Kinder Morgan Energy Partners LP, one of the nation’s largest pipeline companies, agreed to buy four terminals from St. Louis-based Slay Industries for $98 million.
The assets include a river terminal in Sauget, a liquid bulk terminal and a warehousing distribution center in St. Louis and a terminal in Muscatine, Iowa.
The purchase gives Kinder Morgan a toehold in the St. Louis terminal market and "unparalleled access to major markets via rail and waterway," Jeff Armstrong, president of the company’s terminals business, said Wednesday in a statement.
Houston-based Kinder Morgan and Slay Industries also formed a joint venture at Slay’s Kellogg Dock coal terminal in Modoc, Ill., and new North Cahokia terminal in Sauget, which includes 175 acres for development.
Slay Industries was founded 90 years ago as Slay Motor Freight and generates annual revenue exceeding $125 million, according to the company’s website.
Job hunters may be better off being unemployed and searching for permanent work rather than taking temporary positions, a new study contends.
“It’s not that temp work is bad, per se,” said David Autor, who co-wrote the study. “It’s that people who are successful as temps, would tend to be far more successful in direct hire jobs. It’s the opportunity cost rather than direct harm.”
Autor, an economist at the Massachusetts Institute of Technology, and colleague Susan Houseman carried out a broad study of outcomes for 37,000 job seekers. The study group comprised clients of Work First, a public job-placement service operating in Detroit whose goal is to get people off welfare.
Applicants were randomly assigned to jobs; some were temporary positions doled out by agencies, others were direct hires to participating companies. All the jobs were relatively low-wage, low-skill labour.
Autor found that those workers who lucked into direct-hire employment, on average, earned 30 to 50 per cent more over the next two years than workers who took temp jobs. They found that earnings for temp workers tended to jump at the outset but then settled back when those jobs ended after a few days or weeks.
“The average outcome is that people placed in temp jobs do less well than they would have if they had just spent the extra time to search for a direct-hire position,” Autor said from his office at M.I.T. on Monday.
“Holding the temp job has two consequences: First of all, it’s very difficult to search for a job while you’re working. Second, when you’re connected to a temp agency, you may have the illusion a job is about to show up. They say, ‘We’ll call you when we have something.’ I wouldn’t call it ‘complacency,’ but it may create the sense that you’re doing something when you’re not payday loans guaranteed no fax.”
At the root of all this is the onerous nature of the job hunt itself.
“We know from all kinds of studies that people … hate searching for work. They hate it much more than working.”
Temp work, it seems, jolts people out of a job-hunting state of mind while offering no long-term benefits.
“Direct-hire placements give people stability. Stability is very valuable,” Autor said. “People often talk about the benefits of flexibility and so forth. Most of those benefits are actually for the employer rather than the employee.”
One of his conclusions is that government should not be in the business of trying to place people in temp jobs.
“You don’t need a government agency to connect you to a temp agency. Everybody knows where they are,” Autor said. “What is hard is connecting workers directly to employers.”
The participants in the study were a very particular kind of worker – one with little training. But Autor believes the study’s findings apply to a broad economic spectrum.
He is very careful not to suggest that people who need to put food on the table should be turning down any sort of job. But he gently suggests that the goal should be a successful job search, not a short one.
“What I’d like (job seekers) to take from this is that although temporary work sometimes leads to a direct-hire position, that’s probably not the most fruitful way to get them, relative to the sort of painful work of a direct-hire search,” Autor said.
“Don’t view temp work as the on-ramp into the labour market.”
European exports declined for a second month in November as the euro’s strength made goods from the region more expensive abroad.
Exports from the euro area dropped a seasonally adjusted 0.4 percent from October, when they decreased 0.1 percent, the European Union’s statistics office in Luxembourg said today. The trade surplus narrowed to 3.9 billion euros ($5.6 billion) in November as imports rose 0.3 percent from October, when they fell 1 percent. European inflation accelerated to 0.9 percent in December, a separate report showed.
The euro’s 10 percent advance against the dollar in the past year is threatening to undermine the region’s recovery by making exports less competitive. While European services and manufacturing industries expanded at the fastest pace in more than two years in December, the economy still faces a “bumpy road” ahead, European Central Bank President Jean-Claude Trichet said yesterday.
“The exports-driven recovery of the preceding two quarters is fading,” said Dominique Barbet, an economist at BNP Paribas SA in Paris. “Imports’ lack of dynamism suggests lackluster domestic demand.”
December inflation was the fastest since February 2009, with energy prices rising 1.8 percent from a year earlier, the statistics office said. Core inflation, excluding volatile costs such as tobacco, food and energy, accelerated to 1.1 percent in December from 1 percent in the previous month.
Greece’s Struggles
The euro fell the most in almost a month against the dollar today as Greece’s struggles to cut its budget deficit dented investor confidence in European assets. The 16-nation currency traded at $1.4366 at 3:43 p.m. in London, down 0.9 percent on the day.
The ECB yesterday left its benchmark interest rate at a record low of 1 percent and signaled that officials will wait for more signs of recovery before withdrawing emergency measures further, with Trichet citing “a great level of uncertainty” surrounding the economic outlook short term personal loans. The central bank forecasts growth of about 0.8 percent this year and around 1.2 percent in 2011.
European Aeronautic, Defence & Space & Co., the parent of Airbus SAS, on Jan. 12 reported its steepest annual revenue drop since the company went public a decade ago, partly because of a weaker dollar. Eckhard Cordes, chief executive officer of Metro AG, Germany’s biggest retailer, said on Jan. 12 that he anticipates economic conditions will remain “challenging” in 2010 after currency swings eroded fourth-quarter revenue.
Biggest Economy
Economies around the globe are emerging from the worst recession in six decades, led by China, where exports gained for the first time in 14 months in December. The Asian nation overtook Germany as the largest exporter of goods in 2009. Industrial output in the U.S., the world’s biggest economy, rose in December for a sixth month, data showed today.
Euro-area exports to the U.S., the region’s second-biggest trading partner, dropped 20 percent in the first 10 months of 2009 from a year earlier, today’s report showed. Shipments to the U.K., the largest market for euro-area goods, declined 24 percent, while exports to China rose 1 percent. The detailed country data are published with a one-month lag.
To help shore up earnings, companies have been cutting costs and paring wages. European unemployment rose to 10 percent in November. That’s the highest in more than 11 years. Koenig & Bauer AG, the world’s third-biggest printing-press maker, said last month that it plans to eliminate more jobs.
“China and other emerging countries bring in volume but not necessarily profit,” Koenig & Bauer CEO Helge Hansen said on Dec. 4 in Wuerzburg, Germany. “They help retain jobs, but they don’t help in terms of a positive balance.”
MIAMI — The nation’s roughly 1 million paid tax preparers will soon be regulated by the Internal Revenue Service, which plans to require competency tests and registration with the government.
The new regulations don’t kick in this year, in part because of the size of the undertaking, IRS Commissioner Doug Shulman said Monday. But the agency will soon send letters to 10,000 preparers with a record of errors on returns.
About 80 percent of taxpayers use a tax preparer or tax software to complete their annual returns. Most are unregulated, unless they are attorneys, certified public accountants or agents who represent taxpayers before the IRS.
More people are turning to preparers or software for help with their taxes as the tax code becomes more complex, he said.
"If we can have preparers fill out taxes right, the American people are well-served," Shulman said. "We’re going to get accurate returns and collect the right amount of money."
Concern about unscrupulous and untrained tax preparers has been longstanding, said Karen Reinagel, president of the Florida Society of Enrolled Agents, a group of tax professionals authorized by the federal government to represent taxpayers in dealings with the IRS. "The taxpayer has no idea if they’ve got the proper education, if they’ve kept up with continuing education," Reinagel said.
People expect hair dressers and auto mechanics to have passed certain tests and acquired certain licenses, and they may assume as much about their tax preparers.
"But if they’re not registered or licensed they don’t have to have an education," Reinagel said. "They wouldn’t think they would have to ask."
The system will be paid for through user fees by tax preparers who register with the government and take the IRS competency tests business card templates.
Eventually, the IRS said, it will have a searchable database for taxpayers to consult before working with a preparer.
Shulman said his agency was already studying potential regulations for tax preparers before recent criticism about abuse of large tax credits offered through federal stimulus laws.
In a report last month by the inspector general for tax administration, as of July 25, about 74,000 taxpayers had wrongly claimed $504 million through the first-time home buyers tax credit that was expanded in last year’s federal stimulus law. The credit pays $8,000 to first time buyers and $6,500 to current owners if they buy a new home.
"Any time there’s a large, refundable tax credit, you’re going to see fraud _ people trying to claim the credit where it’s not earned," Shulman said.
The EITC _ Earned Income Tax Credit _ for low-income individuals and families is also a source of fraud. The credit offers up to $5,600 to those who qualify. Shulman praised that program as having lifted more people out of poverty than any program in the country.
In addition to the new regulations for preparers, IRS agents will visit thousands of tax preparers, sometimes without advance notice. Some agents will pose as taxpayers to gauge what kind of advice a preparer offers. These visits will begin this year.
And the IRS has set up a task force to review tax preparation software and review businesses that offer refund advances.
The rules won’t apply to volunteers who help low-income families and individuals prepare their taxes. But those who work at Volunteer Income Tax Assistance Program already must pass a test before working on others’ returns.
Ford Motor Co. CEO Alan Mulally says the automaker plans to speed up debt repayment as its financial condition continues to improve.
Ford has about $27 billion in debt. Mulally says the company repaid $10 billion this year and has sold $1 easy to get unsecured personal loans.6 billion worth of stock.
Colorado nonprofits expected a tough year in 2009 — and that’s exactly what they got, according to a survey released Wednesday by the Colorado Nonprofit Association and the Community Resource Center.
Of the 450 leaders of Colorado nonprofit organizations surveyed, 48 percent said their organizations expect to fall short of their revenue goals for the year.
Other key survey findings:
• Fifty-six percent of respondents reported an interval over the last 12 months when total expenses exceeded total revenue.
• Sixty-five percent said a major donor reduced or eliminated support due to the economic downturn.
• Sixty-four percent said the economy had a negative impact on obtaining funding from foundations, government agencies and corporations.
The survey — entitled “Weathering the Storm” — is an update of a similar report published earlier this year.
When it became apparent that nonprofits in the state were doing worse than they expected at the beginning of the year, CRC and the Colorado Nonprofit Association invited charities to complete an online questionnaire between Oct. 26 and Nov. 6.
But despite discouraging financial returns, the latest report shows that Colorado nonprofits are taking measures to persevere in during a challenging economic time.
According to the survey, the state’s nonprofits responded to the funding gap by:
• Collaborating with other organizations, with 39 percent sharing expenses and costs payday loan.
• Increasing fundraising activities. Thirty-two percent of nonprofits ramped up face-to-face solicitations, 42 percent requested more foundation grants and 27 percent asked board members to contribute more money.
• Reducing expenses. To respond to the economic downturn, 28 percent of nonprofits surveyed cut back or eliminated programs. Meanwhile, 21 percent cut staff pay or hours and nearly 16 percent laid off staff.
• Using more unpaid volunteers. The survey said 43 percent of nonprofits are already using more volunteers and nearly 40 percent are considering such action.
Looking ahead over the next three years, many Colorado nonprofit leaders say they are re-examining their services and existing programs.
Roughly one-third are re-evaluating their assumptions with the possibility of fundamental restructuring. Another 35 percent expect to expand services in key areas (an increase from 26 percent in the first version of the report).
However, most respondents said they expected their nonprofit will “stay in business.” Fewer than 1 percent of respondents anticipated the need to close.
Click here to download the report in PDF format.
Controversy has accompanied Verizon Wireless' latest Droid phone ad that mocks Apple Inc.'s iPhone, but never actually mentions its rival.
The ad starts with a group of mesmerized people looking at a phone that is behind a glass case and asks, "Should a phone be pretty? Should it be a tiara-wearing, digitally clueless beauty pageant queen?”
Then it says the Motorola Droid, which uses Google Inc.'s (NASDAQ:GOOG) Android operating system, is "racehorse-duct-taped-to-a-Scud-missile fast."
It also shows what some critics are portraying as an anti-gay image of a group of fashionably dressed (and partially undressed) male statues getting hit with tomatoes.
The ad can be viewed on YouTube by clicking here.
A post by Kara Swisher on the Wall Street Journal's All Things Digital blog slams the ad and is headlined, "Is the new droid ad anti-women and anti-gay or just plain idiotic? Actually all three!
VentureBeat rated the ad "just plain clueless," especially for "likening the Droid phone’s speed to that of the Scud missile, a not-very-fast Russian rocket used by Saddam Hussein’s regime no faxing 1 hour payday loans. A Scud killed 28 Americans at an airbase in Saudi Arabia in 1991. Other Scuds have killed lots more civilians in the Middle East."
Not all of the reviews have been negative, with many focusing on the cool look and humor of the spot.
But while saying he liked the ad, Stuart Turton of PC Pro wrote, that "when stripped to its barebones (the ad) actually says that the Droid is uglier than an iPhone, and… erm… well, that’s it. Funnily enough, it appears that by criticising the iPhone for placing style before substance, Verizon’s done exactly that."
Verizon's other Droid ads resulted in legal challenges by the iPhone's exclusive U.S. service provider, AT&T Inc., which were recently dropped. In those, Verizon took aim at AT&T's service and likened the iPhone to a misfit toy in a holiday-themed video.
Shares in banks, builders and companies part-owned in the Middle East fell around the world on Thursday and investors sought safety in government bonds on worries about Dubai’s ability to pay its debts.
Sterling fell as exposure focused on UK banks, and euro zone government bond futures hit their highest level since late April, breaking out of the trading range that has been in place since June as risk aversion prompted by the crisis kicked in.
“The Dubai story is weighing heavily on stock markets and people are looking to safe-havens so there’s some flight to quality again,” said Charles Berry, a trader at LBBW.
The euro broke above 91 pence for the first time in a month to hit a high of 91.29 pence.
“There are concerns regarding the extent of the exposure of the UK banks to Dubai, hence sterling is coming under pressure,” said Ian Stannard, currency strategist at BNP Paribas.
European bank shares fell over 3 percent on concern about potential exposure. Dubai said on Wednesday that two of its key firms, Nakheel and Dubai World, plan to delay repayment on billions of dollars of debt.
Companies where Middle Eastern investors own big stakes, such as the London Stock Exchange were also hit by concern the holdings could be cut to meet obligations at home.
By 1020 GMT the DJ Stoxx European bank index .SX7P was down 3.5 percent at 221.7 points.
The fall was led by HSBC, Standard Chartered, Barclays, Deutsche Bank and Royal Bank of Scotland, whose shares all fell over 4 percent.
In Seoul, shares in construction issues fell, with Samsung C&T leading losses as investor concerns focused on Dubai’s once booming construction sector.
A Samsung C&T spokesman said that the company was currently working on a $350 million project awarded by Nakheel in 2007.
“So far, we have not had any problems with the project,” he said.
Shares in Hyundai Engineering & Construction were down 4.41 percent and Samsung Engineering fell 2.16 percent as of 0458 GMT.
Nakheel’s NAKHD.UL Islamic bond prices extended losses, falling 12 points to 72, their lowest since February, according to Reuters data.
DEBT DELAY
Technology has been a driving force in this year’s initial public offerings.
Consider ChangYou.com Ltd., a Chinese online game developer whose stock price jumped 25 percent at its offering day in April on the NASDAQ. It is now up more than 100 percent from its IPO price.
The company recently had the U.S. launch of its Dragon Oath martial-arts online game, a hit in Asia for the past three years. It has three more online games scheduled for release here and is opening a subsidiary in Santa Clara, Calif.
Among the 16 other tech IPOs in 2009, price gains of better than 30 percent since their offering have been produced by SolarWinds Inc., a management and monitoring software firm; A123Systems Inc., a manufacturer of rechargeable lithium-ion batteries; and Opentable Inc., an online reservation site.
In a year of other IPO gains by familiar names such as Hyatt Hotels and Vitamin Shoppe, the average first-day IPO price "pop" has been 7 percent, and the average overall return 10 percent, according to RenaissanceCapital.com.
But don’t get the impression we’ve returned to the wild-and-crazy IPO markets of the past. Some planned IPOs haven’t even hatched and others have quickly laid an egg because investor caution rules the roost.
"Demand for IPO money continues to run off the scale, as the need for companies to access the capital markets increases," observed David Menlow, president of IPOfinancial.com in Millburn, N.J. "However, the tug of war is between the comfort level of potential investors and the need for capital for these companies."
Investors are wary of debt-laden companies put on the IPO block by private-equity firms. An example is the Dole Food Co. IPO that was priced at the low end of its expected range, closed lower on its offering day in October and has since declined.
Rather than focus on one market sector, an investor should examine each IPO carefully to see if it makes sense, Menlow advised. Years ago, investors couldn’t care less what an IPO did because they just wanted in on the deal, resulting in "a lot of dogs with fleas" among those IPOs, he said.
"We’re in the last stage of a double-dip recession and starting to see some rays of sunshine in the IPO market," said Linda Killian, portfolio manager of IPO Plus Aftermarket Fund in Greenwich, Conn., up 16 percent over the past 12 months. "The IPOs that have come to market have been priced to sell."
Getting the 2009 IPO market off on the right foot was Mead Johnson Nutrition Co., a quality spin-off from Bristol-Myers Squibb Co. whose IPO was priced right, Killian noted. When that success was followed by Rosetta Stone Inc instant payday loan., another viable growth company, other firms were enticed to come to market, too.
IPO Plus Aftermarket Fund, which requires a $5,000 initial investment, buys a portfolio of IPO stocks at the time of the offering and in their subsequent aftermarket trading. The largest of the fund’s 23 holdings were recently Visa Inc., Constant Contact Inc., Athena Health Inc., Mead Johnson and Rackspace Hosting Inc.
"Individual investors can look for good IPOs that have traded down since they were offered," said Killian. "For instance, RailAmerica Inc. is below its IPO price and, although leveraged, is a well-run regional freight railroad operating in 27 states and part of Canada that has fared well in the economic downturn."
Institutional investors still drive the overall IPO market, since only select investors at full-service brokers typically get the opportunity to invest in IPOs. Most average investors invest in IPOs on the secondary market after their initial price pop. IPO Plus Aftermarket Fund is another way of doing that.
"The overall stock market is driving the IPO market, which is playing catch-up," explained John Fitzgibbon, founder of IPOScoop.com in Edison, N.J. "The IPO market is a follower, not a leader, and you must have a good stock market in order to get a good IPO market."
Among financial IPOs, Cypress Sharpridge Investments Inc. and Invesco Mortgage Capital Inc. have made gains, pointed out Fitzgibbon, but "the rest are underwater." Some real estate investment trusts also attempted to sweep up toxic assets into IPOs to get rid of them, but those IPOs have stumbled, he said.
"I always keep an eye on the initial IPO filing versus the final filing, since an increase indicates excessive demand and therefore likely good aftermarket performance," he said.
Rue21 Inc., a fast-growing specialty retailer for young women and men whose recent IPO was priced above its expected range and ended its offering day up 28 percent, is "a barn-burner," believes Fitzgibbon. It has had rapid growth and rising profits while displaying ability to predict fads, he said.
He is less enthusiastic about Dollar General Corp., the largest retail-store IPO in more than a dozen years, because it was loaded with debt by Kolberg Kravis Roberts and "pushed out the door as an IPO." But even though that IPO was priced at the low end of its expected range, it has since risen in price based on current investor confidence in discount retailer prospects.
Federal Reserve Bank of San Francisco President Janet Yellen said it’s “far from clear” whether the Fed should use interest rates to stem a surge in financial leverage, and urged further research into the issue.
“Higher rates than called for based on purely macroeconomic conditions may help forestall a potentially damaging buildup of leverage and an asset-price boom,” Yellen said in the text of a speech today in Hong Kong. At the same time, “use of monetary policy for these ends necessarily compromises the attainment of other macroeconomic goals,” she said.
Yellen’s remarks come just as debate rises over whether the Fed’s current commitment to keep rates low for an “extended” period may be fueling rising asset prices in Asia. While officials from China, Hong Kong and Japan said in the past week that the stance is spurring speculative capital, Fed Chairman Ben S. Bernanke said yesterday it’s “not obvious” there’s a bubble in the U.S.
“Further research into the connections among monetary policy, the banking and financial sectors, and systemic risk is needed to help answer this question,” Yellen, a voting member of the rate-setting Federal Open Market Committee this year, said in her remarks, referring to whether to use rates to influence asset prices.
The San Francisco Fed chief also endorsed the idea of making banks hold more capital than otherwise during economic expansions, for use when recessions hit. She said that “one promising strategy is to implement a system that would require banking organizations to build capital buffers in good times that could be run down under stressful conditions.”
Bernanke on Economy
Yellen didn’t comment on the outlook for economic growth or rate policy in her remarks at the event organized by The Institute of Regulation & Risk. Bernanke said yesterday that reduced bank lending and “high” unemployment are likely to restrain the recovery, warranting continued low borrowing costs one hour payday loans.
The FOMC pledged after a Nov. 3-4 meeting to keep the benchmark interest rate near zero for an “extended period.”
The central bank’s injection of more than $1 trillion in liquidity has helped end the U.S. economy’s contraction, pushing up stock prices. The effort has narrowed the Libor-OIS spread, which measures banks’ reluctance to lend, to levels not seen since 2007. The Standard & Poor’s 500 Index is up 64 percent from its low for the year on March 9.
China’s Liu
Liu Mingkang, chairman of the China Banking Regulatory Commission, said in Beijing Nov. 15 that the American rate stance and falling dollar has led to “massive” speculation. Donald Tsang, the chief executive of Hong Kong, said Nov. 13 in Singapore “I’m scared and leaders should look out.”
Emerging economies “might overheat and experience financial turmoil,” Bank of Japan Governor Masaaki Shirakawa said in Tokyo yesterday.
Bernanke, by contrast, said in response to audience questions after a speech in New York that “it’s not obvious to me in any case that there’s any large misalignments currently in the U.S. financial system.”
Fed Vice Chairman Donald Kohn, speaking yesterday at Northwestern University in Evanston, Illinois, also said low rates don’t appear to be fueling another bubble in U.S. financial markets.
Yellen, 63, previously served as a Fed governor and was White House Council of Economic Advisers chief in the Clinton administration. Yellen has led the San Francisco Fed since 2004.
The financial crisis, which began with the collapse of the U.S. subprime-lending market in 2007, has resulted in more than $1.6 trillion in writedowns and losses by banks and other financial institutions worldwide.
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