Thursday PM February 18th, 2010
by: Ed Mayberry, February 18, 2010 4:02:13 pm
A Burlington Northern Santa Fe derailment last night near Santa Fe sent 22 cars off the tracks and forced an evacuation when an oil-based substance leaked. BNSF spokesman Joe Faust said it was not immediately clear what caused the train to derail. Nobody was hurt. Police Captain Wayne Kessler described the jumble of derailed cars saying: “It's a mess. They are sideways.” Kessler says the evacuation order, for a mile radius, was lifted within two hours of the derailment of the train bound for Houston. Faust told the Associated Press that two tankers ruptured and one carried an asphalt material, while the other was hauling molten sulfur. The cleanup process will involve heavy equipment moving the cars. A stretch of nearby Highway 6 was closed. Santa Fe is a city of about 11,000, located 30 miles southeast of Houston.
Officials with Halliburton say about 150 jobs at the Halliburton Technology Center in Duncan will be moved to Houston during the next two years. Halliburton spokeswoman Diana Gabriel says the move is part of a plan to consolidate operations at company headquarters in Houston. The jobs being moved include chemists and engineers. The technology center currently has about 400 employees. Gabriel says there are no plans to remove or reduce the remaining 250 or so workers in Duncan. Halliburton was founded in Duncan by Erle Halliburton in 1919 and has become one of the world's largest providers of products and services to the oil and gas industry. The company moved its corporate headquarters to Houston in 2003 from Dallas where it had been since 1961.
The number of newly laid-off workers filing applications for unemployment benefits unexpectedly surged last week after having fallen sharply in the previous week. The gain dampened hopes about how quickly the labor market may improve this year. The Labor Department said that first-time claims for unemployment benefits rose by 31,000 to a seasonally adjusted 473,000. Analysts expected a small decline. The increase followed a drop of 41,000 in the previous week which had raised hopes that the labor market, which has lost 8.4 million jobs since the recession began in December 2007, could be improving.
A private research group says its forecast of future economic activity rose for a 10th straight month in January, but the pace of growth is slowing. The Conference Board says its index of leading economic indicators rose 0.3 percent last month. That's weaker than a 1.2 percent rise in December and a 1.1 percent rise in November. Its also was short of the 0.5 percent gain that economists polled by Thomson Reuters expected. Some economists have been worrying that growth in the economy will stagnate this year as government support programs wind down and unemployment remains high. The leading indicators index is designed to forecast economic activity in the next three to six months.
Wholesale prices shot up at double the expected pace in January, propelled higher by big increases in energy costs. The surprisingly large jump was viewed as a temporary blip and not the start of inflation problems. The Labor Department said that wholesale prices rose 1.4 percent last month, reflecting higher costs for gasoline and other energy products. Private economists had expected a 0.7 percent increase. Core inflation at the wholesale level, which excludes energy and food, rose 0.3 percent in January, faster than the 0.1 percent increase economists had predicted.
A new study says states may be forced to cover a $1 trillion funding gap for public sector pensions and retiree health care. The Pew Center on the States report looks into state-administered pension plans and post-employment benefits in all 50 states. The survey blames a decade's worth of policy decisions for leaving the plans shortchanged. The report says policy makers have exacerbated the funding problem by expanding benefits, relying on overly optimistic assumptions about investment returns, and failing to sufficiently fund the programs. Pew says the shortfall may force states to reduce benefits, raise taxes or slash government services. Other recommendations include raising the retirement age and making employees pay more into the system. The study doesn't cover many city, county and municipal pension plans, which are thought to have similar underfunding.
With tax collections tanking and jobless rates at record highs, state legislators are appealing to conservative voters by bashing the federal government. Lawmakers in 44 states have introduced measures warning Congress not to trample states' rights. Dozens of other bills oppose the government on issues including gun control and health care. Their efforts play to people angry with the status quo. A recent Pew Research Center poll found high anti-incumbent sentiment among voters ahead of the November Congressional elections. No states are likely to secede from the union, but they could derail or delay federal legislation. In conservative South Carolina, Republican House Majority Leader Kenny Bingham says his caucus has made standing up to the federal government a top priority this year.
Leaders of a House committee say they want to know whether an oil and gas drilling technique known as hydraulic fracturing is hazardous to human health. Top Democrats on the House Energy and Commerce Committee sent letters to eight oil and gas companies seeking more information about chemicals used in the process. Hydraulic fracturing, also known as “fracking,” injects water, sand and chemicals underground to force open channels in tight sand and rock formations so that oil and natural gas will flow. Democratic Representative Henry Waxman of California says hydraulic fracturing could help unlock vast supplies of natural gas once thought unattainable, but he adds that lawmakers need to weigh any risks to drinking water and the environment.
A Mississippi Navistar plant has won a $751 million contract to build more than 1,000 mine resistant ambush protected vehicles for the Marine Corps. U.S. Senator Thad Cochran says the firm-fixed-price contract was awarded to Illinois-based Navistar Defense for more than 1,000 Category I MRAP vehicles. Navistar Defense says some of the production also will be performed at its Garland plant. MRAPS have V-shaped, up-armored hulls that provide more protection from improvised explosive devices than traditional troop transport vehicles, like the Humvee. Vehicles will be delivered starting in April, and Navistar expects to finish during the summer. The company said parts aren't included in the deal. The initial vehicles to be manufactured at West Point, Mississippi, will include upgrades to enhance maneuverability.
The Federal Aviation Administration is proposing a $2 million-plus fine against a sister carrier of American Airlines for the second time in less than a month for safety violations. The FAA says that AMR Corp.'s American Eagle conducted at least 1,178 passenger-carrying flights using four bombardier jets with main landing gear doors that had not been repaired in accordance with a safety directive. The flights took place between February and May of 2008. Earlier this month, the FAA proposed a fine of nearly $2.5 million against American Eagle for not making sure crews had accurate information about the weight of baggage on dozens of flights. Parent AMR has 30 days to appeal both fines.
A report by a government watchdog is finding fault with the Federal Aviation Administration's oversight of aircraft maintenance at American Airlines. The report says the case raises questions about the effectiveness of the FAA's maintenance oversight of airlines in general. The report by the Transportation Department's inspector general is based on an investigation of complaints lodged in February 2008 by the pilots union at American. FAA and American officials say the problems are old issues that have been addressed. However, the report says the FAA is still working on some of the issues and that the effectiveness of the agency's actions is still uncertain.
President Barack Obama has announced a new bipartisan commission to take on deficit-reducing responsibilities that Congress has been reluctant to embrace the move came a day after he touted the $862 billion economic stimulus program. Obama's administration has been taking an increasing amount of criticism for record-high deficits, and Obama said something has to be done about it. He said the continuing red-ink trend could “hobble our economy” and “will cloud our future.” Obama introduced former White House Chief of Staff Erskine Bowles, who worked for President Bill Clinton, and Republican former Senator Alan Simpson as co-chairmen of the panel. The administration has forecast that the deficit will hit a record a record $1.56 trillion for the budget year ending September 30th.
Several prominent business groups are joining a growing list of organizations and states challenging the federal government's finding that climate-changing pollution from cars, power plants and factories is dangerous to people. The National Association of Manufacturers is filing a challenge this week, joined by groups including the American Petroleum Institute, National Association of Home Builders and the Corn Refiners Association. The Environmental Protection Agency said in December that carbon dioxide and other greenhouse gases endanger human health, setting the stage for future rules restricting such emissions. At least three states--Texas, Virginia and Alabama--are also challenging the EPA finding, claiming it is based on flawed science.
U.S. climate expert Jake Schmidt says departing UN climate change official Yvo de Boer did a “powerful job” in getting the world to focus on climate change. De Boer, who announced his resignation today, denies his decision stems from his disappointment that the Copenhagen Climate Summit fell short of its goal.
AT&T plans the addition of more than 70 new cell sites in Texas this year, plus upgrades at more than 550 additional cell sites to 3G throughout the state. The company’s wireless investment is expected to be in the $18 billion to $19 billion range companywide—a five to ten percent increase over last year. Last year AT&T added more than 130 cell sites and upgraded more than 280 existing sites to 3G.
Rates for 30-year home loans have edged lower for the second straight week, but remain above last year's record lows. The mortgage finance company Freddie Mac said that the average rate on a 30-year fixed rate mortgage fell to 4.93 percent this week from 4.97 percent a week earlier. Rates dropped to a record low of 4.71 percent in early December, pushed down by an aggressive government campaign to reduce consumers' borrowing costs.
The Federal Reserve is boosting the rate banks pay for emergency loans. The move won't affect borrowing costs for millions of Americans, but it brings the Fed's crisis lending program closer to normal. The Fed has agreed to bump up that rate by one-quarter point to 0.75 percent. The increase takes effect Friday. The central bank said the move should not be viewed as a signal that it will soon boost interest rates for consumers and businesses. Record-low borrowing costs are still needed to foster the recovery.
For the first time since 2007, there's no drought in Texas. The state had been enduring some of the nation's most severe drought conditions until rains started falling about six months ago. The new federal drought map and Texas climatologist John Nielsen-Gammon both agree the state's finally done with drought conditions. Now there are only a few counties considered abnormally dry, but not drought-stricken. This time last year, more than 60 percent of the state was under drought. Nationally, Michigan and several western states are still under some drought conditions, but only Hawaii has areas of extreme drought.
Microsoft and Yahoo! have received clearance from regulators in Washington and Europe to proceed with a search partnership intended to challenge Google. The companies announced that the partnership has been approved without restrictions by the Justice Department and the European Commission. Under the 10ten-year agreement, Microsoft's Bing search engine will process all search requests and steer search-related ads on Yahoo! The companies said they will begin implementing the deal in the coming days and expect to complete the process by early 2012.
Live Nation Entertainment's Ticketmaster unit has reached a settlement with federal regulators to refund money to people who bought marked-up tickets to 14 Bruce Springsteen concert tickets last year. The settlement was announced by the Federal Trade Commission. It will give customers the difference between the marked-up price and the face value of their tickets. The FTC launched an investigation into Ticketmaster's practices after Springsteen fans who tried to buy tickets for concerts in May and June encountered a “no tickets found” message on Ticketmaster's Web site. They were redirected to the company's Ticketsnow.com resale site to buy higher-priced tickets. Ticketmaster blamed the incident on a “glitch.”Earnings
Dell says its net income fell six percent in the most recent quarter. Consumers snapped up low-cost laptops and smaller net books over the holidays. But businesses, which account for about half of Dell's revenue, still haven't markedly increased spending on new computers. From November through January, Dell says earnings slipped to $334 million. That is down from $351 million a year ago. Revenue increased 11 percent to $14.9 billion. Dell's results roughly tracked the report from its larger competitor Hewlett-Packard, which said it sees corporate PC buying picking up in the second half of the year.