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Stock market outlook gloomy amid more disheartening economic data
38 minutes ago
By The Canadian Press
TORONTO - Overseas stock markets are weak and Wall Street index futures indicate a down open as investors fret over the economy.
In Canada, the Bank of Nova Scotia (TSX:BNS) has warned of a bigger-than-expected $595-million hit to its quarterly earnings caused by financial-market upheaval. The other banks are expected to suffer similarly to Scotiabank, which releases its results Dec. 2.
Bank of Canada governor Mark Carney strongly indicated today that the central bank will cut interest rates further next month in an effort to stimulate the economy. Carney told a luncheon in London that downside risks have grown, while inflation is less of a concern.
The Canadian dollar was at 80.78 cents, down 0.53 cent after losing 0.44 cent Tuesday, as commodity prices kept declining.
Crude oil fell under US$54 a barrel, trading down 72 cents at $53.67 after going as low as $53.30 in overnight electronic trading on the New York Mercantile Exchange.
Copper was down 4.4 cents at US$1.6275 a pound.
In economic news, Statistics Canada's composite leading index - an indicator of future activity - fell 0.4 per cent in October. It was the biggest drop since the early-1990s recession, after a 0.3 per cent drop in September.
New American data showed deepening weakness. Construction of new homes plunged 4.5 per cent last month to the lowest level on government records. The Commerce Department said residential construction fell to an annualized rate of 791,000 units.
U.S. consumer prices, meanwhile, fell by the largest amount in records dating back to 1947, down one per cent last month as gasoline prices receded sharply. Core prices, excluding volatile food and energy costs, were down 0.1 per cent - the first decline in more than a quarter-century.
Financial market will again be fixated on congressional testimony by executives of General Motors Corp., Ford Motor Co. and Chrysler LLC. They are appealing for a multibillion-dollar infusion of taxpayer cash to prevent massive layoffs and stabilize the companies.
Investors are concerned that a collapse of any - or all - of the Detroit-based automakers would ripple through an already sagging economy.
In early earnings news, supermarket operator Metro Inc. (TSX:MRU.A) rang up $72.3 million in summer-quarter profit, up 25.5 per cent from year-ago earnings that were reduced by the integration of A&P stores. Sales were $2.48 billion, up 1.8 per cent from a year ago, or 1.5 per cent on a same-store basis.
Wall Street rebounded Tuesday in another turbulent session, as investors rushed back into the market to test a 2003 low. The Dow Jones industrial average finished up 151 points, with most of the gain coming in the final hour.
Toronto's S&P/TSX composite index, meanwhile, closed up 40 points.
Overseas stock markets were in the red, with a noticeable exception in Shanghai, where the benchmark Chinese index gained 6.1 per cent, peeking back over 2,000 - down from 5,500 early this year.
Tokyo's Nikkei index declined 0.7 per cent and the Hang Seng in Hong Kong was down 0.8 per cent.
Losses were steeper in Europe, with the FTSE 100 down 2.5 per cent early in the afternoon in London. The German DAX shed 3.5 per cent and the Paris CAC-40 lost two per cent.
Copyright © 2008 Canadian Press
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November 19, 2008
Detroit Chiefs Plead for Aid
By BILL VLASIC and DAVID M. HERSZENHORN
WASHINGTON — The heads of the Big Three automakers of Detroit pleaded on Tuesday for emergency government aid to stave off potential collapse, but after four hours of testimony, it appeared they had not persuaded enough lawmakers to move quickly on a bailout.
Senate Democratic leaders said they had not been able to muster the support for legislation that would provide $25 billion to the troubled auto industry from the Treasury Department’s $700 billion economic rescue fund.
There is still a possibility that money may be freed up for Detroit from a previously approved loan program to help automakers retool their plants for more fuel-efficient vehicles.
But the industry hardly received a warm reception in Washington, despite its mounting troubles. The frantic bid from Detroit for help was laid bare at a packed hearing of the Senate banking committee, in which two of the three automakers said they might run out of money by the end of the year.
The cause of their misfortunes was not management mistakes, they said, but the weak economy and the inability of consumers to obtain credit to buy cars.
The executives from General Motors, Ford Motor and Chrysler seemed stunned by the general lack of confidence that lawmakers showed in their companies.
“We have little evidence that $25 billion will do anything to promote long-term success,” said Senator Michael B. Enzi, Republican of Wyoming.
The discussions were tense, with the automotive executives on the defensive from the start. At times, it appeared the lawmakers had little familiarity with the deep reorganization steps already taken at the companies. On the other side, the Detroit executives painted a bleak picture of an industry under siege. The chief executives of G.M. and Chrysler said their companies were using up their cash at a rate that could leave them close to insolvency without federal aid.
“Without immediate bridge financing support, Chrysler’s liquidity could fall below the level necessary to sustain operations,” said Robert L. Nardelli, the chairman of Chrysler.
His comments were echoed by G.M.’s chairman, Rick Wagoner, who warned that the rippling impact of the auto industry’s cash woes could put three million American jobs at risk.
He said that a failure by G.M., Ford or Chrysler would rapidly bring the entire domestic industry down. “The societal costs would be catastrophic — three million jobs lost within the first year, U.S. personal income reduced by $150 billion and a government tax loss of more than $156 billion over three years,” Mr. Wagoner said.
Alan R. Mulally, Ford’s chief executive, added, “If any one of the domestic companies should fail, we believe there is a strong chance that the entire industry would face severe disruption.”
Despite the urgent tone of the executives, lawmakers in both parties saw little chance that a bailout could be put together and passed during the current lame-duck session. The Bush administration has steadfastly refused requests by Democratic leaders to tap into the financial rescue program to aid the automakers.
The Treasury secretary, Henry M. Paulson Jr., at a House hearing on Tuesday morning and again at a lunch with Republican senators, implored lawmakers to oppose using any of the $700 billion financial bailout for the auto companies, which he said would set a dangerous precedent.
The White House instead has pushed for the auto companies to get immediate access to $25 billion in previously approved loans to retool production plants to make fuel-efficient vehicles.
For television watchers back home there were dueling news conferences and hearings with carefully sharpened questions and even more carefully rehearsed answers. Behind the scenes, auto executives and their lobbyists scrambled from office to office pressing influential lawmakers to take up their cause.
Outside the banking committee hearing, liberal demonstrators preached anti-corporate sermons. And a small corps of Japanese journalists tracked the fate of the American companies, rivals of Toyota and Nissan.
Senator Carl Levin, Democrat of Michigan and one of the auto industry’s chief allies on Capitol Hill, said he still hoped a deal to provide quick access to the $25 billion in loans could be worked out. Mr. Levin conceded no progress on hammering out the details had been made, but said that efforts were being undertaken.
Mr. Levin said that lawmakers were considering several approaches, including rewriting the provision that mandates that any subsidized loans go toward retooling plants to produce advanced fuel-efficient cars.
The suddenness of the cash crisis at G.M. has caught Washington by surprise.
Senator Richard C. Shelby of Alabama, the ranking Republican on the banking committee, said he was skeptical that the Detroit companies could sufficiently reorganize their operations and improve their competitiveness.
“How is this money going to be used?” he said. “Will it be used to improve their business model and product lines, or is this just life support?”
The hearing underscored how deeply complicated the problems are at the Big Three, which have been losing billions of dollars even as they close factories and cut tens of thousands of jobs.
It also stirred new criticisms of Detroit’s ability to compete in the global marketplace. Several senators called into question the carmakers’ vehicle quality, high labor costs and the capability of their senior management.
Senator Christopher J. Dodd, who is chairman of the banking committee and has been generally supportive of aid to the auto companies, gave little solace to the Detroit executives.
“Their discomfort in coming to the Congress with hat in hand is only exceeded by the fact that they are seeking treatment for wounds that are to a large extent self-inflicted,” he said. “No one can say they didn’t see this coming.”
But the auto executives argued that their turnaround strategies were taking hold just as the economy faltered and available credit dried up for consumers.
The overall United States vehicle market has fallen 14.8 percent through the first 10 months of the year. However, sales in October plummeted 31.9 percent, mostly because of the lack of available credit for potential car buyers.
“There is no great mystery as to why this enormous decline in sales has occurred,” said Ron Gettelfinger, president of the United Automobile Workers union. “Because of the overall credit crunch, most families cannot get credit on reasonable terms to finance the purchase of a vehicle.”
While Democratic lawmakers have vowed to get some type of aid for Detroit this week, the process of producing a coherent and effective package has proved elusive.
After the hearing, Mr. Dodd was greeted in the hallway by reporters asking him if he “had the votes” to fix Detroit. “Votes for what?” he said, indicating that a vote on any legislation was questionable this week.
Detroit’s huge financial problems have caused some legislators to question the haste to rush a bailout through Congress.
“I am prepared to consider economic aid to the automakers, but providing regular order is followed,” said Senator Arlen Specter, Republican of Pennsylvania. “And by that I mean, we have a bill we know the specifics of, to have a chance to study it, to have hearings, to have a floor debate, to have amendments.”
Copyright 2008 The New York Times Company
US economy faces 'catastrophic collapse' without auto bailout: GM
1 hour, 26 minutes ago
WASHINGTON (AFP) - The US economy will face a "catastrophic collapse" if the government does not bail out the automotive industry, the head of General Motors told lawmakers Tuesday.
"This is about much more than just Detroit," GM chairman and chief executive officer Rick Wagoner said as he joined executives from Ford, Chrysler and the United Auto Workers Union to plead for 25 billion dollars in government-backed loans.
"It's about saving the US economy from a catastrophic collapse."
GM has said it will run out of cash as early as January if it does not get help from the government and analysts have said it would likely be liquidated if it was forced into bankruptcy protection.
Wagoner cited a recent study showing that three million jobs and more than 156 billion dollars in government tax revenues would be lost should the domestic auto industry be allowed to fail.
"I do not agree with those who say we are not doing enough to position GM for success," Wagoner said in remarks prepared for delivery.
"What exposes us to failure now is the global financial crisis, which has severely restricted credit availability, and reduced industry sales to the lowest per-capita level since World War II."
Hopes for a speedy bailout packaged have faded, however, amid strong opposition from the Bush administration and leading Republicans.
Both the White House and US Treasury Secretary Henry Paulson voiced opposition to the package Tuesday, saying Congress should instead adapt an existing 25-billion-dollar loan program aimed at helping the auto industry develop more fuel efficient vehicles.
Paulson told lawmakers that the 700 billion dollar US financial bailout program "is not a panacea for all our economic difficulties."
While Paulson said it was important to ensure that "none of the auto companies fail, particularly during this period of time," he said "there are other ways" to accomplish this.
"I believe any solution must be a solution that leads to long-term viability, sustainability viability," Paulson said at a hearing of the House of Representatives Financial Services Committee.
White House press secretary Dana Perino criticized the plan developed by Democrats because it "does not require viability."
"That is going to be a test for us to be able to actually reach a compromise," Perino said, adding the White House would continue to work with Congress and hoped to forge an agreement "this week."
But Democrats countered the long-term competitiveness of the US auto industry would be undermined if the loans intended to help underwrite technological development were used instead to help the Big Three weather the current economic downturn.
On Monday, Democratic Senate leaders in Congress opened a "lame duck" session vowing to fight for a new loan program for the auto industry.
Senate Majority leader Harry Reid hit out at Paulson for refusing to adapt the 700 billion dollar bailout approved in October to aid the auto industry, saying: "All it would take is one stroke of a pen and that problem would be solved.
"We are seeing a potential meltdown in the auto industry , with consequences that could directly impact millions of American workers and cause further devastation to our economy."
Democratic leaders would need at least 10 Republican votes to pass the bailout in the Senate and overcome the minority's obstruction tactics with a 60-seat filibuster-proof majority.
Perino pointed out that any attempt to reopen the Troubled Asset Relief Program, as the bailout is known, would not make it through the Senate, and said the White House was working with Senate Republican minority leader Mitch McConnell on the issue.
A credit crunch has made it impossible for the automakers to borrow money privately and US auto sales, which last month hit a 25-year low, are expected to sink to between 10 and 13 million vehicles next year from recent averages of 15 to 17 million.
Copyright © 2008 Agence France Presse. All rights reserved. The information contained in the AFP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of Agence France Presse.
Copyright 2008 © Yahoo! Inc. All rights reserved.
Saudi super-tanker taken to Somali pirate lair
1 hour, 33 minutes ago
MOGADISHU (AFP) - A hijacked Saudi super-tanker, carrying 100 million dollars of oil, anchored Tuesday off a notorious Somali pirate port as sea gangs struck again and seized a Hong Kong cargo ship.
The biggest act of piracy yet by the marauding Somali bandits has stunned the international community. The Saudi Arabian foreign minister called piracy a growing "disease" and experts said few ships are now safe in the Indian Ocean.
Bile Mohamoud Qabowsade, an advisor to the president of Somalia's breakaway state of Puntland, said the Sirius Star was now at the pirate lair of Harardhere, some 300 kilometres (180 miles) north of Mogadishu.
"We have been receiving some information and we now know that the ship is anchored near Harardhere," Qabowsade told AFP.
The super-tanker with its crew of 25 -- 19 from the Philippines, two from Britain, two from Poland, one Croatian and one Saudi -- and loaded to capacity with two million barrels of oil was seized on Saturday, according to the US Navy.
"All 25 crew members on board are believed to be safe," said Vela International, a subsidiary of Saudi oil giant Saudi Aramco and operators of the ship.
"At this time, Vela is awaiting further contact from the pirates in control of the vessel," the company said in a statement.
But international security fears were heightened when a Hong Kong cargo ship was hijacked in the Gulf of Aden near the Yemen coast.
The China Maritime Search and Rescue Centre said the freighter, The Delight, with 25 crew, was carrying 36,000 tonnes of wheat to Bandar Abbas in Iran when attacked, China's Xinhua state news agency reported.
The Chinese government had earlier condemned the hijacking of a Chinese fishing boat off the Somalia coast and said it is working to rescue the 24 crew -- 15 Chinese, four Vietnamese, three Filipinos, one Japanese and one from Taiwan.
The Sirius Star, the size of three soccer fields and three times the weight of a US aircraft carrier, is the largest ship ever seized by pirates and the hijacking was the farthest out to sea that Somali bandits struck.
Its cargo has been estimated to be worth 100 million dollars at current crude prices.
Maritime security experts said the pirates had approached the tanker from the stern in speedboats and thrown grapnel hooks tied to rope ladders, most likely boarding unopposed as the ship cruised on auto-pilot with nobody keeping watch on the bridge.
Saudi Foreign Minister Prince Saud al-Faisal slammed the attack. "Obviously this is a very dangerous thing ... Piracy, like terrorism, is a disease," the prince said in Athens.
Admiral Michael Mullen, head of the US military as chairman of the Joint Chiefs of Staff, said he was "stunned" by the reach of the Somali pirates.
"They're very well armed. Tactically, they are very good," he said.
The majority of attacks have taken place in the Gulf of Aden over the past year, around the tip of Somalia which juts into the Indian Ocean and commands access to the Red Sea and the Suez Canal.
The group which seized the Sirius Star operates further south -- out of Hobyo and Harardhere -- and has been more aggressive. It made another spectacular catch in September with a Ukrainian cargo laden with combat tanks for southern Sudan, which is still held.
Experts expect the attack on the Sirius Star to spur shipping companies to strengthen security or change routes to sail around the Cape of Good Hope.
The pirates have taken security experts by surprise with their latest strike.
"It puts a huge ring around Somalia where it isn't safe for international shipping," said Roger Middleton, consultant researcher for London-based think-tank Chatham House.
Bahrain-based US Navy Fifth fleet spokesman Nathan Christensen underscored the difficulty of patrolling the vast areas of the Indian Ocean. "We patrol an area of 2.5 million square miles, from Pakistan to Kenya ... We can't be everywhere at once," Christensen said.
NATO is considering extending its anti-piracy operation off Somalia beyond next month, alliance spokesman James Appathurai told reporters in Brussels.
Four ships from Britain, Greece, Italy and Turkey form a NATO patrol in the waters, with two protecting UN food aid convoys to the strife-torn Horn of Africa country.
NATO's operation ends in mid-December when a bigger European Union mission is set to take over but NATO is considering "complementary" action to the EU mission, Appathurai said.
The International Maritime Bureau has reported that 90 vessels have been attacked since January. Of those, 38 were hijacked while pirates still hold 16 vessels with more than 250 crew as hostages.
Somalia, a largely lawless state, has not had an effective government since the 1991 ouster of President Mohamed Siad Barre.
Copyright © 2008 Agence France Presse. All rights reserved. The information contained in the AFP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of Agence France Presse.
Copyright 2008 © Yahoo! Inc. All rights reserved.
Lance Armstrong says he fears for his safety at Tour de France
Tue Nov 18, 9:35 AM
By The Associated Press
LONDON - Lance Armstrong fears he could be attacked by spectators if he returns to the Tour de France next year.
The seven-time Tour champion, who is making a comeback after three years in retirement, said in an interview in The Guardian on Tuesday that he is concerned about his safety.
"I don't want to enter an unsafe situation but you see this stuff coming out of France," said the American rider, who has many critics in France. "There're some aggressive, angry emotions. If you believe what you read, my personal safety could be in jeopardy.
"Cycling is a sport of the open road and spectators are lining the road. I try to believe that people, even if they don't like me, will let the race unfold."
Armstrong, 37, was asked if he specifically fears a physical attack.
"Yeah. There're directors of French teams that have encouraged people to take to the streets ... elbow to elbow. It's very emotional and tense," he said.
It's unclear why Armstrong is worried about his safety now, given that attacks on riders are extremely rare. Organizers have in recent years taken additional steps to protect riders from spectators, including increased use of crowd barriers.
The Tour has its own police force to guard the route and ensure safety, and French police paid particular attention to Armstrong's safety when he was riding.
Armstrong announced his comeback in September and joined the Astana team. He is reunited with Astana team leader Johanna Bruyneel, who teamed with Armstrong for all seven Tour de France wins from 1999 to 2005.
Armstrong plans to meet with Tour officials before deciding whether to compete in the 2009 Tour.
Previously, he had expressed doubts over trying for win another Tour title because of the problems he might encounter with French organizers, journalists and fans.
Armstrong is scheduled to race the Giro d'Italia for the first time. The 100th anniversary edition of the Giro is scheduled for May 9-31. The Tour de France starts July 4.
Armstrong said in the Guardian interview that he is in better shape at this stage of the season than in past years.
"I'm much better physically now," he said at his home in Austin, Texas. "And mentally there is no comparison. I'm far stronger and more motivated. The motivation of 2008 feels like the motivation of 1999. I was back from cancer then. I had the motivation of vengeance because nobody wanted me or believed in me."
Armstrong reiterated his denials of the doping allegations that have dogged him during his career.
"I understand people in France and in cycling might have that perception, but the reality is that there's nothing there," he said. "The level of scrutiny I've had throughout my career from the press and the anti-doping authorities is unmatched. I'm not afraid of anything. I've got nothing to hide. I won seven Tours through hard work.
"This next year won't be any different - even if people hate to hear that. I'm going to be focusing on every aspect of the bike, the team, the strategy, the training, the hard work, the sacrifice. There are no secrets. To the critics, I would say, believe it or not, there are exceptional athletes out there. Michael Phelps ... Paula Radcliffe."
Armstrong also restated his rejection of the French anti-doping agency's proposal that he agree to retest his 1999 urine samples to see whether the French newspaper L'Equipe was right when it reported they contained the banned substance EPO.
"I'm all for drug controls, but if the athlete cannot defend himself, what kind of kangaroo court is that?" he said.
Copyright © 2008 Canadian Press
"Freedom of the press, freedom of association, the inviolability of
domicile, and all the rest of the rights of man are respected so long as
no one tries to use them against the privileged class. On the day they
are launched against the privileged they are overthrown."
--Prince Peter Kropotkin (1842-1921) Russian prince, author, called "The
Anarchist Prince"
Obama may have to bury his beloved BlackBerry
Sun Nov 16, 8:20 PM
By Seth Borenstein, The Associated Press
WASHINGTON - Before he ran for president, Barack Obama quit smoking.
Now that he's won the job, he may have to break another addiction: checking his BlackBerry for email.
The president's email can be subpoenaed by Congress and courts and may be subject to public records laws, so if a president doesn't want his e-mail public, he shouldn't email, experts said. And there may be security issues about carrying around trackable cellphones.
Obama transition officials haven't made a decision on what the new president will or will not carry but those who have been there say it's unlikely he'll carry his BlackBerry and he may be in for some withdrawal pains.
"Definitely he's going to feel an electronic detoxing," said Reed Dickens, former assistant press secretary to President George W. Bush.
Dickens jokes he is so addicted to his BlackBerry he checks his device before opening his right eye.
Obama has often been seen avidly checking his email on his hand-held equipment. This past summer, news cameras recorded him checking his BlackBerry while watching his daughter's soccer game, only to have Michelle Obama slap at his hands, prompting him to return the device to its holster.
Actress Scarlett Johansson said she has had frequent email exchanges with him during his campaign travels, something the Obama campaign downplayed.
"This is a decision president-elect Obama will have to face," said former Bush press secretary Scott McClellan, who added Obama's legal advisers will probably recommend against an emailing president.
"While he has pledged an open and transparent government, I doubt the president-elect is interested in subjecting his own personal communications to that standard," McClellan wrote in an email interview.
He added: "He will have to think very hard about whether he wants to make his own words that subject to open records by having his own email and his own BlackBerry."
There is presidential precedent for an email blackout. Presidents George W. Bush and Bill Clinton didn't email while in office.
"It's all discoverable; it creates a trail that might end up in congressional investigators' hands," said Clinton press secretary Mike McCurry.
If you want to delete White House email, you get a stern warning about archiving presidential records, he said.
A few days before Bush took office in 2001, he sent an email to a few dozen close friends saying he would no longer use email: "Since I do not want my private conversations looked at by those out to embarrass, the only course of action is not to correspond in cyberspace. This saddens me."
Bush was unhappy about losing his email and mostly used the phone to talk with friends, McClellan wrote, adding: "I am sure the president looks forward to being able to communicate with them via email again come Jan. 20, 2009."
The Bush White House has been battling courts about lapses in email archives at the White House.
Before 2001, Bush was an active emailer but that was before the now ubiquitous BlackBerry with email and text-message functions was released in 2002. Users who constantly check their devices often call themselves crackberry addicts. A Canadian government agency asked its workers to live by a "BlackBerry blackout" on nights and weekends "in order to achieve work/life quality here."
"I think Obama is the first president who is addicted to the BlackBerry like the rest of us and there's a lot of presidential records and archive rules on what gets stored and what doesn't," said former Clinton press secretary Joe Lockhart.
Quitting BlackBerry use is not something some political types - such as McClellan - or tech-geeks like thinking about.
Benjamin Nugent, author of the book "American Nerd," said the president-elect is such a techie and has nerd qualities. So cutting off the BlackBerry could be painful.
"It'll be interesting if we could see the torment on his face. For me it would be hell."
But it actually could be good for the president-elect, said psychology professor Lawrence Welkowitz of Keene State University in New Hampshire.
"It might be a completely freeing thing for him, so that he can free himself to think and act," said Welkowitz, who doesn't carry a BlackBerry.
But even if Obama isn't packing a BlackBerry or cellphone, he'll have plenty of aides within arm's reach who do, experts said. Often a president uses the equipment of personal assistants.
And there is the chance Obama may buck the past and keep his BlackBerry tethered to his belt.
"He's the president," McCurry said.
"If he wants to carry the BlackBerry, he's entitled."
S.E.C. Accuses Mark Cuban of Insider Trading
November 17, 2008, 11:49 am
The Securities and Exchange Commission said Monday that it had charged Mark Cuban, the billionaire Internet entrepreneur and owner of the Dallas Mavericks basketball team, with insider trading for selling 600,000 shares of an Internet search engine company.
The S.E.C. said Mr. Cuban sold the stock in the company, Mamma.com, based on nonpublic information about an impending stock offering. The commission asserted that Mr. Cuban avoided losses in excess of $750,000 by selling his stock prior to the public announcement of the offering.
The commission filed a civil lawsuit against Mr. Cuban in Federal District Court for the Northern District of Texas, accusing him of violating federal securities laws. It said it was seeking to impose financial penalties and confiscate gains from the trades.
“As we allege in the complaint, Mamma.com entrusted Mr. Cuban with nonpublic information after he promised to keep the information confidential,” Scott W. Friestad, deputy director of the S.E.C.’s enforcement division, said in a statement. “Less than four hours later, Mr. Cuban betrayed that trust by placing an order to sell all of his shares. It is fundamentally unfair for someone to use access to nonpublic information to improperly gain an edge on the market.”
Mr. Cuban’s lawyer, Ralph C. Ferrara of Dewey & LeBoeuf, argued that the S.E.C.’s lawsuit “has no merit and is a product of gross abuse of prosecutorial discretion.”
“Mr. Cuban intends to contest the allegations and to demonstrate that the commission’s claims are infected by the misconduct of the staff of its enforcement division,” Mr. Ferrara said in a statement posted on Mr. Cuban’s blog.
The statement quoted Mr. Cuban as saying: “I am disappointed that the commission chose to bring this case based upon its enforcement staff’s win-at-any-cost ambitions. The staff’s process was result-oriented, facts be damned. The government’s claims are false and they will be proven to be so.”
In an aside, Mr. Cuban said on his blog, “I wish I could say more, but I will have to leave it to this, and let the judicial process do its job.”
In its complaint, the S.E.C. asserted that Mamma.com invited Mr. Cuban to participate in the stock offering in June 2004 after he agreed to keep the information confidential. The S.E.C.’s complaint asserted that Mr. Cuban knew that the offering would be conducted at a discount to the prevailing market price and that it would be dilutive to existing shareholders.
Within hours of receiving this information, the S.E.C. alleged in its complaint, Mr. Cuban called his broker and instructed him to sell his entire position in the company.
When the offering was publicly announced, the commission said, Mamma.com’s stock price opened at $11.89, down $1.215 or 9.3 percent from the prior day’s closing price of $13.105.
Mamma.com is now owned by Copernic, a Montreal-based company that provides search software and online advertising services.
“Insider trading cases are a high priority for the commission,” Linda Chatman Thomsen, director of the commission’s enforcement division, said in the S.E.C. statement. “This case demonstrates yet again that the commission will aggressively pursue illegal insider trading whenever it occurs.”
A lawyer familiar with securities law and insider trading cases said the commission must think it has a strong case against Mr. Cuban. “It does take a fair amount of time to develop these cases,” said Phil Stern, the co-chairman of white-collar criminal, regulatory and internal investigative services at the law firm of Neal Gerber Eisenberg. “They felt they had the case. If anything, they would be more cautious with a high-profile person.”
Another lawyer who previously worked at the S.E.C. said the commission’s action on Monday was “the beginning of a long process.”
“There is going to have to be discovery, depositions, lots of conferences with the court, pretrial hearings,” said John Carney, a partner at the law firm of Baker Hostetler and a former senior counsel at the S.E.C. and a former chief of the securities fraud unit of the United States attorney’s office in New Jersey. “A trial in a case like this could drag out for years.”
Earlier this year, Mr. Cuban made a bid to buy the Chicago Cubs, reportedly offering $1.3 billion. It was not immediately clear how the S.E.C.’s charges would affect his chances of being approved by Major League Baseball if his bid were to succeed.
But Mr. Stern of Neal Gerber Eisenberg said the charges would hurt Mr. Cuban’s chances to buy the Cubs.
Mr. Cuban, whose properties include the HDNet cable television network, is already a controversial basketball team owner. He is known for sitting conspicuously behind his own bench in a Mavericks T-shirt and arguing against the referees.
Off the court and on his own blog, Mr. Cuban has been a frequent critic of the National Basketball Association and its commissioner, David Stern, particularly on the issue of officiating, where he once claimed the chief of referees could not run a Dairy Queen. Mr. Cuban then ran a Dairy Queen for a day; even in retribution, he was seeking attention.
Asked about the S.E.C.’s allegations against Mr. Cuban, Mike Bass, an N.B.A. spokesman said, “We don’t comment on matters such as this.”
Mr. Cuban was the first N.B.A. owner to write a blog, posting his opinions almost daily, from topics as diverse as appeals to fans, criticism of the opposing team (particularly the Mavericks’ rival San Antonio Spurs), and treatises on business and politics. A recent post discusses hedge funds.
Although he has been both insightful and contentious within league ownership circles, in eight years since being approved owner of the N.B.A.’s Dallas Mavericks, Mr. Cuban did transform the franchise from a laughingstock to an N.B.A. championship contender. The Mavericks made the finals in 2006, only to collapse and lose the final four games to the Miami Heat.
During those 2006 playoffs, Mr. Cuban was fined $450,000, including $250,000 for several acts of misconduct after the penultimate loss, including yelling at a referee, staring down Mr. Stern and for uttering profanities to reporters in two separate post-game tirades.
In his eight years of ownership, Mr. Cuban has amassed nearly $1.7 million in fines. He has also matched each fine with a donation to charity.
Mr. Cuban has outfitted his team’s spiffy locker rooms in the American Airlines Center with the latest technology (televisions, computers) to attract free agents to come to Dallas. Mr. Cuban often worked out in his team’s weight room before games, talking to reporters with sweat dripping down his body as he climbed a Stairmaster and challenged reporters’ views.
The image seemed a parallel to his own life as a suburban Pittsburgh-born self-made billionaire.
– Jack Lynch and Liz Robbins
Best-and worst-performing cars
Forbes.com - Jacqueline Mitchell
The recent news that Chrysler may merge with General Motors didn't come as a surprise to many, as Chrysler has been struggling for years. It can't negotiate a deal with GM fast enough to save it from going under, in large part because its poor-performing vehicles are a drag on overall sales.
It therefore shouldn't come as any surprise that when the performance of cars is examined according to their predicted reliability, recalls and rate of depreciation, Chrysler vehicles dominate the list of the poorest performers, with seven of the 10 models on our list. All the vehicles have multiple recalls, ranging from airbags to door latches, along with mediocre resale values and bottom-level reliability scores for market-research groups.
Owners of the current-model-year Dodge Avenger, for example, have had to deal with six recalls. The depreciation and true market value of Avenger only ranks at two stars (out of a possible five) in the Automotive Leasing Guide, which provides depreciation estimates for use in the automotive financing industry.
And experts see no signs of Chrysler making quality improvements across the board, because the company currently lacks the financial resources to do so. It also remains unclear if the company has the means to hang on until auto sales revive.
"I'm not sure Chrysler can weather the storm as an individual company," says Dan Edmunds, director of vehicle testing at Edmunds.com.
It's an entirely different story, however, for the two Japanese auto giants, Toyota and Honda. The best-performing cars, according to our rankings, are all made by these two carmakers, with Toyota claiming six spots and Honda four in the top 10.
In the sixth spot is the immensely popular Honda Accord. It earned the highest Insurance Institute Highway Safety crash test ratings, its predicted reliability is high and there are no recalls so far this year.
"Honda's manufacturing quality is strong, and the consumer's perception of quality is also strong," says Jonathan Banks, senior director of consulting services for Automotive Leasing Guide.
Behind the Numbers
To compile our list of 2008 best- and worst-performing cars, we looked at five factors, all pertaining to 2008 model-year vehicles: the number of recalls to date, according to the National Highway Traffic Safety Administration (NHTSA) database; reliability ratings from Consumer Reports; depreciation, in the form of Automotive Leasing Guide's (ALG) star ratings; safety from the Insurance Institute for Highway Safety (IIHS) crash test ratings; and fuel economy and annual fuel costs from the U.S. Environmental Protection Agency.
Fuel costs were based on AAA's national regular gas price of $2.42 and unleaded at $2.60.
Aside from a standout number of recalls, we looked specifically for below-average reliability, high depreciation and IIHS results of "marginal" or "poor" for worst performers. Of the vehicles that met at least two of these qualifications, we also looked at other factors, such as fuel efficiency and fuel cost per year of ownership, assuming 15,000 miles driven per year.
Leading the Pack
Just as Chrysler dominates the bottom of the list, Toyota reigns at the top, with six vehicles that have among the highest resale values and best reliability scores. And all of the top 10 are among the most fuel-efficient cars and SUVs on the road.
The fuel-efficient Toyota Prius hybrid tops the list with an "excellent" reliability rating, no recalls and a five-star-rated resale value. It has the highest fuel economy (1.61 km per litre) and the lowest annual fuel cost of any car on the list ($789).
Another top performer is Toyota's Scion xD , a hatchback introduced in the 2008 model year as a replacement to the xA hatchback. The xD has an "excellent" reliability rating, no recalls and good fuel economy (1.62 km per litre).
While the Scion is a solid performer, however, it isn't perfect. It earned an "acceptable" (second-highest) frontal crash-test rating but did score a "good" rating (highest) in side- and rear-impact crash tests. Also, its resale value is an average three stars.
Which is more attractive in buying a car: a better price or better predicted reliability? Weigh in. Add your thoughts in the Reader Comments section below.
While there are no similar cars from U.S. automakers on the top half of the list, there are bright spots for 2009 and beyond, as GM and Ford Motor both plan to bring more fuel-efficient, nicely equipped small cars like the Chevrolet Cruze and Ford Festiva to the U.S. from other countries.
"There are things in the pipeline," says Edmunds, at least for those two companies. "I just don't know if Chrysler will be around to do it."
Trailing the Pack
Chrysler has carved out for itself a big space on our list of poor-performing cars, but the automaker has plenty of company.
When gas prices topped $4 a gallon this summer, consumers dropped gas-guzzling SUVs like the Nissan Xterra (1.6 km per litre), as sales plummeted 29.1% from January to October, compared with same period in 2007. The Xterra falls to sixth place among the worst-performing vehicles, as there have been three recalls on the car so far this year, not to mention its below-average performance in crash ratings in side (marginal) and rear (poor) tests, as well as its mediocre three-star resale value.
The Xterra's sales drop can't be chalked up to a general anti-SUV sentiment either, as the smaller Toyota Rav-4 rated fourth among best-performing cars and the Honda CR-V came in fifth. Unlike the Xterra, both cars deliver on fuel economy and resale value.
With the 2009 model year now in full swing (it kicked off Oct. 1), the 2008 model-year cars still sitting on dealer lots are loaded with incentives to make them more appealing to consumers. Chances are, says Banks, many poor-performing vehicles are among the ones with the highest incentives. But while you may save with a lower transaction price now, on a year-end deal, you're likely to be paying for it later.
"If it has a one- or two-star resale value, then it's not a great quality car," says Banks. "If it has a lot of recalls, then you may spend a lot of time in the repair shop. And when the vehicle warranty ends, you may face high repair costs."
HOD still rocking hard ... unbeal!
Covalon dragging the dregs lately. Hammered by markets and totally disillusioned investors seeing much promise but no revenues in sight.
Since there is literally zero interest in this pup, I will just migrate my comments on Covalon to my OTC Board or a Canadian stock board.
Covalon really sinking with markets, and at the same time investors are getting disillusioned by management with much promise but no results.
Even NT is one that needs to be looked at as a trader! May disappear much like GM, but events could bring it back up on daily speculations.
Some I am watching are:
COV
GGN
VAV
CBS
KBC
VRS
ENA
Trying to determine which will bounce back huge when markets return and which will just disappear!
Junior pups hitting major lows!
Contribute to an RRSP whenever possible to minimize tax load according to Sherry Cooper and other CDN gurus.
MAFIABOY
Started reading this book, a recent release, about a 15-year old hacker that was hunted down by the CIA, RCMP and FBI.
After about 30 pages I just couldn't take it anymore, as I found him arrogant and irritating. I must be old school or something.
http://www.nationalpost.com/todays_paper/story.html?id=854375
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
'Mafiaboy' Sentenced to 8 Months
Wired News Report Email 09.13.01
"Mafiaboy," the Canadian teenager who launched a denial-of-service attack that paralyzed many of the Internet's major sites for one week in February 2000, will be spending the next eight months in a youth detention center.
Judge Gilled Ouellet, who presided over the trial in Quebec's Youth Court, handed down the ruling on Wednesday.
Ouellet said that the 17-yeat-old had committed a criminal act when he attacked Yahoo, eBay and Amazon and other major Internet sites.
"This is a grave matter. This attack weakened the entire electronic communication system," Ouellet told the court. "And the motivation was undeniable, this adolescent had a criminal intent."
Prosecutor Louis Miville-Deschenes said that he hoped the sentence would send "a strong message to the hacker world."
Mafiaboy will also serve one year of probation after his release from the detention center. During his probation he will be allowed to attend school and have a part-time job.
He was also ordered by Ouellet to donate $250 to charity.
Mafiaboy's real name has not been released by the court, due to the Canadian law that protects the identity of offenders under 18 years of age.
Defense lawyer Yan Romanowski said that his client was shocked and saddened by his sentence and is considering an appeal.
"He hoped the judge had understood that he had had his lesson and that detention was not a proper remedy in these circumstances," Romanowski said.
"Detention is too much as far as I am concerned," Romanowski added.
The maximum sentence Mafiaboy could have received was two years in detention. Prosecutor Louis Miville-Deschenes had asked the court to sentence Mafiaboy to one year of detention.
"We think it is a reasonable ruling. It sends a strong message to hackers that they will get caught if they do things like that," Miville-Deschenes told reporters after court was dismissed.
'Second Life' ends couples' first marriage
LONDON (AFP) - A woman is to divorce her husband after discovering he was having a virtual affair within the online game "Second Life," newspapers reported Friday.
ADVERTISEMENT
Amy Taylor, 28, met her husband David Pollard within the game in May 2003, and six months later, she moved into his home in Cornwall.
The couple married in July 2005, while their "Second Life" avatars Dave Barmy and Laura Skye -- younger, slimmer versions of their real-life selves -- also held an online ceremony for their virtual friends.
After a rare break from the computer, however, Taylor returned to find her 40-year-old husband in an intimate, albeit virtual, position with an online prostitute within "Second Life", which she said was the "ultimate betrayal".
"I was so hurt," she was quoted as saying in The Times, adding that theirs was a "very serious marriage".
"I just couldn't believe what he'd done. It's cheating as far as I'm concerned, but he didn't see it as a problem and couldn't see why I was so upset.
"He said I was just making a big fuss and tried to make out it was my fault for not giving him enough attention."
Second Life is an online role-playing game with more than 15 million users, in which players can create virtual avatars and interact with other gamers, or the environment.
The game has its own virtual economy, in which online currency can be exchanged for real-world US dollars, and several major businesses have set up "branches" within the game, while others operate entirely within it.
According to the Daily Telegraph, Taylor claims that Pollard is now engaged to the woman he was having an online tryst with, despite never having met her.
She has, meanwhile, found a new love, through fantasy online role-playing game "World of Warcraft".
same here!
Did somebody plug headphones into your computer when you weren't looking/ I did that to myself once (hmmm just recently!).
A little girl was run over last year in a school zone right next door. Police keep warning people to slow down but away they go full speed right before the opening of class with a latte in one hand and a cigarette in the other and 300hp under the hood.
Strangest thing just happened on boot up. I clicked on my profile and there was a message saying something to the effect that "I either I didn't have enough resources or didn't have proper administrative access". I went in anyways and it was as if I had just bought the computer with no desktop, no bookmarks, and the desktop image of my computer seller.
Windows Defender had an open window open on the desktop with three (3) options green.
I rebooted and everything was back to normal except that I didn't have saved passwords anymore.
Thoughts?
tia
ou
Allen-Vanguard estimates fiscal 2008 revenues
2008-11-13 09:21 ET - News Release
Mr. David Luxton reports
ALLEN-VANGUARD CORPORATION PROVIDES GENERAL UPDATE TO SHAREHOLDERS
Allen-Vanguard Corp. has provided a general update, including its revenue for the fourth quarter of fiscal 2008, an update to the business and financial drivers and opportunities for fiscal 2009 which commenced Oct. 1, 2008, as well as further commentary on the progress of its financial discussions.
Recent performance
The company recorded a pronounced upturn in the finish to its fiscal year ended Sept. 30, 2008, after a very disappointing third quarter. Revenue for the fourth quarter grew by approximately 50 per cent over the third quarter to approximately $45-million, which resulted in estimated revenue for fiscal 2008 in the range of $300-million to $310-million, with all figures subject to final audit. Allen-Vanguard noted that its year-end financial report will show the previously announced restructuring charge for severance and other costs of downsizing its global work force and rationalizing manufacturing facilities, and will also show a large writedown of goodwill and other intangible assets.
The company also reported a very strong start to its new fiscal year which began Oct. 1, 2008, with a sharp increase in its services business in particular, resulting in order backlog as of Oct. 31 of approximately $120-million. The pace of orders six weeks into the new fiscal year represented an annualized revenue rate of $325-million, which is in line with the company's expectations for fiscal 2009.
Business and financial drivers for fiscal 2009
The company has just completed an exacting analysis and forecast for fiscal 2009, against a macroenvironment where improvised explosive devices (IEDs) are projected to remain a persistent global threat, per worldwide military doctrine and per United States Homeland Security doctrine. Allen-Vanguard's suite of products and services is core to the worldwide counter-IED mission.
The revenue expectations for fiscal 2009 represent an increase of approximately 5 per cent over fiscal 2008, led by a plus-50-per-cent increase in service revenues. More than 60 per cent of forecast 2009 revenue is estimated to come from the combined systems and services, and the personal protection systems business segments. Systems and services comprise counter-IED training programs as the company enlarges its incumbency in key, long-term counter-IED training programs for U.S. and NATO special forces, as well as additional revenue streams from its proprietary global data base of IED incidents. Personal protection systems comprise established products such as bomb suits, bomb tools and robots, and new proprietary products including microclimate systems, blast protection seats and personal armour. Following the disappointing performance of sales of electronic countermeasures (ECM) equipment in fiscal 2008 due to order delays, the fiscal 2009 revenue expectations for the electronic systems business unit have been limited to high-visibility contracts already in backlog and high-probability opportunities already well advanced in the sales process. The electronic systems business is concentrated in two major U.S. military programs and thus carries the most exposure to any change in spending priorities, in contrast to the systems and services segment and in particular the personal protection systems segment with its highly diversified product and customer base.
The company noted that revenue by quarter is expected to be more consistent compared with fiscal 2008, when 75 per cent of revenues were recorded in the first half of the year. Quarterly revenue is expected to expand as the year progresses. Predictability of revenue is high due to the program nature of the service revenue component, as well as the strong backlog of product revenue.
David Luxton, president and chief executive officer of Allen-Vanguard, said: "After disappointing our stakeholders in the second half of last year, we have been particularly rigorous in our forecasts for fiscal 2009, ensuring that all of our product line revenue forecasts are supported by order backlog, pending orders or through pipelines of advanced sales opportunities. The result is a forecast that is driven by our own sales and technical efforts, and is less susceptible to external factors and program delays. In addition, we continue to increase market reach through expanded partnerships, alliances and teaming agreements with prime contractors and system integrators. We have recently signed a teaming agreement with a global electronics and communications firm for an ECM opportunity with an expected potential value to Allen-Vanguard of more than $100-million over two years. We are also in active discussions with other global players to take several of our product lines into more markets and programs. At this juncture, we see limited downside risk, attributable mainly to timing of ECM orders as we and others in our industry await clarification of defence spending priorities following the U.S. presidential election. As against that, we see upside potential from our new products, in particular microclimate systems, vehicle blast seats and personal counter-IED armour, as well as opportunities to improve our product margins."
The company anticipates that its overall gross margin will be approximately 40 per cent, which will be an average of the high margins on proprietary personal protection products where the company has global market shares in excess of 50 per cent and the lower margins on services and systems. General and administrative expenses have been reduced to an estimated $10-million per quarter, or $40-million on an annualized basis, following the restructuring announced Sept. 25, 2008, as reported in Stockwatch, which included a 15-per-cent reduction in head count as well as consolidation of manufacturing facilities. Research and development expense is forecast at $14-million on a net basis, slightly below the level of fiscal 2008 due to financial prudence, but with continued emphasis on defending the company's technology leadership position, as well as new product development.
With these financial metrics, the company anticipates strong levels of operating cash flow with free cash flow available for debt reduction and a steady reduction in the ratio of debt/cash flow throughout the year.
Update on financial discussions
After an initial rapid paydown of the debt incurred in the acquisition of Med-Eng Systems in September, 2007, the company has been unable to make quarterly debt repayments since Sept. 30, 2008, due largely to significant order delays by the U.S. DoD for ECM equipment.
As at Aug. 31, 2008, the company had debt outstanding of $188-million on its $200-million term loan facility. The company has obtained accommodations from its lending syndicate to Nov. 28, 2008, which defers compliance with certain financial covenants, including the deferral of the $10-million quarterly principal repayment which was due Sept. 30, 2008. The accommodation permits the parties to continue a constructive dialogue regarding revisions to the existing credit terms. The company is currently meeting its operating cash requirements with cash flow generated from operations.
Allen-Vanguard is also in discussions with potential investors to provide adequate working capital and to explore recapitalization alternatives. The company and its board of directors, advised by its investment bankers, continue to explore potential investments and strategic transactions, some of which entail new capital and financial deleveraging.
"We recognize that all our stakeholders are anxious to know the outcome of these deliberations as soon as possible, especially given the severely deteriorated condition of financial and credit markets," concluded Mr. Luxton. "In the meantime, we are continuing our practice of updating shareholders on highlights of our progress and our business plan."
We seek Safe Harbor.
G.M.’s Troubles Stir Question of Bankruptcy vs. a Bailout
By MICHELINE MAYNARD
DETROIT — Momentum is building in Washington for a rescue package for the auto industry to head off a possible bankruptcy filing by General Motors, which is rapidly running low on cash.
But not everyone agrees that a Chapter 11 filing by G.M. would be the disaster that many fear. Some experts note that while bankruptcy would be painful, it may be preferable to a government bailout that may only delay, at considerable cost, the wrenching but necessary steps G.M. needs to take to become a stronger, leaner company.
Although G.M.’s labor contracts would be at risk of termination in a bankruptcy, setting up a potential confrontation with its unions, the company says its pension obligations are largely financed for its 479,000 retirees and their spouses.
Shareholders have already lost much of the equity that would disappear in a bankruptcy case. Shares of G.M. rose 16 cents Wednesday, to $3.08, but they have fallen 90.5 percent over the last 12 months, amid sharply lower auto sales and fears about G.M.’s future.
And as companies in industries like airlines, steel and retailing have shown, bankruptcy can offer a fresh start with a more competitive cost structure to preserve a future for the workers who remain.
“Just let market forces play out,” said Matthew J. Slaughter, associate dean at the Tuck School of Business at Dartmouth. “And if G.M. or one of the other companies files for bankruptcy, support the workers and the communities that would affected by a bankruptcy filing.”
William Ackman, a prominent activist investor who runs Pershing Square Capital, said Tuesday that G.M. should consider bankruptcy. “The way to solve that problem is not to lend more money to G.M.,” he said in an interview with Charlie Rose on PBS.
Instead, G.M. should submit a prepackaged bankruptcy, laying out steps it plans to enact once in Chapter 11 protection, said Mr. Ackman, who is not a major holder of G.M. shares.
“I’d rather the government’s money be used to train people for other jobs,” Mr. Ackman said. “The bankruptcy word scares people. It’s simply a system.”
Not surprisingly, Rick Wagoner, G.M.’s chief executive, disagrees. He told investors last week that “the consequences of bankruptcy would be dire and extend far beyond” the company. G.M. will “take every action we possibly can to avoid it,” he added.
The company also may be forced to take drastic actions as a condition of receiving any federal bailout package. It may include stiff requirements that G.M. and other automakers restructure and meet financial goals before they can get access to federal financing. Lawmakers may also demand a change in management.
Such demands “may have the same end as a restructuring,” but avoid the taint of an actual bankruptcy filing, said Susan R. Helper, a professor of regional economic development at Case Western Reserve University.
Even though a bankruptcy might help create a stronger company in the long run, consumers could easily see it as a sign that the cars they bought might not retain their value, and seek other options when shopping for a new car. (By contrast, travelers tend to have fewer concerns about flying on airlines operating in bankruptcy because their commitment ends with the flight.)
A car is “a major investment for a lot of families and the assurance that it will perform for a set period of time is part of the bargain,” said Christie L. Nordhielm, an associate professor of marketing at the University of Michigan.
To help ease consumers’ fears, G.M. could put money in escrow to reimburse its 6,468 dealers for any repairs to address problems covered by warranties. Airlines have taken such steps in the past to guarantee the value of tickets for future flights.
A study of 6,000 consumers last summer by CNW Marketing found that 80 percent of them said they would switch companies if G.M. or Ford filed for bankruptcy protection in the United States, suggesting that only G.M. loyalists would stand by the automaker.
A bankruptcy filing by a single Detroit car company could cost the economy $175 billion in the first year of the legal case in lost employee income and tax revenue, the Center for Automotive Research estimated this week. Given the complexity, a G.M. bankruptcy case could last three years or more.
A bankruptcy at G.M., with $111 billion in assets, would rank as one of the biggest bankruptcies ever, but would still be dwarfed by the case filed by Lehman Brothers last spring.
There are parallels between the Lehman bankruptcy and G.M.’s situation. In each case, the government was faced with deciding whether it was worth favoring one entity over its competitors as it worried about the impact on the broader economy of a potential collapse.
Certainly workers in other industries who have lost their jobs may feel the government should extend more help to them, too.
“Why should the government treat G.M., Ford and Chrysler workers any differently?” said Professor Slaughter.
But the United Automobile Workers union, which has joined the automakers to push for a bailout, might find grounds for a strike if a bankrupt G.M. asked a court to throw out its labor contracts.
A bankruptcy also could jeopardize the fate of a health care fund created in 2007 that was supposed to shift a $100 billion burden off the companies’ backs. The U.A.W. recently agreed to let G.M. delay payments to the fund.
Professor Helper, of Case Western Reserve, said the social cost to communities in Michigan, Ohio and other states where its 55 plants and other operations are located could be devastating, if G.M. were to liquidate or significantly cut its work force.
“Even if they go bankrupt in a year, it is better than going bankrupt now,” given the state of the national economy, she said. “From a social point of view, even if G.M. is not providing a return on investment, it is still providing a lot of good jobs.”
Mary M. Chapman contributed reporting.
Copyright 2008 The New York Times Company
Excellent illustration on the possible consequences of drinking and driving
VRS sinks to new low
lol
November 12, 2008
Democrats Seek Help for Carmakers
By DAVID M. HERSZENHORN and CARL HULSE
WASHINGTON — Democratic Congressional leaders said Tuesday that they were ready to push emergency legislation to aid the imperiled auto industry when lawmakers return to Washington next week, setting the stage for one last showdown with President Bush.
“Next week, during the lame-duck session of Congress, we are determined to pass legislation that will save the jobs of millions of workers whose livelihoods are on the line,” the majority leader, Harry Reid of Nevada, said in a statement.
His call for the session, the first since the election, came shortly after the House speaker, Nancy Pelosi, said Congress and the administration “must take immediate action” to stave off a possible collapse of the American auto industry.
Ms. Pelosi stopped short of saying Congress would adopt legislation to provide emergency financial aid to the automakers, giving the Treasury Department the option of using money from the $700 billion bailout program instead.
But with the White House insisting that the bailout money be reserved for financial institutions, that option seemed unlikely, leading a senior Democratic official to say Democrats would try to force Mr. Bush’s hand.
Congressional aides said that Democrats, should they move ahead with emergency legislation, would have to decide whether to put forward a stand-alone measure for the auto industry or include the aid in a wider economic stimulus measure. Such a package as the latter is likely to include extended unemployment benefits, aid to strapped states and cities, new money for health care and food stamps and possibly money for public works — all programs Mr. Bush has resisted.
Mr. Reid and Ms. Pelosi have urged the Bush administration to help the major automakers, especially General Motors, which is fast depleting its cash reserves and seems to be hurtling toward bankruptcy. G.M. shares, pummeled for weeks, fell an additional 13 percent on Tuesday to $2.92, its lowest point since 1943. G.M. on Monday warned shareholders that it might not be able to continue as a “going concern.”
At a meeting on Monday at the White House, President-elect Barack Obama also urged Mr. Bush to help the automobile companies, and Congressional aides said Democratic leaders were coordinating their activities with his transition team.
“In order to prevent the failure of one or more of the major American automobile manufacturers,” Ms. Pelosi said in her statement, “which would have a devastating impact on our economy, particularly on the men and women who work in that industry, Congress and the Bush administration must take immediate action.”
She added, “I am confident Congress can consider emergency assistance legislation next week during a lame-duck session, and I hope the Bush administration would support it.”
A senior Democratic official, who did not want to be identified talking publicly about party strategy, said Ms. Pelosi had decided to challenge Mr. Bush to work with the Democrats or veto aid to the teetering auto companies — and take the blame if one of them fails.
The White House has resisted calls by Congress to use the $700 billion to help the automakers, saying that money is better spent easing the credit crunch at the heart of the economic crisis.
Tony Fratto, the deputy White House press secretary, said it was not clear what the Democrats were proposing to do. But Mr. Fratto said Congress might better focus its efforts by easing restrictions on $25 billion in plant-retooling loans for the automobile industry that were approved in September.
The automakers have called for at least $25 billion more in assistance, and industry experts say G.M., Ford and Chrysler need quick access to unrestricted cash to help meet payroll and other basic obligations.
Mr. Bush, at his meeting with Mr. Obama on Monday, reiterated his longstanding desire to a reach a free-trade agreement with Colombia, which Mr. Obama and other Democrats have opposed. Some officials suggested Mr. Bush would back aid for the automakers in exchange for Democratic support on the free-trade deal, a notion that the White House dismissed.
A standalone bill would have the best chance of winning passage in Congress, where Republicans for the moment still retain a powerful minority in the Senate, and the best chance of winning Mr. Bush’s signature.
But many Democrats, and many leading economists, have said there is a need for a broader stimulus, and Democrats have been working on a package that would include an increase of unemployment benefits, new infrastructure spending, financial assistance for states struggling with increased Medicaid costs and increased food stamps.
Whichever path they choose, Democrats could be headed for a confrontation with Mr. Bush and were setting the stage for a dramatic lame-duck session, including a potential reunion on Capitol Hill of Mr. Obama, Vice President-elect Joseph R. Biden Jr. and the defeated Republican nominee, Senator John McCain of Arizona.
Mr. Obama does not intend to play a leading role in the session. Aides said he was focused on the economic packages he would offer as president, as well as working behind the scenes with Congressional Democratic leaders. But aides have not definitively ruled out the prospect of Mr. Obama casting his vote if it was needed. His Senate replacement will not be named by then.
The Senate had long planned to come back into session next week to deal with a public lands bill, and both the Senate and the House had planned to begin organizing for the next Congress.
But it was not certain that the House would convene for a formal post-election session, in which dozens of retiring and defeated lawmakers will be called back to work. House Democrats have said they are not inclined to spend time considering a stimulus package if it was only going to be vetoed by Mr. Bush.
With the auto companies reeling and Mr. Bush sending no signal that he would act, Ms. Pelosi said she had asked Representative Barney Frank, Democrat of Massachusetts and chairman of the Financial Services Committee, to begin drafting legislation directing that part of the $700 billion bailout be used to help the automakers.
“Emergency assistance to the automobile industry would be conditioned on executive compensation restrictions, a prohibition on golden parachutes, rigorous independent oversight and other taxpayer protections to ensure that any companies that benefit from this assistance and not the taxpayers bear the full burden of repaying any costs that are incurred,” Ms. Pelosi said in her statement.
Ms. Pelosi’s position drew quick support from Representative John D. Dingell, Democrat of Michigan and a top ally of the auto industry, who said he was working with other Michigan lawmakers on a measure to help the industry “re-emerge as a global, competitive leader in fuel efficiency and in new, path-breaking, energy-efficient technologies that protect our environment.”
General Motors, and to a lesser extent, Ford, were also mobilizing their car dealers and suppliers across the country to exert pressure on the White House and Congressional Republicans to support federal relief, according to industry sources.
They noted that Kentucky, the home state of Senator Mitch McConnell, the Republican leader, has auto manufacturing facilities that could make him sympathetic to moving quickly on aid.
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Copyright 2008 The New York Times Company
Breaking News Alert
The New York Times
Wednesday, November 12, 2008 -- 11:22 AM ET
-----
Paulson Shifts Bailout Focus to Borrowers and Non-Banks
Treasury Secretary Henry M. Paulson Jr. said that the $700
billion financial bailout program would not be used to buy
troubled mortgage-backed assets, as originally intended.
Instead, capital would be provided directly to nonbank
companies as well as banks and financial institutions, and
that more would be done to prevent home foreclosures.
Breaking News Alert
The New York Times
Wednesday, November 12, 2008 -- 11:22 AM ET
-----
Paulson Shifts Bailout Focus to Borrowers and Non-Banks
Treasury Secretary Henry M. Paulson Jr. said that the $700
billion financial bailout program would not be used to buy
troubled mortgage-backed assets, as originally intended.
Instead, capital would be provided directly to nonbank
companies as well as banks and financial institutions, and
that more would be done to prevent home foreclosures.
'Entitled' students expect better marks for trying hard, attending class: study
Attitude is 'making teachers crazy,' researcher suggests
Shannon Proudfoot
Canwest News Service
Wednesday, November 12, 2008
Most university students believe that if they're "trying hard," a professor should reconsider their grade.
One-third say that if they attend most of the classes for a course, they deserve at least a B, while almost one-quarter "think poorly" of professors who don't reply to e-mails the same day they're sent.
Those are among the revelations in a newly published study examining students' sense of academic entitlement, or the mentality that enrolling in post-secondary education is akin to shopping in a store where the customer is always right.
The paper describes academic entitlement as "expectations of high marks for modest effort and demanding attitudes toward teachers."
It's a hot topic -- and source of much frustration -- among instructors, says author Ellen Greenberger, a research professor of psychology and social behaviour at the University of California-Irvine.
"I would have trembled with fear before I suggested to some of my revered teachers that I wanted them to give me a higher grade," she says, chuckling about how attitudes have changed.
Ms. Greenberger's study reveals that students who feel academically entitled are more likely to engage in academic cheating, exploit others, shirk hard work and display "narcissistic orientation."
She found virtually no connection between self-entitled attitudes and grades, meaning it's not just weak students trying to wheedle better marks out of their professors, and those who do so aren't reaping the benefits on their transcripts.
"It certainly suggests that these attitudes and behaviours aren't producing the desired effect," she says. "It's just making teachers crazy."
The study, which surveyed two groups of approximately 400 undergraduates aged 18 to 25, is published in the November issue of the Journal of Youth and Adolescence.
Technology may encourage some of this demanding student behaviour because e-mail is quick, provides easy access to professors and opens the door to a less formal and respectful tone, Ms. Greenberger says.
"In-person communication obliges you to look the person in the eye as you're about to say, 'You really ought to give me a B because I came to most of the classes'." she says. "Try saying that face-to-face."
Wow, talk about memory lane ... using Roxio Creator 9 copying vinyl record in MP3 format on my hard drive which automatically ends up on iTunes which then gets synched onto my iPod Touch ... lordy lordy!!
Woman dies after being hit by husband's coffin on the way to cemetery
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By The Associated Press
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SAO PAULO, Brazil - Police say a woman has died on the way to a cemetery when a traffic accident hurled her husband's coffin against the back of her neck.
Police say 67-year old Marciana Barcelos was in the front passenger seat of the hearse when the accident occurred Monday in the southern state of Rio Grande do Sul.
Barcelos died instantly.
Her 76-year-old husband Josi Coimbra died Sunday of a heart attack while dancing at a party.
The driver of hearse and Barcelos' son suffered minor injuries.
Meanwhile NT and GM are turning into basket cases prime for bankruptcy ...
CBS.v still onradar in case junior spec money ever comes back!