A judge has revoked bond for Texas financier R. Allen Stanford, who’s charged with swindling investors out of $7 billion. U.S. District Judge David Hittner approved a request by prosecutors to overturn a magistrate judge’s decision to allow Stanford freed on $500,000 bond pending his trial. Prosecutors argue that Stanford’s international ties make him a serious flight risk. Stanford holds dual U.S. and Antiguan citizenship, has an international network of wealthy acquaintances who would help him and possibly access to vast wealth hidden around the world. But Dick DeGuerin, Stanford’s attorney, says his client is penniless, has never tried to flee and wants to fight the charges against him.
The British serious fraud office says it’s frozen more than $100 million in assets held in London and believed to be connected to R. Allen Stanford. The agency says it was acting on a request from the U.S. Justice Department. It says it obtained a court order in April to preserve the assets but hadn’t previously disclosed the action.
Unemployment rates rose in all the largest U.S. metropolitan areas for the fifth straight month in May. The Labor Department says jobless rates in May rose from a year earlier in all 372 metropolitan areas it tracks. Houston’s unemployment rate is at 6.9 per cent, compared to April’s 6.3 per cent. The unemployment rate in Kokomo, Indiana, jumped to 18.8 per cent, up 11.7 percentage points from a year ago, the largest increase of all metro areas. The second-highest jump occurred in Indiana’s Elkhart-Goshen. Its rate jumped to 17.5 per cent, up 11.4 percentage points from a year earlier. Both areas have been slammed by layoffs in transportation equipment manufacturing.
Online job advertisements declined by over 500,000 in June compared with the same period a year earlier, but a national report shows only a modest decrease from may. The Conference Board, a New York-based research group, released its monthly help-wanted online data series report this week. Online advertised vacancies were about 3.29 million in June, a 66,700 decline from May and an over 505,000 drop from June 2008. Since record monthly declines of 507,000 and 506,000 in December and January, ad vacancies have dropped a modest 71,000. The report measures the number of new online jobs and openings reposted from the previous month on more than 1,200 major Internet job boards and smaller Web sites that serve niche markets.
A private research group is reporting that consumers’ confidence in the economy has fallen unexpectedly in June as shoppers fret about job security. The New York-based Conference Board says its consumer confidence index stands at 49.3, down from its revised May level of 54.8. Economists surveyed by Thomson Reuters were projecting a reading of 55. The dip follows rises in April and May that were helped by a stock market rally. The confidence index has two parts. The present situation index, which measures how shoppers feel now about the economy, declined to 24.8 from 29.7. The expectations index, shoppers’ outlook for the next six months, declined to 65.5 from 71.5 in May.
A key housing index shows a clear trend that home price declines are moderating. The Standard & Poor’s/Case-Shiller Index shows home prices in 20 major cities tumbled by 18.1 per cent from April 2008. The ten-city index fell 18 per cent from the year before. April, however, marked the third straight month both indexes didn’t set record price declines. And yearly losses in 13 metros improved compared to March. Still, the 20-city index is off almost 33 per cent from its peak in the second quarter of 2006, and the ten-city has dropped by almost 34 per cent, which means home values are now around 2003-levels.
NRG Energy and Optim Energy have begun commercial operation of a new natural gas-fueled combined cycle generating plant at NRG’s Cedar Bayou Generating Station in Chambers County. Texas Public Utility Commission Chairman Barry Smitherman spoke above the noise of the new plant.
“But these men and women have chosen to invest it in Texas. That creates jobs and creates opportunity. Secondly, we really need the power. As we’ve seen on the last couple of days and for a week, we have been approaching record consumption with the record high temperature in the ERCOT market.”
The plant adds 550 megawatts of electrical generation to the Texas grid—enough to power more than 440,000 homes.
Two additional nuclear reactors being considered by San Antonio’s public utility will cost up to $13 billion, according to new cost estimates. CPS Energy officials want to build the $10 billion to $13 billion reactors at the South Texas Project outside Bay City, saying it’s the most cost-effective way to get additional power. CPS Energy owns 40 per cent of the project. New Jersey-based NRG Energy owns the remaining portion, and the utilities would split the cost. San Antonio ratepayers would be hit with a five per cent rate increase every other year for the next decade to pay for the expansion.
Reliant Energy says it’s lowering prices for current customers on month-to-month flex plans, amounting to as much as a 20 per cent reduction since May 1st. Reliant first lowered prices up to ten per cent for most month-to-month plans in May following its acquisition by NRG Energy.
President Barack Obama says his new Consumer Financial Protection Agency will protect Americans from unscrupulous practices and make financial products easier to understand. The president sent Congress a 152-page bill to create the new agency, a key element in the sweeping overhaul of financial rules the administration unveiled two weeks ago. Obama says the agency will ensure that consumers are provided with simple, transparent and accurate information on financial products like credit cards and mortgages. Creation of the consumer agency is part of what would be the most comprehensive rewrite of the government’s financial rules since the 1930s. The administration also is pushing to give the Federal Reserve expanded powers to serve as a systemic-risk regulator for the entire financial system and to boost government powers to wind down the nation’s biggest financial institutions if they get in trouble.
ConocoPhillips and the state-run Saudi Arabian Oil are again asking for bids to build a multibillion-dollar refinery in Saudi Arabia, saying economic conditions have improved. The companies signed a $6 billion agreement in 2006 to build the 400,000 barrel-a-day oil refinery in the kingdom’s Red Sea city of Yanbu, but postponed those plans late last year as energy prices plunged. Crude prices had been cut in half from July highs of $150 per barrel when the refinery plans were postponed in early November. Crude fell to lows around $30 by the end of the year. The refinery, expected to start up in 2014, will process Arabian heavy crude supplied by Aramco.
International oil companies have begun bidding to develop some of Iraq’s oil and gas reserves in a landmark bidding round. It marks their return to the country over three decades after the sector was nationalized. More than 30 firms are vying to secure 20-year service contracts to develop six oil and two gas fields. The fields hold about 43 billion of Iraq’s 115 billion barrels of crude reserves. The first field on offer is Rumaila, which holds 17.8 billion in crude reserves. Iraqi officials hope the companies’ will help boost production needed to finance reconstruction after the 2003 U.S.-led invasion. But some lawmakers have argued the new contracts will be unconstitutional since Parliament won’t be allowed to approve them.
Protests are planned in more than a dozen cities across the country to demand that a group of mortgage companies who benefited from federal bailout money participate in a government program designed to prevent foreclosures. The protesters want the companies to sign on to the Obama administration initiative called “making home affordable.” The administration estimates it could help up to nine million financially troubled homeowners stay in their homes. Rally organizers say about 80 per cent of eligible loan companies are participating already. The protests were scheduled in 14 cities, including Dallas, as well as Philadelphia, Boston, Los Angeles and Miami. They’re organized by the Association of Community Organizations for Reform Now, also known as ACORN.
Hyundai says U.S. consumers who buy or lease its vehicles through the end of August will receive a gas card that lets them buy fuel at $1.49 a gallon for a year. The promotion is aimed at winning over those who are worried about volatile prices at the pump. Hyundai customers who enroll in the promotion, which launches Wednesday, will receive a gas card that bills gas purchases at $1.49 per gallon of regular-grade gas, regardless of the pump price. Though all eligible vehicles take regular gas, customers can buy mid-grade gas at $1.64 a gallon and premium gas at $1.79 a gallon. In January, it launched a program which offers to take back vehicles under certain conditions from Hyundai customers who lose their jobs.
Sears says that it plans to offer a buyer protection program for its home appliances to help consumers who lose their jobs during the recession. The free program, which runs through August 1st, covers appliance purchases of more than $399 made on a Sears card by cardholders who lose their job. Cardholders must have held a full-time job for at least 60 days when the appliance was purchased. If a customer loses his or her job, the program will credit 1/12th of the purchase price to the account for each month the cardholder is out of work. If the person is still out of work one year after the purchase, they will receive an account credit for what’s left of the purchase amount and get to keep the appliance without any further payment obligations.
Comcast will become the first major cable TV operator to roll out wireless broadband outside of wi-fi hotspots. It’s launching the service in Portland, Oregon, with at least three other cities, including Chicago, to follow this year. The service offers speeds of up to four megabits per second and is carried over the 4G network of Clearwire, where it’s offered. Elsewhere, it will use Sprint Nextel’s 3G network coast-to-coast. Clearwire’s a joint venture involving Comcast, other cable operators and technology companies. It’s currently in Portland and Atlanta, with plans to deploy in Las Vegas, Chicago, Charlotte, North Carolina, Dallas-Fort Worth, Honolulu, Philadelphia and Seattle this year. Comcast High-Speed 2Go Metro Service is on promotion for $49.95 a month for a year and includes Comcast’s wired Internet home service and a wi-fi router. The regular price is about $73 a month. The national version, using Sprint, costs $20 a month more.