MADISON COUNTY
Premier Wen Jiabao has promised China’s struggling exporters a stable exchange rate in a move that might fuel tensions with Washington over Beijing’s currency controls as the global economy weakens.
Wen’s pledge, reported by the official Xinhua News Agency and state radio, comes after the U.S. Senate approved a measure to allow higher tariffs on Chinese goods that critics say are unfairly cheap due to an artificially undervalued currency.
Beijing’s exchange rate controls are especially sensitive at a time when other nations are trying to revive growth by boosting exports and complain that a weak Chinese yuan is widening the country’s swollen trade surplus.
Wen’s pledge Friday at a trade fair in southern China came after export growth suffered an unexpectedly steep decline in September, hurt by a fall in sales to Europe amid the continent’s debt crisis.
Wen promised a “basically stable exchange rate,” Xinhua said. He pledged to maintain export-related tax rebates and other support.
U.S. manufacturers complain the yuan is undervalued by up to 40 percent, giving China’s exporters an unfair price advantage and wiping out American jobs. Beijing has allowed the yuan to gain by about 7 percent against the dollar since June 2010 in tightly controlled trading, but that is not as fast as critics want.
The measure approved Tuesday by the Senate would allow Washington to raise tariffs on goods from countries that the U.S. Treasury concludes are manipulating exchange rates for a trade advantage. The bill is not expected to become law because it lacks the support of the leadership of the lower House of Representatives, which has yet to vote on it.
China’s government reacted angrily to the measure, dismissing it as protectionism at a dangerous time for the shaky world economy and warning that trade relations would be damaged if it were allowed to become law.
China’s economy, the world’s second-largest, is relatively robust, with growth forecast by the World Bank of 9.3 percent this year. But weakening exports by Chinese manufacturers that employ millions of people could lead to layoffs and social tensions.
September’s export growth fell to 17.1 percent over a year earlier, down from August’s 24.5 percent, customs data showed Thursday.
Candy shaped like marijuana that’s showing up on store shelves around the country won’t get kids high, but aghast city leaders and anti-drug activists say the product and grocers carrying it represent a new low.
“We’re already dealing with a high amount of drug abuse and drug activity and trying to raise children so they don’t think using illegal substances is acceptable,” said City Councilmember Darius Pridgen. “So to have a licensed store sell candy to kids that depicts an illegal substance is just ignorant and irresponsible.”
The “Pothead Ring Pots,” “Pothead Lollipops” and bagged candy are distributed to retail stores by the novelty supply company Kalan LP of the Philadelphia suburb of Lansdowne. It also wholesales online for $1 for a lollipop and $1.50 for a package of three rings.
Company president Andrew Kalan said the candy, on the market six to nine months and in 1,000 stores around the country, promotes the legalization of marijuana.
“It does pretty well,” he said.
“This is the first complaint I’ve heard,” Kalan said, “and people are usually not shy. I’m actually surprised this is the first.”
An irate parent brought the candy to Pridgen’s attention, hoping the city could apply pressure and get it out of stores.
Pridgen and Councilmember Demone Smith displayed the candy, along with fake marijuana known as “K2″ that’s also sold in some stores at Tuesday’s Common Council meeting, where Pridgen said he’d refuse to grant licenses to stores in his district that planned to sell the merchandise and would seek to embarrass stores that carry it. The synthetic marijuana is sold as incense but is smoked.
Synthetic marijuana typically involves dried plant material sprayed with one of several chemical compounds. The products contain organic leaves coated with chemicals that provide a marijuana-like high when smoked. The Drug Enforcement Administration recently used its emergency powers to outlaw five chemicals found in synthetic marijuana.
It appeared Pridgen’s message had gotten out by Thursday. A check of about a half-dozen stores in Buffalo, often in impoverished neighborhoods where real drugs are a festering problem, turned up none of the controversial candy.
The bags of “Pothead Sour Gummy Candy,” and lollipops shaped like marijuana leaves appear to be a recent addition to the inventory of some corner stores. The sour apple-flavored candy contains nothing illegal, but with its marijuana leaf, the word “Legalize” and a joint-smoking, peace sign-waving user on the packaging, critics say it’s not only in poor taste but an invitation to try the real thing free 3-in-1 credit report.
“It’s the whole idea that it promotes drugs and the idea that, here, you’ll look cool if you use this _ which is what gets these kids in trouble in the very first place,” said Jodie Altman, program supervisor at Renaissance House, a treatment center for drug- and alcohol-addicted youth.
Charmaine Rosendary, 36, of Buffalo shook her head when she saw a picture of the package.
“That’s not right. It’s just promoting marijuana,” she said while buying produce Friday at a Buffalo market. She said she wouldn’t allow her five teenagers, ages 15-19, to have it.
“I would not buy it or give them money to buy it,” she said. “It looks like weed.”
It’s not the first legal product to come under fire.
In 2008, the Hershey Co. stopped making Ice Breakers Pacs in response to criticism that the mints looked too much like illegal street drugs. Police in Philadelphia complained that the packets, nickel-sized dissolvable pouches with a powdered sweetener inside, closely resembled tiny heat-sealed bags used to sell powdered street drugs.
Candy cigarettes and fruity or energy drink-infused alcoholic beverages have been criticized for targeting young people. And in 1997, the Federal Trade Commission said the iconic Joe Camel cigarette ads and packaging violated federal law because they appealed to kids under 18. The tobacco company, R.J. Reynolds, eventually shelved the caricature.
A spokesman for the Office of National Drug Control Policy said advocates for legalization who claim marijuana is benign are not supported by science.
“Trivializing drug use is a threat to public health because it erodes perceptions of harm among young people,” said Rafael Lemaitre.
Kalan said his company carries several products with the marijuana leaf and “legalize” message to accommodate growing demand in the movement to legalize marijuana.
“We don’t advocate for a political position. We just look at what the marketplace wants and respond to it,” the wholesaler said. “It’s just candy… It’s sour apple flavor, it doesn’t claim to be pot in disguise or anything like that.”
QUOTE OF THE WEEK
“I believe history will remember Steve Jobs as one of the greatest innovators of all time, the Thomas Edison of the 21st century one hour payday loan.”
Germany’s chancellor says she would support a Europe-wide move to recapitalize banks across the continent if such a moves was deemed necessary.
Angela Merkel said “if there is a common view that banks aren’t sufficiently capitalized for the current market condition” a financial firewall should be built.
The comments come after the International Monetary Fund called on Europe to put up billions of euros to recapitalize Europe’s biggest banks.
Merkel said “common guidelines” on the right amount of capitalization were necessary, adding that this needed to be done urgently. She was speaking in Brussels Wednesday after a meeting with European Commission President Jose Manuel Barroso.
THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.
BRUSSELS (AP) _ The International Monetary Fund, a key player in eurozone bailouts, on Wednesday pushed for radical changes in the way the region’s debt crisis should be handled.
Antonio Borges, the head of the IMF’s Europe program, said the eurozone’s bailout fund should get more firepower and new tools.
To help, he said the IMF could intervene in bond markets to keep the crisis from engulfing large economies like Italy and Spain. The surprise proposal would profoundly alter the fund’s role in the crisis.
It has so far contributed close to euro80 billion ($105 billion) to eurozone bailouts, about a third of the total, but never intervened in open markets.
“We have a whole set of options that could be put on the table to restore confidence in those countries,” Borges said at a news conference in Brussels.
His comments are the first open acknowledgment of a radical change in approach by the IMF to the eurozone’s debt crisis. The currency union’s debt troubles have intensified severely as most investors expect a default by Greece and fear much larger Italy and Spain will be dragged into the crisis.
In public statements until now, IMF officials had insisted on agreements made at a eurozone summit in July, which gave a first range of new powers to the region’s bailout fund and tentatively offered a second, euro109 billion bailout for Greece, with modest losses accepted by banks on their Greek investments.
But Borges made clear on Wednesday that those decisions were no longer sufficient.
He said that the euro109 billion figure was an estimate based on conditions that have since changed, adding that a new program needed bigger focus on Greece’s massive debt and growth. He said that didn’t necessarily entail bigger losses for banks and other private Greek bond holders.
Borges also piled pressure on Greece to take more stringent measures to get its economy back on track, saying there was no rush to take a decision on the payment on the next slice of bailout money because the country doesn’t face a big bond repayment deadline until December.
Athens has said it will start running out of money to pay salaries and pensions in mid-November if it doesn’t get the euro8 billion ($11 billion) installment of its first euro110 billion ($145 billion) bailout.
The increasing uncertainty over Greece’s fate have increased market volatility and destabilizing the banking sector. Belgium and France are fighting for the survival of Dexia, the first potential failure of a big European bank since the credit crunch of 2008.
To build confidence, Borges backed a push to boost the impact of the eurozone’s bailout fund by using its resources more creatively.
In a new report on Europe released at the same time as the press conference, the IMF said the eurozone should consider using its crisis tools to guarantee bond issues from struggling countries. It also said eurozone countries should commit to indemnify the European Central Bank against possible losses on purchases of shaky government bonds it has made so far.
Both these moves have been discussed as part of a plan to bolster the effectiveness of the euro440 billion ($580 billion) bailout fund, the European Financial Stability Facility.
Borges said the IMF is ready to help Europe support struggling Italy and Spain as soon as all countries have ratified the changes to the EFSF agreed in July.
For instance, the IMF could help the eurozone’s bailout fund to support the distressed bond markets in Italy and Spain by buying their bonds on the open market alongside the EFSF. The fund could also give the two countries precautionary credit lines, he added.
He said Europe needs to take coordinated action on its banks to restore confidence in the financial sector. The IMF has previously said that it may cost as much as euro200 billion to recapitalize lenders across the continent.
“We are not saying that banks are in trouble and we are not saying that banks are weak,” Borges said, but he stressed that there was a big crisis of confidence that could only be addressed through action at European level.
In its report, the IMF says the EFSF should be empowered to directly recapitalize banks.
The nation’s economy is managing to grow modestly, reports Monday showed, despite high U.S. unemployment and growing alarm about Europe’s debt crisis.
Manufacturing expanded in September more than in August, though the pace of growth remains weak, according to a survey by the Institute for Supply Management. The ISM said its manufacturing index rose for the first time in three months.
And construction spending rose modestly in August, the government said. The gain was due mostly to a pickup in state and local government projects.
In addition, U.S. auto sales rose in September, largely because consumers bought more pickups and SUVs, U.S. automakers said.
Collectively, the reports suggested that the U.S. economy may be able to avoid another recession yet will continue to struggle.
Economists said the manufacturing and construction reports are consistent with an annual growth rate of about 2 percent to 2.5 percent for the July-September quarter.
That would be an improvement from growth of about 0.9 percent in the first six months of the year. But it wouldn’t be enough to reduce the unemployment rate, which is 9.1 percent.
The reports are “mildly encouraging,” said Paul Ashworth, chief U.S. economist at Capital Economics. “But even if the U.S. avoids a recession, economic growth is going to remain lackluster.”
Manufacturing executives said their volume of new orders shrank for the third straight month. That doesn’t bode well for future production.
Stocks initially declined, partly because Greece said earlier Monday that it would miss deficit-reduction targets it had agreed to as part of its bailout agreement. That raised worries that Greece could default on its debts, harming Europe’s economy.
The ISM’s manufacturing index rose to 51.6, up from 50.6 in August. A reading above 50 indicates expansion. The increase follows two months of declines.
Measures of production and exports grew, while a gauge of new orders was unchanged. Factories also added workers, the report said. The ISM is a trade group of purchasing executives.
The manufacturing sector has been a key driver of the economy’s growth since the recession officially ended in June 2009 low fee payday loans. The index topped 60 for four straight months earlier this year. It rose above 50 a month after the recession ended and has topped that level ever since.
But manufacturing accounts for only about 11 percent of the economy and can do only so much to support the recovery. And manufacturing has slowed in the past several months as consumer spending has weakened in response to high unemployment and stagnant wages. High gas and food prices are also forcing shoppers to cut back in other areas.
Respondents to the survey expressed “concern over the sluggish economy, political and policy uncertainty in Washington, and forecasts of ongoing high unemployment,” said Bradley Holcomb, chair of the ISM’s survey committee.
The report follows other indicators that show the economy is sputtering though still growing. Companies ordered more machinery, computers and other equipment in August, a government report last week showed.
Twelve of the 18 manufacturing industries tracked by the ISM reported growth in September. They include food and beverages; clothing; autos and other transportation equipment; and chemicals. Furniture, paper products, and electrical equipment were among those that contracted.
Construction spending rose 1.4 percent in August, the Commerce Department said. The increase followed a 1.4 percent drop in July, which had been the biggest setback in six months.
Analysts noted that much of the increase stemmed from a jump in spending on government projects, such as roads and schools. But with many states and cities short of cash, gains of that size aren’t expected to continue.
And private construction is still not healthy.
“The pickup in the pace of spending was … not a sign of revival in private demand,” said John Ryding, an economist at RDQ Economics, in a note to clients.
Building activity reached a seasonally adjusted annual rate of $799.1 billion. That’s 4.8 percent above an 11-year low hit in March. But it’s barely more than half the $1.5 trillion pace considered healthy.
The world is not an easy place in which to invest these days. To make any headway, investors must exhibit the patient determination of an explorer such as Marco Polo.
“There are really no bright spots, but you can find values,” asserted Daniel O’Keefe, lead portfolio manager of Artisan Global Value Investor Fund (ARTGX). “The greatest times to invest are during periods of greatest uncertainty, which, while not psychologically comfortable, is the way it works low interest rate personal loans.”
The current global environment should not alter anyone’s long-term investing strategy, O’Keefe said. Given current stock valuations and the cleaner balance sheets of most companies, over a reasonable period of time you are going to do well investing globally, he predicted.
“We own shares of two European banks
In a significant new blow to al-Qaida, U.S. airstrikes in Yemen on Friday killed Anwar al-Awlaki, an American militant cleric who became a prominent figure in the terror network’s most dangerous branch, using his fluent English and Internet savvy to draw recruits for attacks in the United States.
The strike was the biggest U.S. success in hitting al-Qaida’s leadership since the May killing of Osama bin Laden in Pakistan. But it raises questions that other strikes did not: Al-Awlaki was an American citizen who has not been charged with any crime. Civil liberties groups have questioned the government’s authority to kill an American without trial.
The 40-year-old al-Awlaki was for years an influential mouthpiece for al-Qaida’s ideology of holy war, and his English-language sermons urging attacks on the United States were widely circulated among militants in the West.
But U.S. officials say he moved into a direct operational role in organizing such attacks as he hid alongside al-Qaida militants in the rugged mountains of Yemen. Most notably, they believe he was involved in recruiting and preparing a young Nigerian who on Christmas Day 2009 tried to blow up a U.S. airliner heading to Detroit, failing only because he botched the detonation of explosives sewn into his underpants.
Yemen’s Defense Ministry said another American militant was killed in the same strike alongside al-Awlaki _ Samir Khan, a U.S. citizen of Pakistani heritage who produced “Inspire,” an English-language al-Qaida Web magazine that spread the word on ways to carry out attacks inside the United States. U.S. officials said they believed Khan was in the convoy carrying al-Awlaki that was struck but that they were still trying to confirm his death. U.S. and Yemeni officials said two other militants were also killed in the strike but did not immediately identify them.
Washington has called al-Qaida in the Arabian Peninsula, as the branch in Yemen is called, the most direct threat to the United States after it plotted that attack and a foiled attempt to mail explosives to synagogues in Chicago.
In July, U.S. Defense Secretary Leon Panetta said al-Awlaki was a priority target alongside Ayman al-Zawahri, bin Laden’s successor as the terror network’s leader.
The Yemeni-American had been in the U.S. crosshairs since his killing was approved by President Barack Obama in April 2010 _ making him the first American placed on the CIA “kill or capture” list. At least twice, airstrikes were called in on locations in Yemen where al-Awlaki was suspected of being, but he wasn’t harmed.
Friday’s success was the result of counterterrorism cooperation between Yemen and the U.S. that has dramatically increased in recent weeks _ ironically, even as Yemen has plunged deeper into turmoil as protesters try to oust President Ali Abdullah Saleh, U.S. officials said.
Apparently trying to cling to power by holding his American allies closer, Saleh has opened the taps in cooperation against al-Qaida. U.S. officials said the Yemenis have also allowed the U.S. to gather more intelligence on al-Awlaki’s movements and to fly more armed drone and aircraft missions over its territory than ever before.
The operation that killed al-Awlaki was run by the U.S. military’s elite counterterrorism unit, the Joint Special Operations Command _ the same unit that got bin Laden.
A U.S. counterterrorism official said American forces targeted a convoy in which al-Awlaki was traveling with a drone and jet attack and believe he’s been killed. The official was not authorized to speak publicly and spoke on condition of anonymity.
The Yemeni government announced that al-Awlaki was “targeted and killed” around 9:55 a.m outside the town of Khashef in mountainous Jawf province, 87 miles (140 kilometers) east of the capital Sanaa. It gave no further details.
Local tribal and security officials said al-Awlaki was traveling in a two-car convoy with two other al-Qaida operatives from Jawf to neighboring Marib province when they were hit by an airstrike. They said the other two operatives were also believed dead. They spoke on condition of anonymity because they were not authorized to talk to the press.
Al-Awlaki, born in New Mexico to Yemeni parents, began as a mosque preacher as he conducted his university studies in the United States, and he was not seen by his congregations as radical. While preaching in San Diego, he came to know two of the men who would eventually become suicide-hijackers in the Sept. 11, 2001 attacks on the World Trade Center and the Pentagon. The FBI questioned al-Awlaki at the time but found no cause to detain him.
In 2004, al-Awlaki returned to Yemen, and in the years that followed, his English-language sermons _ distributed on the Internet _ increasingly turned to denunciations of the United States and calls for jihad, or holy war. The sermons turned up in the possession of a number of militants in the U.S. and Europe arrested for plotting attacks.
Al-Awlaki exchanged up to 20 emails with U.S. Maj. Nidal Malik Hasan, alleged killer of 13 people in the Nov. 5, 2009, rampage at Fort Hood. Hasan initiated the contacts, drawn by al-Awlaki’s Internet sermons, and approached him for religious advice.
Al-Awlaki has said he didn’t tell Hasan to carry out the shootings, but he later praised Hasan as a “hero” on his Web site for killing American soldiers who would be heading for Afghanistan or Iraq to fight Muslims.
In New York, the Pakistani-American man who pleaded guilty to the May 2010 Times Square car bombing attempt told interrogators he was “inspired” by al-Awlaki after making contact over the Internet.
After the Fort Hood attack, al-Awlaki moved from Yemen’s capital, Sanaa, into the mountains where his Awalik tribe is based and _ it appears _ grew to build direct ties with al-Qaida in the Arabian Peninsula, if he had not developed them already. The branch is led by a Yemeni militant named Nasser al-Wahishi.
Yemeni officials have said al-Awlaki had contacts with Umar Farouk Abdulmutallab, the accused would-be Christmas plane bomber, who was in Yemen in 2009. They say the believe al-Awlaki met with the 23-year-old Nigerian, along with other al-Qaida leaders, in al-Qaida strongholds in the country in the weeks before the failed bombing.
Al-Awlaki has said Abdulmutallab was his “student” but said he never told him to carry out the airline attack.
The cleric is also believed to have been an important middleman between al-Qaida militants and the multiple tribes that dominate large parts of Yemen, particular in the mountains of Jawf, Marib and Shabwa province where the terror group’s fighters are believed to be holed up.
Last month, al-Awlaki was seen attending a funeral of a senior tribal chief in Shabwa, witnesses said, adding that security officials were also among those attending. Other witnesses said al-Awlaki was involved in negotiations with a local tribe in Yemen’s Mudiya region, which was preventing al-Qaida fighters from traveling from their strongholds to the southern city of Zinjibar, which was taken over recently by Islamic militants. The witnesses spoke on condition of anonymity for fear of reprisals and their accounts could not be independently confirmed.
Yemen, the Arab world’s most impoverished nation, has become a haven for hundreds of al-Qaida militants. The country has also been torn by political turmoil as President Saleh struggles to stay in power in the face of seven months of protests. In recent months, Islamic militants linked to al-Qaida have exploited the chaos to seize control of several cities in Yemen’s south, including Zinjibar.
A previous attack against al-Awlaki on May 5, shortly after the May raid that killed Osama bin Laden, was carried out by a combination of U.S. drones and jets.
Top U.S. counterterrorism adviser John Brennan has said cooperation with Yemen has improved since the political unrest there. Brennan said the Yemenis have been more willing to share information about the location of al-Qaida targets, as a way to fight the Yemeni branch challenging them for power.
Yemeni security officials said the U.S. was conducting multiple airstrikes a day in the south since May and that U.S. officials were finally allowed to interrogate al-Qaida suspects, something Saleh had long resisted, and still does so in public. The officials spokes on condition of anonymity to discuss intelligence issues.
____
AP correspondent Matt Apuzzo and AP Intelligence Writer Kimberly Dozier in Washington contributed to this report.
Fresh from fending off a takeover bid by rival ConAgra Foods, Ralcorp Holdings appears poised to expand its corporate headquarters in downtown St. Louis.
St. Louis aldermen today will receive legislation proposing tax breaks for the foodmaker, which would sign a 10-year lease and improve and expand its space in the Bank of America Plaza at 8th and Market streets downtown.
The bill would offer Ralcorp $20 million in bond financing and property tax breaks on new equipment. The company is expected to spend $6.9 million on improvements.
The company employs 400 people in the office tower and is expected to hire more over the course of the deal.
Ralcorp’s lease is expiring and the company looked at other sites around the region, but decided to negotiate with its current landlords to stay put and expand in place.
“We evaluated many opportunities, and determined that versus moving, expanding our square footage and investing in this space would best serve our business, our employees, our shareholders and the St. Louis community,” said the company’s co-chief executive officers, Kevin Hunt and David Skarie, in a statement.
The chief executive of UBS says he feels responsible but not guilty for the $2 billion loss a rogue trader has caused the Swiss bank.
Oswald Gruebel told the Swiss weekly Der Sonntag in an interview Sunday he also isn’t thinking about resigning.
Gruebel was brought in more than two years ago to lead UBS out of a series of missteps that have heavily damaged the biggest Swiss bank’s reputation. He told the paper in his first interview since UBS announced the loss Thursday that he was “responsible for everything that happens at the bank electronic check payday advance.”
He added “but if you ask me whether I feel guilty, then I would say no.”
A 31-year-old trader, Kweku Adoboli, is being held in London on charges of fraud and false accounting.
Powered by WordPress -- XHTML 1.0