There hasn’t been a good reason to own a money market mutual fund for four years. These days, most funds are yielding under 0.1 percent. You can receive 1 percent in an online bank savings account, and get FDIC insurance to boot.
Nonetheless, the funds are still holding $2.7 trillion in investors’ money. That speaks to their reputation as a liquid, very-low-risk place to park cash while waiting for something better to come along.
Now it seems they may not be as safe as we thought. The problem is Greece.
Fitch Ratings reported last week that American money funds have half their money invested in European banks. European bankers, meanwhile, are very nervous about what might happen if the Greek government stiffs its creditors.
To understand why, imagine today’s financial system as a big house of cards. A card or two might tip over without any damage. But if the wrong ones slip, especially while a breeze is blowing, the chain reaction can bring the house down in a heap.
Back in 2008, the Treasury Department thought it could let Lehman Brothers fall without much danger. We saw what happened instead.
All this explains why the rich nations of Europe are resigned to bailing out the profligate, rioting Greeks
The owner of Japan’s tsunami-damaged nuclear plant will pay an estimated $1 billion (88 billion yen) to thousands of residents who evacuated homes near the radiation-leaking plant and don’t yet know when they can return.
Compensation Tokyo Electric Power Co. ultimately may pay for the world’s second-worst nuclear disaster is expected to be trillions of yen.
Japan’s Cabinet last week approved a bill to help TEPCO meet the massive costs, and parliamentary approval is pending. It would establish a fund from public money and contributions from utilities and special government bonds.
The estimate TEPCO released Wednesday is in addition to 50 billion yen paid in preliminary compensation to 50,000 households in late May.
TEPCO said it is preparing to distribute the latest compensation to about 150,000 people forced to evacuate areas around the Fukushima Dai-ichi plant, which has leaked radiation since the March 11 earthquake and tsunami destroyed its power and crucial cooling systems.
The estimate is based on criteria adopted by a government panel this week _ up to 120,000 yen ($1,500) per month to each family for the first six months, a reduced 50,000 yen ($625) per month each for another six months.
TEPCO is also preparing to pay separate compensation to fishermen, farmers and agriculture cooperatives, and others who have suffered because of disaster. Those figures are not available yet.
On Wednesday, the Iitate village office moved into the prefectural, or state, government office in Fukushima City after more than 6,000 residents evacuated the village, which was designated as high-risk for long-term radiation exposure easy payday loans.
“I hope we can all return to our homes as soon as possible,” village chief Norio Kanno told reporters.
At the Fukushima plant, workers are struggling to get a crucial water treatment system fully operational. Fresh water being pumped into the reactors to keep them cool becomes contaminated with radiation, and 110,000 tons of radiation-tainted water have pooled across the plant.
It could overflow within 10 days if action is not taken. The treatment system that went fully operational Friday was halted because a cartridge to absorb radioactive particles reached its limit within five hours, not several weeks as expected.
After cleaning and adjustment, the water treatment system is being tested again and has processed 1,700 tons of water, TEPCO spokesman Junichi Matsumoto said.
The contaminated water has hampered work to install a sustainable cooling system at each reactor that incorporates the water treatment system. Unit 1 is close to that stage, but the other two reactors have fallen behind due to high radiation or debris.
TEPCO has reduced water put into the reactors, so that less water accumulates, but there is a risk. Matsumoto acknowledged the temperature at Unit 3 has slightly risen and requires careful monitoring.
TEPCO hopes to bring the reactors to a stable cold shutdown state by early January, _ a goal some experts have questioned as too ambitious.
Tens of thousands of passengers in Australia and New Zealand were stranded when airlines suspended flights Sunday as an ash cloud from an erupting volcano in southern Chile spread, threatening to damage engines.
Australia’s national carrier, Qantas Airways, said all the airline’s flights in and out of the southeastern city of Melbourne would be grounded. Other carriers including Virgin Australia and discount airlines Jetstar and Tiger similarly suspended flights.
Up to 30,000 passengers in New Zealand and Australia found themselves stuck, according to airlines’ estimates. Sunday afternoon, frustrated travelers lined up in airports and looked for last-minute accommodation. Hotels near Melbourne’s airport were fully booked.
The plume of ash could disrupt travel for the next several days, according to Airservices Australia. It said the main ash cloud had reached southern Tasmania and New Zealand’s South Island but it was expected to pass to the south of the Australian mainland.
Qantas also canceled 22 flights to and from New Zealand and the Australian island-state of Tasmania, as well as eight flights within New Zealand’s South Island, as the dust cloud from Chile’s erupting Cordon Caulle volcano spread across the atmosphere.
Virgin Australia later announced it was suspending 34 domestic flights and one international one from Melbourne on Sunday evening.
“We have been closely monitoring the situation all day,” Virgin’s Sean Donohue said in a statement bad credit payday loans. “Safety is always our number one priority.”
Australian budget carrier Jetstar said it canceled a total of 92 flights affecting 12,000 passengers.
National carrier Air New Zealand did not cancel or delay any flights but has adjusted flight routes and altitudes to ensure aircraft remain clear of any ash, company spokeswoman Tracy Mills said. The drifting clouds of fine grit can severely damage airplane engines.
New Zealand’s Civil Aviation Authority said the ash plumes could affect airplane cruising levels for both jet and turboprop aircraft at between 20,000 and 35,000 feet (6,000 and 10,600 meters).
The agency said the ash would likely disrupt flights for the next week.
The volcano in Chile began erupting on June 4. Flights in the South American countries of Chile, Argentina, Uruguay and Brazil were grounded for some days following the eruption.
The flight warnings and disruptions come 14 months after air traffic was grounded across Europe after the eruption of Iceland’s Eyjafjallajokull volcano.
Private weather forecaster WeatherWatch.co.nz said Sunday that ash from the volcano had spiraled clockwise around Antarctica at a very high altitude.
Most economists expect the Bank of Canada to hold the line Tuesday on its lending key rate, keeping it at the one per cent level.
Transocean Ltd. gave its top executives bonuses for achieving the “best year in safety performance in our company’s history” _ despite the explosion of its oil rig that killed 11 people and spilled 200 million gallons of oil into the Gulf of Mexico.
The company said in a regulatory filing that its most senior managers were given two thirds of their total possible safety bonus.
Transocean noted “the tragic loss of life” in the Gulf when the rig operated by BP PLC exploded last April. But it said the company still had an “exemplary” safety record because it met or exceeded certain internal safety targets concerning the frequency and severity of its accidents, according to the filing with the Securities and Exchange Commission on Friday.
Safety accounts for a quarter of the executives’ total cash bonuses. The total bonus for CEO Steve Newman last year was $374,062.
According to calculations by The Associated Press, the total value the company assigned to Newman’s compensation package was $5.8 million.
That figure includes an $850,000 base salary _ a 34 percent increase from the prior year; perquisites of $622,057, which includes housing and vacation allowances, among other things; and the $374,062 bonus. Also included in the figure are stock options valued at $1.9 million and deferred shares valued at $2 million when those awards were granted in March 2010.
Transocean’s Deepwater Horizon oil rig explosion on April 20 in the Gulf of Mexico killed 11 workers and set off the largest offshore oil spill in U.S. history.
A commission appointed by President Barack Obama earlier this year said the explosion was caused by a series of time and money-saving decisions by Transocean, BP and oil services company Halliburton Inc. that created an unacceptable amount of risk.
In the regulatory filing, the company said its bonuses were appropriate as a way to recognize its executives’ efforts in “significantly improving the company’s safety record” and implementing a new internal planning system.
Those efforts have “enabled the company to maintain its financial flexibility during a challenging period, while, at the same time, positioning the company for sustained growth in the future.”
The Associated Press formula calculates an executive’s total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the SEC.
The value that a company assigned to an executive’s stock and option awards for 2010 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company’s stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options.
International leaders were gathering in London on Tuesday seeking to plot out an endgame for Moammar Gadhafi’s tottering regime and to strike agreement on plans for Libya’s future.
U.N. Secretary-General Ban Ki-Moon, U.S. Secretary of State Hillary Rodham Clinton, the Arab League and as many as 40 global foreign ministers were joining the talks _ seeking to ratchet up pressure on Gadhafi to quit.
Italy’s Foreign Minister Franco Frattini said several nations planned to table a joint deal aimed at swiftly ending the conflict, setting out proposals for a cease-fire, exile for Gadhafi and a framework for talks on Libya’s future between tribal leaders and opposition figures.
Britain and the United States signaled ahead of the talks that they could accept a plan under which Gadhafi quickly leaves Libya and in return escapes a war crimes trial, despite a previous insistence that he must face the International Criminal Court.
“There are some African countries that could offer him hospitality. I hope that the African Union can come up with a valid proposal,” Frattini said Monday.
African Union chairman Jean Ping will attend the talks at London’s Lancaster House alongside delegates who include Qatar’s emir Sheik Hamad bin Khalifa Al-Thani and foreign ministers from Morocco, the UAE, Jordan and Iraq.
Gadhafi “must understand that it would be a gesture of courage on his part to say `I am leaving’,” Frattini said.
Turkey, which has offered to attempt to mediate a permanent cease-fire, also said the talks would gauge international support for scenarios under which Gadhafi could retreat into exile.
Britain’s Foreign Secretary William Hague, who was hosting the summit, said Tuesday that _ while the U.K. hoped Gadhafi would face international justice _ it was down to Libyans to decide his fate.
“Of course where he goes, if he goes, is up to him and the people of Libya to determine and we will not necessarily be in control of that,” Hague told BBC radio.
International allies were “not going to choose Col. Gadhafi’s retirement home,” he added.
Hague and Clinton met Tuesday with Libyan opposition envoy Mahmoud Jibril _ who was holding talks in London, but not attending the main conference.
“We discussed the current political and humanitarian situation in Libya. We agreed on the absolute importance of protecting and safeguarding civilians in Libya,” Hague said following his talks with Jibril.
He said he had asked Jibril for his “assessment of the humanitarian needs in Libya and priorities for international assistance.”
A senior U.S. administration official said the U.S. would also soon send diplomat Chris Stevens to Benghazi to meet with rebel leaders.
In a joint statement, British Prime Minister David Cameron and French President Nicolas Sarkozy said Jibril’s Interim National Transitional Council could play a key role in deciding Libya’s future following Gadhafi’s potential ouster payday loans with no fax.
The leaders said that the transitional council and “civil society leaders, as well as all those prepared to join the process of transition to democracy,” should begin work to decide how Libya moves toward democratic elections. They said Gadhafi loyalists were facing a final chance to ditch support for the dictator and side with those seeking political reform.
Sarkozy and Cameron discussed the meeting late Monday in a video conference with President Barack Obama and German Chancellor Angela Merkel.
In a speech Monday night at the National Defense University at Fort McNair, Obama said the London talks would decide on what political effort would be needed _ alongside military action _ to increase pressure on Gadhafi.
“While our military mission is narrowly focused on saving lives, we continue to pursue the broader goal of a Libya that belongs not to a dictator, but to its people,” Obama said.
Libya’s deputy foreign minister Khaled Kaim told a news conference in Tripoli that foreign leaders had no right to attempt to impose a new political system on the country.
“Libya is an independent country with full sovereignty,” he told reporters. “The Libyan people are the only ones that have the right decide the country’s future, and planting division of Libya or imposing a foreign political system is not accepted.”
Kaim called on nations attending the London talks to agree on a peace deal.
“We call upon Obama and the Western leaders to be peacemakers not war mongers, and not to push Libyans towards a civil war and more death and destruction,” he said.
The London meeting _ which will also be attended by NATO secretary-general Anders Fogh Rasmussen _ was also expected to discuss disputes over the scope of NATO-led coalition airstrikes, and to more clearly define the extent of cooperation between Libya’s rebel groups and international military commanders.
Russian foreign minister Sergey Lavrov _ who will not attend the talks _ has said the international air campaign which began March 19 has breached the terms of the U.N. resolution which authorized the enforcement of a no-fly zone over Libya.
Cameron insisted that the coalition had not gone beyond its remit, but acknowledged the impact had been to force Gadhafi’s military into a retreat from a number of key towns.
“We should do everything we can to protect people and actually _ as a result _ that is actually driving back the Gadhafi regime,” Cameron said.
Sarkozy and Cameron said in their joint statement that the military action would end only when civilians were free from the threat of attack.
___
Hadeel al-Shalchi, in Tripoli, Bradley Klapper in London and Ciaran Giles in Madrid contributed to this report
The New York Times announced "digital subscriptions" on Thursday, revealing the long-awaited details of its paywall plan. Starting March 28, non-subscribers will be able to read only 20 online articles for free each month.
Home delivery subscribers can continue to access online and app content for free. Non-subscribers can choose from three packages: $15 every four weeks for Web access and smartphone content; $20 for Web plus access to the Times iPad app; and $35 for Web, tablet and smartphone access.
There’s still some room for free, though: Readers who reach online Times articles through links from search engines, blogs and social media will be able to access those individual articles, even if they have reached the 20-article monthly limit.
But for some search engines, users will have a daily limit of free links. The New York Times’ press release on its plan did not specify which search engines will be affected, but a Times article on the plan said there will be a five-link limit through Google (GOOG, Fortune 500).
The homepage at NYTimes.com and all section fronts will remain free to browse at all times. The "Top News" section will remain free on the Times’ smartphone and tablet applications.
"Free links from social and search is a key point," said Sree Sreenivasan, the dean of students at Columbia Journalism School. "This will keep the visitor numbers from falling too much. And their core paying audience is not going to change."
The Times says its homepage receives 30 million unique readers per month. Figures from The Nielsen Company, however, said NYTimes.com had 15.5 million unique visitors in January. ComScore data said New York Times Digital, which includes properties like About.com, overall had 71.9 million unique visitors in January.
Sreenivasan said he considered the plan pricing to be fair, though the company should "make payments as easy as iTunes" to increase readers’ willingness to fork over cash.
The Times’ digital subscription plan is rolling out in Canada starting Thursday, "in order to fine-tune the customer experience" before the service rolls out to the rest of the world.
New York Times Co personal business card. (NYT) stock ended 0.3% higher at $8.89 a share, though it had risen as high as $9.35 earlier in the session following the announcement.
In a prepared statement, Times publisher and chairman Arthur Sulzberger, Jr., said the move "will result in another source of revenue, strengthening our ability to continue to invest in … journalism and digital innovation."
The cost of free: Determining the paid vs. free balance has been difficult for media companies, and they’ve been making big bets on digital publications as print sales dwindle. Most employ a "freemium" model — some content free, some paid — in an effort to keep as many readers as possible.
News Corp. (NWS, Fortune 500) has been at the forefront of charging for content. While some of its The Wall Street Journal content can be accessed for free, a sizable portion is behind a paywall.
And last month, News Corp. unveiled an iPad-only publication called The Daily. CEO Rupert Murdoch committed around 100 staffers and an investment of $30 million to get it launched, and will spend $26 million a year to keep it running. The Daily costs 99 cents a week, or $40 for a yearly subscription — though News Corp. has extended a free trial for several weeks.
The price point for digital content is a sticky decision for media companies, as the proliferation of blogs often means readers can get similar content for free elsewhere.
And going digital can be expensive. To take The Daily as an example: To break even on its operating costs from subscriber revenue alone, The Daily would have to sell more than 650,000 subscriptions — and that’s without accounting for the cut Apple (AAPL, Fortune 500) takes for selling The Daily through its App Store.
Apple unveiled a new subscriptions model last month, in which the company will take 30% of all sales generated through its platform — and publishers cannot include links in their apps to let customers buy content outside of the app.
The Times said its apps will be in compliance with the Apple subscription model by June 30.
House Republicans proposed a stopgap budget measure to fund the government until April 8 while lawmakers try to work out their differences on spending for the rest of the fiscal year.
The bill would cut about $6 billion in spending, in part by ending or reducing funds for 25 programs. Most of those changes have been endorsed by President Barack Obama or Senate Democrats. About $2.6 billion of the reduction would be made by rescinding unspent funds for lawmakers’ pet projects.
“While short-term funding measures are not the preferable way to fund the government, we must maintain critical programs and services for the American people until Congress comes to a final, long-term agreement,” said House Appropriations Committee Chairman Hal Rogers, a Kentucky Republican. “A government shutdown is not an option.”
The bill, to be put to a vote next week, would replace the current funding measure that expires March 18. It would be the sixth stopgap measure since the fiscal year began Oct. 1. By cutting $2 billion per week, it would keep Republicans on track to cut $61 billion this year.
Democrats and Republicans remain far apart on how to fund the government through September. Lawmakers are arguing over which side should make the next move after a House-approved plan to cut $61 billion and a Democratic alternative were defeated this week in the Senate.
Democrats said it’s up to House Republicans to show flexibility after the Senate made clear their plan wasn’t viable in that chamber.
“We’re looking for a counteroffer,” Representative Steny Hoyer of Maryland, the second-ranking Democrat, said today.
‘Prepared to Move?’
“Are you prepared to move?” Hoyer asked Majority Leader Eric Cantor on the House floor. “I’m asking you and I can’t get an answer and you apparently are not going to make a counteroffer.”
Cantor said it’s up to Senate Democrats to produce a budget-cutting plan that can clear the chamber that could provide the basis of negotiations with the House.
“There is really no offer on the table that is valid because it can’t pass the Senate,” said Cantor of Virginia. “What is the Democratic Senate’s offer?”
Obama today urged lawmakers to work out a deal, saying the public expects them to “stop with the political bickering.” He said, “We can’t keep on running the government on two-week extensions. That’s irresponsible.”
“The notion that we can’t get resolved last year’s budget in a sensible way with serious but prudent spending cuts, I think, defies common sense,” Obama said. “It shouldn’t be that complicated.”
Senator John McCain, an Arizona Republican, said he will attempt to amend the new short-term proposal to fund the Pentagon for the rest of the year.
“We can’t subject our nation’s national security to a two week-by-two week process,” McCain said. “It is not the way the Defense Department can function and this nation can defend itself and its vital security interests.”
Homebuilders have yet to see a turnaround in the housing market after the worst year for new-home sales in a half-century.
The National Association of Home Builders said Tuesday that its index of builder sentiment for February remained unchanged for the fourth straight month at 16. Any reading below 50 indicates negative sentiment about the market. The index hasn’t been above that level since April 2006.
Homebuilders are struggling to compete with millions of foreclosures that are forcing home prices down. Last year was also the worst in more than a decade for sales of existing homes.
Weak sales mean fewer jobs. Each new home built creates, on average, the equivalent of three jobs for a year and generates about $90,000 in taxes, according to the trade group.
“Builders are telling us that some pockets of optimism have begun to emerge, but many prospective purchasers are concerned about selling their existing home in the current market,” said David Crowe, the home builders group’s chief economist.
High unemployment, tighter bank lending standards and uncertainty about home prices have also kept many people from buying homes. Mortgage rates had been at the lowest levels in decades, but have since started to rise.
The housing market is expected to show some signs of life this year but the recovery will likely be uneven. The latest regional data showed builders are becoming more optimistic in the Northeast and South and more grim in the Midwest and West. And while hopes for improved single-family sales now and over the next six months improved, the amount of foot traffic by prospective buyers remained flat.
The online coupon site Groupon.com and the FTD flower company are giving refunds after getting complaints that a Valentine’s Day flower deal wasn’t so sweet.
Groupon customers were offered $20 off a $40 purchase from FTD last week. But some customers found the flowers were priced lower as sale items on FTD’s own website. They complained on the Internet that FTD inflated prices for Groupon customers to make up for the discount.
But FTD President Rob Apatoff says that’s not so. He says it was clear on the sites that the coupon didn’t apply to sale items.
Still, Apatoff says his company will credit the customers’ accounts to give them the lower price because of the confusion. Both companies also say they’ll make full refunds if people aren’t satisfied.
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