Thursday PM October 15th, 2009
by: Ed Mayberry, October 15, 2009 9:10:11 pm
Retail gasoline prices in Texas have gone up by four cents a gallon since last week. AAA Texas reports that the average price per gallon at the pump was $2.33. Prices increased two cents nationally to $2.49. Houston had the cheapest gasoline in Texas at $2.27 a gallon, while El Paso had the most expensive gasoline at $2.40. An auto club statement says a belief by economists that the recession is over and increased economic activity has led to an increase in oil and gas prices.
The number of new jobless claims has fallen to the lowest level since January. It's a sign that companies are cutting fewer workers. But economists say the drop isn't yet steep enough to signal that new hiring is taking place. The four-week average, which smoothes fluctuations, fell for the sixth straight time. The tally of people continuing to claim benefits dropped by 75,000 to 5.99 million, its first time below six million since the week of March 28th.
Inflation pressures remained modest in September even though gasoline prices edged higher. The Labor Department said that consumer prices rose 0.2 per cent last month, matching economists expectations. Prices excluding energy and food were also up 0.2 per cent, slightly higher than the 0.1 per cent increase analysts had forecast. Over the past 12 months, consumer prices are actually down 1.3 per cent, reflecting a severe recession which has kept a lid on price pressures across a wide range of products and services.
Capital One's quarterly Market Pulse survey shows Texas businesses and consumers expressing greater concern about local economic conditions. Decreased savings have them holding off on major purchases, and some businesses report a declining financial position. That triggers a more cautious outlook toward investment and hiring decisions. Some 68 per cent of small and large Texas businesses say they do not have plans to hire additional employees in the next six months. But most businesses believe economic conditions are holding steady.
Businesses that received federal contracts under the economic stimulus are reporting more than 30,000 jobs saved or created in the first months of the program. Numbers released by a government watchdog offer the first hard data on the effect of the stimulus. These numbers only reflect jobs linked to federal contracts, such as construction at military bases or within national parks. That's a tiny fraction of the $787 billion stimulus. Broader data on local spending won't be available until late this month. The job tally is part of the largest-ever attempt to measure the success of a government program in real time. While the economy is showing signs of recovering from recession, Americans continue to lose their jobs. The White House says things would have been far worse without the stimulus.
Should social security recipients get a $250 check to make up for the fact that their benefits won't rise next year? President Barack Obama says they should. But Republican Senator Judd Gregg of New Hampshire says the payments already reflect the cost of living--which declined in the past year. Still, some advocates for seniors argue that older Americans spend more on health care costs, which rise faster than consumer prices. The debate comes as the Social Security Administration confirms that there will be no cost of living increase next year for more than 50 million social security recipients, the first year without a raise since automatic adjustments were adopted in 1975. By law, the cost of living adjustments are pegged to inflation, which is negative this year because of lower energy costs. Social security payments, however, cannot go down. The announcement comes a day after Obama called for $250 payments for seniors, veterans, retired railroad workers and people with disabilities.
The receiver who took over R. Allen Stanford's businesses is suing two former employees of the Texas financier's capital management firm for more than $11 million. In court papers, Dallas lawyer Ralph Janvey said the money should be returned to investors the government alleges were defrauded in a $7 billion ponzi scheme. Janvey says the payments were for just three months work and came from revenue "not generated by legitimate business activities." The payments were made in November 2008, three months before the government filed federal charges against Stanford and his top officers. The announcement comes a day after Stanford was seen bleeding from his mouth during a criminal court hearing in Houston.
A pipeline company wants a Nebraska excavating firm to pay for the damage caused when a pipeline carrying liquid fuels like propane and butane leaked more than 70,000 gallons in 2007, and the bill could top $2 million. Houston-based Mid-America Pipeline< filed a federal lawsuit against Wilson excavating this week. The lawsuit says Wilson excavating caused the pipeline leak while trying to remove beaver dams in eastern Nebraska. Officials at Wilson excavating in Yutan, Nebraska, declined to comment because they have not seen the lawsuit. Mid-America Pipeline's attorney did not immediately respond to messages left Tuesday and Wednesday.
Nigeria's president says an amnesty granted to militants over the past two months in the oil-rich Niger Delta has restored peace to the region. The government says more than 8,000 militants have disarmed since it offered the amnesty in August. President Umaru Yar'adua said that "agitations" are over and that development must take place in the region for peace to continue. Yar'adua said there is now greater stabilization in the country's oil market. Unrest in the Delta region had cut Nigeria's oil production by about a million barrels a day. The delta's main militant group said it would not participate in the amnesty, but several top commanders and their men laid down their arms.
Kroger has opened its first Marketplace store in Richmond on Grand Parkway at Mason Road. It's a 125,000-square-foot store that also houses Ashley Furniture Fred Meyers Jewelers, Little Clinic, toys and bed and bath items.
Pilgrim's Pride says the Federal Trade Commission and Department of Justice have cleared the way for its deal with Brazilian beef producer JBS, which would help pull the chicken producer out of bankruptcy. Last month, JBS said it would buy a majority stake in Pilgrim's Pride for $800 million, in a transaction that would include paying off Pilgrim's Pride's creditors in full and distributing new stock to current shareholders--something unusual for a company in bankruptcy protection. Pilgrim's Pride and six of it subsidiaries filed a reorganization plan with the U.S. Bankruptcy Court for the Northern District of Texas in September. The company anticipates its reorganization plan will be approved by the bankruptcy court so it can exit bankruptcy protection by the end of the year.
Southwest Airlines reports it lost $16 million in the third quarter because of fuel hedges and an early retirement program. Not counting those, southwest says it would have made a profit of $23 million. Dallas-based Southwest says revenue fell 7.8 per cent to $2.67 billion. Traffic rose on Southwest's planes last month. But the trouble was that many of those travelers were penny-pinching vacationers instead of freer-spending business travelers. All the big airlines have been struggling with the falloff in business travel during hard economic times. Even with more customers, Southwest trimmed unprofitable routes and capacity dropped 5.8 per cent for the quarter. During the same period last year Southwest lost $120 million.