Monday PM September 13th, 2010
by: Ed Mayberry, September 13, 2010 5:09:00 pm
A chief drilling official says BP crews have resumed drilling a relief well meant to allow them to permanently seal the blown-out well in the Gulf of Mexico. John Wright, who is in charge of the operation aboard the Development Driller III vessel, said in an e-mail to the Associated Press that drilling has resumed. BP and the government have said it would take about four days from the time crews started drilling again to intersect the blown-out well. Once the relief well intersects the blown-out well, crews will pump in mud and cement to permanently seal the well. The flow of crude was first stopped with a cap in mid-July.
Researchers say they've found patches of oil believed to be from the leak on the sea floor. Some of these are two inches thick. University of Georgia researcher Samantha Joye says she and her colleagues have found oil as much as 80 miles from the Deepwater Horizon well. She says the latest sample was taken early today and the oil covered newly dead creatures, such as shrimp and deep-sea worms. The scientists have collected at least ten samples from the sea floor, about a mile down. Testing is needed to confirm it is BP oil. But Joye says it has the appearance of recent oil from the busted well, not old oil.
The administrator of the $20 billion victims compensation fund that BP set up after the spill is considering making a significant concession following strong criticism from residents about the claims process. The issue involves the current requirement that wages people have been paid to help skim oil and perform other cleanup work must be subtracted from the amount they get from the compensation fund. Fund czar Kenneth Feinberg told hundreds of people who packed a convention center in Houma, Louisiana, that he is reconsidering that requirement. He said no decision has been made, but he understands the loud concerns raised by people who are still hurting. The April 20th rig explosion killed 11 workers and led to 206 million gallons of oil spewing from BP's undersea well.
The government is starting to provide details of how it spent money in the aftermath of the Gulf oil spill. And some of the contracts that were awarded could provide ammunition for critics of government waste. The federal government hired a New Orleans man for $18,000 to appraise whether news stories about its response to the spill were positive or negative for the Obama administration. The government also spent $10,000 for just over three minutes of video showing a routine offshore rig inspection. The video was gathered for news organizations, but there's no word on whether any of it was used. And a $216,000 no-bid contract for a survey of seabirds was awarded to an environmental group that has criticized what it calls the “extreme anti-conservation record” of Sarah Palin. But an official from the group, Defenders of Wildlife, says politics played no role in the contract.
Two of the biggest names in business say they see a bright future for the economy. Famed investor Warren Buffett says there will be no double-dip recession as some fear. He says banks are lending money again, businesses are hiring employees and he expects the country to come back stronger than ever. The chairman of Berkshire Hathaway was speaking via video to the Montana Economic Development Summit in Butte. Microsoft CEO Steve Ballmer says there soon will be more technological advancement and invention than seen during the Internet era. He says that will help drive business growth. The conference was organized by U.S. Senator Max Baucus. The Montana Democrat says it leaves “bickering and name-calling” back in Washington, D.C., so leaders can find good ideas.
Banks are going to have to re-think their lending policies--perhaps putting tighter limits on credit cards, mortgages and other loans. It's the result of an agreement in Switzerland by the world's central banks, with the goal of avoiding another financial collapse. The new rules will gradually require banks to hold onto more capital so that they can absorb potential losses. And they'll be required to limit their risk-taking. Requiring banks to keep more capital on hand will restrict the amount of loans they can make. But the banks will be better able to withstand the blow if many of those loans go sour. Down the line, consumers could see banks impose higher fees. Bank stocks overseas are generally higher on the news. But some bank stocks are losing ground amid fears that their profits will be hurt as they try to raise large amounts of cash.
A grant program for needy higher education students could be threatened by the projected $18 billion state budget shortfall. The San Antonio Express-News reports that about 24,000 first-time Texas Grant Program recipients could be shut out in the next two years. The Texas part of the title stands for toward excellence, access & success. Governor Rick Perry has ordered all state agencies to plan for a ten percent cut in the next two-year spending period. The Texas Higher Education Coordinating Board administers the $614 million grant program. Higher Education Commissioner Raymund Paredes says it would be “catastrophic” to cut financial aid just as that front edge of the changing demographic hits colleges. He has proposed getting money first to needy students who are also high achievers.
The number of college students defaulting on their federal student loans is climbing, and those who attend for-profit schools remain the most likely group to default, according to new government data. The U.S. Department of Education says numbers from fiscal year 2008 show seven percent of borrowers of federal student loans default within two years of beginning repayment, up from 6.7 percent the previous year. The default rate for students at for-profit schools rose from 11 percent to 11.6 percent. For-profit colleges are fighting proposed Education Department regulations that would cut off federal aid to for-profit college programs if too many of their students default on loans or don't earn enough after graduation to repay them.
Publishing giant Houghton Mifflin Harcourt is making a $400 million investment to back up the company's increasing emphasis on putting more technology into the nation's classrooms. The investment includes $100 million in incubator money for investments in technology that supports student achievement. Barry O'Callaghan, the CEO of Houghton Mifflin Harcourt, said his company can provide capital and product expertise to budding educational entrepreneurs. The Boston-based company also plans to invest $300 million over the next three years developing its own technology, such as a pilot algebra application for the Apple I-pad currently being tested by 400 California eighth-graders. O'Callaghan says he doesn't envision traditional textbooks disappearing entirely. The company is now about evenly split between hardbacks and online, he said.
A $15 million Federal Aviation Administration Airport Improvement Program Grant has been announced for taxiway rehabilitation at George Bush Intercontinental Airport, allowing the accommodation of larger aircraft. Two of the taxiways were constructed in 1965 and were designed to serve B727-100 aircraft. A concrete overlay in 1976 was added to accommodate larger aircraft, including the Boeing 747. The funding will also be used to improve one of five major runways at IAH.
Workforce Solutions is sponsoring a job fair midday Tuesday at its Southwest Career Office on Bissonnet at Dairy Ashford. Employers such as the Port of Houston, Comcast, the Art Institute of Houston and the City of Houston are taking part.
Money Management International is aligning all of its Consumer Credit Counseling Service branches under the MMI name. The 120 branches make it the nation’s largest consumer credit counseling agency. The transition is slated to be complete by the end of the year.
A new survey finds the average price of regular gasoline in the United States has stayed almost flat in the last three weeks. The Lundberg survey of fuel prices released Sunday says the price of a gallon of regular dropped less than a penny to $2.69. Analyst Trilby Lundberg says the average price for a gallon of mid-grade was $2.84, and premium was at $2.95. Newark, New Jersey, had the lowest average price among cities surveyed at $2.45 a gallon for regular. San Francisco was highest among surveyed cities at $3.06. Diesel was at $2.98. Houston’s average retail prices have risen 4.2 cents per gallon in the past week, averaging $2.48 this weekend, according to HoustonGasPrices.com.
The government says U.S. airlines were late more often in July than a year earlier, but there were only three planes stuck for more than three hours. The Transportation Department says the nation's largest airlines operated 76.7 percent of flights on time in July, down from 77.6 percent in July 2009. The on-time rate in July was better than the month before, as incidents of severe weather that delayed planes declined from June to July. Only three planes were stuck on the tarmac for more than three hours in July, compared with 161 a year earlier. All three were American Eagle flights leaving Chicago's O'Hare on July 23rd, a day of severe thunderstorms in the area.
Hewlett-Packard says it has agreed to buy the security software provider Arcsight for about $1.5 billion. It's one of a string of recent deals that has taken HP beyond the personal computer market as HP looks to diversify its business and increase revenue. Arcsight, based in Cupertino, California, helps organizations keep tabs on the data flowing through their computer networks and analyze it for signs of hacking, theft or fraud. HP sas it would offer Arcsight stockholders $43.50 per share in cash--a 24 percent premium over the Arcsight's closing share price Friday. It's a 54 percent premium over Arcsight's last closing share price before news of a potential deal leaked.
Whole Foods Marketis trying to clear some murky waters for seafood shoppers. The grocery chain has launched a color-coded rating program with the help of Monterey Bay Aquarium and Blue Ocean. It’s intended to measure the environmental impact of its wild-caught seafood. The program is the latest in a series of moves by major grocers to change seafood policies as concern rises about overfishing and the environmental effects of certain fishing methods. The system gives seafood a green, yellow or red rating. It's based on how abundant the species is and how sustainable the methods used to catch it are.
First Lady Michelle Obama is challenging the nation's restaurants to add more healthy options to menus, label those items more prominently and market nutritious foods to kids. Speaking at the National Restaurant Association, Mrs. Obama pleaded with restaurants small and large to take a little butter or cream out of their dishes, use low fat milk and provide apple slices or carrots as a default side dish on the kids' menu. Mrs. Obama said that Americans are spending half of their food dollars outside the home and eating a third of meals in restaurants. She asked the restaurants to rethink the food they offer and reformulate their menus to help combat childhood obesity.
Media reports say Hertz has raised its offer for rental car company Dollar Thrifty to about $1.43 billion from $1.2 billion in an effort to thwart a rival bid by Avis. The Wall Street Journal reports on its Website that Dollar Thrifty's board has accepted Hertz Global Holdings's new $50-per-share offer--up from the $41 it offered in April—and amended the companies' merger agreement. The move comes just days before shareholders of the Tulsa, Oklahoma, company were scheduled to vote on Hertz's original proposal and as some Dollar Thrifty shareholders have protested the board's rejection of a $1.3 billion cash-and-stock counteroffer from rival Avis Budget Group. Dollar Thrifty Automotive Group has said that the Avis proposal did not include deal protection measures or adequately address antitrust concerns. Parsippany, New Jersey-based Avis had offered a deal valued at more than $47 per share, but without the $45 million breakup fee that Park Ridge, New Jersey-based Hertz agreed to pay if it fails to complete its acquisition.
Intel's CEO says the semiconductor industry hasn't fully cracked the challenge of making chips that help people move content seamlessly between their devices. Paul Otellini says that capability will be critical because there are five billion devices connected to the Internet, and that number will rise. Consumers increasingly demand technology that lets them start a movie or TV show on a smart phone and finish it on a home personal computer or TV, for example. The industry is exploring those challenges as they develop chips for new Internet-connected devices. Otellini's keynote at Intel's annual developer conference focused on Intel's efforts to get its processors into those devices. Otellini also showed features of Intel's new line of chips, which will start appearing in computers next year.
It could be the next step for YouTube--moving from recorded video into live streaming. YouTube is already the largest video platform on the Web. And it's expected to become a major force in the rapidly-growing live streaming video business--a field in which some smaller companies have already established themselves. An experimental trial for a live streaming platform began today, with four new media partners. For the last two years, YouTube has offered several events live, including a U2 concert and President Barack Obama's first State of the Union address. But for all of those events, YouTube relied on third-party technology.