Analysts say world stock market volatility could go on for awhile even though most Asian markets rebounded today after a hefty cut in a key U.S. interest rate. The rebound in Asia did not immediately translate to European markets, which slipped in early trading. Stocks had been falling on fears the U.S. may be headed for recession. Some analysts say the federal funds interest rate cut of three-quarters of a percentage point is a sign American authorities view the U.S. credit crunch as a very serious problem. They also warn that lower interest rates won't fix bad credit problems and usually take several months to have an effect on an economy in any case.
Secretary of State Condoleezza Rice says the U.S. economy is resilient and will remain an "engine of growth.'' Speaking during the World Economic Forum in Switzerland today, Rice said that President Bush's $150 billion stimulus package would "boost consumer spending and support business investment this year.'' Her comments come amid anxiety from other world leaders at the forum who say the U.S. is in a recession that could affect the global economy. Rice says she knows many are concerned about recent fluctuations on Wall Street, but that Washington is working to lay out a stimulus plan that is "swift, robust, broad-based, and temporary.'' Rice also said the U.S. would welcome foreign investment and free trade.
The head of Mexico's central bank says the U.S. recession is already on. Guillermo Ortiz, governor of the Central Bank of Mexico, spoke at the World Economic Forum. Ortiz says Latin America will begin to feel an increased impact, even though the effects so far have been muted. He says he thinks Latin America is reasonably well-prepared to handle the effects. Ortiz says it's only the early rounds of a 15-round fight and predicted a global slowdown. He also says his long-term view remains positive and that the U.S. economy will eventually overcome the current problems.
The Congressional Budget Office is projecting a $250 billion deficit for the current budget year. And that doesn't take into account the $100 billion President Bush wants for an economic booster plan, the spike in unemployment or disappointing holiday retail sales. The nonpartisan CBO is reporting the estimate to House lawmakers. The chairman of the Senate Budget Committee says the 2008 red ink will likely be $350 billion. The figures are well over the $163 billion deficit registered last year. Also, unlike an increasing number of economists, the CBO isn't forecasting a recession this year. It's predicting a growth rate of 1.7 percent. The 2006 deficit was $248 billion and had closed from a high of $413 billion registered in 2004.
The Port of Houston Authority has approved a $74 million wharf construction contract for the Bayport terminal. Proposals are being accepted for the construction of the terminal's second wharf, dredging and material disposal on the site. Construction could begin this summer. The commissioners also approved $9.2 million for the purchase of fuel for two years for the Barbours Cut, Bayport Container and Turning Basin terminals.
The Asian Chamber of Commerce is celebrating the grand opening of its new office on Sam Houston Parkway this afternoon. The Asian chamber has over 800 members, making it one of the largest chambers of commerce in the Houston area. The chamber promotes trade between Houston and Asia and fosters economic development in the Houston-area Asian-American communities.
Houston-based ConocoPhillips says higher energy prices helped drive its fourth-quarter profit higher by 37 percent. The nation's third-largest oil company says net income rose to $4.37 billion. Revenue increased 27 percent to $52.7 billion. ConocoPhillips says profit at its exploration and production business climbed to $2.61 billion, benefiting from higher commodity prices, a tax benefit and the release of escrowed funds. Net income at the company's refining and marketing business rose 22 percent to $1.12 billion, in part because of higher refining margins.
Four Houston companies have been named to Fortune magazine's "100 Best Companies to Work For" list, including The Methodist Hospital System at number ten. It was number nine the previous year. David Weekley Homes ranks 17th on the list—down from number 12 in 2007. Camden Property Trust placed at number 50. EOG Resources jumped to 64 on this year's list, up from 83 last year. The list is in Fortune's February 4th issue, which places Google as the top company to work for in the nation.
For the eighth year, the Houston Business Journal is accepting nominations for its own "Best Places to Work" list. Companies must have at least ten employees to qualify and must be headquartered in the Houston ten-county region. Non-headquartered companies must have at least 150 employees in the Houston region. All firms must have HR directors in Houston. The deadline is March 28th, and winners will be announced at an awards ceremony on June 27th.