Friday AM February 8th, 2008
by: Ed Mayberry, February 8, 2008 5:02:00 am
BP says it will limit severance payments to former CEO John Browne. BP will also pay almost $10 million in legal fees to settle a shareholder lawsuit. Investors accuse BP executives of allowing violations of environmental and worker safety laws. The suit was filed in Alaska state court in 2006. BP says it will cancel a portion of Lord Browne's multimillion-dollar severance package. BP also agreed to expand shareholder access to management and factor BP's operational health, safety and environmental performance into executive compensation.
Analysts say it is probably a statistical fluke. The Labor Department says the number of Americans filing claims for unemployment benefits went down last week, but not by enough to indicate that the job market is doing better. The decline of 22,000 puts new jobless claims at a level of 356,000. That erases only a small part of the previous week's rise of 72,000 in claims. The four-week average rose to 335,000, the most in a month. Analysts predict further increases in the claims in the coming weeks, with more firms not only cutting back on hiring, but also cutting jobs.
The Federal Reserve says consumer borrowing increased in December at the slowest pace in eight months. The modest increase of 2.1 percent marks a sharp slowdown from the more than eight percent jump seen in November. It provides further evidence that economic activity was slowing as the year drew to a close. The gain was about half the size of what economists were expecting. Households have been struggling with the slump in housing, coupled with a credit squeeze, which has prompted banks to tighten their lending standards.
Research from the University of New Hampshire shows the nation's poorest cities experienced a substantial drop in poverty rates from 1992 to 2003. But the new research shows it was not enough to lift them out of their relative positions as the most impoverished communities in America. The report concludes that economic development focused on growth can help reduce poverty, but underlying factors also need to change. Factors include levels of education, technological specialization and the concentration of employment in finance and government sectors.
ExxonMobil has secured court orders to freeze more than $12 billion in worldwide assets of Venezuela's state-owned oil company. Irving-based Exxon is preparing to dispute the nationalization of a multibillion dollar oil project. The move limits Petroleos de Venezuela's room to maneuver as it fends off challenges over President Hugo Chavez's 2007 decision to nationalize four heavy oil projects. The sites are in the Orinoco Basin, one of the richest oil deposits in the world. A hearing is February 13th in New York. Exxon and ConocoPhillips opted to walk away from the contracts rather than stay on in a minority role. Both have filed arbitration proceedings with the World Bank seeking compensation.
The Rice University chapter of the National Association of Women MBAs hosts its eighth annual Women in Leadership Conference today at the Jesse H. Jones Graduate School of Management. The forum features keynotes speeches from the CEO and founder of Gurwitch Products, which markets high-end cosmetics, and the vice president of corporate communications at Waste Management.
Wal-Mart will open its first in-store medical clinics under its own brand name. That's after leasing space in dozens of stores to outside companies that operate the quick-service health stops. The world's largest retailer said it'll open "The Clinic at Wal-Mart'' as a joint venture with local hospital systems in Atlanta, Dallas and Little Rock, starting in April. That's as chains like Wal-Mart, as well as CVS, Target and Walgreen partner with mini-clinic providers like RediClinic and MinuteClinic to expand operations. The trade group estimates there will be more than 1,500 by year-end, up from about 800 in November. Wal-Mart has clinics in 77 stores, including nine in Wisconsin and Florida operated by local hospitals. Clinics in 23 locations in Florida and three other southern states have been in limbo since last month when New York-based checkups shut down. Now Wal-Mart has signed a letter of intent to work with local hospital systems and RediClinic to open co-branded walk-in clinics in 200 Wal-Mart Supercenters.
Two subsidiaries of trucking company YRC Worldwide plan to close 27 service centers in a cost-cutting move. USF Reddaway will close 21 service centers in Texas, Louisiana, New Mexico and Oklahoma. USF Holland will close six service centers: in Albany, Georgia; Jackson, Mississippi; Lumberton, North Carolina; Little Rock, Arkansas; Mobile, Alabama; and Metter, Georgia. The closings should be completed by February 22nd. YRC says it will continue to serve those areas indirectly through other subsidiaries of its YRC North American Transportation Division.
The UK-based Renewables Advisory Board is urging officials from utilities, government and academia to collaborate more closely on wave energy research. The panel believes the new technology in the future could provide a fifth of the country's electricity. The UK hopes to use power generated in seas to help meet a European Union target for 15 percent of its energy from renewable resources by 2020. The group says over-optimism in the industry has created higher expectations for the technology.
A federal prosecutor who helped convict former executives at Enron is joining the Denver-based law firm Holland & Hart on April 1st. Cliff Strickland, who was an attorney on the Enron Task Force, is an assistant U.S. Attorney in Denver. Strickland will advise clients on business disputes, white collar defense and securities legislation.
The Cynthia & George Mitchell Foundation is joining with the Energy Foundation in forming a three-year, $6 million initiative to improve air quality while growing the Texas economy. The foundation says Texas is the seventh-largest emitter of global warming pollution in the world. The Energy Foundation, based in San Francisco, is a partnership of major donors.
State officials hope that scenes of Tex-Mex dining in San Antonio and mountain biking in Big Bend National Park will boost tourism. The state's tourism marketing organization Texas Tourism is launching a television, print and online campaign to showcase Texas to the world. The money comes from hotel and motel taxes. Officials say the ads cost $2.3 million to produce. Authorities plan to spend $22.2 million to get the spots on cable TV, in magazines and on travel Web sites. The spots are set in various locales from the beach on South Padre Island to the Wyler aerial tramway above El Paso to a minor league baseball game in Round Rock. Texas Tourism also launched an Internet tool online. It lets people plan vacation itineraries to match the advertisements or check out driving tours of Texas.
Fort Worth-based homebuilder D.R. Horton says it swung to a first-quarter loss because of hefty charges to write off inventory and land values as the housing slump worsens. The nation's largest homebuilder says it lost $128.8 million in the quarter ended December 31st. That's compared with a profit of $109.7 million in last year's initial quarter. The 2008 quarter includes $245.5 million in pretax charges to write down inventory and the value of land deposits. Revenue plunged 39 percent to $1.71 billion. The builder closed on 6,549 homes, down 36 percent from the 2007 period. Analysts surveyed by Thomson Financial expected of $1.62 billion. Company Chairman Donald Horton says he expects the housing environment to remain challenging.