All about business

The question is being raised more and more: Can Toyota recover its reputation?

There is no simple answer. The automaker once enjoyed exceptional renown. In addition to being the largest and most profitable auto company on the planet, Toyota was the most studied and copied. Its production system became a benchmark and a model for competitors to emulate around the world.

On top of that, Toyota (TM) was known for always putting the customer first, hence its passion for building cars with the highest quality and reliability. The automaker obsessively studied car buyers to find out what they wanted and then provided it for them. It became a leader in new vehicle segments like crossovers, and new technologies like gas-electric hybrids.

But when a crisis arose in the form of complaints about unintended acceleration, Toyota didn’t know what to do. Rather than make a forthright statement about the problem, its history, and its proposed solution, the automaker responded with obfuscation, delay, blame-shifting, and denial.

Not until last August, when a Lexus driven by an off-duty California highway patrolman rolled over and burst into flames, killing the driver and three members of his family, did the issue reach widespread public awareness. And when the time came to apportion responsibility for the incident and outline a new direction for the company, top Japanese executives were nowhere to be seen. When president Akio Toyoda first came forward to take responsibility and promise solutions, he seemed to do so with reluctance.

Compare that to the Tiger Woods scandal. Like Toyota, Woods had a reputation for excellence that far exceeded other golfers.

Like Toyota, Woods was widely emulated for his faultless behavior and superb sportsmanship.

Like Toyota, Woods initially put out a story about his wife, a golf club, and the shattered windows of his SUV that bore little relation to reality.

Like Toyota, the news about Woods’ missteps was allowed to trickle out day by day without being effectively refuted.

Like Toyota, Woods refused to make a public appearance to apologize for his misdeeds (and still hasn’t), preferring to issue press releases instead.

And like Toyota, Woods promised to mend his ways, without offering any convincing evidence of exactly how he will do that.

Just as Toyota has seen sales crumble and its used car values plummet, Woods has been abandoned by his corporate sponsors and shunned by other golfers business cards design.

Does this mean that Tiger and Toyota have seen their reputations permanently destroyed? Witnessed the domination of their respective enterprises ended? Are about to be permanently consigned to the ranks of the disgraced and the second-rate?

The betting here is that the answer to all three questions is "no."

Tiger Woods remains one of the best golfers in history, and assuming he can regain his form and start to win again, his fans will return.

The American public has a short memory, an inclination to forgive, and a willingness to extend second-chances. History is full of examples. After declaring he was leaving politics in 1962, Richard Nixon came back and was elected president in 1968. There have lately been reports that Eliot Spitzer, who resigned in disgrace as governor of New York two years ago, is considering a comeback of his own, thanks to an understanding electorate.

The same is true with Toyota, although the reasoning is more economic and less emotional.

American customers want to buys cars they like, and if they decide they still like Toyotas, they will continue to buy them. Ford (F, Fortune 500) was rattled by the Explorer-Firestone tire crisis in 2001, but it eventually recovered because the Explorer was a popular SUV.

Rehabilitation comes down to dollars and cents. If Toyota can convince shoppers that it still offers a strong value, then they will find their way to Toyota dealers.

The critical ingredient that is still missing from the rehabilitation of both Tiger and Toyota is that convincing personal apology. Tiger hasn’t been seen in public since the night of the accident and needs to make a believable account of his behavior along with a statement of his determination to change.

Likewise, Toyota president Akio Toyoda, as well as his management team, must make a complete explanation of their response to unintended acceleration and answer a comprehensive set of questions from outside experts. Only then will its slate be wiped clean, and Toyota will be free to begin the long process of rebuilding its reputation. 

Source

In need of some fash cash? Get instant approval. Apply now for a payday loan or faxless cash advance.

JetBlue inaugurated new service between Orlando and Montego Bay, Jamaica, on Feb. 8 with a daily round-trip flight out of Orlando International Airport.

Montego Bay is the 23rd nonstop destination served by JetBlue from Central Florida. The airline offers flights to six other destinations in the Caribbean and Latin America: Bogota, Colombia; Cancun, Mexico; Nassau, Bahamas; San Jose, Costa Rica; Santo Domingo, Dominican Republic; and Aguadilla, Ponce and San Juan, Puerto Rico.

JetBlue Airways (Nasdaq: JBLU) currently serves 60 cities with 600 daily flights.

Source

Investor Stacy Hastie says One City Centre will soon look more like 600 Washington, the new name given to the downtown St. Louis office tower, which will undergo a $29 million overhaul.

An investment entity managed by Hastie bought the 25-story building Wednesday by placing the only bid — $12.7 million — at a foreclosure sale. The sale extinguished the interest held by Pyramid Cos., which had planned to renovate One City Centre as part of its ambitious Mercantile Exchange project. Financial problems forced Pyramid to close in 2008.

Hastie is part of the effort to redo One City Centre and St. Louis Centre, a former mall that will be converted largely to parking. He said the foreclosure "is a big step forward" and means work is about to begin to move the building’s entrance to Washington Avenue. The building’s new name will reflect the reconfiguration.

In two weeks, the law firm Lewis, Rice & Fingersh will move to One City Centre, while LarsonAllen, an accounting firm, will move its St. Louis County offices to the building by June 1, Hastie said.

The foreclosure occurred a day after the Missouri Development Finance Board, a state agency, approved a $5 million loan for the One City Centre overhaul. It will be packaged with about $15 million in funds and debt from Hastie’s entities and $10.1 million in tax credits and city funds to pay for the rehab.

Less certain is the future of the Arcade building, at 800 Olive Street, which another Hastie-run investment entity bought out of foreclosure Wednesday. Hastie’s $9 million bid gave him control of the building, which Hastie plans to sell to another developer.

Earlier this week, investment entities managed by Hastie agreed to pay off the loans Bank of America made to Pyramid for the One City Centre and Arcade projects. Conversion of the Arcade into condos was under way in 2007 when Pyramid halted work. Bank of America filed a foreclosure notice in early December.

Source

Missouri may have given birth to “Mad Men” star Jon Hamm and Grammy-winning singer Sheryl Crow but the state ranks 44th on a list of the best-looking states.

In light of Miss Virginia winning the Miss America crown Saturday, The Daily Beast ranked the states based on the hometowns of the winners of the Miss America and Miss USA pageants for the past decade, more than 300 male and female fashion models and the 125 men mentioned in 10 years’ worth of People’s “Sexiest Man Alive” issues. The list also factored in health and fitness data for each state from 2006-2008, ranked by the Trust for America’s Health.

Illinois, home of supermodel Cindy Crawford, comes in at No. 11.

Washington, D.C., ranked No. 1 for its beautiful people, and North Dakota came in last.

Source

The National Hockey League said Friday night it has signed a letter of intent to sell the financially struggling Phoenix Coyotes to a new ownership group from Toronto.

"The NHL and Ice Edge Holdings announced today that they have entered into a letter of intent to proceed in attempting to document and close a proposed transaction pursuant to which Ice Edge would purchase the Phoenix Coyotes’ franchise. While much remains to be done, the NHL looks forward to working closely with Ice Edge to bring the sale to conclusion as expeditiously as possible. Ice Edge has committed to keep the Coyotes in Glendale, Arizona," NHL Commssioner Bill Daly said in a statement.

The Coyotes are in Chapter 11 bankruptcy and were bought by the NHL in October for $140 million.

Ice Edge investors include Canadians and Americans. The group wants to keep the team in Arizona but previously had talked about playing some home games in Canadian cities without NHL teams.

Ice Edge needs to finalize the purchase of the Coyotes from the NHL and then will work on an arena lease deal with the city of Glendale. The Phoenix suburb owns Jobing.com Arena where the Coyotes play.

"The city of Glendale is pleased that the National Hockey League has concluded the initial negotiations for the sale of the Coyotes and is entering into a letter of intent with Ice Edge Holdings to immediately assume operations of the team Faxless payday loans. The transfer of ownership and possession to Ice Edge Holdings is a major and final step in establishing the long-term presence of hockey in Glendale, Arizona," Glendale said in a statement.

Source

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.

Source

Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., said Chinese growth is likely to be hurt by an absence of consumer demand from trading partners such as the U.S.

“The Chinese, I suspect, will have a bubble of their own to confront,” Gross said in a Bloomberg Television interview yesterday from Pimco’s headquarters in Newport Beach, California. “It’s gearing up for export that doesn’t find an end consumer, that’s the real problem in China.”

The “systemic risk” of new asset bubbles in global economies and markets is rising with the Federal Reserve keeping interest rates at record lows, Gross wrote in his December investment outlook posted on Pimco’s Web site yesterday. Under what Pimco has termed the “new normal,” investors should be prepared for lower-than-average historical returns with heightened government regulation, lower consumption, slower growth and a shrinking global role for the U.S. economy.

“With unemployment in the double digits and likely to stay close to that for the next six months despite job creation ahead, the Fed has nowhere to go,” Gross, co-founder and co- chief investment officer of Pimco, said on Bloomberg Television.

Fed Chairman Ben S. Bernanke said after a Nov. 16 speech in New York that it’s “not obvious” that asset prices in the U.S. are out of line with underlying values after a 64 percent jump in the Standard & Poor’s 500 Index from its March low.

Negative Rates

Treasury three-month bill rates turned negative yesterday for the first time since financial markets froze last year on concern that the rally in higher-yielding assets has outpaced the prospects for economic growth. The two-year note yield touched 0.68 percent, the least since Dec. 19.

The Fed cut its target rate for overnight lending between banks to a range of zero to 0.25 percent in December. Policy makers reiterated on Nov. 4 that they intended to keep the rate at the record low for an extended period.

The “heavy lifting” will likely be done first by other central banks such as those in Australia and Norway that have already begun to increase interest rates, Gross wrote cashadvance.

“China may abandon its dollar peg within six months’ time and with it, its own easy monetary policy that has fostered more significant mini-bubbles of lending and asset appreciation on the Chinese mainland,” he added.

China’s Currency

China has kept its currency at about 6.83 per dollar since July 2008 to help sustain exports amid a global economic slump.

China’s trade surplus in October almost doubled from the previous month, to $24 billion. The nation, with the world’s largest foreign-exchange reserves of $2.3 trillion, is the biggest creditor to the U.S., holding $798.9 billion of Treasuries as of September.

“With renewed upward appreciation of the yuan may come potentially volatile global asset price reactions to the downside — higher Treasury yields, and lower stock prices — which the Fed must surely be leery of before making any upward move, of its own,” Gross wrote.

The U.S. economy grew in the third quarter for the first time in more than a year as gross domestic product increased 3.5 percent from July through September after shrinking the previous four quarters, a Commerce Department report showed on Oct. 29.

Gross advised following the lead of billionaire investor Warren Buffett on buying utilities because their earnings growth will mimic U.S. economic growth and provide steady dividend income. Buffett’s Berkshire Hathaway Inc. agreed this month to take over Burlington Northern Santa Fe Corp., the No. 1 U.S. railroad, for $26 billion.

Fund Returns

The Total Return Fund managed by Gross boosted its investment in Treasuries, so-called agency debt and other government-linked bonds to 48 percent of assets in September from 44 percent in August, according to Pimco’s Web site. The holdings were the most since August 2004.

The $192.56 billion Total Return Fund returned 18.29 percent in the past year, beating 54 percent of its peers, according to data compiled by Bloomberg. The one-month return is 1.11 percent, outpacing 59 percent of its competitors. Pimco is a unit of Munich-based insurer Allianz SE.

Source

Stocks recovered from early losses Tuesday, closing at 13-month highs for the second day in a row, as strength in commodity-linked shares offset weakness in the retail sector.

The Dow Jones industrial average (INDU) rose about 30 points, or 0.3%, to close at 10,437.42. The S&P 500 (SPX) gained 1 point to close above the key 1,100 level. The Nasdaq composite (COMP) advanced 0.3% to end at 2,203.78.

All three indexes are at their highest levels since October 2008.

Stocks opened lower and struggled for most of the day as the dollar regained ground against rival currencies, reflecting a decreased appetite for risky assets.

The tone improved in the last few hours of trading as oil and gold prices reversed direction. Oil closed above $79 a barrel, while gold edged up to settle at a fresh all-time high.

The rebound in commodity prices boosted shares of energy and materials companies. But gains were limited by weakness in the retail sector after Home Depot and Target offered cautious earnings outlooks.

Tuesday’s economic news was mixed. Government data showed inflation at the wholesale level remains subdued, while industrial production was weaker than expected in October.

Ryan Larson, senior equity trader at Voyager Asset Management, said the stock market continues to look to the dollar for direction.

"The main story has been the dollar trade," he said. "When the dollar is weak, investors take on more risk. If it’s strong, they take the risk off."

The dollar has wallowed near a 15-month low against rival currencies in recent weeks as investors take advantage of U.S. interest rates near zero percent to fund bets in more risky stock and commodities markets.

However, after pushing the major indexes up some 30% from the lows of early March, investors have become wary of placing big bets as the economic outlook remains cloudy.

"The economy is growing, but shows a loss of momentum given the recent round of economic and corporate data," said Nick Kalivas, vice president of financial research at MF Global.

Investors will digest reports on consumer prices and initial construction of new homes Wednesday morning. Later in the week, the government will report on the number of Americans filing first-time claims for unemployment benefits.

Stocks rallied Monday as investors bet on the weak dollar and Federal Reserve Chairman Ben Bernanke said interest rates will remain low amid a slow recovery.

Economy: The government reported that the Producer Price Index, the key measure of inflation for manufacturers, edged up 0 cash till payday.3% in October. Core PPI, which excludes volatile food and energy prices, fell 0.6%.

The PPI was expected to have risen 0.5% for the month, according to a consensus of economist opinion from Briefing.com. The core was expected to have edged up 0.1% in October.

Before the start of market trading, the government also reported that industrial production rose 0.1% last month versus a forecasted 0.4% increase. In September, production rose 0.7%. Capacity utilization rose by 0.2 percentage point to 70.7%, a rate slightly below economists’ expectations for 70.8%.

Companies: Home Depot (HD, Fortune 500) reported a decline in third-quarter earnings to 41 cents per share from 45 cents in the year-ago quarter. While the results were better than 36 cent per share profit that analysts had expected, the company said it expects earnings for the full year to be down 13%.

Discount retailer Target (TGT, Fortune 500) reported an 18% increase in third-quarter profit, helped by gains in the company’s credit card portfolio. But Target, which had suffered declining profits for the last eight quarters, remained cautious about the outlook for holiday spending.

TJX (TJX, Fortune 500), which owns the T.J. Maxx and Marshalls chains, reported a larger-than-expected quarterly profit on increased consumer demand for discount products. The company said it expects profit from continuing operations of 65 cents to 71 cents per share in the fourth quarter. Analysts surveyed by Thomson Reuters are forecasting a profit of 71 cents per share in the fourth-quarter.

On the higher end, Saks (SKS) reported a quarterly profit, surprising analysts who were expecting the company to report a loss. However, the results were driven mostly by cost-cutting, and the company offered a cautious outlook.

International markets: The Nikkei and the Hang Seng each closed lower by a fraction of a percent. European markets ended with losses of less than 1%.

Other markets: Treasury prices rose, with the yield on the 10-year note falling to 3.33%.

The weak dollar recovered a little Tuesday. The dollar index, which measures the U.S. currency against a basket of rivals, was up 0.7% to 75.38 from 74.92.

Oil prices rose 24 cents to settle at $79.14 barrel in New York.

The price of gold closed at an all-time high of $1,139.40 an ounce, up 20 cents from Monday’s record close of $1,139.80. 

Source

U.S. President Barack Obama said on Sunday the world economy was on a path to recovery but warned that failure to re-balance the global economic system would lead to further crises.

Obama was addressing Asia Pacific leaders in Singapore, where officials removed any reference to market-oriented exchange rates in a communique after disagreement between Washington and Beijing over the most sensitive topic between the two giants.

The statement from the Asia Pacific Economic Cooperation (APEC) forum endorsed stimulus measures to keep the global economy from sliding back into recession and urged a successful conclusion to the Doha Round of trade talks in 2010.

An earlier draft pledged APEC’s 21 members to maintain “market-oriented exchange rates that reflect underlying economic fundamentals.”

That statement had been agreed at a meeting of APEC finance ministers on Thursday, including China, although it made no reference to the Chinese yuan currency.

An APEC delegation official who declined to be identified said debate between China and the United States over exchange rates had held up the statement at the end of two days of talks.

That underscored strains likely to feature when Obama flies to China later on Sunday after Washington for the first time slapped duties on Chinese-made tires.

Beijing fears that could set a precedent for more duties on Chinese goods that are gaining market share in the United States.

Obama told APEC leaders the world could not return to the same cycles of boom and bust that sparked the global recession.

“We cannot follow the same policies that led to such imbalanced growth. If we do, we will continue to drift from crisis to crisis, a failed path that has already had devastating consequences for our citizens, our businesses, and our governments,” Obama said.

“We have reached one of those rare inflection points in history where we have the opportunity to take a different path — to pursue a new strategy for jobs and growth. Growth that is balanced. Growth that is sustainable.”

Obama’s strategy calls for America to save more, spend less, reform its financial system and cut its deficits and borrowing. Washington also wants key exporters such as China to boost domestic demand.

YUAN ON THE AGENDA Chinese President Hu Jintao has been under pressure to let the yuan appreciate, but in several speeches at APEC he ignored the issue and focused instead on what he called “unreasonable” trade restrictions on developing countries.

One of the key themes when Obama visits China for three days will be the yuan, which has effectively been pegged against the dollar since mid-2008 to cushion its economy from the downturn.

Washington says an undervalued yuan is contributing to imbalances between the United States and the world’s third-biggest economy. China is pushing for U.S. recognition as a market economy and concessions on trade cases that would make it harder for Washington to take action against Chinese products. 

Read more

Opel’s top German labor leader said on Sunday he was willing to hold negotiations over a restructuring of the European carmaker under its parent General Motors so long as it gains greater independence.

Klaus Franz was shocked last week when GM’s board abruptly dropped plans to sell a 55 percent stake in Opel to auto parts maker Magna and its Russian bank partner Sberbank.

“GM does not enjoy any credibility or faith in the eyes of the public or the (German) government, so they have to consider whether they now want to seek confrontation or cooperation by finding a common solution,” Franz told Reuters on Sunday.

“To see whether they are interested in cooperation, we need to know whether they are willing to start off where we last stopped — namely, the degree of autonomy and freedom that was set in the contract with Magna and accepted by General Motors,” he said.

He said this was a clear condition for any talks. GM’s chief executive, Fritz Henderson, is due to travel to Opel’s headquarters in Ruesselsheim this week and is expected to discuss the decision with local management on Monday.

Following the sudden decision last week to drop the sale management scared unions by threatening Opel’s bankruptcy and its German boss Carl-Peter Forster left the company after attacking the board’s decision.

A newspaper report said on Sunday that Forster, a former BMW executive and son of a German diplomat who grew up in London, is now slated to take over as head of Indian group Tata Motors’ British carmaker Jaguar Land Rover.

Briton Nick Reilly, currently head of GM’s international operations, is now set to lead the reorganization of Opel, a person briefed on the plan told Reuters on Friday, with GM’s global marketing chief Bob Lutz to be Opel’s new chairman.

Lutz was quoted as saying on Sunday that GM would probably stick to a plan to slash fixed costs at Opel by nearly a third. “The restructuring plan developed at the end of last year is still the basis for a profitable business model. The plan foresees a 30 percent cut in structural costs,” he told Swiss newspaper Sonntag.

Meanwhile Magna’s top European executive, Siegfried Wolf, advised GM to give more freedom to Opel and tread carefully with regard to the brand.

“GM must now smooth things out and win back trust. That requires a lot of sensitivity and tact,” he was quoted as telling German newspaper Bild am Sonntag.

(Reporting by Christiaan Hetzner, additional reporting by Emma Thomasson in Zurich; Editing by Greg Mahlich)

Read more