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Monday PM September 20th, 2010

BP Gulf of Mexico well officially declared dead…Academic economists officially declare recession over…EPA announces program to help Texas petrochemical companies fix air permits declared illegal under Clean Air Act…


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The well that spewed 206 million gallons of oil into the Gulf of Mexico has been declared dead. Retired Coast Guard Admiral Thad Allen says the sealed-off BP well on the Gulf floor poses no further threat. The declaration from the federal government’s point man on the disaster followed one last test to ensure a cement plug would hold. It comes five months after an explosion sank a drilling rig and led to the worst offshore oil spill in U.S. history. The gusher was contained in mid-July after a temporary cap was put on the well. Mud and cement were later pushed down through the top of the well, allowing the cap to be removed. But the well could not be declared dead until a relief well was drilled and the well was sealed from the bottom. President Barack Obama is calling the successful “kill” a milestone. He’s also promising that his administration will continue to work closely with people who live in the region as they rebuild their livelihoods and restore the environment.

It’s official: the longest recession the country has endured since World War II ended in June 2009, according to a group that dates the beginning and end of recessions. The National Bureau of Economic Research, a panel of academic economists based in Cambridge, Massachusetts, says the recession lasted 18 months. It started in December 2007 and ended in June 2009. That was the longest of any recession since World War II. Previously the longest postwar downturns were those in 1973-1975 and in 1981-1982. Both of those lasted 16 months.

President Barack Obama says he isn’t celebrating a business group’s assertion that the recession officially ended in June 2009. Appearing at a town-hall meeting sponsored by CNBC, Obama says times are still very hard for people “who are struggling,” including those who are out of work and many others who are having difficulty paying their bills. The National Bureau of Economic Research, a panel of academic economists based in Cambridge, Massachusetts, says the recession lasted 18 months, starting in December 2007 and ending in June 2009. Previously the longest postwar downturns were those in 1973-1975 and in 1981-1982. Both of those lasted 16 months. The president says that it’s going “to take more time to solve” an economic problem that was years in the making.

President Obama says mounting federal budget deficits bother him a lot, but that he found a $1.3 trillion deficit “wrapped in a bowl waiting for me” when got to the Oval Office. Obama repeated his opposition to extending Bush era tax cuts for those with incomes over $250,000 a year. Obama said, “the first thing you do when you’re in a hole is not dig it deeper.” He said the country “can’t give $700 billion away to some of America’s wealthiest people.” He also noted he’s instituted a three-year freeze on some spending, but his options are limited because roughly 60 percent of the budget goes to the Social Security, Medicare and Medicaid entitlement programs.

Homebuilders confidence in the housing market stayed this month at the lowest level in 18 months, and more worry that the traffic of potential buyers is falling. The National Association of Home Builders says its monthly index of builders’ sentiment in September was unchanged at 13. The index has now been at the lowest level since March 2009 for two straight months. Readings below 50 indicate negative sentiment about the market. The last time the index was above 50 was in April 2006. Builders say they saw foot traffic from prospective buyers, an indication of future sales, fall this month. High unemployment, slow job growth, and tight credit have kept people from buying homes.

The Environmental Protection Agency has formally announced a program designed to help Texas petrochemical companies fix air permits recently declared illegal under the Clean Air Act. The EPA launched the voluntary audit program. In June, the EPA officially disapproved Texas’ so-called flexible permit program, leaving more than 120 plants, including some of the nation’s largest refineries, with unacceptable permits. For 90 days, the companies will be able to work directly with the EPA to begin the lengthy process of fixing their problematic paperwork, including making any necessary modifications to meet the requirements. Companies that enroll within 45 days will enjoy reduced penalties on violations that are uncovered.

The parent company of United Airlines and Continental Airlines say that, following the closing of their merger, its common stock on the New York Stock Exchange will be under the ticker symbol UAL, once approved by the UAL board of directors and the NYSE. The holding company will be renamed United Continental Holdings. The companies expect to close the merger by October 1st.

Port of Houston Commissioner Kase Lawal has been asked to serve as a member of the White House Advisory Committee for Trade Policy and Negotiations. The Office of the U.S. Trade Representative provides information and advice on trade agreement negotiation objectives and bargaining positions, the operation of trade agreements and other trade policy issues. Lawal has served on the port commission since June 1999 as appointee of Houston’s mayor and city council.

Gasoline prices have risen almost three cents in the past week, averaging $2.51 per gallon, according to The national average, meanwhile, has fallen slightly—about 0.2 cents—in the last week, averaging $2.73 per gallon.

A U.S. Treasury Department statement says that foreign investors could be asked to buy a stake in General Motors when it sells stock to the public. GM would not comment on reports that talks are under way with China’s SAIC about buying GM shares. SAIC is a Chinese government-owned automaker and GM partner. The Treasury statement, dated Saturday, says investors will be sought across “multiple geographies.” The U.S. Treasury lent GM about $50 billion to help it through bankruptcy protection last year. GM has repaid $6.7 billion and the rest was converted to a 61 percent government stake in the company. The government hopes to get its money back with a stock offering that could come in November. Foreign investment in U.S. companies is common.

General Motors is recalling more than 20,000 Cadillac CTS and CTS-V vehicles to replace a glove compartment box that could lead to leg injuries in a crash. GM says the recall involves nearly 5,000 all-wheel drive 2009 Cadillac CTS and CTS-V models, and more than 15,000 vehicles from the 2010 model year. Tests conducted by the government found that a front seat passenger not wearing a seat belt could strike the glove box door and sustain leg injuries in a crash. GM said all motorists should wear seat belts. The automaker plans to begin notifying owners of the recall next month. Dealers will replace the glove compartment assembly at no charge. Owners can contact Cadillac at (866) 982-2339.

The nation’s farmers are watching warily as federal regulators weigh whether to clamp down on the dust clouds that are a constant companion in rural areas. Supporters of tougher restrictions on dust say they would help clear the air of tiny grains that can lodge deep in the lungs, worsening heart and respiratory problems. But farming groups have urged the Environmental Protection Agency to retain its current standards for dust, soot and other microscopic particles. They argue that tighter restrictions would be unworkable and that dust isn’t a real pollutant. Next February, the EPA is expected to release proposed changes to its standards for tiny particles of industrial pollution, and slightly larger particles called “coarse particulate matter” that include dust.

A person familiar with Blackstone’s plans says the private American equity company is no longer interested in investing in Liverpool Soccer Club. Liverpool co-owner Tom Hicks of Dallas had hoped to secure a $437 million financing package from Blackstone and share control of the club in a move that would have prevented a quick sale of Liverpool. But a person familiar with the company’s plans told the Associated Press Blackstone is no longer pursuing its interest in Liverpool after considering an initial deal. The person spoke on condition of anonymity because negotiations were private. Hicks and co-owner George Gillett, Jr., are facing an October deadline to repay the club’s debt to Royal Bank of Scotland. Hicks earlier this year sold baseball’s Texas Rangers after the team emerged from bankruptcy protection.

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