Shareholders at Continental Airlines and UAL Corporation approve a deal to form the world’s biggest airline. Continental officials announced preliminary results of voting during a shareholder meeting in Houston. United shareholders approved it at a meeting near Chicago. The votes clear the way for the $3 billion stock swap to close in about two weeks. It likely will be some time before passengers notice much difference when they fly Continental or United. The combined airline will be called United and based in United’s hometown of Chicago, run by Continental’s CEO.
The Environmental Protection Agency is investigating a 40-day benzene release at BP’s Texas City refinery, the site of a 2005 explosion that killed 15 workers. The EPA’s investigation comes after Texas filed suit against BP over the toxic release in April. Texas City residents have also filed a class-action suit against BP seeking $10 billion in damages. EPA Regional Director Al Armendariz says the agency joined the investigation to ensure “disclosure of all information by BP.” Initially, the EPA is requiring BP to disclose information regarding its operations during the month-long incident. BP is already under fire for problems at the refinery that led to the explosion in 2005 and for the Gulf of Mexico oil spill.
BP says crews have begun pumping cement to permanently seal the company’s blown-out well in the Gulf of Mexico. A spokesman says there no longer is a need to use mud in tandem with the cement because pressure from the well isn’t an issue. BP expects the well to be completely sealed on Saturday. The government had previously said it expected the well to be declared dead by Sunday. The pumping of cement follows the successful intersection late Thursday between a relief well drilled nearly 2.5 miles beneath the floor of the Gulf and the blown-out well. An April 20th explosion killed 11 workers, sank a drilling rig and led to the worst offshore oil spill in U.S. history.
The Texas unemployment rate rose to 8.3 percent in August after a large loss of government jobs fueled by a purge of temporary census workers. The Texas Workforce Commission says the jobless rate jumped from 8.2 percent in July, mostly because of a loss of 35,300 government jobs after census jobs were dropped from the payroll in August. The overall drop in jobs was 34,200, according to commission figures. Commission Chairman Tom Pauken says the government losses offset gains in most sectors. The Texas unemployment rate remained below the national figure of 9.6 percent. Education and health services had the largest increase in August at 12,400 jobs.
Consumer prices posted a small rise in August, but outside of a big jump in volatile gasoline prices inflation was essentially flat. The Labor Department says consumer prices edged up 0.3 percent in August, matching the July increase. Core inflation, which excludes food and energy, showed no increase in August. The recession and the weak recovery since that time have banished inflation as an immediate threat. Sluggish demand is preventing most businesses from raising prices and high unemployment is keeping a lid on wage pressures.
Prices at the gas pump have gone up across Texas this week. AAA reports a five-cent increase, with the average retail price per gallon now at $2.57.
Americans’ wealth shrank in the spring for the first time since early 2009 as financial turmoil eroded stock portfolios. The Federal Reserve says household net worth fell 2.7 percent–or $1.5 trillion–in the April-to-June quarter. The decline left Americans’ net worth at $53.5 billion. Shriveled stock portfolios were the biggest force dragging down wealth. Wall Street was shaken by fears over Europe’s debt crisis. Since then, stocks have risen. Net worth is the value of assets such as homes, checking accounts and investments, minus debts like mortgages and credit cards. Before last quarter’s decline, net worth had been growing slowly for four straight quarters. Americans’ net worth would have to rise an additional 23 percent to revisit its pre-recession peak of $65.8 trillion.
The Harvard professor President Barack Obama is putting in charge of the new Bureau of Consumer Protection says people need a “tough cop on the beat” to protect them from financial industry abuses. Obama is naming Elizabeth Warren as a special adviser to both him and Treasury Secretary Timothy Geithner. The financial regulatory bill Obama signed into law this year created the bureau to be an advocate for consumers in their dealings with banks, mortgage companies and other financial institutions. In a post on the White House blog, Warren says the bureau is based on the idea that if the playing field is level and consumers know what’s going on, they’ll be able to make better financial decisions.
Federal regulators have voted to propose new rules that could make it harder for financial firms to disguise their level of debt. Members of the Securities and Exchange Commission are proposing expanded disclosure requirements for banks’ practice of temporarily trimming their debt at the end of quarters to make their financial statements appear stronger. The practice is legal but regulators say it can give investors a distorted picture of a bank’s debt and level of risk. The SEC proposal would require financial firms to report detailed information on their short-term borrowing every quarter. Firms currently are required to disclose that borrowing only once a year.
Texas is getting a $1.8 million federal grant to help market fruits and vegetables and promote food safety. The funding was announced by Deputy Agriculture Secretary Kathleen Merrigan during an appearance in Dover, Delaware, at the National Association of State Departments of Agriculture annual meeting. USDA says the Texas funding is part of 54 block grants totaling $55 million, to benefit specialty crop growers and consumers. California gets the largest grant, at nearly $17.3 million. Florida is second, receiving nearly $4.8 million, followed by Washington state with more than $3.7 million, then Texas, which will use its money for 21 projects.
The number of rigs actively exploring for oil and natural gas in the U.S. increased by seven this week to 1,661. Houston-based Baker Hughes says that 982 rigs were exploring for natural gas and 670 for oil. Nine were listed as miscellaneous. A year ago this week, the rig count stood at 1,010. Texas gained 18 rigs. The rig count tally peaked at 4,530 in 1981, during the height of the oil boom. The industry posted a record low of 488 in 1999.