Thursday PM July 29th, 2010
by: Ed Mayberry, July 29, 2010 9:07:00 pm
The government's point man for the Gulf oil spill says preparations for an attempt to plug the gusher from above are going well enough that the timeline for the "static kill" may be moved up. Work on the relief well needed for a permanent fix must be completed before the start of the static kill, which is intended to make the job of plugging the well for good easier.
More than 2,000 miles from the Gulf of Mexico oil spill, a federal judicial panel in Idaho is being asked to consolidate more than 300 spill-related lawsuits against BP and other companies before a single court. Gulf Coast residents and businesses are suing for severe economic losses. Many want the lawsuits centralized in New Orleans, closest to the disaster. BP and other companies involved in the spill favor Houston. Courts in Alabama, Mississippi and Florida are also being suggested.
An expert on marine sciences and coastal circulation says it's unlikely oil from BP's massive spill in the Gulf of Mexico will reach the East Coast. Roy He of North Carolina State University says the chances are low in part because the well is capped for now. BP expects to permanently kill it soon. He also says large amounts of oil haven't been observed in the loop current, which could carry oil around Florida and into East Coast waters. He also points to the ongoing dilution and degradation of the oil. A National Center for Atmospheric Research model released at the beginning of June projected that parts of the oil spill could come up the East Coast during the summer.
The Texas Commission on Environmental Quality has formally proposed beefing up regulations on oil and gas drilling in the state's Barnett Shale region. The proposal now enters a public comment period. The new rules are expected to go into effect February 1st. The new rules are meant to strengthen technical drilling requirements and oversight of the oil and gas facilities. Many facilities are near urban areas. TCEQ has been accused of having weak regulations, contributing to air pollution. The TCEQ now has four monitors that measure pollution in areas that have a lot of drilling. Hourly results are posted on an agency Website. The commission also plans to install three additional monitors.
Former Enron CEO Jeff Skilling is asking an appeal court to release him from prison on bail as he appeals his conviction. Skilling is serving a 24-year prison sentence after an accounting fraud that deceived investors about Enron’s financial condition. The request follows a Supreme Court ruling that a law used to convict him had been wrongly applied. The court in June ruled that a law barring honest services fraud doesn’t apply to his case. It said the law should apply only to cases where bribes and kickbacks had changed hands.
No jobs are affected at the Johnson Space Center in the latest round of NASA-related layoffs. But 1,400 contract workers in Florida, Alabama and Texas responsible for serving the space shuttle fleet are being laid off by October 1st. United Space Alliance has begun telling workers, including 900 employees at the Kennedy Space Center, that they are expected to be let go as part of the planned reductions stemming from the end of the shuttle program. Laid off workers will receive between four and 26 weeks of pay, depending on their years of service. The shuttle program now employs about 8,700 contractors, down from 12,000 employees in October 2008. It also employs another 1,200 civil workers, who are expected to be assigned to new programs after the shuttle. The final shuttle flight is expected next year.
New jobless claims fell last week for the third time in four weeks but remain elevated. The Labor Department says first-time claims for unemployment insurance dropped by 11,000 to a seasonally adjusted 457,000. Analysts surveyed by Thomson Reuters had expected a smaller drop. Claims have fluctuated this month due to temporary seasonal factors. General Motors and other manufacturers skipped their traditional summer shutdowns, which led to fewer layoffs and unemployment claims. But the impact of that distortion has largely faded from the data, a Labor Department analyst said. The four-week average of claims, which smoothes fluctuations, dropped to 452,500, the lowest level since May. Economists say jobless claims need to fall to at least 425,000 to signal sustained job growth.
Houston Community College Northeast continues its HCC Partners for Jobs mission to showcase programs and training available for retraining for new jobs. The Job Training Fest is set for Friday and Saturday morning at Northeast College on Community College Drive.
Companies that promise to reduce or eliminate credit card balances and other debt for customers will no longer be allowed to charge an upfront fee. The Federal Trade Commission says the new rule is intended to crack down on the debt settlement industry, which has flourished in the downturn as borrowers struggle to pay their bills. The rule goes into effect October 27th. Since the start of the recession, the Better Business Bureau says it received more than 3,500 complaints about debt settlement companies.
Mortgage rates dropped to the lowest level on record for the fifth time in six weeks, making home-buying and refinancing the most attractive in decades for those who can get loans. Freddie Mac says the average rate for 30-year fixed loans this week was 4.54 percent, down from 4.56 last week. That's the lowest since Freddie Mac began tracking rates in 1971. The last time home loan rates were lower was during the 1950s, when most mortgages lasted just 20 or 25 years. The rate on the 15-year fixed loan dropped to four percent, down from 4.03 percent last week and the lowest on record. Rates have fallen since the spring. Yields on U.S. Treasury bonds have dropped as jittery investors seek safer investments. Mortgage rates tend to track yields on Treasurys.
New data shows households across a majority of large U.S. cities received more foreclosure warnings in the first six months of this year than in the first half of 2009. According to the foreclosure listing firm RealtyTrac, 154 out of 206 metropolitan areas with at least 200,000 residents posted an annual increase in foreclosure activity between January and June. Florida accounted for nine of the top 20 metro areas with the highest foreclosure rates. The latest figures show the threat of foreclosures is spreading well beyond the top tier of metropolitan areas located in California, Florida, Nevada and Arizona, which have borne the brunt of the fallout from the housing crisis. The number of households facing foreclosure in the first half of the year climbed eight percent versus the same period last year, but dropped five percent from the last six months of 2009. In all, about 1.7 million homeowners received a foreclosure-related warning between January and June. That translates to one in 78 U.S. homes.
A new survey suggests the U.S. economic recovery will remain slow deep into next year, held back by shoppers reluctant to spend and employers hesitant to hire. The latest quarterly Associated Press economy survey shows economists have turned gloomier in the past three months. They foresee weaker growth and higher unemployment than they did before. According to the survey, economic growth the rest of this year and early next year will weaken, to less than three percent and the unemployment rate will be no lower at the end of the year than it is now--9.5 percent. As a result, the economists think the Federal Reserve will keep interest rates near zero until at least next spring. Despite expectations of slower growth, a majority of the 42 economists surveyed believe the recovery remains on track, raising hopes that the economy can avoid falling back into a "double-dip" recession.
The government says it plans to test 55 vehicles from the 2011 model year under a new safety ratings system that includes tougher requirements. The National Highway Traffic Safety Administration says the tests will be conducted under a new five-star ratings system that includes new tests. The revamped system will give consumers a single overall score for the first time. Some of the best-selling cars, trucks and sport utility vehicles in the U.S. will be tested, including the Toyota Camry, Chevrolet Malibu, Ford F-150 and Honda Odyssey. The consumer program was started in 1979. Some safety advocates have said most vehicles earn four or five stars on the tests, making it difficult for consumers to compare safety features.
American Airlines has agreed to pay $5 million and provide evidence against other airlines to settle a class-action lawsuit brought by freight shippers who were victims of a price-fixing cartel. A lawyer for the shippers, Michael Hausfeld, says that American was the first airline to agree to help the shippers conduct other lawsuits outside the United States. He said Air France KLM, which said this month it agreed to pay $87 million to settle its role in the same case, refused to offer its help. Tim Wagner, a spokesman for AMR's American Airlines, said the settlement avoids the cost of a trial. "American Airlines has done nothing wrong, and the settlement makes clear that American is admitting no fault or liability," Wagner said.
Southwest Airlines added an upbeat note to a strong quarter for the airline industry by reporting a $112 million profit for spring and early summer. The nation's biggest discount airline says revenue rose 21 percent, helped by heavy traffic during the start of the summer vacation period. Southwest is the last of the big six carriers to report second-quarter results. All except American Airlines made money thanks to higher fares and new fees on passengers.
ExxonMobil says its second quarter income nearly doubled as oil prices increased from last year. The world's largest publicly traded oil company reported earnings of $7.56 billion in the quarter, up from $3.95 billion in the year-ago period.