The government says the number of newly-laid off workers seeking unemployment insurance fell last week, fresh evidence that layoffs are easing. The Labor Department says initial claims for jobless benefits dropped to a seasonally adjusted 550,000 for the week ending August 1st, down from an upwardly revised figure of 588,000. That’s much lower than analysts’ estimates of 580,000, according to a survey by Thomson Reuters. The four-week average of claims, which smoothes out fluctuations, dropped to 555,250, its lowest level since late January. However, the department says the tally of people continuing to claim benefits rose by 69,000 to 6.3 million.
It’s a sign of the economic hard times. An Associated Press review finds the number of petitions from employers trying to bring foreigners to work permanently in the U.S. has declined dramatically over the last two years. The government has received about half the number of employer-sponsored applications for work-based green cards in fiscal years 2008 and 2009 than it did in each of the previous years. Experts say long application processing times, deep job cuts in sectors that have traditionally lured large numbers of applicants and more competition from American job seekers have also led to the sharp decline. Many economic sectors hardest hit in the economic downturn are among those that attracted the largest numbers of foreign workers, including the hospitality and financial industries.
Retailers are reporting sluggish sales for July as shoppers’ worries about jobs escalate, raising concern about the health of the back-to-school shopping season. As merchants report their sales figures, mall-based chains continue to be hit hardest as consumers focus on necessities. Stage Stores’ same-store sales fell 11.9 per cent and Wet Seal 12.1 per cent. Warehouse club operator Costco Wholesale’s results are slightly below analysts’ estimates. Its same-store sales dropped seven per cent. The sales figures are based on same-store sales or sales at stores opened at least a year. Same-store sales are considered a key indicator of a retailers’ health.
The 99¢ Only Stores have canceled the plan to exit the Texas market, according to the Houston Business Journal. Last September, the company’s board announced a plan to close all 48 Texas stores, and a distribution center in Katy. But the chain began experiencing improved same-store sales. It will keep 33 Texas stores open, as well as the 18 Houston outlets.
The top Roman Catholic bishop in the United States says the global economic crisis was caused in part by people abandoning personal ethics, and he’s calling for increased morality in business. Cardinal Francis George is president of the United States Conference of Catholic Bishops. He says a restructured global economy is emerging, and it should help poor people around the world. George is one of more than 80 cardinals and bishops at the Knights of Columbus annual convention being held this week in Phoenix. Organizers describe the event as the largest gathering of American bishops outside their official annual meeting. The Knights of Columbus is a group of 1.78 million Catholic men who volunteer inside and outside of the church.
Despite continuing economic challenges that could force the closure of hundreds of post offices around the nation, the Houston District of the U.S. Postal Service continues to maintain a 96 per cent on-time overnight delivery rate for single-piece first class mail. Houston District scores are 96 per cent on time for both overnight and two-day delivery. Three- to five-day delivery is at 94 per cent and first-class international mail is at 93 per cent.
Venezuela’s state oil company says it has agreed to pay down a $1 billion loan secured from its U.S.-based affiliate over a year ago. State-run Petroleos de Venezuela sa said in a statement it will start paying the loan from Houston-based Citgo Petroleum this month. Fitch ratings had said the loan granted PDSVA to help pay for the 2007 nationalization of heavy oil projects caused “considerable concern.” The agency downgraded Citgo’s credit rating a notch to a junk-grade double-B-minus after the loan was announced in December 2007, and has not lifted it since. PDVSA has also said it’s paying down billions of dollars in debts accrued with oil contractors amid depressed world oil prices.
The Federal Trade Commission has issued a final regulation to curb price manipulation in oil trading markets. The regulation prohibits oil traders from making false or misleading statements about oil prices, petroleum production or oil market statistics that would likely distort the market. The new rule, which will go into effect in November, implements tougher oil price manipulation requirements passed by Congress in 2007. FTC Chairman Jon Leibowitz said in a statement that the new rule will allow the agency to crack down on fraud in the oil markets that can drive up prices at the pump. The regulation carries a civil penalty of up to $1 million per violation, per day. It was approved by a vote of 3-1.
An investigation by the Associated Press shows billions of dollars the government is spending to help homeowners avert foreclosure are passing through–and enriching—companies accused of preying on struggling homeowners. Mortgage servicers are middlemen who collect monthly payments from homeowners and funnel the money to the banks or investors who hold the loans. Mortgage servicers are in the best position to rework the terms of loans under the government’s $50 billion mortgage-modification program but have been slow to do so. But the industry has a checkered history. The AP found that at least 30 servicers have been accused in lawsuits of harassing borrowers, imposing illegal fees and charging for unnecessary insurance policies. The biggest players in the servicing industry–Bank of America, Wells Fargo, JPMorgan Chase and Citigroup–all face litigation. Smaller firms face even harsher accusations. The government insists it has no choice but to partner with the servicers.
The Obama administration says DHL has agreed to pay the government $9.4 million to settle a dispute that the company made shipments to Iran, Sudan and Syria in violation of U.S. embargoes. The Treasury Department alleges that the company made more than 300 shipments to Iran and Sudan between 2002 and 2007 in violation of U.S. embargoes with those countries. And, the U.S. alleges that the company failed to keep records of certain shipments to Iran between 2002 and 2006. It didn’t provide information about the Syria shipments.
The Federal Reserve says banks boosted borrowing from its emergency lending facility over the past week, but cut back on other programs designed to ease the financial crisis. The overall picture suggests some credit problems are easing. The Fed says commercial banks averaged $35.1 billion in daily borrowing over the week that ended Wednesday. That was up from $33.8 billion in the week ended July 29th. The identities of the financial institutions are not released. They pay just 0.50 per cent in interest for the emergency loans.
President Barack Obama, Vice President Joe Biden and other administration officials took to separate stages nationwide Wednesday to announce $2.4 billion in federal grants to develop next-generation electric vehicles and batteries. The administration calls it the single largest investment in advanced battery technology for hybrid and electric-drive vehicles ever made. The grants will be split among nearly 50 projects in 25 states, with the biggest shares going to Indiana and Michigan to create job opportunities in the automotive industry. Recipients include Johnson Controls of Milwaukee, $299 million to build battery packs and cells for hybrid vehicles at a facility in Holland, Michigan; General Motors, $241 million to produce battery packs and the develop electric drive vehicles in Michigan and Maryland; and Ford, $92.7 million for electric drive components at plants in Michigan and Missouri.
General Motors’ product development chief says the company will introduce a plug-in rechargeable midsize sport utility vehicle sometime in late 2010 or in 2011. Vice Chairman of Global Product Development Tom Stephens says the new vehicle will be about the size of a Chevrolet Equinox SUV and get double the city gas mileage of a similar-sized conventional vehicle. The SUV will have a version of GM’s two-mode hybrid powertrain now used in larger SUVs and pickup trucks. The current Equinox with a four-cylinder engine and front-wheel-drive gets 22 miles per gallon in the city.
Of the six most-popular midsize sedans, none gets a top rating in bumper safety crash tests. The Insurance Institute for Highway Safety says the Mazda 6 was the only car to receive an “acceptable” rating. That’s one rating below “good,” the top rating. The IIHS estimates the average cost for bumper repairs on the Mazda 6 at $871. That’s an improvement from the 2007 model, which received a “marginal” rating. Ratings for the Honda Accord and Hyundai Sonata improved one notch to “marginal” from “poor.” The 2009 Ford Fusion’s bumper rating slipped to “poor” from “marginal” in 2007. GM’s Chevrolet Malibu also received a “poor” ranking, with average reported costs hitting $2,329. The results are based on the average cost to repair front, rear and corner bumpers following a six mph crash.
The tweets were flying again, at least intermittently, after Twitter fell victim to a hacker attack this morning. Facebook says it is also looking into possible problems. In its status blog, Twitter said it was “defending against a denial-of-service attack.” That’s where hackers command scores of computers to a single site at the same time, preventing legitimate traffic from getting through. Technology business analyst Shelly Palmer tells AP Radio that denial-of-service attacks happen almost daily to major companies’ sites. One New York City public relations manager says she relies on Twitter for news and felt “completely lost” without it.