Monday PM January 19th, 2009
by: Ed Mayberry, January 19, 2009 10:01:49 pm
Clear Channel Communications plans to lay off seven per cent of its workforce tomorrow, according to the Wall Street Journal, or about 1,500 employees. It's an effort to save $400 million. Most job cuts are in advertising sales, but syndication content will increasingly replace locally-produced radio shows. Clear Channel has six Houston radio stations—KTRH 740, KBME 790, KPRC 950, KKRW 93.7 FM, KTBZ 94.5 FM and KODA 99.1 FM. Clear Channel swapped KLOL 101.1 FM and KHMX 96.5 FM to CBS Radio for five other stations to satisfy merger requirements by the Department of Justice. Clear Channel merged with Boston-based leveraged buyout firm Thomas H. Lee Partners and private equity group Bain Capital Partners of Boston.
BASF is reducing production at some European plants and may cut additional jobs, according to Bloomberg News. More than 1,888 workers will be affected by factories reducing operations to about 75 per cent capacity. BASF has already cut 200 jobs, and further job actions might be necessary, depending on economic conditions. BASF is closing its Wilmington, North Carolina, vitamins manufacturing site by March 31st, affecting some 33 positions. But demand for crop-protection products and additives for foods remains high, according to the company.
A forecast released by the U.S. Conference of Mayors finds only five metropolitan areas in the U.S. will escape job losses this year. The biggest city, New York, is expected to take the biggest jobs hit as Wall Street companies slash thousands from their payrolls. Overall, the New York area is expected to lose 181,000 jobs in 2009. The Los Angeles area is expected to see 164,000 lost jobs, in part because of the huge drop in home prices that has punctured the California economy. The Miami area is expected to lose 85,000 jobs. The projection by IHS Global Insight sees the Chicago area shedding about 80,000. Unemployment is expected to top ten percent in 70 areas, from already hard-hit cities like Detroit and Cleveland to places that had until recently been prosperous like the Riverside-San Bernardino area in California. Other big cities like Denver and St. Louis are expected to see unemployment rise above nine per cent. Ithaca, N.Y.; Fairbanks, Alaska; and St. George, Utah, are among the handful of the nation's 363 metropolitan areas expected to see employment remain flat or increase slightly.
The Conference Board's latest quarterly report indicates CEO confidence in the U.S. economy is at an all-time low. About 100 business leaders were surveyed. The director of the New York City-based Conference Board Consumer Research Center says the erosion is "a reflection of the rapid and severe deterioration in economic conditions experienced in the final months of 2008." About 80 per cent say they don't expect any change in the economy during the first six months of the year.
The Southwest Regional Office of the U.S. Bureau of Labor Statistics says the Houston Consumer Price Index registered a two-month 2.7 per cent decline. The biggest factor in the decline was a 17.9 per cent decrease in the transportation index, as gasoline prices dropped 47.4 per cent in that period. Clothing, other goods and services, food and beverages and recreation also registered decreases. The all-items CPI for Houston edged down 0.2 per cent in Houston.
Houston-based Noble Energy is announcing its biggest natural gas field off Israel's coast in the Mediterranean Sea. Exploratory drilling indicates three trillion cubic feet of gas. That's roughly the same amount of the company's existing gas reserves. Noble operates the well and owns a 36 per cent stake in the project.
Goldman Sachs Group is paying $6.95 million to Enron creditors to settle claims over debt payments. Goldman Sachs was accused of helping the collapsed energy trader make early payments of more than $1 billion to commercial paper investors about a month before Enron's bankruptcy. Commercial paper is an unsecured, short-term loan issued by a corporation. Enron sued Goldman and about 175 other firms in 2003 as it worked to pay off creditors. It adds to more than $22 billion in recoveries for creditors.
A years-long fight between the Navajo Nation and El Paso Natural Gas over a pipeline right of way easement has been settled. The two sides have reached a deal that will pay the tribe about $350 million over 20 years. That's more than ten times what the previous lease brought in for the tribe, which battled fiercely for higher payments when it expired in 2005. The tribe and the Houston-based company reached an agreement on the economic terms of a lease last year, but jurisdictional issues remained a sticking point. The tribal council's resources committee finally approved the agreement earlier this month. It still must go before the U.S. Bureau of Indian Affairs, but that is considered a formality.
Meijer is recalling two types of crackers and two varieties of ice cream due to possible salmonella contamination. Meijer brand cheese and peanut butter and toasty peanut butter sandwich crackers and peanut butter and jelly and peanut butter cup ice cream are being recalled. The Grand Rapids-based grocer and retailer said in a news release that the makers of the products have announced possible contamination. The products are sold in Meijer stores and gas stations in Michigan, Ohio, Indiana, Illinois and Kentucky. A salmonella outbreak has killed at least six people and sickened more than 470 others in Michigan and 42 other states.
Russia and Ukraine have signed a deal that restores natural gas shipments to Ukraine and paves the way for an end to the nearly two-week cutoff of most Russian gas to a freezing Europe. The agreement was signed by the heads of the Russian state-run natural gas monopoly Gazprom and its Ukrainian counterpart Naftogaz. The signing was witnessed by Russian Prime Minister Vladimir Putin and Ukrainian counterpart Yulia Tymoshenko. Putin says that Gazprom had received orders to resume shipments bound for Europe, which had been cut since January 7th as Moscow and Kiev argued over price and allegations that Ukraine was stealing gas destined for Europe. Officials say the restored gas shipments could take up to 36 hours to cross Ukraine and reach European customers.
The Houston City Council last week approved changing the name of Ellington Field to Ellington Airport. The name change is designed to enhance efforts to market Ellington to general aviation and commercial developers, according to the Houston Airport System's Rick Vacar. Ellington Airport has three runways and more than 300 available acres for development.
The Rice Alliance for Technology and Entrepreneurship has been recognized by the United States Association for Small Business and Entrepreneurship as having the Most Outstanding Entrepreneurship Program. The Rice Alliance is Rice University's flagship entrepreneurship program, providing entrepreneurship education and supporting the commercialization of technology innovations and the creation of new companies. Evaluation criteria includes innovation and uniqueness, quality and effectiveness, completeness and comprehensiveness, sustainability and transferability.