Royal Dutch Shell, which has its U.S. headquarters in Houston, is reducing its workforce by about 5,000 employees. Shell recently reported a 62 per cent drop in third quarter net income. The cuts represent about ten per cent of the company's overall employees. Shell employs about 13,000 in Houston, although there's no word on how many workers will be cut here.
Retail gasoline prices in Texas have gone up nine cents a gallon since last week. AAA Texas reports that the average price per gallon at the pump is $2.56. Prices increased seven cents nationally to $2.69. Houston, Galveston and San Antonio had the lowest price at $2.53 a gallon; El Paso had the most expensive gas at $2.67, up 16 cents since last week. The association says prices have increased 28 cents in the last month, but equal prices from April 2007. Rising oil prices and signs that the recession is over have contributed to gas price increases.
A restaurant chain has announced plans to restore the Hurricane Ike-damaged Flagship Hotel in Galveston. Officials with Landry's Restaurants say the project will return amusement rides, including a carousel and a ferris wheel, to the pier. Spokesperson Dancie Ware says the rides will be consistent with those when the pier was built in 1940. The hotel was constructed in 1965. The property is owned by Landry's CEO Tilman Fertitta, who in 2004 bought the hotel and agreed to spend at least $15 million on renovations. Ike slammed Galveston in September 2008. The Galveston County Daily News reports executives with Landry's are scheduled to appear before the city's planning commission on Tuesday. Houston-based Landry's owns restaurants including Rainforest Cafe, Saltgrass Steak House and Landry's Seafood House.
U.S. and Chinese companies will join up to build a 36,000-acre wind farm in Texas, showing how the industry continues to expand globally despite tough economic conditions. The turbines are being built in China and shipping is expected to begin in March. The companies involved said that it is the largest Chinese-American investment in U.S. renewable energy to date and is expected to cost $1.5 billion. U.S. Renewable Energy Group, a private equity group, and Cielo Wind Power of Texas, are working with China's Shenyang Power Group. A-Power Energy Generation Systems of China is building 250 turbines at its Shenyang plant. The wind farm is expected to produce enough electricity to power 180,000 homes.
The lawyer charged with tracking down money lost in what authorities call R. Allen Stanford's ponzi scheme says he hopes to gain control of more than $1.5 billion to return to jilted investors. Court-appointed receiver Ralph Janvey filed a report in federal court in Dallas, outlining his plan to go after $1.5 billion. That would give allegedly defrauded investors a return of 20 cents on the dollar. Janvey has about $71 million in cash on hand and is pursuing the rest through lawsuits and other means. John Little, a lawyer appointed to represent investors, says Janvey's recovery goal is "something of a fantasy" and says investors should prepare to receive as little as two cents on the dollar. Stanford is in jail awaiting trial on related criminal charges in Houston.
The government says the number of people claiming jobless benefits for the first time dropped slightly last week, evidence that the labor market remains weak even as the economy is recovering. The Labor Department said its tally of newly laid-off workers seeking unemployment insurance fell by 1,000 to a seasonally-adjusted 530,000 last week. Analysts expected a steeper drop to 521,000. Still, the four-week average, which smoothes out volatility, fell for the eighth straight week to 526,250, its lowest level since early January. Claims are slowly declining as companies lay off fewer workers. The number of people continuing to claim benefits, meanwhile, has dropped sharply by 148,000 to 5.8 million, below analysts' expectations.
A review of jobs created or saved by President Barack Obama's economic recovery plan shows some of the numbers are overstated. The administration says recovery money has helped pay for more than 30,000 jobs. But the Associated Press found that a company in Colorado that said it created more than 4,300 had actually produced fewer than 1,000. A firm in Ohio that reported 54 jobs created only six. There's no evidence the White House sought to inflate job numbers, but the administration did embrace flawed figures soon after they were released. The White House says it's aware of the problems and is trying to fix them. Companies with flawed reports told the AP they were confused how to count various situations. New figures will be released Friday.
The economy grew at a 3.5 per cent pace in the third quarter, the best showing in two years, fueled by government-supported spending on cars and homes. The Commerce Department report delivered the strongest signal yet that the economy entered a new, though fragile, phase of recovery and that the worst recession since the 1930s has ended. The much-awaited turnaround ended the streak of four straight quarters of contracting economic activity, the first time that's happened on records dating to 1947. It also marked the first increase since the spring of 2008, when the economy experienced a short-lived uptick in growth.
President Barack Obama is hailing the new figures, saying the country has "come a long way" since early this year. In remarks prepared for a small business group, Obama said he believes the new figures are "an affirmation that this recession is abating and the steps we've taken have made a difference." The economy had shrunk by 6.4 per cent in the first quarter. The president cautioned, however, that "we have a long way to go to fully restore our economy" and recovery from the deepest business slump since the 1930s-era Great Depression. He called the report "welcome news."
Senators have agreed to extend a popular tax credit for first-time homebuyers and to offer a reduced credit to some repeat buyers. The tax credit provides up to $8,000 to first-time homebuyers but is set to expire at the end of November. A spokeswoman for Senate Majority Leader Harry Reid said Senators agreed Wednesday to extend the existing tax credit for first-time homebuyers while offering a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years. A Congressional aide said the tax credits would be available to homebuyers who sign sales agreements by the end of April. They would have until the end of June to close on their new homes. The aide, who spoke on condition of anonymity, was not authorized to publicly discuss the deal.
The House has approved a stopgap spending measure to avoid a shutdown for 11 cabinet-level departments whose budgets won't be enacted by a midnight Saturday deadline. The measure would give Congress until December 18th to finish seven incomplete spending measures that were supposed to be wrapped up by September 30th. The bill passed by a 247-178 vote and now goes to the Senate, which must pass it this week to avoid a partial shutdown. The legislation, among other things, extends highway programs and federal loan guarantees for larger mortgages. The anti-shutdown measure was attached to a remarkably generous spending bill for the Interior Department and environmental programs. Lawmakers are pumping billion of dollars into clean and safe-drinking water projects.
Treasury Secretary Timothy Geithner said he sees positive signs that the economy is recovering, although the recession remains "alive and acute" for families dealing with unemployment and facing home foreclosure. In testimony before the House Financial Services Committee, Geithner said that Americans were saving much more and borrowing less from the rest of the world. The economy grew at an annual rate of 3.5 per cent in the third quarter of this year, the strongest rate of growth seen in two years.
A House committee has voted to set new rules for investment rating agencies. Lawmakers say the agencies misled investors by giving high marks to risky securities tied to subprime mortgages. The proposal marks the House Financial Services Committee's latest attempt to tighten the rules of the road for financial institutions after last year's market crisis. A floor vote is expected as early as November as part of a broader regulation reform package, although the measure would still face scrutiny in the Senate. The bill would allow the Securities and Exchange Commission to test the methods employed by rating agencies and sanction lax supervisors.
Continental Airlines has signed two partnerships with carriers--one day after it joined the world's largest carrier alliance. Houston-based Continental this week signed deals with Japan's largest domestic airline ANA and Asiana Airlines, based in Seoul, South Korea. The airlines will cooperate with Continental through code sharing, frequent flyer programs, and passenger lounge access. Code sharing allows passengers to book legs of a flight on different airlines with one ticket. Continental officially switched Tuesday from Skyteam--led by Delta and Air France-KLM--to the Star Alliance, which includes United, US Airways and Lufthansa. Continental already has code-sharing deals with four other star members.
American Airlines is bringing mainline jet service back to Little Rock National Airport. The Fort Worth-based airline confirmed it will begin using McDonnell Douglas MD-80s in April on four daily American Eagle flights between Little Rock and Dallas/Fort Worth International Airport. The new plan also calls for reducing the number of daily flights between Little Rock and Dallas/Fort Worth from 12 to seven. Little Rock airport director Ron Mathieu says the other three flights will be 50-seat regional jets--meaning an overall reduction of 22 seats from the 740 available now. American spokeswoman Andrea Huguely says adding the larger aircraft will help better serve the airline's business customers with first class options and more seat choices.
General Motors says its money-back guarantee is going so well, it will extend the program through December. The automaker launched its "May the Best Car Win" campaign in September as a way get consumers to try GM cars and trucks with minimal risk. The program was slated to last 60 days and end November 30th. It will now last until January 4th, 2010. The campaign includes advertisements comparing GM vehicles to those of competitors. Jay Spenchian, GM's executive director of the marketing strategy support group, says more people are considering GM's four brands--Chevrolet, Cadillac, GMC and Buick--and few vehicles have been returned. GM said is likely next week to post its first year-over-year monthly sales gain in 21 months.
Chrysler says it will begin offering customers a television service in their vehicles featuring up to 20 channels of live TV. Starting in December, Chrysler buyers can purchase the service, called Flo TV, that offers popular cable channels like Fox News, MSNBC and Comedy Central. The cost: $629 plus an installation fee. A one-year subscription service is included. A spokesman says the company is still negotiating over the subscription fee after one year, but packages could start as low as $9 a month. Distracted drivers need not worry: the TV system would be integrated into vehicles' DVD system, which has drop-down screens viewable only to passengers.
The South Asian Chamber of Commerce hosts its 16th anniversary gala this evening at the Westin Oaks Galleria, with the theme of "The Art of Business, Media & Politics." The South Asian Chamber was formed in 1993, representing members from seven South Asian nations—Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka. It supports business relationships between South Asian entrepreneurs and professionals in Houston.
The Society of Exploration Geophysicists has been staging its International Exhibition and 79th Annual Meeting at the George R. Brown Convention Center this week. More than 8,000 attendees from over 60 countries are discussing geophysics as it applies to oil and gas exploration and production, water resources, mining, engineering and environmental problems. SEG was founded in Houston in 1930.
Another Texas company is recalling flour tortillas after company officials discovered they may contain an ingredient not listed on product labels. San Angelo-based Mrs. Rios Corn Products says the tortillas were recalled after its officials found their packaging didn't list whey as an ingredient. Whey can cause a life-threatening allergic reaction in some people. The company said in a news release that the tortillas were distributed in Texas to convenience stores, supermarkets and restaurants. Pop's Bakery in San Angelo issued a recall Tuesday after it discovered whey milk wasn't listed on product labels as an ingredient. Pop's says those tortillas were shipped to restaurants and retail grocery stores only in West Texas. Consumers with questions can call Mrs. Rios Corn Products at 325-653-5640 and pop's bakery at 325-655-1170 or 325-374-5392.
The world's largest publicly traded oil company says third-quarter profit tumbled with crude prices, but like other big energy companies, production is bouncing back. Exxon Mobil reports that profits from July to September dropped 68 per cent to $4.73 billion. Exxon depends on oil and gas production for more than two-thirds of its earnings. The company's petroleum production increased by three per cent from the same period last year, though crude fetched an average of $50 less per barrel.
Waste Management's profit sank in the third quarter, despite rising prices for recycled commodities and cost-cutting. The recession has hit the nation's largest trash hauler as businesses cut costs by disposing of trash less frequently and falling prices for paper and other commodities battered its recycling business. Waste Management, based in Houston, also has been affected by falling natural gas prices that have pulled down electricity prices. Waste Management says quarterly net income was $277 million, down 11 per cent from $310 million, in the third quarter of 2008. Revenue slid 14 per cent to $3.02 billion from $3.53 billion. Analysts, on average, expected revenue of $3.07 billion.