Wednesday AM June 18th, 2008
by: Ed Mayberry, June 17, 2008 4:06:00 am
The government says wholesale prices bolted ahead in May at the fastest pace in six months as energy and food prices marched higher. The Labor Department reports that its producer price index, which measures the costs of goods before they reach store shelves, shot up 1.4 percent in May. That was up from a modest 0.2 percent rise in April and marked the biggest increase since November.
Industrial production dipped in May, underscoring the strain on factories from the deep housing slump. The Federal Reserve reported that output at the nation's factories, mines and utilities fell 0.2 percent in May, following a 0.7 percent decline in April. The latest report on manufacturing activity disappointed economists. They were forecasting a tiny 0.1 percent rise in overall production.
Lawmakers are looking to give the Commodity Futures Trading Commission more power. Many lawmakers believe that part of the run-up in gas prices is the work of speculators operating in the energy futures markets. So they want to give the CFTC more manpower and more information. One proposal would require that the commission be told about all trades in the oil futures markets. It would then investigate the impact of those trades on the price of oil. The CFTC is already investigating market manipulation.
Republicans have prevented the Senate from taking up a bill that extends more than $50 billion in business and individual tax credits that have expired or are about to expire. GOP opponents of the bill objected to Democratic plans to pay for it by bringing in more revenue from hedge fund managers and multinational companies. Republicans said tax relief should not be matched by what they said were tax hikes. They also blocked consideration of the bill last week. The vote to take up the bill was 52-44. It takes 60 votes to bring a bill to the Senate floor.
The Federal Reserve continues its efforts to help banks overcome credit problems, auctioning another $75 billion in loans. In the latest auction, commercial banks paid an interest rate of 2.360 percent for the short-term loans, with 76 bidders for the slice of $75 billion in 28-day loans. The Monday auction was the 14th since the program began in December. Smoothing the flow of credit lets people finance big-ticket purchases, such as homes and cars, and helps businesses expand operations and hire workers.
The Harris County Commissioners Court and the Houston City Council have jointly re-appointed Jim Edmonds as chairman of the Port Commission of the Port of Houston Authority. Edmonds has served as chairman since 2000, overseeing the construction of the Bayport Container Terminal. Port commissioners serve two-year terms without pay.
Health insurance companies frequently rate doctors. Now, doctors are rating the health insurance industry. The doctors' rating of the industry, including Medicare, is based on how fast and how much of the billed claim insurers pay. And how did they do? Well, in the three million claims analyzed by the American Medical Association, Medicare was the best for doctors among the eight plans, paying 98 percent of the contracted rate. United Healthcare was at the bottom of the list with 62 percent, and Aetna had a rating of 71 percent. Doctors say they spend 14 percent of their total revenue processing paperwork just to get what's coming to them. They hope to change that by negotiating better contracts with insurers.
Real estate services firm Jones Lang Lasalle says it's buying the Staubach Company in a cash-and-stock transaction. Chicago-based Jones Lang will pay $613 million over five years for the realty firm founded in 1977 by former Dallas Cowboys quarterback Roger Staubach. Of that, $123 million will be in cash and $100 million in stock at closing, with the balance payable in cash over five years. Jones Lang will also pay up to $114 million more, depending on whether Dallas-based Staubach reaches performance goals. Roger Staubach will join the Jones Lang board as executive chairman, Americas. Staubach Chief Executive Greg O'Brien will join Jones Lang as CEO of Brokerage in the Americas. No local layoffs are anticipated, according to the managing director of the Houston office. The Staubach Company is one of the nation's largest independent real estate brokerage firms, helping clients find office, industrial and retail space. It has more than 70 offices in North America and about 1,600 employees. Jones Lang says the deal will strengthen its tenant-representation business and add to earnings per share beginning next year. The deal doesn't include Staubach Retail Services or Cypress, which is Staubach's investment development business.
The Liverpool Soccer Club's feuding American owners have been invited to appear before a British parliamentary inquiry. Liverpool co-owners Tom Hicks and George Gillett, Jr., along with Manchester City's Thaksin Shinawatra, have been asked to appear before the all-party Parliamentary Football Group. The British lawmakers are investigating problems involving how English Premier League teams are being run. The lawmakers share fans' concerns over foreign owners and their increasing influence. Hicks and Gillett could use one of the hearings in the fall to air their grievances with each other since taking over Liverpool last year. Liverpool goalkeeper Pepe Reina echoed fans' concerns Tuesday about the club's financial situation, including substantial debts. Hicks is a Dallas businessman who owns baseball's Texas Rangers and the NHL's Dallas Stars. Gillett owns the NHL's Montreal Canadians.
Bottled water has long been seen as chic, but in a tight economy some consumers are starting to see it as a wasteful "rip-off." Marketing and beverage analysts note that people are no longer so happy to spend a dollar or more for a 20-ounce bottle of water, when tap water is nearly free. Trade figures show U.S. consumers spent $16.8 billion on bottled water last year. That's an increase in growth, but it's reported as the slowest growth rate since the early 1990's. The economic factor may be doing what environmentalists have been trying to do for years: wean people off the bottles of water touted as stylish and healthier than tap water. Many cities have enacted pro-tap campaigns. Chicago has started a five-cent tax on plastic water bottles. While it's tough to track rates of tap-water use, sales of faucet accessories--such as those that purify water--are apparently booming.