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This Week’s Headlines: At NCUJHS: Looking for stock market tips?... In the Legislature: Tax audit brings cries of foul.... Nelsons and GMP reach settlement... Tag Archives: Essex County Three seeking Illuzzi’s seat Posted on June 12, 2012 by BethanyMDunbar Pictured is Vince Illuzzi at an energy meeting at Barton's municipal building in 2010. Photo by Joseph Gresser by Tena Starr copyright the chronicle June 13, 2012 So far, at least three people are in the running for the Orleans-Essex Senate seat that Vince Illuzzi has held for 32 years. John Rodgers of Glover, a former state representative, Bob Lewis of Derby, a current representative, and Jim Guyette of Newport said this week that they are seeking the job that Mr. Illuzzi plans to leave this year in order to run for state auditor. Republican Tom Salmon, who is currently auditor, is not seeking re-election. Mr. Illuzzi, also a Republican, wasn’t saying much this week about his decision to run for statewide office. “I’m not prepared to get into it right now,” he said on Monday. He said he will be filing his nominating petitions, and he will have a statement later in the week. The deadline for filing petitions for office is Thursday, June 14. Mr. Lewis said he filed his petitions for the Senate seat on Monday. “Basically, I will be announcing my candidacy in the near future,” he said. He said he’s planning a press conference for early next week. Governor Jim Douglas appointed Mr. Lewis to fill out the remaining term of Loren Shaw, who voluntarily gave up his seat. He has since been elected in his own right and has been in Montpelier since March of 2008. He serves on the Fish, Wildlife and Water Resources Committee. Mr. Rodgers had initially planned to run for the House seat that he lost to fellow Democrat Sam Young by one vote in 2010. In the general election, Mr. Young beat him by three votes. That narrowed down to a single, critical vote in a recount. Mr. Rodgers was a four-term incumbent, and the defeat came as a surprise. He said he decided to run for the Orleans-Essex Senate seat instead when he heard that Mr. Illuzzi might not be seeking re-election. “It’s something I’ve considered for a long time,” he said. “I need another challenge in my life.” He said he’d already had his paperwork done for the House seat when he shifted course and decided to run for Senate. Mr. Rodgers said he’s been getting a lot of encouragement and many people have offered to help him. And he’ll need all the help he can get, he said. “It’s a huge area.” Although Mr. Rodgers is well known in the southern part of Orleans County, he acknowledges that he’ll have a lot of work to do in the Newport and Derby area. “And in Essex County, I’m fairly unknown,” he said. Mr. Rodgers believes that he and the area’s other Senator, Bobby Starr of North Troy, would work well together since their political philosophies are similar. “I’m a Democrat, but I’m a conservative minded Democrat,” he said. He said he’s a “regular working guy” who thinks independently and does not necessarily follow the wishes of party leadership, but can work across party lines, a talent that Mr. Illuzzi was known for, and one that’s increasingly rare in partisan politics. “I can get along with everyone,” Mr. Rodgers said. He said that in 2010 he made a “calculated risk to not campaign,” a risk he won’t take this time. “I’ve got a lot of ground to cover now.” In a statement, Mr. Guyette said his reasons for running are simple: “First, there is no economy and very few job opportunities in this area. It seems to me the current local and state politicians have been unwilling to help improve the lives of residents when it comes to pocketbook issues.” The area consistently has the highest unemployment, underemployment and poverty rates in the state because of bad economic policies, Mr. Guyette said. “So how can we fix things? To start, let’s look at new economic policies, infrastructure improvements, creating a natural gas pipeline, scrapping Act 250, changing local permit reforms, and putting a very tight legal leash on the activities of out-of-state groups who tend to have too much say in economic and job development issues. I believe if I’m given the chance to be your senator, we can take steps to make drastic improvements in these areas.” Mr. Illuzzi has made rumblings about running for statewide office before, but this is the first time he has actually decided to throw his hat into the ring. At the moment, one question is whether he will run for auditor as an independent or as a Republican. Another is whether he can continue with his job as Essex County state’s attorney. Kathy Scheele, director of elections at the Vermont secretary of state’s office, said that’s a question with no clear answer right now. There’s nothing in the law that prevents somebody from submitting petitions for more than one office, Ms. Scheele said. “If they were to win, that would be a question for the General Assembly, the attorney general, or the courts to weigh in on.” Mr. Illuzzi was first elected to the state Senate in 1980 when he was 27 years old. In recent years, he’s run largely unopposed and has secured the Democratic nomination as well as the Republican. contact Tena Starr at [email protected] Posted in Editor's Picks | Tagged Essex County, Orleans County, politics, Tena Starr, Vermont Auditor, Vermont Senate, Vince Illuzzi Categories Editor's Picks (121)

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NY trader charged in Conn. with $1B Apple scheme NY trader charged in Conn. with fraud scheme related to purchase of $1 billion in Apple stock NEW HAVEN, Conn. (AP) -- A trader from New York has been charged in a scheme that involved the unauthorized purchase of about $1 billion of Apple stock that wound up costing his Connecticut-based employer $5 million, federal prosecutors said Tuesday. David Miller, while employed as an institutional sales trader for Rochdale Securities LLC in Stamford, executed a trade to buy 1.6 million shares of Apple Inc. stock in October on a day the company was scheduled to announce earnings, prosecutors said. The scheme was designed so Miller would profit if the stock price rose, but it declined, they said. A Rochdale customer stated it had ordered only 1,625 shares of Apple, the Cupertino, Calif.-based maker of iPods, iPhones and iPads. Miller falsely claimed that he had made a mistake in ordering many multiples of what was written in a client's order, authorities said. In telling Rochdale that he was simply executing a customer order, Miller misrepresented that the customer was at risk of loss if the trade proved unprofitable when he knew that it was Rochdale that would bear the risk of loss, prosecutors said. As a result of the scheme, Rochdale was left holding more than 1.6 million shares of Apple stock, authorities said. It promptly traded out of the position but suffered losses of about $5 million. Miller was charged with wire fraud. His attorney, Kenneth C. Murphy, declined to comment Tuesday. Authorities say Miller, who lives in Rockville Centre, N.Y., just east of New York City, duped another broker-dealer into taking on a significant short position in Apple stock. Miller convinced the broker-dealer to sell 500,000 shares of Apple stock, falsely claiming that he was trading for the account of a company with which he had no relationship and for which he was not authorized to trade, prosecutors said. Miller engaged in that part of the scheme to hedge against the large purchase of Apple stock he was executing at Rochdale, prosecutors said. He placed the broker-dealer at risk of sustaining substantial losses, they said. Miller, 40, appeared Tuesday in U.S. District Court in Bridgeport. He didn't enter a plea and was released on a $300,000 bond. He could face up to 20 years in prison if convicted. Investment & Company InformationFinance

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Systemic Disorder Essays on economic crisis, decoding dominant ideologies and creating a better world HomeAbout Systemic Disorder Monthly Archives: November 2012 In show of power, financiers impose will on Argentina’s Navy We know that finance capital is powerful, but that a hedge fund can impound the navy of the world’s eighth largest country is nonetheless startling. Financiers the world over have fumed over Argentina escaping their clutches a decade ago — the example of a country refusing to acknowledge the maximization of bank profits as the central organizing principle of civilization is too scary to contemplate — but most have made their peace. Accepting that something is better than nothing, at least for now, almost all of Argentina’s creditors accepted 30 percent of the face value of the country’s sovereign debt. Much of that debt is odious, accumulated by Argentina’s military dictatorship as it killed, tortured, “disappeared” or forced into exile Argentines by the hundreds of thousands as it imposed the Pinochet/Chicago School economic model. The rest of the debt came courtesy of the the country’s neoliberal rulers following the end of military rule, as it followed International Monetary Fund instructions into a crisis that culminated with economic crisis at the end of 2001. When Néstor Kirchner became Argentina’s fifth president in two weeks, he put an end to austerity and defaulted on the debt, ultimately agreeing to pay 30 percent to those willing to negotiate a settlement but refusing to pay anything to holdouts. Many of Argentina’s creditors are not the financial institutions that originally made the loans; much of the debt was sold to speculators. Two of those speculators, the hedge funds Elliott Capital Management and Aurelius Capital Management, are among the seven percent of creditors who refused to agree, instead demanding full payment of the face value of the debt that they bought for pennies on the dollar. The key speculator here is Paul Singer, the type of character for which the term “vulture capitalist” was coined. Mr. Singer’s hedge fund is Elliott Capital and one of the fund’s subsidiaries is NML Capital. The eyes of a billionaire To all appearances, the billionaire Mr. Singer is determined to squeeze every dollar out of every “investment,” and he has the means at his disposal to bring this about. Using the Internet, his NML Capital tracked a ship used as a training vessel for the Argentine Navy. Calculating its chances, NML Capital waited for the ship to dock in Ghana, then quickly went to a local court, where it successfully obtained an order impounding the ship. The ship remains stranded in Ghana’s main port, and the Argentine government had to resort to chartering a flight to bring most of the crew home; it couldn’t use an Argentine airplane under fear that the plane, too, would be impounded. Mr. Singer has long used such tactics, according to a report in Forbes magazine, and he purposely waited for the ship to dock in Ghana because he believed it was the country among the ship’s ports of call that would most likely grant his wishes. Forbes reports that Elliott Capital had sought in 2007 to seize the Argentine presidential plane when it was scheduled for maintenance in the United States (the plan was foiled when Argentina was tipped off) and two years later plotted to seize Argentine assets at the Frankfurt Book Fair, forcing the government to withhold showing works of art. That having the ship stranded in port might have negative effects on Ghana, a poor country, does not seem to have been of concern. The ship’s presence has greatly slowed down the ability of cargo ships to use the port, causing dozens of vessels to wait offshore in a lengthening queue, according to The Financial Times. Such delays are also costing the shipping companies and others considerable money. But what could be more important than a speculator trading on other people’s misfortune scooping up windfall profits? Buying (very) low, demanding (very) high There is nothing out of character for Mr. Singer to be using such hardball tactics. In fact, his hedge fund’s strategy is to buy outstanding debt at a tiny fraction of its value and then demand to be paid in full. A report on him and the other billionaires with whom he plays, including David and Charles Koch, on the ThinkProgress blog reports: “Singer, manager of a $17 billion hedge fund, earned the moniker “vulture capitalist” for buying the debt of Third World countries for pennies on the dollar, then using his political and legal connections to extract massive judgements to force collection — even from nations suffering from starvation and violent conflicts. Singer and his partners have used such tactics in Panama, Ecuador, Poland, Cote d’Ivoire, Turkmenistan, and the Democratic Republic of Congo. In addition to squeezing impoverished countries with sovereign debt schemes, Singer speculates in the oil markets, a practice which can lead to gasoline price hikes.” Among his other exploits, Mr. Singer is the chairman of the Manhattan Institute, an extreme Right “think tank” that specializes in promoting neoliberal ideology. That affiliation is evidentially not a coincidence. Investigative journalist Greg Palast, writing for Truthout, provides some of the details of the speculator’s previous efforts to “collect” his debts: “Singer’s modus operandi is to find some forgotten tiny debt owed by a very poor nation (Peru and Congo were on his menu). He waits for the United States and European taxpayers to forgive the poor nations’ debts, then waits a bit longer for offers of food aid, medicine and investment loans. Then Singer pounces, legally grabbing at every resource and all the money going to the desperate country. Trade stops, funds freeze and an entire economy is effectively held hostage. Singer then demands aid-giving nations pay monstrous ransoms to let trade resume. … Singer demanded $400 million from the Congo for a debt he picked up for less than $10 million. If he doesn’t get his 4,000 percent profit, he can effectively starve the nation. I don’t mean that figuratively — I mean starve as in no food. In Congo-Brazzaville last year, one-fourth of all deaths of children under five were caused by malnutrition.” The financier war on Argentina The billionaire speculator has also been attempting to get many pounds of flesh out of Argentina courtesy of the U.S. federal court system. The latest in a series of thundering rulings by a senior U.S. district judge, Thomas Griesa, earlier this month ordered Argentina to pay US$1.3 billion to Elliott Capital Management and Aurelius Capital Management, the two main holdouts who refused to agree to the 30 percent deal with Argentina. The Argentine government appealed to a higher court on November 25. That is a routine the government is already familiar with, after the same judge last year issued a ruling that the two hedge funds could seize Argentina’s deposits with the Federal Reserve. Yes, it has come to the point where even the world’s most powerful central bank can be seen as a mere piggy bank to be raided at will by financiers. Well, almost, because that ruling was too much even for the U.S. government — it joined an appeal to a higher court, which threw out the ruling on the basis of sovereign immunity. The Federal Reserve holds money and gold owned by many of the world’s governments, and has an interest in maintaining a shield that protects those holdings from private seizure. This was a matter of the principal of sovereignty — the U.S. doesn’t want its overseas assets seized, either — so let us hold off from celebrating the appeals court reversal too joyously. The various bilateral and multilateral “free trade” agreements that elevate corporate profit above all other human considerations, and the arbitration bodies such as the International Centre for Settlement of Investment Disputes that improvise ever harsher rulings that become precedents for future cases, quietly lurk in the background. Not that ago that the idea that a regulation against pollution that threatens human health would be illegal because it hurts profits would have been bizarre. Yet it is now routine international trade law. A billionaire speculator seizing a military vessel is bizarre; the billionaire’s tactics are sufficiently outlandish that, in this case, other financiers oppose his insistence on being paid in full if only because they are afraid they would not receive their own payments if Argentina has to pay him. President Cristina Fernández has repeatedly said there will be insufficient money available to continue to pay back the creditors who accepted the 30 percent deal nor for domestic social programs if full payments are made to the holdouts Elliott Capital and Aurelius Capital. But if the holdout hedge funds’ tactics ultimately work, what is outlandish will become accepted. What will be seized next? A country’s food supply? Financiers love to portray themselves as the lubricants of the modern economy, enabling capital to be distributed to where investment is needed. They can believe that if they wish, but there is no reason for the rest of us not to see financiers as what they are: parasites. Share this:FacebookRedditTwitterEmailPrintMoreDiggGoogleLinkedInPinterestPocketStumbleUponTumblrLike this:Like Loading... 6 Comments Posted in Latin America Tagged Argentina, austerity, capitalism, economics, finance, hedge funds, neoliberalism, politics World Bank’s call for slowing global warming ignores own role Global warming appears, or so it seems, to have begun to be taken more seriously this week as none other than the World Bank issued a report sounding the alarm bells. But let us not grow warm in our hearts just yet that corporate leaders have suddenly decided to yield to science and reality. What we have here is a case of truly monumental hypocrisy. The policies of the World Bank and its sibling, the International Monetary Fund, have constituted non-stop efforts to impose multi-national corporate control, dismantle local democratic institutions and place decision-making power into the hands of corporate executives and financiers, the very people and institutions that profit from the destruction of the environment. The World Bank’s report, “Turn Down the Heat,” prepared for it by the Potsdam Institute for Climate Impact Research and Climate Analytics, does incorporate the latest thinking of climate scientists. It paints a dire picture of a world in which the average temperature will increase by four degrees Celsius (seven degrees Fahrenheit) by the end of the 21st century without large-scale policies to reverse the trend. Among the effects of such a rise in temperatures, according to the report: “[T]he inundation of coastal cities; increasing risks for food production potentially leading to higher under and malnutrition rates; many dry regions becoming dryer, wet regions wetter; unprecedented heat waves in many regions, especially in the tropics; substantially exacerbated water scarcity in many regions; increased intensity of tropical cyclones; and irreversible loss of biodiversity, including coral reef systems.” The World Bank report advocates that the century’s temperature rise be held to less than two degrees Celsius. The bank says that “more efficient and smarter use of energy and natural resources” can reduce the climate impact of development “without slowing poverty alleviation or economic growth.” Despite the bank’s neo-liberal agenda, a goal stated in these terms is consistent with Center-Left political parties around the world. Among the initiatives proposed by the report are: “[P]utting the more than US$ 1 trillion of fossil fuel and other harmful subsidies to better use; introducing natural capital accounting into national accounts; expanding both public and private expenditures on green infrastructure able to withstand extreme weather and urban public transport systems designed to minimize carbon emission and maximize access to jobs and services; supporting carbon pricing and international and national emissions trading schemes; and increasing energy efficiency.” In other words, the very economic system that has brought the world to the brink of a disaster that could arrive in the lifetimes of many people alive today is supposed to magically eliminate the problem, and without significant changes to consumption patterns. Alas, that is wishful thinking. The very energy corporations that stand to most profit from continued high energy use and increasingly damaging resource-extraction techniques are the biggest sources of misinformation intended to deny the reality of global warming or to claim that climate change is “natural” and to do anything about it would wreck the economy. Increase in extreme weather events Those executives who peddle that ideology will have long ago lined their pockets with outsized profits and will have left this Earth by the time the environmental bill comes due. Last month’s Hurricane Sandy, which devastated the coasts of New Jersey and New York, can’t be seen as anything other than a harbinger of what is coming; similar to the heat waves that destroyed crops in Russia and North America in 2010 and 2012, respectively, and the dramatic retreat of the Arctic ice cap. Of course, no single storm or single heat wave can be attributed to global warming. But global warming increases the odds of destructive, deadly weather events. One measure is the number of “extreme” weather events (top or bottom ten percent of extremes in temperature, precipitation, and drought) as measured by the U.S National Oceanic and Atmospheric Administration. Through the end of October, 38 percent of the contiguous U.S. land mass had experienced at least one of these extreme weather events in 2012, the second-highest figure since records began to be kept in 1910. The average for the past century is 20 percent; all but four years since 1991 have exceeded this average. Consistent with the initiatives proposed by the World Bank report, the Obama administration has advocated “green capitalism” to deal with global warming, although in practice (particularly during the just-concluded presidential election campaign) Barack Obama has offered little better than the standard head-in-the-sand ideas of ramping up oil and gas extraction, salted with chimera like “clean coal” and “safe nuclear energy” — two concepts that are the epitome of oxymoronic construction. Coal throws more global-warming carbon dioxide into the atmosphere than any other energy source and the meltdowns at Fukushima and Chernobyl should be sufficient warnings against building more nuclear power plants even before we contemplate the impossibility of safely disposing nuclear waste. Energy companies continue to sue to overturn regulations Hydraulic fracturing of rock — or “fracking” — using jets of water and chemicals to force natural gas from underground is the latest offer from the world’s energy companies. Bitter battles across North America are raging over fracking and the pollution and destruction of water sources left in its wake. But lest we believe the latest World Bank report might induce a pause for thought, consider this: A U.S.-incorporated energy firm, Lone Pine Resources Inc., is suing under the North America Free Trade Agreement (NAFTA) to overturn Québec’s regulations against fracking. Lone Pine, which is actually headquartered in Calgary, Alberta, despite its formal incorporation in the U.S. tax-haven state of Delaware, is seeking $250 million in compensation, reports The Globe and Mail newspaper of Toronto. (More corporations are incorporated by far in Delaware than any other U.S. state because of its laws specially tailored to benefit corporate executives; the state even has a special court that only adjudicates business disputes.) Technically, Lone Pine is suing the Canadian government because only the three national governments can be sued under NAFTA. The company is suing under NAFTA’s Chapter 11, which authorizes corporations to sue over any regulation or other government act that violates “investor rights,” which means any regulation or act that might prevent the corporation from earning the maximum possible profit. The Wall Street Journal reports that Québec “banned shale-gas exploration in parts of the Saint Lawrence Valley and revoked previously issued mining rights as it studied the environmental consequences.” NAFTA allows a Canadian company to sue the Canadian government in a way it wouldn’t otherwise have been able to do — an excellent deal for polluters. Because the rules of NAFTA are heavily tilted in favor of business and against labor or environmental regulation, almost every case brought to a tribunal under NAFTA ends with either a hefty payout to the suing corporation or an overly generous settlement by governments seeking to avoid an even bigger payout, and a reversal of regulations passed by democratic governments. These decisions are handed down in secret tribunals in which many judges are attorneys who specialize in representing companies in disputes with governments. The rules of NAFTA, draconian as they are, are merely the starting point for still harsher rules under the secret Trans-Pacific Partnership being negotiated by nine countries. Moreover, the TPP would require the use of a tribunal controlled by the World Bank, a tribunal already in common use under many existing trade agreements. Each time a tribunal overturns a regulation or protection, it becomes a precedent — that is, a new starting point from which further corporate control of national laws can be launched. World Bank policies fuel global warming Environmental laws are frequently the target of corporate assaults under free-trade rules, and the most frequent initiators of these assaults are energy and chemical corporations. Tribunals controlled by the World Bank or other institutions that promote corporate globalization ensure that environmental, labor and other legal protections are eviscerated, thereby accelerating the destructive activities that fuel global warming. The World Bank has long imposed harsh austerity on countries around the world, in exchange for drowning those countries in debt, which then gives multi-national corporations and itself, which enforces those interests, still more leverage to impose more control, including heightened ability to weaken environmental and labor laws. The bank also plays a direct role in global warming, having provided billions of dollars to finance new coal plants around the world in the past few years. The World Bank is a key organization in the concatenation of processes that has brought the world to the brink of catastrophic climate change. To issue a report on the likely future destruction to be wrought by global warming without acknowledging its own role and without calling for a fundamental change in the global economic system that it enforces — which is the root cause of a potentially runaway chain of environmental disasters — is beyond chutzpah. Capitalism is incapable of reversing global warming. All of its incentives are for private profit without regard to public effect. The maximization of profit in the short term is the aim of a capitalist corporation (indeed, for one listed on a stock exchange, it is required by law to have no other purpose). Its incentive, then, is to shed costs whenever possible — not only to reduce wages, but to offload the costs of pollution and other public nuisances onto governments and, ultimately, taxpayers. The rigors of competition require that ever bigger profits be made and expansion continually undertaken, under pain of going under if a competitor does this more successfully. Because of the necessity of endless growth, and the lack of need to take into account pollution and of the amount of carbon dioxide thrown into the atmosphere because those are not assigned to the corporate bottom line, every systemic incentive exists to extract and use more natural resources, regardless of long-term costs. It is impossible for such a system to clean up its own mess. At best, it might, in the future, innovate new technologies for renewable energy, but not in a rational manner. The Chinese government has so over-invested in solar-energy equipment, for example, that it is estimated that capacity is now three times more than demand. This explains why U.S. solar-equipment companies are going out of business despite being granted significant government subsidies. Capitalism has developed to the point where the very existence of humanity could be at stake in the future; where ever more inequality leads to deepening crises and an inability for humanity to deal logically with these crises, even ones that carry the potential for catastrophic destruction. What could be more unsustainable? Posted in Environment Tagged Canada, capitalism, economics, global warming, NAFTA, politics, science, weather, World Bank A tale of two elections: Venezuelan accountability and U.S. irregularities There were two widely watched national elections earlier this month. In one, a popular incumbent won for the fifth time in a voting system called “the best in the world” by former U.S. President Jimmy Carter. The other election featured widespread attempts at voter suppression with many localities using computer systems with no paper backup that do not confirm the results. The incumbent in the first example is nonetheless routinely referred to the corporate media as a “dictator” while the second country is portrayed by the same corporate media as “the world’s greatest democracy” that has the right to dictate to other countries. The first example, as you have by now surmised, is Hugo Chávez of Venezuela. Just for the record, here are the results of his presidential contests: December 1998: Elected president with 56.2 percent of the vote. July 2000: Re-elected president with 59.8 percent of the vote under a new constitution. August 2004: Retained presidency by defeating a recall referendum with 59.3 percent of the vote. December 2009: Re-elected president with 62.9 percent of the vote. November 2012: Re-elected president with 55 percent of the vote (81 percent of those eligible voted). If we were to count elections to the parliament, state and local elections, and various referendums, President Chávez and his United Socialist Party of Venezuela have won 15 of 16 elections since 1998. The lone exception was a ballot on constitutional changes that lost by two percentage points – and his reaction was simply to accept the results. Accepting a narrow defeat and allowing an opposition that bitterly hates you and everything you stand for to place a recall referendum on the ballot — it would seem that President Chávez needs to work much harder to become a “dictator.” All parties confirm voting process in Venezuela What most stands out in Venezuelan elections is the transparency of the electronic voting system. Voters in Venezuela make their selections on computers in which party and independent observers participated in 16 pre-election audits, according to a report by the Carter Center. The center’s report further states: “One of the key aspects of the security control mechanisms involves the construction of an encryption key — a string of characters — created by contributions from the opposition, government, and [National Electoral Council], which is placed on all the machines once the software source-code has been reviewed by all the party experts. The software on the machines cannot then be tampered with unless all three parties join together to “open” the machines and change the software. In addition, each voting system machine has its own individual digital signature that detects if there is any modification to the machine. If the voting count is somehow tampered with despite these security mechanisms, it should be detectable … because of the various manual verification mechanisms.” [page 5] As an added precaution, each voter has a fingerprint on file, with a voter having to provide a fingerprint to avoid anyone attempting to vote more than once, and this system is also encrypted to guarantee secrecy. Finally, there measures to ensure accuracy in the vote count, including printouts of all votes and an automatic audit. The Carter Center reports: “The voting process permits voters to verify their ballots through a paper receipt generated by the voting machine. A comparison of a count of the paper receipts and the electronic tally at the end of the voting day with the presence of voters, political party witnesses, domestic observers, and the general public is conducted in a large sample of approximately 53 percent of the voting tables, selected at random. Additionally, party witnesses receive a printout of the electronic tally from every machine. The [National Electoral Council] gives the party a CD with the results of each machine and publishes them on the website so that all of these results can be compared. The human element is therefore still important.” [page 7] The opposition coalition that supported President Chávez’s main opponent, Henrique Capriles, approved the voting lists and electoral process ahead of the vote; the opposition campaign therefore had no basis to contest the results afterward and indeed conceded soon after the polls closed. It took only “minutes” for the vote to be announced, based on 90 percent of the vote total, according to a commentary by a Venezuelan journalist writing for the business publication Forbes magazine. One would not expect to see an article praising Hugo Chávez’s government in a publication like Forbes, which proudly refers to itself as a “capitalist tool.” So all the more noteworthy is this commentary by Venezuelan journalist Eugenio Martinez: “[I]t may be time for the greatest democracy in the world to take a lesson from Venezuela on how to develop and administer an efficient electronic voting system spanning across all stages of the electoral process.” Controversy in U.S. presidential elections We can contrast that with the U.S. election, in which it took days for many local races to be known; the Florida vote for president wasn’t decided until the following weekend. A week after the election, the winners of six congressional races could not be determined. U.S. elections are rarely without controversy, and the last four presidential elections have featured significant attempts to suppress the vote, controversies concerning unverifiable voting machines, hours-long lines at polling places sometimes due to manipulations in the distribution of voting machines and even (in 2000) a sacking of an election office to prevent a re-count from being conducted. That 2000 sacking occurred in Miami when a mob organized by Republican Party operatives stormed the election office, physically preventing the vote count from continuing in an area expected to vote for Al Gore, the Democratic Party presidential candidate. The 2004 election saw the first widespread use of electronic voting machines. And in 2012, many states with Republican governments passed laws aimed at keeping groups of people, particularly African-Americans, from being able to vote, and on election day there were widespread reports of shortages of machines in areas expected to vote heavily for Democrats, leading to long lines while nearby areas expected to vote Republican had no lines at all. Similar problems also occurred in 2004 and 2008. In contrast to Venezuelan voting machines which can be checked, many U.S. voting machines are not equipped with any way to confirm the results — and the machines use private, proprietary software belonging to the manufacturers of the machines that is not accessible to election officials, nor do they provide printouts for confirmation. The 2004 presidential election was noteworthy for the extraordinary 5.5 percentage-points disparity between exit polls and the announced results. In the U.S., the presidential vote is actually 51 separate votes because each state plus the District of Columbia distill their individual totals into the electoral college. Statistically, it would not be unexpected that two might report a result that is a small amount outside the polls’ margin of error, with the divergences evenly distributed. In 2004, seven states reported results that were so far beyond the margin of error that the odds of any one happening are less than one percent, according to a study by the group US Count Votes. The odds of seven outliers (all in one direction, for George W. Bush) to such an extent is one in ten million! The study then broke down discrepancies between exit polling and official results, and found that in jurisdictions in which paper ballots were used, the aggregate discrepancy was within the margin of error (and thus statistically unremarkable), while the aggregate discrepancy for electronic machines was far outside the margin of error, sufficiently so to conclude that an impartial investigation be conducted (which was not done). A separate watchdog group, Election Defense Alliance, said of these unexplained discrepancies and other problems following the 2008 election: “The central process of our elections is the counting of our votes. Yet we now have electronic machines that count our votes out of view [of U.S.] citizens — in other words, in secret. … In the presence of large exit polls discrepancies, there is no way to know whether or not extensive fraud has been committed without an extensive investigation, including access to the voting machines. After three consecutive national elections manifesting large exit poll discrepancies well beyond the margin of error, and all in the same direction, it is way past time that we find a way as a nation to ensure that our elections are conducted fairly.” The three largest manufacturers of voting machines in the U.S. at that time each had strong connections to the Republican Party, and machines of each were involved in problems with the 2004 vote, according to exhaustive accounts chronicled in the book Fooled Again by Mark Crispin Miller. The 2012 presidential vote aligned very closely with polling; perhaps sufficient safeguards have begun to be implemented. But the shortage of machines in areas with heavy concentrations of Democratic voters in several Republican-controlled states demonstrates that clean elections remain an aspirational goal. The attempted voter suppression may have backfired, as most of the voting-suppression laws were overturned by courts and news reports were full of African-Americans and others determined to vote to defy those who didn’t want them to do so. Enthusiasm in Venezuela a contrast to U.S. voters The sanctity of the vote itself aside, the U.S. election was mostly a sterile affair of voting against the other candidate; neither Barack Obama nor Mitt Romney could generate much excitement. Certainly there were millions of people in Venezuela motivated by opposition to Hugo Chávez, but there were many more who voted for the incumbent enthusiastically. A reporter writing before the election for the online news site Venezuelanalysis wrote: “Talking to people at the Merida rally, I was impressed by the depth of political consciousness and variety of opinions among the crowd as to why they supported Chavez’s re-election. For some, Latin American integration was the reason, for others, free healthcare. For many, their main reason for supporting Chavez, as one middle-aged couple put it to me, was that ‘he’s the president who has most given power to the people’ while another man told me, ‘he’s the president who has awoken the people of Venezuela and fellow peoples.’ Another young woman told me her reason was quite simply ‘I love him.’ … Indeed, the young woman who told me that ‘love’ was the reason she voted for Chavez wasn’t being tricked by some populist image or last minute spending burst. She came from a poor family which used to live in a shanty house near where the Merida rally took place. Now she is about to graduate as a doctor in the government’s integral community medicine program, and would have been excluded from the Venezuela’s traditionally elite medical system. Her shanty house had also been transformed into a dignified home through the community driven ‘homes for shanties’ program, part of the government’s mass housing construction mission. It’s transformations like these that have earned Chavez such strong support, as much as it pains the international media to say so. Indeed, according to corporate media sources, gaining the support of the popular majority through directing government policy toward their needs seems to be a bad thing for ‘democracy.’ ” President Chávez is often accused in the corporate media, by no means only in the United States where the most vigorous opposition to the Bolivarian Revolution originates, of “buying” votes. Yet the presidential campaigns of President Obama and former Governor Romney spent approximately US$2 billion while an additional $1.7 billion was spent on congressional races, according to The Center for Responsive Politics. A handful of billionaires, most notably but not limited to oil barons David and Charles Koch and casino magnate Sheldon Adelson accounted for tens, perhaps hundreds, of millions of dollars each thanks to the a string of decisions in the U.S. Supreme Court that equate money with speech, capped by the Citizens United vs. Federal Election Commission decision. How does that staggering amount of money not constitute buying votes and offices? Uneven progress for Bolivarian Revolution The point here isn’t that Venezuela is perfect or a paradise — it is neither. But President Chávez’s Bolivarian Revolution has repeatedly received Venezuelans’ approval to continue progress toward what he calls “21st century socialism.” That process is aimed explicitly at putting an end to the neoliberalism that has imposed so much misery and putting power into the hands of local communities so that people can make the decisions that affect them. Doing so is bitterly opposed by the former rulers of Venezuela, who were the leading backers of opposition candidate Henrique Capriles; by industrialists and financiers throughout the advanced capitalist countries; and by the numerically minuscule capitalist elites of regional countries. The Bolivarian Revolution is a sometimes chaotic process that does not advance in a straight line; aspects of its are opposed by some leaders inside President Chávez’s government. Although nationalization of the state oil company receives most of the attention, the bedrock of the revolution are the formations of small cooperatives in a variety of industries; the creation of “social production companies” in which existing enterprises were to create co-management structures and create chains of supply with cooperatives; shuttered enterprises that are expropriated by the workers who re-start production; and experiments in “co-management” with workers’ participation conducted in large state-owned resource enterprises. The last of these initiatives has suffered setbacks for a variety of reasons, including resistance from existing managements. A need for modernization and resistance from unions has also contributed to setbacks in creating workers’ co-management of the large state-owned resource enterprises. Considerable differences of opinion on the appropriate forms of management and ownership of enterprises continues not only among working people but among officials in the government. Dario Azzellini, in a chapter covering Venezuela in the book Ours to Master and to Own (the source for the preceding two paragraphs), summarizes the progress of the Bolivarian Revolution: “The transformation and democratization of the economy has proved the most difficult. The administration of most companies is neither under workers’ nor community control. Surrounded by a capitalist system and logic, it has been extremely challenging to establish collective production processes. Questions over the distribution of work and the resulting gains are particularly conflictive. However, where workers have succeeded in gaining control of their workplace, it can be observed that they have usually developed ties with the surrounding communities, abolished hierarchical structures, made themselves accountable to the workers’ assembly, and in most cases introduced equal salaries and increased the number of employed workers.” [page 397] Professor Azzellini concludes that “The search for an alternative economy is thus firmly on the agenda.” We need not look any further to discover the solution to the puzzle of Venezuela being falsely painted as a “dictatorship” when it has elections much more transparent and fair than those of the United States. Share this:FacebookRedditTwitterEmailPrintMoreDiggGoogleLinkedInPinterestPocketStumbleUponTumblrLike this:Like Loading... 1 Comment Posted in Latin America, Voting Tagged Democrats, economics, elections, Hugo Chavez, politics, Republicans, Venezuela, voting machines Self-directed workers as a “cure for capitalism” The economy of the future will not be a tabula rasa. Today’s bricks will form part of tomorrow’s edifice and, assuming that humanity’s zig-zagging and often circular course toward greater freedom continues, pieces of a better world exist scattered around us. Cooperative enterprises are surely part of that (hoped for) better tomorrow. If tomorrow’s better world is one of economic democracy, environmental sensitivity, rationality in production and distribution, equality and meaningful community involvement, than cooperatives will form some of the backbone. Some of these bricks are already here: Successful cooperatives exist today, although they are as yet small islands of democracy in the vast sea of authoritarian capitalist enterprises. No one model could ever be universal. Differentiated internal operations and cultures are bound to develop. But certain bedrock principals can, and should, be in place for cooperative enterprises operating in an economy that increasingly includes them. The economist Richard Wolff, in his latest book, Democracy at Work: A Cure for Capitalism,* argues that the ability of the workers of an enterprise to be involved in all its strategic decisions is the most important principal to bring about economic democracy, without which political democracy is a formal, empty shell. He introduces the term “workers’ self-directed enterprises” to encompass such enterprises. During the last structural crisis of capitalism, the Great Depression of the 1930s, massive movements from the Left, including unions, socialist parties and communist parties, forced widespread reforms to be instituted. Eventually, however, Keynesianism and social democratic programs developed new sets of instability and capitalists were able to at first slowly and then more vigorously roll back one reform after another. Professor Wolff argues that even if a suite of reforms could be enacted, the fix would be temporary — capitalists would intervene to take back the reforms, plunging us back into crisis. But the problem is not simply that the wealthy, through their concentration of accumulated capital, can so readily bend political systems to their ends. The problem is the instability of capitalism itself — capitalists are induced to do everything they can to increase profits due to the relentless nature of competition. That can be achieved through taking a larger share of a market or through cutting costs — the latter can include the introduction of machinery or moving facilities to somewhere else where the workers can be paid far less. These decisions are made by a small number of people at the top of the company, ultimately by the board of directors, a body that almost always includes top executives. A similar process of alienation happened in countries that used the system of the former Soviet Union, in which the government owned all enterprises. Professor Wolff uses the term “state capitalism” to describe that model because, in place of a private board of directors, state officials made all the decisions, again excluding workers. Those officials controlled all the production of the workers, appropriating the surplus by paying the workers a small fraction of the value of what they produced, the same as in a traditional private capitalist enterprise. A many-sided argument among Bolsheviks and others on how to organize production raged after the October Revolution, but, within a year of assuming power, the Bolsheviks nationalized large enterprises under the impact of the multiple deep crises of World War I and the threat of the advancing German army. Such a system became synonymous with “socialism.” Along with many others, Professor Wolff argues that “socialism” has to be a much different system, one in which the workers themselves make the decisions of their enterprises, in conjunction with the community of which they are a part. A central part of the ongoing furious campaign against “socialism” is the supposed efficiency of capitalism in comparison to anything else. The inherent instability of capitalism (euphemistically called “business cycles” in orthodox economics) is itself inefficient, nor is it possible to measure all the wins and losses across a society. “In short, the notion of measuring the efficiency of economic events or processes or of an economic system is a mirage. It is not possible to identify or measure all of the effects of any social factor, nor is it possible to separate and weigh all the influences that combine to produce each effect. The very concept of efficiency would have been banished from discourse, let alone science, long ago had it not proven so ideologically useful. Efficiency discourses resemble capitalist notions of efficiency, which in turn resemble the medieval doctrines and debates concerning how many angels can dance on the head of a pin: they too will one day strike people looking back as bizarre and absurd.” [pages 29-30] Moreover, Professor Wolff continues: “The efficiency argument for capitalism rings hollow in the face of high and enduring unemployment affecting jobless millions and their relatives, friends, and neighbors. Watching the growing absurdity of foreclosures creating both homeless people and empty homes throws into serious question the standard defense of capitalist efficiency. … Socialists and communists during the Cold War often simply inverted the standard argument by insisting that is was [their version of] socialism or communism that was efficient (or more efficient than capitalism) and thus represented progress. They, too, often ignored the impossibilities of identifying and measuring all costs and benefits and of separating and evaluating each of the myriad influences that produced them.” [pages 30-31] Having set the stage, Democracy at Work provides a concise summary of the lead-up to the present crisis, from the Great Depression through the explosion of debt incurred as a result of stagnant or declining wages, and summarizes in clear, accessible language the basic problems of advanced capitalist and Soviet-style systems. The book then gets to its heart, sketching out the concept of “workers’ self-directed enterprises.” WSDEs are a distinct form of cooperative enterprise — this is an enterprise in which the workers themselves are the directors, making all decisions on what to produce, where to produce, how to distribute, determining wages and other compensation, and hiring management. The surpluses produced would never be appropriated and distributed by anybody else. In a capitalist corporation, the board of directors are legally required to maximize the profits of the corporation going to the shareholders, regardless of the cost to the workers or the local community, and only the shareholders vote on who the directors are. The profits of the company, the bloated pay of the top executives and the huge piles of cash diverted into speculation are the product of the surpluses produced by the workers — and the competitive pressures of capitalism ensure that this process continually deepens. WSDEs would operate in a far more humane manner. The workers themselves will make the decisions on technological innovation, which is only proper since they, and the surrounding community of which they are a part, will have to live with such decisions. (This is unlike a capitalist enterprise, in which those who bear the cost have no say in the decision.) The self-directed workers can consider a far wider set of issues and concerns about adopting new technology, or any other strategic decision, thereby fully weighing the effects on themselves, their families and their communities. Professor Wolff proposes that a specialized agency be created that would monitor technological innovations, what enterprises need more workers, which enterprises have registered a desire to commence new production, and other social needs, to be funded with enterprise profits. “Rather like a matchmaking service, this agency’s task would be to match employees willing to change jobs with job availability and to arrange for appropriate training and inducements to facilitate the reallocation of personnel. No loss of income would attend the transition period for workers who left one job for another. To run this agency would cost a small portion of all the surpluses distributed by WSDEs to sustain its staff and activities. This agency’s reports and services would form one basis for the decision by all workers about whether to make the technical change in question.” [page 132] Jobs can be rotated (easing boredom), pay differentials minimized (drastically reducing inequality), environmental concerns would be taken seriously (otherwise you’d be polluting your own home) and communities would be stabilized (who would move their jobs to another country for a cut in pay?). And by being involved in your workplace’s decisions — and rewarded for your efforts in making the enterprise a success — alienation is drastically reduced. Without the need to work a crushing number of hours to compensate for low pay, you would have the time to be more of a participant in your community. Professor Wolff’s concept of WSDEs rests on the workers being their own directors; that is, making all the strategic business decisions themselves. He stresses this aspect, and sees ownership of the enterprise as less important, arguing that different ownership models can co-exist with WSDEs. Local, regional and national governments could own them but allow them to be run by the workers; the workers themselves could own the enterprise individually or collectively; or ownership could take the form of shares traded on a market. The author also prefers not to pre-judge whether a system based on WSDEs would take place under market conditions or in which planning predominates; he believes that they can be compatible with either. “How WSDEs will come to exist with private versus socialized productive property and to coexist with markets versus planning will not be determined by spurious claims about their comparative efficiencies. It will be determined through the construction of particular, specific postcapitalist economic systems as they emerge in transitions from both private and state capitalist systems.” [page 144] Fair enough. But here I believe caution is warranted. Leaving a full market system in place would inevitably re-introduce some of the problems of capitalism, albeit in different and milder forms. As I have previously discussed, if collective enterprises, no matter how democratically they are run internally, compete with each other in unfettered markets, market forces would require the collectives to ruthlessly reduce costs (including their own wages) and aggressively expand the market for their products. Failure to do so would mean not surviving in competition with the enterprises who do adapt themselves to market conditions. Because all materials and finished products would remain commodities subject to price volatility in this scenario, the cooperative workers’ own labor would also become a commodity — in essence, they would “become their own capitalists.” Some amount of planning — democratic, bottom-up planning based on aggregate demand as a guide and not top-down planning imposed as an order — would seem to have a significant role in an economy dominated by cooperatives; moreover, the cooperatives would have to have some cooperation with each other, particularly in negotiating prices up and down the supply chain. Ultimately, these are questions that won’t begin to be solved until there is more practice, although a “matchmaking” agency of the type proposed above implies some amount of planning. Much more immediate is the question of how WSDEs would co-exist with capitalist enterprises. WSDEs would handle competitive problems and grapple with issues of size and other issues differently than a capitalist enterprise. For instance, Professor Wolff argues, if WSDEs organized mutual support and pooled political strength, or prove to be more productive, they could prevail against capitalist enterprises. Not extracting large amounts of money for bloated executive pay could free extra funds for developing innovations, or differentiating their products as made under democratic conditions could be a marketing advantage. Early on, WSDEs would need state assistance. Professor Wolff advocates adapting the model of Italy’s “Marcora Law,” which enabled workers to take over troubled enterprises. The author suggests offering the unemployed a choice: Either the traditional weekly benefits, or taking it as a lump sum, pooling their resources with others taking the lump sum, and forming a WSDE. These new enterprises would likely need to rely on technical assistance, subsidized credit, tax breaks and other assistance; such aid can be looked upon as an extension of existing programs to assist small businesses or for women- or minority-owned businesses. Social solidarity with and by existing cooperatives, unions and activist groups would be another form of support. A strong cooperative movement would provide an alternative to traditional authoritarian capitalist employment, eroding capitalists’ ability to impose harsher working conditions. Democracy at Work does formulate one difference from traditional concepts of cooperative enterprises that will likely be seen as controversial: A differentiation between “surplus-producing” workers and “enabling” workers. The first group are those who directly produce the outputs that are sold. The second group include accountants, managers, secretaries, clerks and many other job functions that provide the conditions that enable the “surplus-producing” workers to do their work. Professor Wolff is careful to stress that both categories are equally crucial to the success of an enterprise. Nonetheless, he advocates that only the “surplus producers” be allowed to make the decisions regarding the appropriation and distribution of the surplus. All other decisions would be voted on collectively by all workers. The rationale is that such an arrangement “secures the absence of any exploitation within the WSDE” [page 166]. But leaving such major decisions to only a portion of the workforce risks engendering a division within the workforce, the opposite of the goal, and arguably applies too narrowly the laudable goal of ending exploitation. Moreover, this formulation presupposes that management will form a group distinct from line workers. But there should not be such a distinction: Managers should be elected by the workers a whole, to specific terms and be recallable. There is no reason why management and supervisory positions should not be rotated — workers can become managers, and then go back to being workers. More people would become familiar with more roles, be able to assume greater responsibility and be better equipped to participate in strategic decision-making. Nor is there any reason why people can’t change roles from a direct production job to a support job, which, to be fair, is tacitly acknowledged in the author’s stress on the ability of workers to change job functions within WSDEs. Having two categories of jobs with a crucial decision-making function reserved for one category would seem to defeat the purpose of cooperation — equality. If everybody is necessary to the enterprise, then everybody should be eligible to vote on everything. Decision-making, however, will not be confined to the walls of the enterprise. Residents and workers should participate in each other’s decisions to the extent that they are affected, Professor Wolff writes. Community representatives should participate in WSDE decision-making, and vice versa, as WSDE members are part of the community. “In societies where WSDEs are the prevailing organization of production, capitalists will no longer occupy a crucial political position. Capitalists’ use of the surpluses they appropriate will no longer dominate politics. We will no longer have capitalists making political use of the resources typically at their disposal — the surpluses they appropriate. Instead, the community of workers who direct WSDEs will be the prevailing political partner of residence-based governing bodies. …They might finally realize democracy, which under capitalism was never allowed to go beyond very limited electoral functions.” [pages 167-168] A much higher level of democracy does not mean that a society with an economy based on WSDEs would be a utopia. Professor Wolff is forthright in noting that there will be new problems and contradictions. But with vastly less inequality distorting all areas of society, problems would be more easily tackled. And just as the transcending of earlier systems eliminated many but not all social ills, transcending capitalism will put many problems behind us. “The slave and feudal systems that proceeded capitalism fostered forms of crime rooted in their mixes of economic risks and rewards. But those systems never displayed the recurring boom-and-bust cycles common to all forms of capitalism. These cycles are the products of capitalism — not of this or that group (the state, criminals, others) functioning within that system and in response to its upswings and downswings. … Overcoming the systemic roots and nature of capitalist crises requires a change in the economic system.” [pages 51-52] Professor Wolff’s Democracy at Work offers us a well-written practical guide to alternatives to capitalism, one that we can begin to build today with the tools at our disposal. Whatever disagreements a reader may have with this or that detail, Democracy at Work is recommended to anyone seeking a concise study of why we need to bring a better world into being and how we might get there. * Richard Wolff, Democracy at Work: A Cure for Capitalism [Haymarket Books, Chicago, 2012] Share this:FacebookRedditTwitterEmailPrintMoreDiggGoogleLinkedInPinterestPocketStumbleUponTumblrLike this:Like Loading... 13 Comments Posted in Book review Tagged books, cooperatives, economic democracy, economics, labor, Marxism, socialism Search Follow Systemic Disorder Enter your e-mail address to follow this blog and receive notifications of new posts by e-mail. 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MenuHomeBlogTax BasicsTax TopicsAbout UsDonate Secondary Menu Center for Federal Tax Policy Center for State Tax Policy Center for Legal Reform Search this site Breadcrumb The Tax Burden of the Median American Family By Claire Hintz Special Report No. 96 Special Report No. 96 Executive SummaryThe total tax burden of a median two-income family dipped below 40 percent in 1998, according to a new study by the Tax Foundation. J.D. Foster, Ph.D., executive director and chief economist of the Tax Foundation, unveiled the new study at a tax policy conference on Capitol Hill. Titled "The Tax Burden of the Median American Family" (No. 96 in the Foundation's Special Report series), the study confirms that even adjusting for inflation, recent prosperity has resulted in higher taxes. The $26,759 total tax burden that a median two-earner family paid in 1998 is the highest ever. Taxes as a Percentage of Median Family Income Federal, state and local taxes claimed 39.0 percent of a median two-income family’s total income ($68,605), down from 40.9 percent in 1997 and down from the historical high of 41.5 percent in 1996. The median one-income family’s tax burden was 37.6 percent of its 1998 income ($36,579), down from a high of 38.6 percent in 1997. Against a backdrop of steadily rising tax burdens, the Taxpayer Relief Act of 1997 reduced federal individual income taxes on the median family so dramatically that federal income taxes as a percentage of total income were about the same in 1998 as they were in 1955. The almost two percent decline in the two-earner family’s total tax burden between 1997 and 1998 can be attributed almost entirely to this legislation. It brought such substantial tax relief to the median family because its new tax credits, the Per-Child Tax Credit and the Hope and Lifetime Learning Education Credits, are especially valuable to the demographic group that the median family falls into. Two factors are primarily responsible for the general trend of higher tax burdens over recent decades – the upward trend in state and local taxation and the increase in the federal payroll tax used to fund social insurance programs: State and local taxes combined took 8.8 percent of the two-earner family’s income in 1975, but 23 years later that share had grown to 13.1 percent. For the one-earner family, state and local taxes make up an even larger share of the total tax burden and have been growing even faster. In 1975, state/local taxes took 9.4 percent of family income, but in 1998 they took 15.0 percent. Payroll taxes have also climbed sharply. Although the rate has not increased since 1990, the amount of income subject to the tax has increased so rapidly that the median family’s growing wages have not been able to catch up to the cap. In 1998, the combined rate was 15.3 percent (employer and employee each paid 7.65 percent) on wages and salaries up to $68,400 for Social Security, Disability Insurance, and Medicare. In 1975, when the combined rate was 11.7 percent and the tax applied to the first $14,100 in wages, the two-earner median family paid 9.5 percent of its total income in payroll taxes, compared to 12.6 percent in 1998. As for the one-earner median family, payroll taxes took 9.7 percent of its income in 1975, and that grew to 12.4 percent in 1998. To a large extent, as seen in the two pie charts, the growth in tax burdens has crowded out other important parts of the family budget, such as saving. In fact, taxes now claim a greater share of the median two-income family’s income (39.0 percent) than food (8.9 percent), clothing (3.9 percent), housing (15.9 percent), and transportation (6.9 percent) – combined. Taxpayers pay such a wide variety of taxes at the federal, state, and local levels. Some are easy to detect, like a personal income tax or a sales tax, but many taxes go unseen. That happens when third parties–people who do business with taxpayers–have to pay taxes that end up being passed on to taxpayers in the form of higher prices or lower income. For example, employers pay half of all payroll taxes, and these taxes diminish salaries. Also, when corporations pay their own taxes, they pass that cost on. Unfortunately, taxpayers are mostly unaware of these hidden taxes even though they make up a significant fraction of the family’s real tax burden. This lack of transparency in the national tax system is a great flaw that this study helps to remedy. For historical comparison, this study presents a fifty-year series of the aggregate tax burden on one- and two-earner families. Tax Topic Federal Taxes, Tax Burdens Related Articles Tax Freedom Day® 2014 is April 21, Three Days Later Than Last Year ... Slower Growth through “Tax Reform”: The Baucus Capital Cost Recovery Proposal Executive Summary The Tax Foundation’s Taxes and Growth Model was used to estimate the long-run effects on the U.S. economy and federal revenue of enacting the capital cost recovery plan developed by Senate Finance... If you found this material useful, please consider making a donation to the Tax Foundation.Donate Join the Tax Foundation's fight for sound tax policy Go Tax Policy Blog The official weblog of the Tax Foundation. New York Corporate Tax Overhaul Broadens Bases, Lowers Rates, and Reduces Complexity Indiana’s 2014 Tax Package Continues State’s Pattern of Year-Over-Year Improvements Tax Freedom Day® 2014 is April 21, Three Days Later Than Last Year Tax Foundation State-Local Tax Burden Estimates: An Overview of Methodology Annual State-Local Tax Burden Ranking FY 2011 Ohio Tax Reform in 2014: Framing the Conversation Tax By State For information on your state, select it from the drop-down menu. Select a State Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Ask a Tax Expert Contact information for Tax Foundation policy staff Ask From the Tax Foundation BlogRead all Apr Why Many People are Wrong about Executive Pay and the Corporate Tax Code We recently outlined a bill introduced by Senator Patty Murray (D-WA), which would expand the EITC and pay for it in part by further limiting the deduction for executive compensation. The Senator believes that the... Apr What Does Donald Rumsfeld Have in Common with Franklin Roosevelt? Yesterday was Tax Day, and former Defense Secretary Donald Rumsfeld shared a letter he sent to the IRS with his Twitter followers. Rumsfeld said he did his best to fill out his taxes but says he's not sure he got it... Join Our Network TwitterfacebookYoutubeLinkedIn Tax Policy Blog Photo and Artwork Credit

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High-End Housing Market Ravaged by Stock Selloff Mark Koba | @MarkKobaCNBC Tuesday, 3 Feb 2009 | 9:33 AM ETCNBC.com For wealthier Americans, the free-fall in stocks is not only ravaging their portfolios—it's taking a huge bite out of the value of their homes."The high-end market relies on equities," says Walter Molony, spokesman for the National Association of Realtors. "If stocks are doing well, so too does high-end housing." Source: luxuryportfolio.com Greenwich, Connecticut home Though only 2 percent of the overall housing market, high-end home volume sales have seen a dramatic drop, according to Molony. Homes valued at $750,000 or more plunged a whopping 47 percent in the year ended in November. By comparison, sales of homes valued at $400,000 or less fell by only 3 percent during the same period.A look at the markets during the same time period shows the Dow Jones fell 33.1 percent, while the S&P shows a 37.5 percent drop in value.Real estate professionals agree that sliding markets and a ravaged economy are hurting prospective high-end buyers and sellers. And that means prices will likely decline even more before there is any recovery."Unless they are forced to move, they are staying put," says Mary Cassidy, a licensed real estate broker in Bronxville, New York, a wealthy suburb of New York City that is home to many Wall Streeters. "People are not buying and people are not selling. When everyone’s uncertain as to whether they have a job, why go out and buy something?"Jumbo LoansWhile equities and the economy are reasons for slower sales, the rise in jumbo loan rates is another, says Greg McBride, Senior Financial Analyst at Bankrate.com. "More money down is the big reason people aren't taking them out," McBride says. "It takes good credit but you need 30 percent down or more and even those people are paying an interest rate of more than 7 percent." _____________________________________Calculators and Advice from Bankrate.com:Compare Mortgage Rates NationwideStruggling to Save Your Home? Get Help HereBob Walters, Chief Economist at Quicken Loans also sees fewer jumbo loans being made. "Down payments have to be higher, credit scores have to be higher," says Walters. People are getting hit hard from all sides and there's less demand for more expensive homes."By nature, jumbo loans, or non-conforming loans are used for financing high end homes. They are a mortgage with a loan amount above the industry-standard definition of conventional conforming loan. A loan in excess of $417,000 to $625,000 is currently considered a jumbo in most states. And jumbos have interest rates a little higher than a conforming loan. But those interest rates have gotten even higher over the past few months, which is a direct result from the lack of a secondary market to purchase jumbo loans says Gary Meglino, a corporate executive at Residential Home Funding in White Plains, New York. "The secondary market lost interest in acquiring the loans about May or June of 2008," says Meglino. "The only institutions that are offering jumbo loans have to service them, and that has made them very expensive." Bigger Problem Behind Jumbo LoansIn February of 2008, then-President Bush signed an economic stimulus package that increased the conforming loan limit to $729,750. But that only lasted until the end of 2008 and caused a bigger problem for jumbo loan applicants says Bankrate's McBride. "Conforming loan limits declined beginning in 2009," McBride says. "What that means is that in high cost housing markets, you have a lot more borrowers that are considered jumbo and can't get rates for a lower loan. The conforming loan limit should go back to the 2008 level, when it was higher. In New York it was the $729 thousand figure. It's now at the high end of $625,500. That could increase foreclosures."Foreclosures For High End Homes?In the past, foreclosure rates have been much lower on jumbo loans in comparison to conforming loans. But jumbo's are a higher risk for lenders, because if the jumbo loan defaults, it's harder to sell a home, especially a luxury home. for its full price. And that could be a problem if there are more foreclosures ahead. "I think the best thing is to re-invigorate the banking system, and let it work itself on its own," says Quicken's Walters. "It's not a good policy for the government to buy million dollar homes," when asked about what's the best solution if jumbo loan foreclosures mount in the wake of higher unemployment.Future Of High End Market As the markets continue to decline and home values erode at record lows, the future for high end sales looks fairly bleak at least for now, says Bronxville, NY's Cassidy.

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From the February 6, 2013 issue of Credit Union Times Magazine • Subscribe! Against the Grain ESOP February 06, 2013 • Reprints At a time when some companies are skittish about paying out stored-up pension plans for longtime employees, Lending Solutions Inc. recently went in the other direction. The Elgin, Ill.-based provider of lending center services and consulting programs for financial institutions said it has established a new employee stock ownership plan. Introduced to employees on Jan. 11, the ESOP transfers 30% ownership to the employees of LSI through a defined contribution benefit plan. The company, which employs more than 400 loan officers, said it established the plan on Dec. 20, 1012. “Transitioning to an ESOP model gives us the opportunity to reward many of our long-term employees for their commitment and hard work over the years, as well as attract new employees,” said Mark Johnson, chairman and principal stockholder of LSI. LSI’s ESOP will be administered by the company’s ESOP committee, working in conjunction with a third-party trustee and a third-party administrator, the firm said. LSI said it engaged the services of Innovative Shareholder Strategies throughout the development and introduction of the ESOP. Launched in 2012, ISS is a financial advisory practice specializing in ESOP consulting services. “We’re tremendously proud of what we’ve achieved over the past several years at LSI,” said Lee Kolquist, LSI CEO. “Our employees have always taken great pride and ownership in their work, and now, with the ESOP, eligible employees will have the opportunity to earn a tangible stake in the company to validate that ownership.” According to the National Center for Employee Ownership, there are approximately 11,500 ESOPs in the U.S. covering nearly 14 million participants, LSI said. The NCEO said companies with ESOPs grow 2.3% to 2.4% faster than comparable non-ESOP companies as measured by sales, employment and productivity growth, according to LSI. “An ESOP is a complicated transaction with a lot of moving parts,” Kolquist said. “Innovative Shareholder Strategies was there every step of the way, guiding us through the process with unparalleled commitment and expertise. The professionals from ISS took the time to understand our objectives and to structure a tailored solution beneficial to LSI, its shareholders and its employees.” LSI provides lending and member service to over 300 of North America’s credit unions, banks, and mortgage companies. Last year marked several milestones for LSI, including taking in 500,000 loan applications, the company said. The application came from the $1.1 billion Partners Federal Credit Union in Orlando, Fla. The company said it also set records for total calls answered, indirect loans handled and overall transactions processed. The company, founded by industry consultant Rex Johnson, said it continues to maintain a steady rate of growth each year. In July 2012, it opened its second contact center in Naperville, Ill. “In 2012, we answered more phone calls and processed more loan applications than ever,” said Kolquist said. “However, what we are most proud of is the quality of service that we have been able to consistently deliver. Helping our credit union clients build deeper, long-term relationships with their members has been our mission and continues to be what we strive for each day.” As an enhancement to its online loan application, LSI also launched a mobile-friendly application last year. The mobile application contains all the functionality of LSI’s standard internet application but is optimized for smart phones including iPhones and all Android phones, the company said. The application features automatic recognition of browser types–mobile versus standard–and opens the appropriate application for the member. At the time news of the mobile application was announced, Dave Brooke, LSI executive vice president, said the product builds on the company’s mission to provide to help its clients process more loans. Show Comments

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Monetary Policy Report 1/2010 Monetary Policy Report Monetary policy in Norway The operational target of monetary policy is low and stable inflation, with annual consumer price inflation of approximately 2.5% over time. Norges Bank operates a flexible inflation targeting regime, so that weight is given to both variability in infla- tion and variability in output and employment. In general, the direct effects on consumer prices resulting from changes in interest rates, taxes, excise duties and extraordinary temporary disturbances are not taken into Monetary policy influences the economy with a lag. Norges Bank sets the interest rate with a view to stabil- ising inflation close to the target in the medium term. The horizon will depend on disturbances to which the economy is exposed and the effects on prospects for the path for inflation and the real economy. The decision-making process The main features of the analysis in the Monetary Policy Report are presented to the Executive Board for discussion at a meeting about two weeks before the Report is published. Themes of relevance to the Report have been discussed at a previous meeting. On the basis of the analysis and discussion, the Executive Board assesses the consequences for future interest rate developments, including alternative strategies. The final decision to adopt a monetary policy strategy is made on the same day as the Report is published. The strategy applies for the period up to the next Report and is presented at the end of Section 1 in the Report. The key policy rate is set by Norges Bank’s Executive Board. Decisions concerning the interest rate are nor- mally taken at the Executive Board’s monetary policy meeting every sixth week. The analyses and the mon- etary policy strategy, together with assessments of price and cost developments and conditions in the money and foreign exchange markets, form a basis for interest rate decisions. Communication of the interest rate decision The monetary policy decision is announced at 2pm on the day of the meeting. At the same time, the Execu- tive Board’s monetary policy statement is published. The statement provides an account of the main aspects of economic developments that have had a bearing on the interest rate decision and the Executive Board’s as- sessments. The Norges Bank. Monetary Policy Report, Mar 2010, Monetary Policy Report 1 2010, Anonymous, Feature, Monetary policy, Interest rates, Economic forecasts, Economic recovery, Risk, 9175, Western Europe, 1120, Economic policy & planning, Norway The most acute phase of the global economic crisis appears to have passed. Output growth has resumed in most parts of the world. It appears, however, that the upturn in advanced economies will only be moderate and that the economies of many countries will be marked by considerable spare output capacity and high unemployment ahead. The crisis has given rise to new imbalances that will dampen the recovery. Weak prospects have contributed to a marked decline in interest rate expectations in many countries. New information suggests that the recovery in the Norwegian economy is continuing, but that capacity utilization is probably somewhat lower than anticipated in autumn 2009. Monetary policy cannot fine-tune developments in the economy, but it can mitigate the most severe effects when the economy is exposed to shocks. Overall, the outlook and the balance of risks suggest that the key rate should be gradually increased ahead, although somewhat later than envisaged in October 2009.

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Taylor Morrison Celebrates Initial Public Offering and First Day of Trading on the New York Stock Exchange Business Wire | NEW YORK--(BUSINESS WIRE)-- Scottsdale, Ariz.-based Taylor Morrison, a leading builder and developer of single-family detached and attached homes, opened for trading today on the New York Stock Exchange (NYSE) under the ticker symbol “TMHC” after its initial public offering. Barclays Capital is the Designated Market Maker (DMM) for the company’s stock. President and Chief Executive Officer Sheryl Palmer, joined by members of the Taylor Morrison management team, celebrated the company’s first day of trading by visiting the NYSE trading floor for the stock opening and by ringing The Opening Bell®. Taylor Morrison President and Chief Executive Officer Sheryl Palmer, joined by members of the Taylor Morrison management team, rings the NYSE Opening Bell(R) to celebrate the company's IPO and first day of trading on the NYSE. (Source: NYSE Euronext photo) "We welcome Taylor Morrison in joining the NYSE’s community of listed companies," said Scott Cutler, Executive Vice President, Head of Global Listings, NYSE Euronext. With its diverse line of consumer housing, Taylor Morrison offers a suite of brands to best serve the needs of its customers. “We look forward to a successful and lasting partnership with Taylor Morrison and its shareholders.” For more information on NYSE Euronext’s listings business and to learn about trends in the IPO market, please visit the NYSE Euronext IPO Center. About Taylor Morrison (NYSE: TMHC ) Headquartered in Scottsdale, Arizona, the Company operates in the U.S. under the Taylor Morrison and Darling Homes brands and in Canada under the Monarch brand. Taylor Morrison is a land developer and builder of single-family detached and attached homes serving a wide array of customers from first-time buyers and move-up families to luxury and active adult customers. Taylor Morrison divisions operate in Arizona, California, Colorado, Florida and Texas. Darling Homes serves move-up families and luxury homebuyers in Texas. Monarch, Canada's oldest homebuilder builds homes for first-time buyers and move-up families in Toronto and Ottawa as well as high rise condominiums in Toronto. For more information about Taylor Morrison, Darling Homes or Monarch, please visit www.taylormorrison.com, www.darlinghomes.com and www.monarchgroup.net. About NYSE Euronext NYSE Euronext (NYX) is a leading global operator of financial markets and provider of innovative trading technologies. The company's exchanges in Europe and the United States trade equities, futures, options, fixed-income and exchange-traded products. With approximately 8,000 listed issues (excluding European Structured Products), NYSE Euronext's equities markets - the New York Stock Exchange, NYSE Euronext, NYSE MKT, NYSE Alternext and NYSE Arca - represent one-third of the world’s equities trading, the most liquidity of any global exchange group. NYSE Euronext also operates NYSE Liffe, one of the leading European derivatives businesses and the world's second-largest derivatives business by value of trading. The company offers comprehensive commercial technology, connectivity and market data products and services through NYSE Technologies. NYSE Euronext is in the S&P 500 index. For more information, please visit: http://www.nyx.com. Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20130410006081/en/ NYSE Euronext Media RelationsAnnmarie Gioia, [email protected] KEYWORDS: United States North America Arizona New York INDUSTRY KEYWORDS: Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. NYX.DL

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Social Media Share: Facebook May 16, 2012 10:50 AM by AP Facebook investors to cash out more shares NEW YORK (AP) - Insiders and early Facebook investors will be unloading more of their shares in the initial public offering, the company said Wednesday, as they take advantage of investor demand. Facebook said in a regulatory filing that 84 million shares, worth up to $3.2 billion, will be added to the offering. The entire increase comes from insiders and early investors, so the company won't benefit from the additional sales. The biggest increases come from investment firms DST Global and Tiger Global. Goldman Sachs is doubling the number of shares it is selling. Facebook board members Peter Thiel and James Breyer are also selling more shares. Founder Mark Zuckerberg isn't increasing the number of shares he's selling. The news comes a day after Facebook raised the expected price range for the stock to a range of $34 to $38 per share, up from its previous range of $28 to $35. Also Tuesday, major advertiser General Motors Co. said it would stop advertising on Facebook. At the high end of the price range, the IPO would raise $16 billion without the overallotment option reserved to meet extra demand. That would make it the third-largest U.S. IPO in history, ahead of General Motors in 2010, according to Renaissance Capital. The IPO is the most hotly anticipated in years and would value Facebook overall at more than $100 billion. In a filing with the Securities and Exchange Commission, Facebook said current shareholders are now offering approximately 241 million shares, up from about 157 million shares previously. Even though Zuckerberg isn't increasing the number of shares he is selling, the additional sales will trim his voting control to 55.8 percent from 57.3 percent. That's because he has voting control over some shares now owned by investment firms, which will be sold in the offering. Facebook has more than 900 million users who log in at least once a month, but it makes only a few dollars per year from each one, chiefly through advertising. Advertisers have been complaining that it's difficult to make good use of Facebook. GM did not say why it would stop advertising on Facebook. The Wall Street Journal reported, citing people it did not identify, that it was because GM had concluded that the ads were ineffective. GM spokesman Greg Martin said the company will keep paid content on pages that promote its products. Meanwhile, GM competitor Ford reaffirmed its commitment to Facebook, saying its relationship was stronger than ever. Morgan Stanley leads the team of 33 underwriters selected for the Facebook offering, followed by JPMorgan Chase and Goldman Sachs. The offering is expected to get a final price Thursday evening. Shares would start trading on the Nasdaq on Friday under the "FB" ticker symbol. »Comments More News

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› Japan › Economic Survey of Japan 2005: Achieving fiscal sustainability Economic Survey of Japan 2005: Achieving fiscal sustainability What needs to be done to ensure the sustainability of public finances? Addressing the government's budget deficit should be an important aspect of an exit policy as it would help avoid an abrupt rise in interest rates. Strong economic growth and spending restraint reduced the deficit in the primary budget (which excludes net interest payments) from 6¼ per cent of GDP in 2003 to an estimated 5 per cent in 2004. However, the current fiscal situation is clearly not sustainable. The impact of the sharp run-up in debt over the past decade has been limited by the exceptionally low level of interest rates on government bonds, reflecting easy monetary policy, the risk aversion of investors and the persistence of deflationary expectations. Consequently, government interest payments as a share of GDP are lower than a decade ago despite the higher level of public debt. The transition to positive rates of inflation will boost interest payments, creating a risk of financing strains. As long as higher interest rates are accompanied by a pick-up in nominal growth, the risk is limited as there should be higher tax revenue, although the tax base has been eroded by various exemptions introduced during the past decade. A more serious threat to the fiscal situation would be a rise in the real interest rate. The government's Medium-Term Economic and Fiscal Perspective, revised in early 2004 and extending through FY 2008, set a target of a primary budget surplus by the early 2010s. Indeed, a surplus is likely to be necessary to stabilise government debt, depending on the path of growth, interest rates and inflation, implying a fiscal adjustment of more than 5 per cent of GDP. The Perspective calls for limiting the size of general government spending to near its FY 2002 level (38 per cent of GDP) through FY 2006, combined with some unspecified revenue increases, to reduce the primary deficit by ½ per cent annually over the next four years. Preliminary budget plans suggest that a reduction of around ¼ per cent of GDP will be achieved in 2005, thanks to continued economic growth, spending restraint and some revenue measures, including a hike in the pension contribution rate. Even if consolidation advanced at the ½ per cent of GDP pace included in the Perspective, it would take more than a decade to meet the target, by which time gross debt might have risen to 200 per cent of GDP or more, imposing a significant burden on the economy and increasing the possibility of a rise in the risk premium. The negative impact of the high debt in Japan, however, is limited by the high private-sector saving rate and the low level of interest rates. Nevertheless, the medium-term plan should be more ambitious, even though special circumstances make fiscal consolidation more challenging in Japan than in other OECD countries. At a minimum, the government should achieve its goal of a ½ per cent reduction in the budget deficit per year. However, if economic outturns are better than expected, the pace of consolidation should be faster. The credibility of the Perspective should be enhanced by establishing a stronger link to spending and revenue decisions, as well as by securing effective policy feedback to prevent slippage from the target. Finally, the medium-term plan should be extended beyond 2008 and should be based on more realistic economic assumptions. The objective of freezing government expenditures as a share of GDP should be achieved through FY 2006 and continued efforts to restrain spending are necessary in the future. This will likely require further reform of social security programmes - pensions, healthcare and long-term nursing care - given the spending pressures related to population ageing. Despite the 2004 reform to cut pension benefits, social security outlays are projected to rise by 1½ per cent of GDP by 2010, and this may underestimate the impact of population ageing. Legislation passed in June 2004 to increase the pension contribution rate for the Employees' Pension Insurance from 13.6 to 18.3 per cent by 2017 may help finance rising expenditure. However, already in 2002, the proportion of pension contributions that are evaded was 37 per cent - well above the level assumed in the government's projections - and the increase in the contribution rate may further reduce participation in the system and weaken work incentives. The 2004 reform is projected to reduce the pension benefit replacement rate from 59 to 50 per cent - the minimum level allowed - over the next two decades. Contribution rates should not be raised further, even if unfavourable developments were to require lower replacement rates. Moreover, reforms are needed to slow the growth of public spending on health and long-term nursing care. Given the challenge of limiting social security expenditures and rising interest payments, significant cuts in discretionary outlays are required to achieve the spending ceiling. In particular, public investment, much of which is characterised by low efficiency, should be cut further. At 5 per cent of GDP, public investment remains above the OECD average of 3 per cent. Achieving the target of freezing public expenditures as a share of GDP will be challenging in the context of population ageing, as well as rising interest payments. Consequently, the necessary fiscal consolidation - more than 5 per cent of GDP - will require increases in government revenue, which, at 30 per cent of GDP, is among the lowest in the OECD area. To increase revenue, the government should put more emphasis on closing loopholes and streamling tax relief and allowances so as to broaden the tax base, thus limiting the extent of tax hikes, which have negative effects on growth. Nevertheless, given the size of additional revenue that is needed, higher tax rates will be necessary, particularly for the consumption tax. However, the timing of such increases should take into account economic conditions. Return to the OECD Economic Survey - Japan 2005 homepage A printer-friendly Policy Brief (in PDF format) may also be downloaded. The Policy Brief contains the executive summary and the OECD assessment and recommendations. The complete edition of the OECD Economic Survey for Japan is available from: Password-protected web site for accredited journalists

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Hendrickson Forum 2014 Main Street vs. Wall Street and the New Financial Paradigm: A Conversation with the Honorable Sheila C. Bair Date: April 8, 2014 Time: 11:30 a.m. - 1:15 p.m. Location: Saint Mary's University Center 2540 Park Avenue, Minneapolis, MN 55404 Cost: General $40, Saint Mary’s University Alumni $20, Students $10 (Includes a hearty salad lunch) Register for this event Join us for a presentation and question-and-answer session with Sheila Bair. Five years after the start of the Great Recession, much of the financial sector appears focused on propping up the past failed systems. Homeowners, businesses and small banks struggle to recover while “too big to fail” organizations push for policies that retain their advantage. New developments to consider include changing investment management in the U.S. and Europe as well as the economies of developing countries. Bair will discuss: Turning from short-term gratification to long-term economic stability Producing real value to generate meaningful economic gains Looking forward to global challenges and other 21st century issues At the event, the 2014 Hendrickson Medal for Ethical Leadership will be awarded to Chris Policinski, President and CEO of Land O’Lakes. A sign language interpreter will be available. About Sheila Bair Bair is former head of the FDIC, current chair of the Systemic Risk Council and author of Bull by the Horns: Fighting to Save Main Street from Wall Street and Wall Street from Itself. Sheila C. Bair served as the 19th Chairman of the Federal Deposit Insurance Corporation for a 5-year term, June 2006-June 2011. As FDIC Chair, Bair presided over a tumultuous period in the nation’s financial sector, working to bolster public confidence and system stability. Determined not to turn to taxpayer borrowing during the crisis, the FDIC managed its losses and liquidity needs entirely through its traditional industry-funded resources. In response to the financial crisis, she developed innovative and stabilizing programs that provided temporary liquidity guarantees to unfreeze credit markets and increased deposit insurance limits. In 2007, she was a singular – and prescient – advocate for systematic loan modifications to stem the coming tidal wave of foreclosures. Bair also led FDIC resolution strategies to sell failing banks to healthier institutions while providing credit support of future losses from failed banks’ troubled loans. That strategy saved the Deposit Insurance Fund $40 billion over losses it would have incurred if the FDIC had liquidated those banks. Under Bair’s leadership, the FDIC’s powers were significantly expanded by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The law extends the FDIC’s resolution process to large, systemically important financial institutions, effectively attacking the doctrine of too-big-to-fail. Bair has been a leading domestic and international advocate for common-sense capital and leverage ratios, including backing a key provision in Dodd-Frank that requires large financial entities to have capital cushions at least as strong as those that apply to U.S. community banks. As a member of the Basel Committee on Banking Supervision, in 2006 she called for higher bank capital standards, including an international leverage ratio to constrain growing levels of leverage among the world’s major financial institutions. Financial experts now widely attribute excess leverage as a key driver of the 2008 financial crisis. In 2010, the Basel Committee finally adopted an international leverage ratio. She continues her work on financial policy issues as a Senior Advisor to the Pew Charitable Trusts. Bair also chairs the Systemic Risk Council (SRC) a public interest group of prominent former government officials and leading financial experts which monitors implementation of financial reforms. She is a founding board member of the Volcker Alliance, a non-profit organization established by former Federal Reserve Board Chairman Paul Volcker to promote more effective government. She also serves on the prestigious International Advisory Council to the China Bank Regulatory Commission. During her tenure as FDIC chair, in 2008 and 2009, Forbes magazine named Bair as the second-most-powerful woman in the world, after Germany’s Chancellor Angela Merkel. Also in 2008, Bair topped The Wall Street Journal’s annual “The 50 Women to Watch” list. In 2009 she was named one of Time Magazine’s “Time 100″ most influential people; awarded the John F. Kennedy Profile in Courage Award; and received the Hubert H. Humphrey Civil Rights Award. In 2010, Bair was featured on the cover of TIME Magazine with Mary Schapiro and Elizabeth Warren as “The New Sheriffs of Wall Street.” Also in 2010, she received the Better Business Bureau’s Presidents’ Award. In December of 2011, subsequent to leaving office, Bair was named by the Washington Post and Harvard University as one of seven of America’s Top Leaders. Bair writes a regular column for Fortune Magazine on financial policy matters. She has written a New York Times best seller about her tenure at the FDIC, Bull By the Horns: Fighting to Save Main Street from Wall Street and Wall Street from Itself. Before joining the FDIC in 2006, Bair was the Dean’s Professor of Financial Regulatory Policy for the Isenberg School of Management at the University of Massachusetts-Amherst. Other career experience includes serving as Assistant Secretary for Financial Institutions at the U.S. Department of the Treasury, Senior Vice President for Government Relations of the New York Stock Exchange, a Commissioner of the Commodity Futures Trading Commission, and Research Director, Deputy Counsel and Counsel to Senate Majority Leader Robert Dole. Washinton Post: Sheila Bair’s graph of the year: For many Americans, there’s been no recovery at all Wall Street Journal: U.S. Banking System Still Fragile CNN Money: Is Blackrock too big to fail? CNN Money: Banks are missing out on Payday loans CNN Video: Former bank regulator Sheila Bair warns against debt ceiling ‘nuclear bomb’ Medal for Ethical Leadership The 2014 Hendrickson Medal for Ethical Leadership will be awarded to Chris Policinski, President and Chief Executive Officer of Land O’ Lakes, Inc. Pre-forum Seminar Join us for a seminar on risk management strategies prior to the Hendrickson Forum: Managing Risk in an Interconnected World. Sponsors About the Hendrickson Institute In an age when scandals lead us to question our leaders' integrity, it is important to recognize people we can count on for ethical leadership in every profession. The Hendrickson Institute promotes ethical leadership through special events and corporate training for business leaders as well as the Tomorrow's Leaders regional high school and university scholarship program. The Hendrickson Institute is located at the Saint Mary's University Twin Cities campus, 2500 Park Avenue, Minneapolis. For additional information, call 612-728-5100. Hendrickson Institute for Ethical Leadership Hendrickson Forum Seminar Archive Under-Told Stories Project Under-Told Stories Events

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hide Fed's Bullard: no hurry to taper because of low inflation Friday, November 01, 2013 8:10 a.m. CDT James Bullard, President of the St. Louis Federal Reserve Bank, speaks during an interview with Reuters in Boston, Massachusetts August 2, 2 WASHINGTON (Reuters) - The Federal Reserve should not rush a decision to scale back its asset purchase program because of low inflation, a senior U.S. central banker said on Monday. "For me, you don't have to be in a hurry because of low inflation," St. Louis Federal Reserve President James Bullard told CNBC television. Bullard, who at the Fed's policy meeting last week voted in favor of maintaining the central bank's monthly bond buying campaign at an $85 billion monthly pace, said he wanted to see inflation heading back toward policy-makers' 2 percent goal before tapering bond buying. Inflation has been running much closer to 1 percent, he noted. The Fed held fire on deciding to begin reducing asset buying after a bitter partisan battle in Washington that led to a 16-day partial government shutdown and flirted with a devastating debt default. A deal was eventually forged to reopen the government and raise the U.S. borrowing limit until early in the new year, meaning the fiscal showdown could resume in a matter of months. Bullard said he did not think the shutdown in itself would do lasting harm to the economy, although he acknowledged that the political fighting had hurt confidence. But the Fed should not wait for a permanent budget deal before taking policy action. "I think we can't really wait for the political situation in Washington to be just right because, evidently, they could be bickering forever," he said. He also played down the impact that the central bank's leadership transition would have on decision-taking, after President Barack Obama nominated Fed Vice Chair Janet Yellen to take over the helm from Ben Bernanke when his term expires at the end of January. Yellen's appointment must be confirmed by the U.S. Senate. "I don't think the committee would put very much weight on anything like that. It is a continuous process and it is a committee that is making the policy and they want to adjust at the right time," Bullard said. He also said that he expected she would help ensure policy continuity once she was in charge. (Reporting By Alister Bull; Editing by W Simon and Chizu Nomiyama)

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Coal Industry Expected to Rebound on Growing Demand From China in 2013 RDInvesting Provides Stock Research on Alpha Natural Resources and Peabody Energy NEW YORK, NY -- (Marketwire) -- 02/06/13 -- Despite a steep drop in domestic demand the outlook for the coal industry remains positive as foreign demand continues to grow. The U.S. Energy Information Administration (EIA) recently reported that China coal consumption is nearly equal to the rest of the world combined. Research Driven Investing examines investing opportunities in the Coal Industry and provides equity research on Alpha Natural Resources, Inc. (NYSE: ANR) and Peabody Energy Corporation (NYSE: BTU). Access to the full company reports can be found at: www.RDInvesting.com/ANR www.RDInvesting.com/BTU The EIA reported that China's coal consumption increased 9 percent to 3.8 billion metric tons in 2011, which was its 12th consecutive yearly increase. China now accounts for approximately 47 percent of global coal consumption. The EIA has stated that China has accounted for 82 percent of the growth in coal demand since 2000. According the International Energy Agency, China was not only the largest coal producer in 2011, accounting for roughly 46 percent of global production, but also the largest importer, importing approximately 177 million metric tons in 2011. "[There are] enhanced opportunities for exports of American coal to China to feed some of that demand," says Heath Knakmuhs, senior director of policy at the U.S. Chamber of Commerce's Institute. "While China does have significant internal coal resources they're often far away from load centers. It does provide an opportunity for American coal suppliers -- especially those located in the western U.S. to export enhanced amounts to China." Research Driven Investing releases regular market updates on the Coal Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at www.RDInvesting.com and get exclusive access to our numerous stock reports and industry newsletters. Alpha Natural Resources produces, processes and sells steam and metallurgical coal from approximately 150 active mines and 40 coal preparation plants located throughout Virginia, West Virginia, Kentucky, Pennsylvania and Wyoming. In 2011, the company had more than 200 customers on five continents. Alpha is scheduled to release results for the fourth quarter and full year 2012 before market open on Thursday, February 14th. Peabody Energy serves metallurgical and thermal coal customers in more than 25 countries on six continents. "Turning to 2013, recent data suggests that China's economic growth is again accelerating, and we have seen some rebound in global coal prices, while European and U.S. economies are likely to remain sluggish." commented Peabody's Chairman and CEO Gregory H. Boyce. Research Driven Investing has not been compensated by any of the above-mentioned publicly traded companies. Research Driven Investing is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at: http://www.rdinvesting.com/disclaimer

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T stands for TARP...and TroubleThe Treasury Department's capital purchase program of banks is now underway but there is mounting criticism of the plan from legislators and banks. By David Ellis, CNNMoney.com staff writerNovember 7, 2008: 9:48 AM ET Possible Treasury pick: GeithnerMore VideosTexas bank: 'No thanks' TARPMore VideosNEW YORK (CNNMoney.com) -- When the Treasury Department first unveiled its plan to buy stakes in banks last month, the move was heralded as a potential savior for fast-sinking banks and financial firms.Now, critics of the proposal are growing by the day. Legislators have been among the most vocal. Members of Congress, including House Financial Services Committee Chairman Barney Frank (D-Mass.), have expressed concern that banks may not necessarily use the government funds to make loans - a key selling point when the program was first pitched.What's more, it is unclear if injecting capital into banks will even work. Banks remain skittish about doling out money after getting burned by the housing market collapse. And with the economy slowing, demand for both consumer and business loans is down, according to a Federal Reserve survey of senior loan officers published earlier this week. But for all the jawboning that lawmakers do, whether banks lend or not will ultimately come down to how much pressure the federal agencies that oversee the industry, most notably Federal Deposit Insurance Corp. as well as the Office of Thrift Supervision, put on them, said Jack Murphy, a long-time partner at the law firm Cleary Gottlieb Steen & Hamilton."The real question is how much encouragement will bank regulators give banks to lend?" he said. "That is really the most direct influence you can have." He believes the FDIC and OTS will urge banks and thrifts to make more loans but won't pressure them to lend just for the sake of lending."They will be encouraging banks to lend but they will also be very clear not to ask them to do any lending that won't fit their credit criteria," he said. Rancor in the ranksYet, there has also been no shortage of criticism about the Treasury's Troubled Asset Relief Program, or TARP, from both the banking and securities industries. A joint survey of more than 400 firms published Thursday by the Securities Industry and Financial Markets Association and four other trade groups revealed that a lack of clarity surrounding the program has dissuaded many firms from participating.In particular, banks have expressed concerns about how vague the capital purchase portion of the program has been. The Treasury has a closely guarded process of picking which banks will get funds and which will not and some have argued that the government is effectively creating a group of so-called "winners" and "losers.""The selection process is opaque and there are criticisms about that," said Bert Ely, a principal at Ely & Co., a financial institutions and monetary policy consulting firm in Virginia. "Some people would call this industrial planning." But the complaints don't end there.Other industry groups, including the American Bankers Association and the American Association of Bank Directors, have charged that the program allows Congress to change the terms of the agreement as they see fit in the future.Theoretically, lawmakers could look to extract the proverbial pound of flesh from the banking industry months from now since they have the legal authority to mandate, say, higher dividend payments on preferred shares or some sort of loan quota.A spokeswoman for the Treasury Department stressed that the terms of the capital purchase program are standard legal language. But some banks are already thinking twice about signing up for that reason alone, said David Baris, executive director of the American Association of Bank Directors."Congress can do anything they want," said Baris. "That concerns us." Lack of focus?To date, 49 financial firms have won either full or preliminary approval from the Treasury to get nearly $172 billion in government capital, according to analysts at Keefe, Bruyette & Woods. That includes the original group of nine institutions that signed up for the program when it was first announced, big banks such as Citigroup (C, Fortune 500), Bank of America (BAC, Fortune 500), Morgan Stanley (MS, Fortune 500) and Goldman Sachs (GS, Fortune 500). Before it is all said and done, Treasury plans to inject some $250 billion in capital into banks of all sizes across the country.Some banks, such as San Antonio, Texas-based Cullen/Frost (CFR), have shunned the program altogether. But they appear to be the exception. Many other institutions are expected to queue up for cash before the Nov. 14 deadline. There has also been talk that the capital purchase program could be extended to other participants, including insurance companies and other specialty financial services firms such as bond insurers, which got into trouble earlier this year. Even automakers have reportedly gone to the government with hat in hand seeking a part of the TARP pie.Some industry experts have lambasted the Treasury Department for its seeming lack of focus."I don't think they have been projecting an image that they know what they are doing," said Mauro Guillen, a professor at the Wharton School of the University of Pennsylvania. "Quite frankly you have to be little more decisive." But others contend that Treasury officials, including Secretary Henry Paulson, have been intentionally coy in order to allow themselves some latitude to react to the current crisis.At the same time, there has also been speculation that agency officials have shown restraint in moving forward with the rescue plan because of this week's election and the eventual shakeup at the White House. President-elect Barack Obama is expected to name a nominee for Paulson's successor soon, perhaps as early as Friday.One lingering question, however, is when, and if, the original objective of TARP - purchasing troubled assets from banks in order to get them off their balance sheets - will return.Treasury officials haven't given any indication that they have closed the book on that idea, although its launch has been bogged down by issues related to pricing and which banks get priority. One method that the Treasury has suggested is the use of a reverse auction in which holders would put certain toxic assets up for sale and the government would buy those offered at the best price.Cleary Gottlieb's Murphy was among those who said he anticipated the program to take root, but it was impossible to tell how soon it could happen. "These things aren't simple," said "Treasury is in a position of trying to build a ship after it has set out for sea." Housing plunge: The Fannie fix Obama's business brain trust Married by America: Wall Street and the White House

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Friday, 31 August, 2001, 14:42 GMT 15:42 UK Excite@Home's woes mount The crisis at high-speed internet firm Excite@Home has deepened, with two of its key partners terminating distribution deals and a cash crunch deadline looming. Excite@Home admitted that it had appointed an investment bank to help explore restructuring options, after Cox and Comcast, two cable TV firms, said they would no longer distribute its internet service. At the same time, the company faces a Friday deadline to repay $50m that it owes to Promethean Investment, which provided it with an emergency loan earlier in the year. The company's shares tumbled by 25% in early trading on the Nasdaq exchange on Friday, and its stock is now threatened with delisting. Cash crunch looms Speculation over Excite@Home's future has been lively for the past couple of months, since the firm admitted it was running out of cash. The company, which boasts 3.2 million subscribers to its high-speed cable modem internet access service, ran up losses of $833m in the first three months of the year, and now has about $1bn in debt. Earlier in August, its then-auditors, Ernst & Young, said that there was "substantial doubt" about the AT&T subsidiary's ability to continue as a going concern. Excite@Home subsequently sacked Ernst & Young as auditors. Rescue hopes Excite@Home said it was continuing to hold discussions with Cox and Comcast about ways in which the firms could continue to provide its service to their subscribers. There have also been persistent rumours during the week that investors were likely to appear with a rescue bid for the firm. But no deal has yet been confirmed. And even if these problems are resolved, the issue of debt could prove even more troublesome. Under the terms of Promethean's loan, Excite@Home shares must remain listed on the Nasdaq. Early on Friday, shares in the firm had fallen to 39 cents, down from their high of nearly $19 last September. Under Nasdaq rules, companies whose share price falls below $1 for a prolonged period must be delisted. A delisting could therefore instantly propel the company into bankruptcy. 22 Aug 01 | Business Excite UK holds on Investors desert Excite@Home T-Online eyes ExciteAtHome Excite@Home retreats in Europe 08 Jan 01 | Business GUS gives Breathe new life Breathe loses battle for life Thousands of surfers 'to be cut off' Excite@Home (corporate)

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Economist says Oklahoma City's economic trends remain positive City council members begin the process of drafting a budget for next year reviewed forecasts predicting continuing growth. BY WILLIAM CRUM [email protected] • Published: February 13, 2013 Further, the sprawling Interstate 35 corridor leads the nation in job growth among seven large U.S. economic regions, he said. In an interview, Mayor Mick Cornett noted the risk to the city's prosperity from factors including the federal budget impasse and long-term reductions in military spending. But Cornett said he was “cautiously optimistic” that growth would continue. Oklahoma City is becoming a place where highly educated people want to live, he said. “That's the secret of the 21st century economy,” Cornett said. “And we're investing in that heavily.” City finance experts told council members they are projecting 4 percent growth in sales tax collections in fiscal 2014. City departments have been asked to submit budgets reflecting a 1 percent cut in funding. The council is to receive a proposed budget on April 30. Following a series of meetings to discuss spending plans, the council is to vote on next year's budget on June 11.

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Michelin Chef Joins Former Japan Banker to Sell $9 LunchesKomaki Ito and Tomoko YamazakiFeb 03, 2014 10:46 pm ET(Updates with plans for when the lunchboxes will go on sale in seventh paragraph.) Feb. 4 (Bloomberg) -- Osamu Ito, a former Morgan Stanley MUFG Securities Co. banker, is setting up a crowdfunding company that will raise money online to invest in startups including a Michelin-starred chef’s bento box business. Ito, who left the brokerage yesterday to become chief executive officer of Tokyo-based Crowdfunding Inc., is seeking to raise 35 million yen ($345,747) to start making diet lunch boxes in Japan. The business would be overseen by Shintaro Esaki, who has won three Michelin stars for five straight years at his eponymously-named nouveau Japanese restaurant in central Tokyo. Ito, 34, joins a growing trend globally of crowdfunding websites that allow businesses too small to attract banks or venture capitalists to seek finance for specific projects and raise money from a large number of individual contributors. Crowdfunding platforms raised an estimated $5.1 billion in 2013, compared with $2.7 billion in 2012, according to Crowdsourcing LLC’s research website Massolution. “I am only interested in projects that will set the trend in the new era,” Ito, who was selling financial products at Morgan Stanley MUFG to institutional investors and companies, said in an interview in Tokyo. “I want my investors to feel and be excited about how they can change the world with their own investments.” Growing Entrepreneurship A working group under Japan’s Financial Services Agency has been discussing ways to lower barriers for crowdfunding platform operators that are required to be registered with the regulator, while protecting potential investors interested in such investments. Entrepreneurship in Japan was about half the level in the U.S. in 2010, partly because of a lack of risk-money that was willing to support nascent businesses, a report by the group showed in December. Ito and Esaki want to sell 50 million yen of the low-sugar, low-calorie lunch boxes, or bentos, in the first 12 months, 80 million yen to 90 million yen in the second year and about 120 million yen in the third, Ito said. Investors would receive about 10 percent to 13 percent of the total sales annually during the six-year period the project, he said. Investors can start from 500,000 yen, he said. The “Oishi Plus” bentos will start selling at about 880 yen per box in Tokyo, Ito said. They will go on sale once Ito’s company is registered by the financial watchdog, he said. Ito wants to expand his platform by seeking other entrepreneurs with plans that will meet demand in a rapidly changing environment, he said, declining to specify the next targets. Ito was a vice president at Morgan Stanley MUFG in Tokyo. Before that, he was a salesman at Nomura Holdings Inc., which he joined in April 2002, he said. “Providing capital to those who are in dire need at appropriate times is the role of financial firms,” Ito said, adding that many of the venture capitalists don’t provide such capital until the businesses have matured.--Editors: Iain McDonald, Teo Chian Wei

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Recommend Comment Printer-friendly Sunday, the first trading day after the announcement, the market digested the effect of the Central Bank of Egypt's (CBE) decision to raise the interest rate on Sunday, with a minimal decline of 0.3 per cent. The selling spree started on the last two trading days of the week ending 2 November, and continued with Arab investors trying to get out of the market to compensate for their losses in the bourses back home which took the lowest dip of the year. The average daily trading came at LE1 billion compared to a relatively stagnant market during Ramadan, where average daily transactions did not break the LE500 million threshold. ORASCOM TELECOM HOLDING (OTH) has given many reasons to its investors to be cheerful during the past two weeks. The company's 19 per cent-owned subsidiary Hutchinson Telecommunications International Limited (HTIL) added three million subscribers during 2006, to reach 26.5 million -- recording a year-on-year growth of 76 per cent. HTIL had a consolidated net profit of $13.2 million in 2006, turning around its net loss the year before. HTIL is a leading provider of telecommunication services in emerging Asian markets with activities in India, Hong Kong, Thailand and Israel. It is expected to launch operations in Vietnam in early 2007, followed by Indonesia. OTH bought a 19.3 per cent stake in the company last year and expressed interest in increasing the stake earlier this year. However, no specific offer or time frame was announced for the proposed acquisition. In another development, OTH signed an agreement with Emirates International Investment Company to purchase a 7.9 per cent stake in Orascom Telecom Algeria (OTA) for $399 million. The deal will result in OTH increasing its stake in OTA from 87.7 per cent to 95.6 per cent. This is the second time that OTH increases its stake in the company that operates the Djezzy network, since it raised its holdings in the company from 59.31 to 87 per cent earlier this year. As of 30 June, 2006, OTA represented 23.1 per cent of OTH's subscriber base and contributed 39 per cent of its GSM revenues. OTH's presence on the Algerian market is not limited to its mobile network, since it won a 15-year licence in March 2005 to build and operate a national fixed line network in Algeria as part of an Egyptian Consortium. The consortium includes Telecom Egypt, of which OTH owns 50 per cent. The licence stipulates a two-year exclusivity period to operate national and international fixed line services. THE EGYPTIAN COMPANY FOR MOBILE SERVICES (MobiNil) increased its subscriber base by 35 per cent during the year ending September, 2006 to 8.1 million subscribers. The number of subscribers in the fourth quarter of the same year increased by 12 per cent due the newly added promotional products. MobiNil efforts to attract more customers, especially from the low income segment, included offering a plan consisting of low priced handsets together with phone lines. In July, 2006, it also launched a new product "Alohat" that features per-second off-peak tariff, and Egypt's lowest SMS rate. Two months later, MobiNil cancelled administration fees on pre-paid cards, a move that is expected to attract even more subscribers. Meanwhile, observers believe that MobiNil will soon apply for a 3G licence, especially after the National Telecommunication Regulatory Authority (NTRA) decided to suspend it from offering services under EDGE technology (2.75G) pending its acquisition of a 3G licence. THE COMMERCIAL INTERNATIONAL BANK (CIB) joined forces with a number of partners to form a financial services and investment banking company under the name Commercial International Capital Holding (CI-Capital). CIB, Oasis Capital Egypt, Dynamic Securities Trading, and Orascom Telecom and MobiNil Chairman Naguib Sawiris (in his personal capacity) finalised an agreement to form a strategic alliance by which all parties will consolidate their financial services and investment banking businesses into CI-Capital. According to an HC Securities research note, Sawiris -- along with a number of Oasis investors including the Saudi-based Olayan and the UAE-based Al-Futtaim families -- will pump new capital into CI-Capital to finance the company's ambitious growth strategy. They aim to "create the pre-eminent investment and merchant banking institution in Egypt and across the Gulf region." BESIX GROUP, Orascom Construction Industries' (OCI) 50 per cent-owned subsidiary, acquired two ready-mix concrete, asphalt and road construction Belgian companies worth $40 million. The two companies, SOCOGETRA and COBELBA, have operations in Belgium, France, Luxembourg and Hungary. The transaction is currently being reviewed by the relevant antitrust authorities. While the deal is not expected to push OCI's revenues in the short term, it will consolidate its European presence. According to an HC Securities' commentary on the deal, the two newly acquired companies are expected to record revenues of $110 million in 2006, contributing to OCI's bottom line by less than $4 million. This amounts to less than one per cent of OCI's consolidated net profits in 2006. OCI's Chief Executive Officer Nassef Sawiris said the deal would affirm OCI's drive into two strategic activities, infrastructure concessions and construction, as well as the production of aggregates and ready mix. BESIX provides engineering, procurement and construction (EPC) services for public and private large commercial infrastructure and maritime projects. The group has a long list of landmark projects in the Middle East, including Burj Dubai Tower which will be the world's tallest building standing more than 700 metres high and the Sheikh Zayed Bin Sultan Al-Nahyan Mosque in Abu Dhabi. Compiled by Sherine Abdel-Razek Front Page --- Subscribe to Al-Ahram Weekly --- © Copyright Al-Ahram Weekly. All rights reserved Comment Recommend Front Page | Egypt | Region | Interview | Economy | International | Opinion | Reader's corner | Press review | Culture | Features | Living | Sports | Cartoons | Special | People | Encounter | Listings | BOOKS | TRAVEL Current issue | Previous issue | Site map

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hide Treasury: credit warning a sign of urgency in debt debate Tuesday, October 15, 2013 5:12 p.m. EDT WASHINGTON (Reuters) - The U.S. Treasury said on Tuesday the threat of a credit rating downgrade is a reminder for U.S. lawmakers that the United States is dangerously close to defaulting on its obligations. Fitch Ratings warned earlier in the day it could cut the sovereign credit rating of the United States from AAA, citing the political brinkmanship over raising the federal debt ceiling. "The announcement reflects the urgency with which Congress should act to remove the threat of default hanging over the economy," a Treasury spokesperson said. (Reporting by Jason Lange; Editing by Sandra Maler)

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hide Treasury Wine CEO's exit shows challenge for Australian industry Sunday, September 22, 2013 11:34 p.m. CDT By Jane Wardell SYDNEY (Reuters) - The ousting of the chief executive of Treasury Wine Estates Ltd , the world's second-largest wine maker, on Monday underscored the need for a fundamental shift in the way Australia markets its wines to the world as its exports fall. Once hailed around the world for its so-called "critter labels" - cheap but decent quality wines featuring colourful kangaroo and koala adorned labels - Australia has been slow to grasp a move by consumers toward higher-end tipples. The global trend is most noticeable in the United States, the world's largest wine consumer where Treasury competes against world No.1 by sales Constellation Brands Inc , and in the rapidly growing Chinese market. That leaves Australia with the tough task of cutting oversupply, increasing prices and - perhaps most importantly - rebranding its wines to the quality end of the market. "People are trading up," said Mark Parer, a Beijing-based importer of Australian wines with Plantagenet Wines. "The French are way ahead on marketing and branding." Australia exported A$1.8 billion of wine worldwide last year, down from a peak of $3 billion in 2007, according to the Winemakers' Federation of Australia. In the United States, consumers bought just 16 million litres (3.5 million British gallons, 4.2 million gallons) of Australian wines priced around A$3.75 ($3.52), down from 77 million litres in 2007. Treasury's misjudgment of the move upward in the United States proved very costly for the company and Chief Executive David Dearie, who presided over a A$160 million charge due to the destruction of thousands of gallons of cheap wine. Treasury, whose brands include mass-produced Berringer, Wolf Blass, Rosemount and high-end Penfolds, was also forced to offer major discounts on "excess, aged and deteriorating inventory" after significantly over estimating U.S. demand. Treasury Chairman Paul Rayner said on Monday the board decided the company needed "a leader with a stronger operational focus to deliver the company's growth ambitions." Rayner said the U.S. market was an integral part of the business, although he noted a new CEO would have leeway to alter the company's strategy there. Warwick Every-Burns, a non-executive member of the board, will take over the reins temporarily while the company searches for a permanent replacement. Treasury isn't alone in its troubles. Privately-held Casella Wines, the maker of the ubiquitous Yellow Tail "critter" label, earlier this year posted its first financial loss. Casella's net loss of A$30 million for 2011/12 was a sharp turnaround from the A$45 million profit it made in 2010/11 and 20 years of profits on the back of more than 8 million cases of Yellow Tail shipped each year to North America. Casella, which was forced to negotiate a debt restructure with lender National Australia Bank Ltd , blamed the high Australian dollar for crimping export margins and allowing lower-cost countries like Chile and Argentina to gain market share in the United States. But analysts say the lower Australian dollar masked the wider problem for Australian wine exports and the recent rise in the currency will not be enough to revive its fortunes. FRENCH SUCCESS The bright spot for Australia is that while volumes are down across the board globally, it sold 14 million more litres in the $7.50 to $9.99 segment and 16 million more litres in the over $10 segment last year. Parer said Australia needs to take a leaf out of the French wine book, in China at least. Paris-based maker Pernod Ricard last month reported a 12 percent increase in sales of its Australian label Jacob's Creek to Asia. The label is now the second-largest brand in China in terms of sales revenue. A "cheap and cheerful" staple on wine shelves around the world, Pernod took Jacob's Creek into premium territory with a Reserve range. It has also rolled out new variations of the label tailored to foreign palates, including a heavy red in China, the 1837 Solway. Treasury has made some steps toward increasing awareness of its higher-end brands in China, announcing plans to open a series of wine bars to encourage drinking of luxury wines as well as gift-giving. It currently sells in China only through distributors, a channel that Parer said can make it difficult to control the message. Only time will tell how successful Treasury is at repositioning itself. "I think a willing new CEO ... can build this business going forward," Rayner told reporters. "I'm confident about the future." (Reporting by Jane Wardell; Editing by Stephen Coates)

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IMF: Gas Prices Don't Reflect True Costs Share Tweet E-mail Comments Print By editor Originally published on Thu March 28, 2013 8:18 am Listen Transcript DAVID GREENE, HOST: It's MORNING EDITION from NPR News. Good morning, I'm David Greene. LINDA WERTHEIMER, HOST: And I'm Linda Wertheimer. When you're filling up a car with gas, chances are you are not looking at the price per gallon and thinking how low it is. And maybe thinking that the government ought to do something about that and raise prices. But the economic wizards at the International Monetary Fund are recommending exactly that, not just for the U.S. but for the entire world. So to find out what's that's about, we turn to David Wessel. He is the economics editor of The Wall Street Journal and a frequent guest on our program. David, good morning. DAVID WESSEL: Good morning, Linda. WERTHEIMER: So let me get this straight. Gasoline is selling for around $3.65 a gallon in the U.S. and the IMF thinks that's too low? WESSEL: That's right. The IMF says that the price of gasoline in the U.S. covers the cost of producing and distributing it, but doesn't reflect all the costs that using gasoline imposes on society: traffic, pollution, global warming. But in other countries, particularly in the developing world, governments set gasoline prices artificially low - lower than the cost of producing it. In Saudi Arabia, for instance, gas goes for only 45 cents a gallon. The result is that people here and abroad use more energy than they would otherwise. So the IMF says that subsidizing energy or mispricing it aggravates budget deficits, crowds out spending on health and education, discourages investment in energy, encourages excessive energy use, artificially promotes capital-intensive industries, accelerates the depletion of natural resources... (LAUGHTER) WESSEL: ...and exacerbate climate change. But other than that it's a great idea. WERTHEIMER: So how much do governments spend subsidizing energy? WESSEL: They spend a lot of money. About half a trillion dollars a year in direct subsidy that taxpayers pay for. That's two percent of government revenues worldwide - not that much. But in some countries, particularly in the Middle East and North Africa, it's more like 20 percent of revenues. The U.S. doesn't do that much direct taxpayer subsidy or regulation of energy prices, though we do have those controversial tax breaks for oil and gas exploration. But when the IMF adds up all this under-pricing of energy, they say it comes to about a trillion and a half dollars a year. WERTHEIMER: Now, David, we usually think of the IMF as worrying about money and rescuing countries that run short of money. Why are they worrying about energy prices? WESSEL: Well, that's a good question. One reason is that they worry a lot about budget deficits. In a lot of countries, these energy subsidies are an enormous part of government spending, sometimes even equal to the size of their government budget deficits. Some governments spend more on energy subsidies than they do on education and healthcare. And nobody really thinks that's a great idea. So what the IMF is saying is there's a twofer here: You can curtail these subsidies, reduce your deficits, and do something about global warming at the same time. WERTHEIMER: But you wouldn't curtailing subsidies mean that poor people, or people who are living in poorer countries and already struggling, would have yet another cost going up? WESSEL: Right. Well, energy subsidies are often defended as a way to help the poor. But actually they don't really target the poor. Think of it this way: If you're poor and you don't own a car, and you don't have an air conditioner, and the government subsidizes energy, electricity and gasoline, you don't get much benefit. If you live in the same country and you're rich, and you have two or three cars and five air-conditioners, you get a big benefit. So there are ways to cushion the blow on the poor - giving them vouchers to buy energy cheaply, or giving them cash payments to offset subsidies or something. The politics are tricky. But David Lipton, the number two at the IMF who's been pushing this idea, says this. He says it's better to do this the right way than to do it right away, but it's important to do it. WERTHEIMER: But, of course, here in the United States you would raise the price by raising taxes. That doesn't sound likely. WESSEL: It isn't likely. I think the only way that happens is if some day Congress does some of massive overhaul of the tax code and decides to deal with the deficit at the same time it deals with global warming. But that sure doesn't look like it's going to happen soon. WERTHEIMER: David Wessel, economics editor of The Wall Street Journal, thank you. WESSEL: You're welcome. Transcript provided by NPR, Copyright NPR.

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PacWest Bancorp and CapitalSource Agree to Merge July 23 - PacWest Bancorp (Nasdaq: PACW) and CapitalSource Inc. (NYSE: CSE) have announced the signing of a definitive agreement and plan of merger whereby PacWest and CapitalSource will merge in a transaction valued at approximately $2.3 billion. The combined company will be called PacWest Bancorp and the combined subsidiary bank will be called Pacific Western Bank. The CapitalSource national lending operation will continue to do business under the name CapitalSource as a division of Pacific Western Bank. CapitalSource Inc., headquartered in Los Angeles, is the parent of CapitalSource Bank, a California Industrial Bank with approximately $8.7 billion in assets at June 30, 2013, and 21 branches located in southern and central California. In connection with the transaction, CapitalSource Bank will be merged into Pacific Western Bank, the Los Angeles-based wholly owned subsidiary of PacWest Bancorp.Pacific Western Bank had $6.7 billion in assets at June 30, 2013, and 75 branches across 10 California counties. The independent directors of PacWest and CapitalSource unanimously approved the transaction. On completion of the transaction, the combined company board will have 13 directors, eight representatives from PacWest and five representatives from CapitalSource. Matt Wagner, CEO of PacWest Bancorp and chairman and CEO of Pacific Western Bank, will be CEO of the combined company and of Pacific Western Bank. James J. Pieczynski, CEO of CapitalSource, will become president of the new CapitalSource division of Pacific Western Bank, incorporating all of the current CapitalSource lending operations. John Eggemeyer, chairman of PacWest Bancorp, will become chairman of the combined company. Tad Lowrey, chairman and CEO of CapitalSource Bank will become non-executive chairman of Pacific Western Bank. The combined company will remain headquartered in Los Angeles and will have senior executives from each of the organizations in key positions. The transaction, currently expected to close in the first quarter of 2014, is subject to customary conditions, including the approval of bank regulatory authorities and the stockholders of both companies. Certain stockholders of CapitalSource and PacWest, including all current directors, have agreed to vote in favor of the transaction. As of June 30, 2013, on a pro forma consolidated basis, the combined company would have had approximately $15.4 billion in assets with 96 branches throughout California. The combined institution would be the 6th largest publicly-owned bank headquartered in California, and the eighth largest commercial bank headquartered in California (out of more than 232 financial institutions in the state). Under the terms of the agreement, CapitalSource shareholders will receive $2.47 in cash and 0.2837 shares of PacWest common stock for each share of CapitalSource common stock. The total value of the CSE per share merger consideration, based on the closing price of PacWest shares on July 19, 2013, of $32.32, is $11.64. The transaction is intended to qualify as a tax-free reorganization for U.S. federal income tax purposes and CapitalSource shareholders are not expected to recognize gain or loss to the extent of the stock consideration received. Giving effect to the transaction, existing shareholders of PacWest are expected to own approximately 45 percent of the outstanding shares of the combined company and CapitalSource shareholders are expected to own approximately 55 percent. Matt Wagner, CEO of PacWest Bancorp, commented, "This transaction represents the combination of two outstanding organizations. CapitalSource has built an enviable lending platform and growth engine. PacWest has a valuable community banking franchise and a low cost deposit base driven by our high percentage of noninterest bearing demand deposits. The combination of these two franchises will create a formidable company going forward, with a strong balance sheet and capital base, attractive margins and good earnings momentum." "The combination of CapitalSource and PacWest will produce tremendous benefits for the shareholders of both companies, said James J. Pieczynski, CEO of CapitalSource. PacWest fills the need of CapitalSource for a more stable and low cost deposit base. CapitalSource will give PacWest a more robust and diverse lending presence. Both institutions share a conservative credit culture and have talented and dedicated employees that will make the combined company much more than the sum of its parts going forward." "We have worked hard over the last five years to build a high performing bank and we are proud of our success," said Tad Lowrey, CapitalSource Bank chairman and CEO. "PacWest is the perfect partner to accelerate and expand our capacity to serve the credit needs of middle market and small businesses and to broaden the products and services we can offer to our deposit customers here in California once the merger into Pacific Western Bank is completed."

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Bachus to Give Up House Financial Services Chair January 20, 2012 • Reprints Even if the Republicans keep control of the House next year, the House Financial Services Committee is likely to have a new chairman. Committee Chairman Spencer Bachus (R-Ala.) said this week that he won’t seek a waiver of the House Republican Conference’s rules which limit a member to a total of six years as a panel’s chairman or ranking member. He has been chairman of the panel since last year and was the ranking Republican from 2007-2010. He is planning to seek reelection to Congress, where he has served since 1993. Rep. Ed Royce (R-Calif.), the panel’s third-ranking Republican, has run unsuccessfully for the top spot before and might run again but hasn’t announced plans. He is the sponsor of legislation that would raise the cap on member business loans from 12.25% of assets to 27.5% of assets. As chairman, Bachus has at times praised credit unions but didn’t sign on as a cosponsor of the MBL legislation. He did cosponsor a bill aimed at providing regulatory and tax relief for community banks. Some of those benefits would also go to credit unions. Bachus’ heavily Republican district includes parts of Birmingham and its suburbs. The House Financial Services Committee’s top Democrat Barney Frank (D-Mass.) has already announced he won’t seek reelection to Congress this year. The panel’s number two Democrat, Rep. Maxine Waters (D-Calif.), has been lining up support to succeed Frank but other members may enter that contest as well. The parties will choose their committee leaders after this November’s elections. Show Comments

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From the June 19, 2013 issue of Credit Union Times Magazine • Subscribe! Cascade FCU Backs Up No Merger Vow With Cash if It Reneges By Eileen Courter June 19, 2013 • Reprints If you’re a recent member of Cascade Federal Credit Union in Seattle and the credit union merges, you’ll have a little more money in your account, thanks to a no merger guarantee. The credit union has put it in writing on its Web site saying if, as the result of combining with another financial institution, one of three things happens within two years of the original membership, Cascade Federal will pay members $100. The guarantee applies if the credit union changes its name, alters a member’s account number or closes a primary branch. This is not a gimmicky, new trend. Dale Kerslake, president/CEO of Cascade Federal, said the guarantee actually dates back to 1997 when members complained about mergers at other financial institutions they belonged to. At the time, several community banks had merged and members were frustrated. To reassure them that a merger wouldn’t happen at Cascade Federal, the no merger promise was made. Kerslake noted that since the credit union doesn’t plan on taking any of those three steps, it’s really a non-issue. The credit union adds about 100 new members each month, so if the guarantee were ever paid it would cost the credit union about $250,000. With assets of $258 million and $27 million in net worth, the payout wouldn’t be significant. “I was accused by one of my fellow CEOs of offering the guarantee as kind of a poison pill. It would be a pretty small pill,” Kerslake quipped. While he doesn’t condemn all mergers, he acknowledged some skepticism towards them. “In general, I think some mergers are a good idea,” Kerslake said. “But probably too many of them are cases of management looking to make things better for themselves and putting themselves ahead of the credit union.” Would Kerslake reconsider if a small, struggling credit union approached Cascade Federal seeking a merger? “I’ve been here for 30 years,” Kerslake answered. “I have actually had several offers to merge with smaller credit unions. I guess I was naïve in thinking we could help the smaller credit union. In every case, those credit unions ended up merging with another credit union, so I really didn’t accomplish anything.” He added “I think small credit unions are very important to the overall health of the industry. Each time we lose a credit union, we lose 10 volunteers. In the last five or six years, we’ve lost 3,000 credit unions, so that’s about 30,000 volunteers who are no longer in our grass roots ranks.” Although the guarantee is for people who joined Cascade Federal, Kerslake said if he were to take in a smaller credit union, he would probably apply it to members of that credit union. While he doesn’t think the pledge has drawn a lot of members who wouldn’t have joined Cascade Federal, it does offer a little reassurance that members won’t experience frustration that will cause them to look for another financial institution. Kerslake said he hasn’t seen other credit unions adopting a similar guarantee but if it sounds worthwhile, simply do it, he suggested. As far as he’s concerned, it’s pretty straightforward. Denny Graham, president/CEO of FI Strategies LLC, a strategic planning firm in St. Louis, has offered advice on encouraging members to approve mergers. He thinks Cascade Federal has made a wise move. “There are a lot of good reasons for credit unions to merge, but there are also a lot of good reasons for healthy credit unions – and Cascade is one – to stay independent,” Graham noted “So if that’s their policy, why not say so?” Graham said “I haven’t heard of it as a trend, but clearly there are a lot of credit unions that have no intention of being acquired. If that’s the case, why not make it public? It’s a great PR move. The public is certainly tired of seeing signs changed on their financial institution.” He agrees with Kerslake that even if Cascade Federal had to pay off on its promise, it wouldn’t be a major blow. Looking closely at the guarantee, he figures that even if a merger did occur, it really wouldn’t affect that many members. While other credit unions may not have a written policy, some have taken a no-merger stance but have simply not publicized that decision, said Tom Glatt Jr., founder of Glatt Consulting in Wilmington, N.C. “If I were on the board or a member of the management team, I wouldn’t want to restrict my flexibility,” Glatt explained. “You never know when a merger possibility may present itself, and certainly if it makes sense and is truly beneficial to the members, you’re adding another cost you have to account for in evaluating the merger decision.” Glatt said “at the end of the day, if they’re inclined to pay that kind of dividend to facilitate a merger, they’re just stating publicly the strategy they’ve decided on. I don’t know that I’d advocate it, but it’s certainly interesting.” Show Comments

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Home » Events Events Videos from Events Events Meet the Author - James Rickards James Rickards Thursday, April 17th at 7 p.m. James Rickards, author of The Death of Money, will be our featured speaker. The international monetary system has collapsed three times in the past hundred years, in 1914, 1939 and 1971. Each collapse was followed by a period of tumult: war, civil unrest, or significant damage to the stability of the global economy. Now James Rickards, the acclaimed author of Currency Wars, shows why another collapse is rapidly approaching – and why this time, nothing less than the institution of money itself is at risk. Advance Praise for The Death of Money "A terrifically interesting and useful book . . . fascinating.” — Kenneth W. Dam, Former Deputy Secretary of the Treasury and Adviser to three Presidents James Rickards is Senior Managing Director at Tangent Capital Partners LLC, a merchant bank based in New York City, and is Senior Managing Director for Market Intelligence at Omnis, Inc., a technical, professional and scientific consulting firm located in McLean, VA. Mr. Rickards is a seasoned counselor, investment banker and risk manager with over thirty years experience in capital markets including all aspects of portfolio management, risk management, product structure, financing, regulation and operations. Mr. Rickards’ market experience is focused in alternative investing and derivatives in global markets. He has also served as General Counsel at several alternative asset management companies and a stock exchange facility and is expert in fund governance and international fund structures. He lives in Darien. All author programs will feature a book signing and refreshments. Books will be available for purchase at each event. Additional parking for evening and weekend Library programs on Thorndal Circle (behind Nielsen’s). Meet the Author The Catherine Lindsey Actors/Playwrights Workshop Workshop your play. The Catherine Lindsey Actors/Playwrights Workshop is excited to announce that the Actors/Playwrights Workshop, now in its 22nd year, will present a series of workshops at Darien Library. Participants are invited to workshop their plays at the following session: Thursday, April 17th at 7 p.m. The workshops will allow the playwrights to refine their scripts before submitting them to the Catherine Lindsey Actors/Playwrights contest by April 30. Playwrights are not required to attend these sessions in order to have their play considered. Submit your play using this form. On Sunday, June 15 at 2 p.m., the Actors/Playwrights Workshop will present the first public-staged reading of selections from the plays in the Library’s Community Room. The Actors/Playwrights Workshop welcomes Actors’ Equity actors and non-Equity actors to participate, brings together local and regional playwrights and actors, and encourages a collaborative effort to create new plays and present a public-staged reading. Co-founded by the late Catherine Lindsey and her husband Robert, the workshop introduces original plays in progress to be developed in a workshop environment with the goal of the public-staged readings. Catherine Lindsey was a beloved friend of the Library and director of Darien Library Theater for over 25 years. The memorial workshops will offer actors and playwrights the opportunity to work together to create original theatrical works in a supportive and creative environment. The Actors/Playwrights Workshop welcomes all interested playwrights and actors, with or without experience, to join. The sessions offer actors and playwrights the opportunity to work together to create original theatrical works in a supportive and creative environment, culminating in the June 15th program, which will feature six staged performances. The musicals, monologues, short scenes from full-length and one-act plays to be performed will be chosen by the Darien Library Selection Committee. When writing your piece please keep in mind that the number of cast members is limited, only one play may be submitted per person, and plays must be 10-minutes long or less. Please limit your plays to 10-pages double-spaced, 12 point font. For more information, contact Workshop Director Robert Cusack at (203) 655-7699 or at [email protected]. Additional parking for evening and weekend Library programs on Thorndal Circle (behing Nielsen's). Events Friday Night Feature - 'Philomena' PHILOMENA will screen in our Community Room April 18th. Friday, April 18th at 6:30 p.m. and 8:30 p.m. - Philomena (2013) Starring Judi Dench and Steve Coogan; Rated PG-13; 98 minutes. Closed captioned for the hearing impaired. Judi Dench plays an elderly Irish woman who, as a teenager, gave birth while she was working at a convent. The Catholic Church had the child adopted, and now, decades later, Philomena is introduced to Martin Sixsmith, onetime government spokesperson who is now working as a freelance journalist. Martin agrees to help Philomena look for her son, and the trail takes them to the United States, and brings them face-to-face with some long-buried secrets. "An utterly charming combination of road trip, odd-couple comedy and heart-touching true story that will leave few dry-eyed, Philomena rests comfortably in the lap of the great Judi Dench." -- Moira MacDonald, Seattle Times For more information, please watch the film's trailer. Check out what else we're screening in April. Additional parking for evening and weekend Library programs available on Thorndal Circle (behind Nielsen's). Register for These Spring Tech Classes In April/May: LinkedIn, Word, and Excel Class registration is limited to Darien residents, those who work in Darien full-time, and Friends who have donated $300 or more. Register: Introduction to Microsoft Excel Tuesday, April 22nd, 2- 4 p.m. Excel is Microsoft’s powerful spreadsheet software. Join us for this beginner class and learn what a cell is, how to create a worksheet, and much more! Register: Intermediate Excel Thursday, April 24th, 2 - 4 p.m. Learn how to use sorting, filtering, and lists to make your data come alive. Register: LinkedIn Thursday, May 1st, 2-4 p.m. Learn about the social media craze and how to set up your own LinkedIn account. This workshop will explore finding and establishing connections, group memberships, and effectively using LinkedIn for your job search! Register: Introduction to Microsoft Word Tuesday, May 6th, 2 – 4 p.m. Use word processing software to your advantage to create professional, dynamic documents. Events Image courtesy Flickr user lestaylorphoto All classes are on Tuesday evenings, 6:30 - 7:30 p.m., in the Conference Room, with one exception noted below. Tuesday, April 22nd at 6:30 p.m. - Register: Book Clubs Join Blanche in exploring great resources for your book club. She'll walk you through different websites to help enhance your club's next discussion. Tuesday, April 29th at 6 :30 p.m. - Register: Finance and Investing (meets in the Technology Center) The Library is home to a wealth of information for first-time investors up through the most seasoned shareholders. Explore these resources to keep your fingers on the pulse of your own investments. Tuesday, May 6th at 6:30 p.m. - Register: Job Search Starting a job search can be overwhelming, especially with all of the different websites that are now available. Come learn about the Library's premium online resources available to help you search postings, zoom in on companies in an industry or region, and define your career goals with free asessments. Events Crafting Over Coffee image courtesy Flickr user chrissy.farnan Wednesday, April 23rd at 10 a.m. Join Jennifer St. Jean of Itty Bitty Bag and Leslie Rottner of Abbey Road Photography as they discuss the process of creating and selling handmade items. This is the perfect opportunity for seasoned crafters to join beginner and amateur crafters to network over coffee. Attendees are welcome to bring crafts they are working on or they can simply hang out and talk about handmade items. Meet your fellow makers! Events Meet Us On Main Street Wednesdays at 11 a.m. - Meet Us On Main Street "You Are What You Read" goes LIVE! Wednesdays at 11 a.m. After a holiday hiatus, we are back to tell you about the latest and greatest books, movies, apps, and articles that we are currently digging. Please join us for this weekly, informal discussion. There will be "oooohs." There will be "ahhhhs." There will be laughs. We hope to see you there. Events Friday Night Feature - 'Captain Phillips' We will screen CAPTAIN PHILLIPS in our Community Room April 25th. Friday, April 25th at 6:30 p.m. and 8:45 p.m. - Captain Phillips (2013) Starring Tom Hanks and Barkhad Abdi; Rated PG-13; 133 minutes. Closed captioned for the hearing impaired. A U.S. cargo-ship captain surrenders himself to Somali pirates so that his crew will be freed in this true story. "This is acting of the highest order in a movie that raises the bar on what a true-life action thriller can do." -- Peter Travers, Rolling Stone Poetry for Spring Written by JanetD on 04/07/2014 Wally Swist "O Wind, If Winter comes, can Spring be far behind?" -- Percy Bysshe Shelley As Shelley reminds us, April is here and spring has sprung, even though we're not quite in short sleeves yet. April is also National Poetry Month, when we get to celebrate the written word. On Sunday, April 27, Darien Library will present Poet's Voice, part of a series of readings in Fairfield County libraries, with a special program featuring poet Wally Swist. Author of over 20 books and chapbooks of original poetry, Wally Swist is also a bookseller, editor, and has written hundreds of published feature articles and reviews. He is a native New Englander who shares his journeys in the natural and spiritual worlds through poetry. Please join us at 2 PM on April 27 for his reading, followed by a wine and cheese reception. As reviewer Gary Metras noted, "To read a Wally Swist poem is to see a piece of the world in a special way." Events Meet the Author - Evie Wyld © Roelof Bakker Tuesday, April 29th at 12 noon Evie Wyld, author of All the Birds, Singing will be our featured speaker. A light lunch will be served. Please register for this event. Shortlisted for the 2013 Costa Award for Best Novel Jake Whyte is living on her own in an old farmhouse on a craggy British island, a place of ceaseless rains and battering winds. Her disobedient collie, Dog, and a flock of sheep are her sole companions, which is how she wanted it to be. But every few nights something—or someone—picks off one of the sheep and sounds a new deep pulse of terror. There are foxes in the woods, a strange boy and a strange man, rumors of an obscure, formidable beast. And there is also Jake's past—hidden thousands of miles away and years ago, held in the silences about her family and the scars that stripe her back—a past that threatens to break into the present. With exceptional artistry and empathy, All the Birds, Singing reveals an isolated life in all its struggles and stubborn hopes, unexpected beauty, and hard-won redemption. Evie Wyld grew up in Australia and London, where she currently resides. She received an M.A. in Creative and Life Writing at Goldsmiths, University of London. She is the recipient of the John Llewellyn Rhys Memorial Prize and a Betty Trask Award. Books will be available for purchase at this event. Meet the Author

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THE BALANCE-OF-PAYMENTS DEFICIT: NOT TO WORRY JANUARY 05, 2010 by DAVID R. HENDERSON Quick. What’s the trade deficit between California and the rest of the world? Don’t try Googling it because you won’t find an answer. No government agency—or private entity—computes the dollar value of goods that people in the rest of the world sell to or buy from Californians. Why not? Because it doesn’t matter. Yet governments do that computation for countries. Do trade deficits between countries matter? They do, but a lot less than most people think. A high trade deficit is not a definite sign of an economy’s weakness, and a low trade deficit or high trade surplus is not a definite sign of an economy’s strength. First, let’s define our terms. By the most comprehensive measure, there can never be a balance-of-payments deficit. If we import a higher dollar value of goods and services than we export, then the extra dollars we spend on imports balance that difference, and the net balance is zero. Of course, when people refer to a balance-of-payments deficit they are not thinking about this comprehensive measure; they’re thinking about a narrower measure—the merchandise trade deficit. This is the difference between the dollar value of what we spend on imports and what we are paid for exports. In 2008, the latest year for which these data are available, Americans spent $840 billion more on imports than foreigners spent on U.S. exports. Offsetting this was a U.S. surplus on services of $144 billion. The net balance of trade on goods and services, therefore, was $696 billion. To put this into perspective, this was about 4.8 percent of the total U.S. gross domestic product. Where did this $696 billion go? It went to other countries, of course, but most of it came back in one of three forms: 1) foreign purchases of American bonds, mainly government bonds; 2) foreign purchases of other assets such as stocks, land, and property; and (3) so-called direct investment whereby foreigners build plants and equipment in the United States. Is this bad? Consider each in turn. 1) If foreigners refused to buy government bonds, the U.S. government would need to offer higher interest rates to make holding the bonds attractive to Americans. That would drive up the cost of financing the U.S. budget deficit. We can decry this deficit—and I do—but given that it exists, which is better: having the irresponsible federal government paying a higher or lower interest rate? I vote for the latter. 2) One reason foreigners invest in U.S. stocks, land, and property is that the United States is still a relatively safe haven for investment. Granted, it’s probably less safe than it was before the U.S. government changed the rules with its bailout, the so-called Troubled Asset Relief Program (TARP), and with the so-called stimulus package. But it’s still safer than investing in much of the rest of the world. So rather than being bad, the size of this investment is actually good. 3) The same reasoning applies here. It’s good, not bad, that foreigners find it attractive to invest directly in the United States. It’s especially good for U.S. workers. The more capital there is per worker, the higher worker productivity is and, therefore, the higher are real wages. Dollars on the Penny What if the money doesn’t come back in any of the above three forms of investment but, instead, is held in U.S. dollars? That’s even better for Americans. Instead of giving up capital in return for merchandise, we are giving up paper money. According to the Bureau of Engraving and Printing, the average cost of a unit of paper money is 6.4 cents. Because of the production process, the cost is probably higher for a one-hundred-dollar bill, and presumably a disproportionately high number of such bills is held abroad. But it’s still likely to cost under 25 cents to print a one-hundred-dollar bill, and the bills take an average of 89 months to wear out. Getting valuable goods in return for paper money that sells for dollars on the penny is a good deal for Americans. Jay Leno, in a 1980s ad for Doritos, said “Crunch all you want. We’ll make more.” Similarly, if people in other countries hold on to their paper U.S. bills, the Federal Reserve can make more. But aren’t we as a nation, by spending more on imports than our exporters earn, actually saving less and implicitly giving up capital for consumption goods? Yes, we are. But that’s the result of decisions that millions of us make individually. And it really doesn’t matter, at an individual level, whether we save less to buy imports or to buy domestically produced consumption goods. Either way, we’re giving up capital for consumption. Is this a bad idea? We’re showing by our actions that we think it’s not. We’re showing that many of us value those high-quality Toyotas more than we value the shares of General Motors stock or U.S. government bonds that we could have bought instead. Do you think you’re giving up too much capital for consumer goods? Then spend less and save more. I mentioned earlier that a small balance-of-payments deficit is not necessarily a sign of economic strength. Between 1980 and 2008, there have been only three years in which the United States has had a merchandise trade surplus: 1980, 1981, and 1991. Those were all years in which the U.S. economy was in recession. That is no coincidence. When economic growth is high, we tend to spend a higher share of our income on imports. The years with

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Retailers wait to see if economic concerns keep shoppers from Black Friday sales By Lauren Coleman-Lochner — Has the Grinch moved to Washington? Retailers will soon find out if concerns over the so-called fiscal cliff and possible tax increases deter any shoppers from malls nationwide on Black Friday, the unofficial start to the holiday shopping season. The National Retail Federation says holiday sales will rise 4.1 percent to an estimated $586.1 billion this year, compared with a 5.6 percent gain in 2011. Even though thousands of stores are opening earlier, 147 million consumers, or 5 million fewer than last year, plan to hit the malls this weekend, according to an NRF survey conducted by BIGresearch. "We hear these guys on cable television with eerie music, talking about doom and gloom," Mortimer Singer, chief executive officer of New York consulting firm Marvin Traub Associates, said in a telephone interview. "Consumers get nervous when this kind of stuff happens." To put them in a spending mood, retailers are opening earlier than ever and dangling discounts such as $7 board games at Target and $19 sweaters at Gap. Mindful that many shoppers plan to buy gifts online, Target and Best Buy are matching prices offered by online competitors such as Amazon.com, while some merchants are adding kiosks and mobile checkouts to integrate online and in-store shopping. Others have giveaways such as free family portraits in November at J.C. Penney Co. stores. In an effort to lure shoppers into stores, malls have added such features as lounges, gift-wrapping services, even child- care, Joel Bines, a Dallas-based managing director in the retail practice at AlixPartners, said in a telephone interview. The moves are "almost entirely related to the amount of business that has moved to the Web," he said. U.S. consumers, whose spending makes up about 70 percent of the U.S. economy, have coped this year with political uncertainty, higher fuel prices and, in the Northeast, the fallout from Hurricane Sandy. There are signs of improvement, including rising home prices and a jobless rate that's ducked under 8 percent in the past two months, the lowest since January 2009. Household confidence in the week ended Nov. 11 climbed to -33.1, the highest level in seven months, according to the Bloomberg Consumer Comfort Index, and has increased in 10 of the past 12 weeks. Still, that figure indicates that one-third of those surveyed hold a negative view of the economy. Black Friday got its name because retailers traditionally turned profitable on the day following Thanksgiving. While that is no longer true across the board, Black Friday has become a powerful marketing tool and one of the busiest days on the U.S. shopping calendar. More than half of American consumers plan to shop during the holiday weekend, with about one-third hitting the stores on Black Friday alone, according to a survey conducted by the International Council of Shopping Centers, an industry group based in New York. Thousands more stores are opening early this year, after a few chains tested the water last year. Wal-Mart Stores, the world's largest retailer, will start its in-store specials at 8 p.m. on Thanksgiving, two hours earlier than last year. Gap, the biggest U.S. specialty-apparel retailer, is opening more stores, about a third of its total, mostly at 9 a.m. on Thanksgiving this year. Macy's is opening stores at midnight after Thanksgiving having done so for the first time last year. Kohl's, Staples and The Disney Store are among those offering "pre-Black Friday" specials. Merchants th

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Buy ILR ILR Journal Online Home Articles The New Dependency Theory The New Dependency Theory January 15, 2013, Ronen Palan, 1 Comment The crisis that began in late 2007, and which seems to be continuing for the foreseeable future, has highlighted the role of global wholesale financial markets in creating what may be described as new dependency relationships. Old dependency theory was a structural-Marxist theory. It hypothesised that the world capitalist economy is structurally arranged to facilitate massive transfers of capital from developing countries to the developed world. The new dependency theory agrees that net outflows of capital from developing countries have been continuing unabated for the past three decades. But—and this is a key difference between new and old dependency theory—these illicit flows are a problem not only for developing countries but also for developed ones. This is so for two reasons. First, the net flow of capital is not necessarily transferred to or invested in the developed world. Rather, the transfer of financial resources from developing countries joins a large pool of capital registered in offshore locations. Second, there is evidence that developed countries are subject to net external outflow of capital as well. In contrast to old dependency theory, the new theory suggests that capital transfers do not necessarily operate on a regional or intra-national basis; rather, wholesale global financial markets have emerged as gigantic re-distributive machines that play a key role in the continuing and growing gap between rich and poor world-wide. In developed countries, the main detrimental impacts of illicit flows are growing income inequalities and a weakening and narrowing of the tax base, as effective (as opposed to nominal) tax rates by corporations and rich individuals decreases continuously. For developing countries these problems are compounded further: they include poor governance structure, a large black economy, lack of capital for basic infrastructural projects, and over-reliance on foreign aid money that generates harmful political-economic dynamics. More fundamentally: Alternative sources of elite revenue made possible by illicit capital flows reduce the need for negotiated settlements between government and society, which lie at the heart of the development of the European democratic state model, and undermines the development of efficient and accountable state institutions Proximity of large offshore financial centres damages capacity for an endogenous financial system These will be discussed further, below. The Architecture of the Private International Banking Industry By the 1970s large surpluses of capital from OPEC member states—the so-called ‘Petrodollars‘—were deposited in fledgling unregulated wholesale markets (known as the Euromarkets) that were rising to prominence as a result. Howard Wachtel (Wachtel 1977) calculates that, in the three years between 1973 and 1976, OPEC countries accumulated current account surpluses of about $158 billion. The vast majority of these so-called Petrodollars were deposited in U.S. based multinational banks—but crucially, not in the U.S. They joined, instead, the pool of capital that made up the offshore financial Euromarkets. Wachtel identified the rise of what were subsequently described as large complex financial institutions (LCFIs) at the heart of the Euromarkets’ web of activities. The first comprehensive analysis of the rise of the new phenomena of tax havens serving as offshore financial centres (OFCs) provided evidence to support Wachtel’s thesis. Park (1982; see also Choi, Park and Tschoegl, 1990) presented a picture of an increasingly integrated international wholesale financial market operating through various cities and islands—which began to be described as OFCs because they specialised in non-resident finance—spread around all the major commercial centres of the world. The unique non-territorial profile of the Euromarkets gave rise, he argued, to enormous economies of scale in finance by integrating different locales into one integrated global wholesale market. Many OFCs developed a profile as ‘funding’ and ‘collective centres’—regional facilities that either tap or fund Euromarket operations. Two subsequent studies of OFCs furnished further evidence of the international integration of these wholesale markets. A 2001 report commissioned by the Bank of England demonstrated the importance of ‘financial intermediation undertaken by entities based in many OFCs [i.e. tax havens, that] is almost entirely “entrepôt”’. (Dixon 2001, 104) The report identified large flows of capital between these centres, back and forth, for reasons that were not entirely clear. Various strands of research into emerging global and offshore financial markets were then brought together in a comprehensive IMF study (Fund 2010) that examined the processes that have contributed to what it described as international financial interconnectedness. This pioneering study charted an emerging topology of global financial markets but, as befitting an international organization, refrained from speculating on the political or economic implications of this new financial architecture. The IMF’s findings were as follows: ‘The architecture of cross-border finance is one of concentration and interconnections. Countries are exposed to certain key money centres or “nodes”—common lenders and borrowers—through which the majority of global finance is intermediated. These exposures reflect transactions that occur predominantly through a small, core set of large complex financial institutions (LCFIs).’ These were the same institutions identified by Wachtel in his 1970s study. ‘LCFIs are systemic players, measured by importance in global book running for bonds, structured finance, U.S. asset backed securities, syndicated loans, equities, and custody asset holders… They operate with global ALM strategies and are engaged, either directly or through affiliates, in banking, securities, and insurance operations.’ LCFIs ‘comprise banks as well as nonbank institutions, such as investment banks, money market funds, and structured investment vehicles (SIVs)… The nonbank entities are often linked to banks, including through credit and liquidity enhancement mechanisms, a behaviour that has been fuelled in part by the desire to avoid regulations.’ Subsequent studies by the Federal Reserve of New York have named this shadowy world of complex entities linked to the LCFIs the ‘shadow banking industry’. The IMF study shows that this shadow banking industry is larger than the official banking industry. The IMF study also showed that, as argued by Park in the 1980s, the infrastructure of payments and settlements in this integrated offshore wholesale market is ‘highly concentrated, largely occurring over a few systems’. Unregulated finance, capital flows and tax evasion If the development of the global wholesale market in this way was not the result of deliberate planning (a point I return to below), it is nevertheless clear that its current design serves particular purposes and contributed to pathologies that are at the core of the current crisis. These pathologies include: • vast amounts of capital deposited offshore by the rich and powerful to avoid taxation, skewing income and wealth distribution worldwide • regulatory arbitrage and the development of shadow banking to escape existing financial regulations • the emergence of the shadow banking industry to overcome structural limitations on financial industry growth, contributing to the artificial liquidity that was at the heart of the crisis. (Nesvetailova 2010) I discuss here the first of these pathologies. It is ironic that one of the earliest versions of the new dependency theory was articulated in a book written largely as an apology for the Swiss banking industry. In The Gnomes of Zurich, Fehrenbach (1966) maintained that large capital flows to the secretive Swiss banking system added a layer of stability to an increasingly volatile financial system. Fehrenbach argued, in addition, that the big three Swiss banks (UBS, Credit Suisse, Swiss Bank Corporation) had together accumulated about $500 billion dollars in assets from third world countries by the 1960s, but that each had opted to re-invest those liabilities largely in the developed world. Fehrenbach argued, in effect, that the Swiss banking fraternity acted as a conduit for financial flows from developing to developed countries—challenging the conventional wisdom that less economically developed countries (LDCs) were net recipients of capital from the developed world. During the 1980s and 1990s, considerable evidence was gathered on the deleterious impact of intra-trade transfer pricing techniques perpetrated by multinational corporations, particularly in the mining industries of the developing world. The first comprehensive assessment of global cross-border illicit money flows estimated them to be in the order of $1 to $1.6 trillion annually. (Baker 2005) About 70% of all capital flight was conducted by means of transfer pricing. Half of this, or $500 to $800 billion a year, flows out of developing countries to the large offshore financial centres. The strongest evidence for the new dependency relationships is provided by a recent analysis of global private financial wealth registered in offshore locations. (Henri 2012) It estimates that at least $21 to $32 trillion of global financial assets—about 18% of all financial assets—was registered in offshore locations in 2010. It traces $9.3 trillion of offshore wealth belonging to residents of 139 mainly low- and middle-income countries. As it notes, these findings ‘underscore how misleading it is to regard countries as “debtors” only by looking at one side of the country balance sheet. Indeed, since the 1970s, with invaluable assistance from the international private banking industry, it appears that private elites in these key developing-world source countries have been able to accumulate at least $7.3 to $9.3 trillion of offshore wealth… compare with these same source-countries’ aggregate 2010 gross external debt of $4.08 trillion, and their aggregate net external debt—net of foreign reserves, most of which are invested in First World securities—of minus $2.8 trillion. In total, by way of the offshore system, these “source countries”—including all key developing countries—are net lenders to the tune of $10.1 to $13.1 trillion. By comparison, the real value of these source countries’ gross and net external debts—the most they ever borrowed abroad—peaked at $2.25 trillion and $1.43 trillion respectively in 1998, and has been declining ever since’. (Henri 2012, 4-5) The combined transfer of financial assets from low- and middle- income countries to offshore accounts is equivalent to nearly 10 times the annual GDP of the entire African continent. Put differently, for every dollar poor countries have received in development assistance, more than twelve dollars are illegally transferred out to offshore accounts. Impact of the New Dependency on Developing Countries What is the impact of large net transfer of capital from low- and middle-income countries to offshore locations? The typical developmental model of the developed economies of the OECD is founded on the principles of ‘a relatively stable compromise between

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Pinnacle Awards Entries Due Friday By Sarah Baker The deadline for local commercial real estate brokers to enter the 12th annual Pinnacle Awards is Friday, Feb. 15.The Memphis Area Association of Realtors Commercial Council will honor those top producers in the industry at an April 25 ceremony at the Memphis Country Club, 600 Goodwyn St.All commercial brokers who hold membership in the Commercial Council are encouraged to submit an application by 5 p.m. Friday. The rules have not changed since they were revamped in 2010.Applicants must have produced new real estate brokerage business of $2 million or more during 2012. It’s based off of the actual lease value created per broker or the cumulative total of larger sales as well. For instance, a five-year-lease for 10,000 square feet and $20 per foot would yield a lease value of $200,000.Applications, signed by the principal broker, are confidentially submitted to Buddy Dearman, partner with Dixon Hughes Goodman LLP, 999 South Shady Grove Road, suite 400, Memphis, TN 38120. A signed PDF may also be emailed to Dearman at [email protected]. Dixon Hughes Goodman has been doing the vote tabulation pro bono since the Pinnacle Awards came into existence in 2002. The anonymity is a large reason applicants are so comfortable in submitting their production information.“We go through and review the applications – there’s a lot of statistical information on there about all of the different transactions that the broker participated in,” Dearman said. “MAAR sets the way the formula allocations work.”For example, if two brokers worked on the same sale of a piece of property, MAAR has a certain sharing percentage it uses within its offices at 6393 Poplar Ave. Those formulas are factored in to determine a person’s annual volume as it pertains to total business done. “We don’t go back and check that data because we don’t access to those records,” Dearman said. “What we do is check the math on the application to make sure that it’s correct, then we put them in basically an Excel document and sort them by the various categories to determine the category winners.”Winners will be announced in a supplement of the April 26 issue of The Daily News and the April 26 issue of The Memphis News. The Daily News Publishing Co. Inc., parent company of The Daily News and The Memphis News, is again sponsoring the Pinnacle Awards.The Pinnacle Awards include the President’s Award, Newcomer of the Year and an inductee to the Commercial Hall of Fame. MAAR Commercial Council will again be celebrating the Community Impact Award, Pinnacle Producers Club, as well as the Pinnacle Producers Club Life Members – those who have been elected to the Top 25 Pinnacle Awards List for any five years.Up to three top producers in each real estate category will be recognized as members of the Pinnacle Elite. The top producers will be recognized as Brokers of the Year for their area of production (retail, office, industrial, land, investment). All of the members of the Pinnacle Elite will be recognized on stage and will receive plaques.Applications are available for download at www.maar.org/pinnacleawards. Co-chairmen Steve Guinn (683-2444) and Tony Argiro (761-8190), both of Highwoods Properties, can answer any questions about the application process.An application fee of $75 must be submitted with each application. This fee also covers the cost of the Pinnacle Awards reception ticket.Last year, MAAR Commercial Council presented 24 Pinnacle Elite awards to brokers whose transactions produced more than $913.5 million – $70 million more revenue than in 2011.

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Tags: schiff Schiff: European-Style Debt Crisis Will Strike US Monday, 09 Jul 2012 05:09 PM By Forrest Jones and John Bachman U.S. attempts to stimulate itself out of the present downturn aren't working, and sooner or later bondholders will turn against the country in much the same way as investors in southern Europe today, says broker, author and financial commentator Peter D. Schiff. The country remains mired in a depression, Schiff tells Newsmax.TV, and Federal Reserve attempts to stimulate the economy via quantitative easing — asset purchases from banks that inject liquidity into the economy to encourage investment and hiring — delay the day of reckoning when the country will have to tighten its belt and pay its bills. Meanwhile, loose monetary policies today will pump up inflation rates tomorrow, and haven't made a dent in high unemployment rates they were supposed to make in the first place. "People no longer have confidence in the future purchasing power of the dollar. Right now, people think that inflation is nowhere in sight, that the Fed has got a handle on it. Well, they’re wrong," Schiff says. "I mean, you’ve got a lot of demand for dollars right now as a supposed safe haven," he said. "But at some point the people who are holding dollars are going to want to spend them on something," said the author of "The Real Crash: America's Coming Bankruptcy — How to Save Yourself and Your Country." Editor’s Note: To order ‘The Real Crash' at a great price — Click Here Now. Yields on Treasurys have fallen to near-record lows as investors park their cash in U.S. government debt and other dollar-denominated positions to ride out uncertainty in Europe. However, two rounds of quantitative easing have pumped more than $2.3 trillion into the economy, described by many as printing money out of thin air. Soon or later, all that liquidity will push up inflation rates, and considering debts remain sky-high in the U.S., it won't take long for investors to flee the U.S. dollar-denominated haven as fast as they raced toward in recent months. "Somebody has to want dollars to actually buy stuff. Somebody has to hold Treasurys to maturity. They can’t just flip them to a greater fool. So eventually, the music stops," Schiff says. At the end of this year, Bush-era tax cuts and other tax holidays expire while automatic spending cuts kick in, a combination known as a "fiscal cliff" that could siphon hundreds of billions out of the economy next year and derail recovery. Fed policies should worry investors more, he says. "It’s going to be obvious to a lot of people that we can’t afford to service the debt let alone retire it, and our creditors are going to run and that’s when the real crisis is going to come," Schiff says. "That’s the real fiscal cliff, not, you know, the expiration of the Bush tax cuts or these tiny automatic spending cuts that are due to kick in. The fiscal cliff is when interest goes up and we have a choice between default or runaway inflation." The U.S. government needs to work out a way to pay off its debts with creditors, including addressing haircuts similar to the way Greece did earlier this year with private creditors. The U.S. debt is too large to pay off at full value, at least under current terms. "We have borrowed so much money that repaying it isn’t even a mathematical possibility. So the only thing that we have to consider is how will we default?" Schiff asks. "We’re going to have to restructure our debt because legitimately paying it back is beyond the realm of possibility." The U.S. will experience a crisis even if policymakers do everything right from here going forward. There's no way around it, thanks to past monetary and fiscal policies. So how does an investor protect himself? Hard assets, he says, especially precious metals. "I think you want to buy gold and silver. You can buy other commodities, non-monetary commodities as a hedge against this," Schiff says. Investors shouldn’t ignore opportunities that pop up in equities markets, either, but should be aware the U.S. economy is due for rough seas ahead. Calm seas today are merely mirages created by the Federal Reserve's stimulative policies, which will wear off soon. "I think we’re still in a depression. I think it’s going to be with us for years and years. It could be five or 10 years; it could be longer, depending on how long it takes us to recognize our mistakes so that we can begin to reverse them," Schiff says. "I think the only thing that is punctuating the recessions is the phony growth that we get from the stimulus. But it’s not real growth. All we do is spend more borrowed money."

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The Kissinger Papers William Burr May 20, 1999 Issue Talking with Mao: An Exchange from the March 18, 1999 issue I regret that I cannot take the authorial credit that Henry Kissinger so graciously extends to me [“Talking with Mao: An Exchange,” NYR, March 18] when he describes “Mr. Burr’s canard that the papers I deposited in the Library of Congress had been placed there to prevent access to them under the Freedom of Information Act.” My remarks on this point in my book, The Kissinger Transcripts, merely follow in a long line of commentators, not the least of whom was Justice John Paul Stevens, who observed in the Kissinger v. Reporters’ Committee for Freedom of the Press case: “Finally, the fact that the documents had been removed by the head of the agency shortly before the expiration of his term of office raised an inference that the removal had been motivated by a desire to avoid FOIA disclosure.” The fact remains that Dr. Kissinger’s papers at the Library of Congress, which are closed to the public without his permission until five years after his death, contain the only complete set of the highest-level records of the foreign policies of this country in the Nixon and Ford years. My book is testament to the fact that copies of these documents can also be found in various scattered locations in the government, including the Nixon papers, the Ford papers, the State Department’s files, and the papers of Kissinger aides like Winston Lord. In my book, I describe this reality as a “deliberate inconvenience” to scholars. And because of the national security secrecy restrictions on almost all of these documents, Dr. Kissinger had every reason to believe he would have exclusive access to these records for decades after leaving office. Theodore Draper made a similar point when he reviewed the first volume of Dr. Kissinger’s memoirs in the spring 1980 issue of Dissent. Mr. Draper observed that Dr. Kissinger’s use of classified documents was “nothing less than scandalous” because his book “contains literally scores of direct references to and textual quotations from documents obviously of the highest classification… I wondered how Kissinger could make use of classified documents on such a large scale and of such recent vintage. If they had been declassified for him, could I or any other scholar have access to them? Could one check up on how he used these documentary sources?” Draper found that the answer was no. “In effect, only quotations were declassified, documents were not. By means of this dodge, no one else can gain access to these documents to determine how faithfully Kissinger made use of them.” Even more problematic is Dr. Kissinger’s claim that the only unique originals in the Library of Congress collection are the transcripts of “telephone conversations ruled by the US Supreme Court as private.” But the Supreme Court only ruled that the Reporters’ Committee did not have standing to sue; it did not rule on whether or not the telcons were private. The only courts that did—in decisions vacated by the Supreme Court—in fact decided that the telcons were the “property of the United States,” which were “wrongfully removed and should be returned to the State Department.” Indeed, the Supreme Court’s decision on Reporters’ Committee suggested that if the telcons were government records, Kissinger’s treatment of them probably violated the Federal Records Act “since he did not seek the approval of the Archivist prior to transferring custody to himself and then to the Library of Congress.” As the Court pointed out, “The Archivist did request return of the telephone notes from Kissinger on the basis of his belief that the documents may have been wrongfully removed under the Act. Despite Kissinger’s refusal to comply with the Archivist’s request, no suit has been instituted against Kissinger to retrieve the records under 44 USC 3106.” Finally, Dr. Kissinger claims that he has made the telcons and other classified documents available to official State Department historians. But they cannot take notes from, or make copies of, the telcons. Copies of those documents will be made available for use in State Department historical compilations only when Dr. Kissinger gives his permission. I would encourage Dr. Kissinger to return the telcons voluntarily; failing that, the Archivist of the US should bring suit. Needless to say, my publishers are eager for a sequel. —— May 20, 1999 —— Killer Children Hilary Mantel The Russian Sphinx Aileen Kelly Put Out More Flags Neal Ascherson The Reason Why Tony Judt What Is to Be Done? Stanley Hoffmann

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‘Failure’ never has to be permanent By Jennifer Napier Special to the Register RICHMOND — Consider the fact that a teenager dropped out of high school at age 16 to join the Army, but was rejected because he was underage. As our young man became an adult, he got a job as a newspaper artist, but was fired by the editor because he “lacked imagination and had no good ideas.” Our young man then decided to start a commercial artist business. It quickly failed. Unwilling to give up, he began another business, this time in animation. The business grew and his studio was gaining in popularity, but the business went bankrupt because our young man was unable to successfully manage the business’ money. He persevered and moved to California to start another animation studio. Because of poor business oversight, he lost the rights to a popular animated character, along with all but one of his staff members in a heated trademark dispute. Does he sound like failure to you? The word failure, however, was not a term in this man’s vocabulary. Our aspiring entrepreneur was determined and learned from his mistakes as he moved forward. He was a man on a mission and would never allow anyone to shatter his dreams. The multiple times he endured harsh trials and failed businesses only fueled his desire to succeed even more. So, who was our high school dropout, rejected wannabe soldier and failed entrepreneur? He was none other than Walt Disney. He dared to dream the impossible. His animated movies, fantasy theme parks and business name have only grown in popularity since his passing in 1966. Why has our society taken the definition of failure and turned it into a permanently negative and demoralizing term? To fail simply means that the initial attempt was unsuccessful. Therefore, additional attempts or revised strategies must be purs

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SEC Settles Fraud Charges with Bear Stearns for Late Trading and Market Timing Violations Firm To Pay $250 Million in Disgorgement and Penalties Washington, D.C., March 16, 2006 - The Securities and Exchange Commission today announced a settled enforcement action against Bear, Stearns & Co., Inc. (BS&Co.) and Bear, Stearns Securities Corp. (BSSC) (collectively, Bear Stearns), charging Bear Stearns with securities fraud for facilitating unlawful late trading and deceptive market timing of mutual funds by its customers and customers of its introducing brokers. The Commission issued an Order finding that from 1999 through September 2003, Bear Stearns provided technology, advice and deceptive devices that enabled its market timing customers and introducing brokers to late trade and to evade detection by mutual funds. Pursuant to the Order, Bear Stearns will pay $250 million, consisting of $160 million in disgorgement and a $90 million penalty. The money will be paid into a Fair Fund to be distributed to the harmed mutual funds and mutual fund shareholders. Bear Stearns will also undertake significant reforms to improve its compliance structure. Simultaneously, NYSE Regulation, Inc. censured and fined Bear Stearns, and imposed compliance with these undertakings. The fine imposed by the NYSE will be deemed satisfied by the payment of the $250 million pursuant to the Commission's Order. Linda Chatman Thomsen, SEC Enforcement Division Director, said, "For years, Bear Stearns helped favored hedge fund customers evade the systems and rules designed to protect long-term mutual fund investors from the harm of market timing and late trading. As a result, market timers profited while long term investors lost. This settlement will not only deprive Bear Stearns of the gains it reaped by its conduct, but also require Bear Stearns to put in place procedures to prevent similar misconduct from recurring." Mark K. Schonfeld, Director of the Northeast Regional Office, said, "Bear Stearns was the hub that connected the many spokes of market timing and late trading - hedge funds, brokers and the mutual funds. Tape-recorded phone calls of its employees make plain the two roles played by Bear Stearns that were fundamental to mutual fund trading abuses. Bear Stearns made it possible for hedge funds and brokers to submit orders long after the 4:00 p.m. cut-off. Bear Stearns made it easier for the hedge funds and the brokers to engage in market timing, and harder for the mutual funds to detect and stop it." Bear Stearns' Timing Desk BS&Co. is an introducing broker dealer whose customers buy and sell securities. BSSC is a clearing firm for BS&Co., other introducing broker dealers and prime brokerage customers (i.e., hedge funds th

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Beyond Debt and Growth: An Interview With Robert Pollin Saturday, 13 July 2013 09:43 By Alejandro Reuss, Dollars & Sense | Interview Tweet (Photo: 401(K) 2012 / Flickr)Nothing warms the heart quite like a story of the high and mighty brought low. Harvard economists Carmen Reinhart and Kenneth Rogoff were the high and mighty—prestigious academics whose influential paper on government debt and economic growth was widely cited by policymakers and commentators to justify painful austerity policies. The underdogs who brought them down were three members of the UMass-Amherst economics department: graduate student Thomas Herndon and professors Michael Ash and Robert Pollin. As Dean Baker of the Center for Economic and Policy Research (CEPR) argues, it is no accident that UMass economists were the ones to debunk Reinhart and Rogoff. The department, Baker notes, “stands largely outside the mainstream” of the economics profession and so is “more willing to challenge the received wisdom.” Reinhart and Rogoff had claimed that countries with government-debt-to-GDP ratios of over 90% could expect dramatically lower future economic growth than other countries. But when Herndon attempted to replicate this result for a course in applied econometrics taught by Ash and Pollin, he found that he couldn’t. In fact, as the Herndon-Ash-Pollin published paper would report, there was no dramatic growth dropoff above the supposedly critical 90% threshold. The reasons behind the faulty finding? Well, there was the world’s most famous spreadsheet error—which has received extraordinary media attention mainly because it is so embarrassing, so all the more delicious given the lofty position of the authors. More importantly, however, was Reinhart and Rogoff’s questionable treatment of the data. Most of the difference between their results and Herndon-Ash-Pollin’s was due to no mere error, careless or otherwise, but to deliberate (and, in Pollin’s view, “indefensible”) decisions about how to average the data, how to divide it into different categories, and so on. Pollin is the co-director of the Political Economy Research Institute (PERI) at UMass-Amherst and is well-known for his work on minimum-wage and living-wage laws as well as the project of building a green economy. Dollars & Sense co-editor Alejandro Reuss sat down with him to talk not only about the Reinhart-Rogoff paper and the Herndon-Ash-Pollin takedown, but also larger issues about the economic crisis and austerity: the role economists have played in abetting austerity, the reasons behind policymakers’ determination to impose austerity policies, and the diverging paths before us—the profit-led recovery promised by neoliberal economists versus a wage-led recovery pointing toward a more egalitarian social-democratic system. —Eds. Dollars & Sense: While Reinhart and Rogoff’s so-called “Excel error” got a lot of attention in the media, this was a relatively small factor in the findings they reported. What do you think are the key critiques of the view that high debt-to-GDP ratios doom growth, both in terms of the figures and inteRobert Pollin retation? Robert Pollin: I recall one commentator said that the Excel coding error was the equivalent of a figure skater who was not doing well, but it wasn’t entirely clear until he or she fell. Even though the fall itself wasn’t the most significant thing, it dramatized the broader set of problems. I think that’s true of the Reinhart-Rogoff paper. The main things that were driving their results were, first, that they excluded data on some countries, which they have continued to defend. Second, and most importantly, was the way that they weighted data. They took each country as a separate observation, no matter how many years the country had a high public debt-to-GDP ratio. For example, New Zealand had one year, 1951, in which they had a public debt-to-GDP ratio over 90%. And in that year New Zealand had a depression. GDP growth was negative 7.6%. The UK, by contrast, had 19 years in which the debt-to-GDP ratio was over 90%, and over those 19 years GDP growth averaged 2.5% per year, which is not spectacular, but not terrible. Now, according to the way Reinhart and Rogoff weighted the data, one year in New Zealand was equally weighted with 19 years in the UK, which I find completely indefensible. Dollars & Sense: So when you correct for these problems, you end up with a modest—maybe not even statistically significant—negative relationship between the debt-to-GDP ratio and future growth. What are the main arguments about how to inteRobert Pollin ret this relationship? Robert Pollin: Reinhart and Rogoff have been making the defense that even the Herndon-Ash-Pollin results still showed public debt-to-GDP over 90% being associated with a GDP growth rate of 2.2%. Meanwhile, at less than 90% debt-to-GDP, growth is between 3 and 4%. So they’re saying, “Well, we made some mistakes but it’s still a 1% difference in growth over time, which matters a lot.” And I wouldn’t disagree with that observation. But there are other things in here. First, is it statistically significant? One of the other things we [Herndon-Ash-Pollin] did was to create another public debt-to-GDP category, 90% to 120%, and then above 120% debt-to-GDP. For the 90–120% category there’s no difference in future growth rates [compared to the lower debt-to-GDP category]. So it’s only when you go way out, in terms of the debt ratio, that you will observe a drop-off in growth. Second, what happens when you look over time? In their data, for 2000 to 2009, the growth rate for the highest public debt-to-GDP category was actually a little bit higher than in the lower categories. So what’s clear is that there really is no strong association. In addition, some people have then taken their findings and asked which way causality is running. Is it that when you have a recession, and you’re at lower growth, you borrow more? Well, that’s certainly part of the story. And Reinhart and Rogoff have now backpedaled on that. But to me even that is not nearly getting at the heart of the matter. The heart of the matter is that when you’re borrowing money you can use it for good things or bad things. You can be doing it in the midst of a recession. If we’re going to invest in green technologies to reduce carbon emissions, that’s good. We also need to ask: what is the interest rate at which the government is borrowing? The U.S. government’s debt servicing today—how much we have to pay in interest as a share of government expenditures—is actually at a historic low, even though the borrowing has been at a historic high. The answer obviously is because the interest rate is so low. When you’re in an economic crisis and you want to stimulate the economy by spending more, does the central bank have the capacity to maintain a low interest rate? In the United States, the answer is yes. In the UK, the answer is yes. Germany, yes. In the rest of Europe, no. If you can borrow at 0%, go for it. If you have to borrow at 9%, that’s a completely different world. And the Reinhart-Rogoff framework doesn’t answer the question. It doesn’t even ask that question. Dollars & Sense: Looking at research touted by policymakers to justify austerity policies, which has now been debunked, do you see the researchers putting a “thumb on the scale” to get the results that they wanted? Is that something you want to address, as opposed to simply getting the data, seeing what’s driving the results, and debunking the inteRobert Pollin retation when it is not justified? Robert Pollin: It’s clear that politicians seized on these findings without questioning whether the research was good. That’s what you’d expect them to do. Politicians are not researchers. The only research Paul Ryan cited in the 2013 Republican budget was the Reinhart-Rogoff paper. George Osborne, the Chancellor of the Exchequer in the UK—same thing. People at the European Commission—same thing. Now, speaking about Reinhardt and Rogoff themselves, I don’t know. In general, it is certainly a tendency that if someone gets a result that they like they may just not push any further. I think that may have happened in their case, without imputing any motives. All I can tell you is that they wrote a paper which does not stand up to scrutiny. Dollars & Sense: All this raises the question of why elites in Europe and in the United States have been so determined to follow this austerity course. How much do you see this as being ideologically driven—based on a view of government debt or perhaps government in general being intrinsically bad? And how much should we see this as being in the service of the interests of the dominant class in society? Or should we think of those two things as meshing together? Robert Pollin: I think they mesh together. I think part of it comes from our profession, from the world of economics. It’s been basically 30 years of pushing neoliberalism. It has become the dominant economic agenda and certainly hegemonic within the profession. When the crisis hit, countries did introduce stimulus policies and one of the criticisms [from economists] was that this is really crude and we don’t really know much about multiplier effects and so forth. That’s true, and the reason that we have only this crude understanding of how to undertake countercyclical policies is because the mainstream of the profession didn’t research this. It was not a question. They spent a generation proving that we didn’t need to do these policies—that a market solution is the best. So that’s the economics profession and it does filter into the political debates. But then, beyond that, is the agenda of getting rid of the welfare state and I think a lot of politicians want that to happen. They don’t want to have a big public sector. Either they believe that a big public sector is inefficient and that the private sector does things more efficiently, or, whether they believe that or not, they want lower taxes on wealthy people (and wealthy people want lower taxes because that lets them get wealthier). They don’t want constraints on their ability to enrich themselves, and they certainly don’t want a strong and self-confident working class. They don’t want people to have the security of health insurance or pension insurance (i.e., Medicare and Social Security in this country). That’s the model of welfare-state capitalism that emerged during the Great Depression and was solidified during the next generation, and these people want to roll it back. The austerity agenda has given them a launching pad to achieve this. I have no idea whether Reinhardt and Rogoff believe this or not, but their research enabled people like Paul Ryan to have the legitimacy of eminent Harvard economists saying we’re killing ourselves and we’re killing economic growth by borrowing so much money. Dollars & Sense: Policymakers in the United States, Europe, and elsewhere, to a great extent, have just tried to “double down” on neoliberal policies. But with the structural problems of neoliberalism, keeping the same structure looks in effect like a way of keeping the same crisis. What do you see as the possible ways out of the impasse, both desirable and undesirable? Robert Pollin: I think there are fundamentally only two approaches—basically profit-led models versus wage-led models. In the Financial Timestoday [June 10], the well-known columnist Gavyn Davies is saying that the reason the stock market is going up—and it’s going up very handsomely—is fundamentally because the current model of capitalism is able to proceed by squeezing workers even harder. The wage share, which had been relatively stable for generations, is going down and the profit share is going up. Now is that sustainable? Presumably you’re going to have a problem of demand at a certain point because if workers don’t have enough in their pockets, how are they going to buy the product? One answer is we can export to rising Asian markets and so forth. But the Asian countries themselves are depending on the exact same model. The alternative, which I think makes more sense logically and is also more humane, is to have a more equal distribution of income—a social democratic model of capitalism in which you do have a strong welfare state that acts as a stabilizer to aggregate demand and also enables workers to buy the products that they make. And that’s true for China and for the United States. We have to add into that the issue of environmental sustainability. At the same time that we’re building a new growth model it has to be a model in which carbon emissions go down per unit of GDP. I don’t think it’s that hard to do technically. Whether it happens is another matter. [The 20th-century Polish macroeconomist Michal] Kalecki, of course, recognized this a long time ago, saying you can have a model of capitalism based on repressing workers. (He noted that it’s helpful, if you’re going to do that, to have a repressive fascist government—not that he was advocating doing that, of course.) After a while, and this was in the Financial Times today, workers are going to see that they’re not getting any benefit from a recovery, and it’s going to create all kinds of political results, and we don’t know what they’re going to be. But people are going to be pissed off. Dollars & Sense: That brings us to a central question, which Kalecki raised, that a social problem may be solved technically and intellectually, but still face barriers of economic and political power. That applies not only to full employment, the issue he was addressing, but also to environmental sustainability and other issues. Can our most serious problems be resolved within the context of capitalism, or do they require a new kind of economy and society, whatever we may call it? Robert Pollin: The challenge that Kalecki introduced points to some version of shared egalitarian capitalism, such as a Nordic model. Whether that model works and how long it works is an open question, and it varies for different countries. Certainly, when we think about environmental infrastructure investments, collective solutions are workable. We know from Europe that initiatives, which are collectively owned and collectively decided, for building renewable energy systems really do work. In large part, this is because it is the community saying, “We don’t mind having wind turbines if it’s done right within our community and we have a stake in it.” If some big coRobert Pollin oration were to come and say, “We’re wiping out 18 blocks here to put up some turbines and we have a right to do it because we own the property”—it doesn’t work. We have public utilities and that works just fine in this country. Expanding the role of the public sector in my view is totally consistent with what’s going to happen in the future. So that starts transcending the primacy of coRobert Pollin orate capitalism. But we can’t get there in ten years. No matter how much anybody wants it, that’s not going to happen. We have a problem of mass unemployment and we have an environmental crisis with climate change, and if we’re not going to transcend capitalism in ten years we have to also figure out ways to address the concerns now within the existing political framework. That’s not fun. When I deal with mainstream politics in Washington, it’s very frustrating, but that’s the world we live in. I think that if we press the limits of the existing system, that helps me to understand how to move forward into something different than the existing structure. My professor Robert Heilbroner, a great professor who had a beautiful way of expressing things, talked about what he called “slightly imaginary Sweden.” So it’s not the real Sweden but this notion of some kind of egalitarian capitalism. As you press the limits of that model, you can intelligently ask what’s wrong with it. If we’re pushing the limits and something is holding us back, let’s solve that problem. I think that’s a good way forward. This piece was reprinted by Truthout with permission or license. It may not be reproduced in any form without permission or license from the source. Alejandro Reuss Alejandro Reuss is co-editor of Dollars & Sense and an instructor at the Labor Relations and Research Center, UMass-Amherst. Show Comments

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Why choose Investis? Our news and views myInvestis HomeCorporate & IR SitesSocial MediaApps & MobileVideo & WebcastingCharts, Maps & FeedsEmbedded Reporting About Us ClientsAwardsWhere We WorkSenior ManagementThe EnvironmentSocial ResponsibilityPartnerships Our senior management bring a wealth of experience in corporate communications, investor relations and internet technology. But of course they all have an enormous amount of broader expertise as well. Helen James With ten years of City experience, Helen brings a first-hand insight into the demands placed on PLCs. Helen was Head of Pan-European Equity Sales at Paribas prior to her becoming a founding director of Investis in 2000. Investis’ Managing Director since 2000, Helen became CEO in October 2012, following the management buyout led by Gresham Private Equity. In this role she will both continue to oversee all of our client relationships and drive company strategy and growth. David Grigson David has over 25 years' experience working at a senior level across a range of publicly quoted companies. He is currently chairman of Trinity Mirror plc, senior independent director at Ocado Group plc, and a non-executive director of Standard Life plc. He is also chairman of Creston plc, the marketing services company, and a director and trustee of the Dolma Development Fund. In his executive career, David was chief financial officer of Reuters Group plc at the time of the announcement of its £8.7 billion merger with Thomson Corporation to form Thomson Reuters. He was appointed chairman of Investis in November 2013. His experience of working with companies in the digital and investor relations space means he is perfectly positioned to assist Investis in our continued expansion. Rupert Spiegelberg CEO of Investis Inc. Rupert heads up our North American operations, headquartered in NYC. He previously drove our push into mainland Europe and more recently was responsible for developing our Product strategy before moving to the US. With more than 14 years experience in online IR and corporate communications in the US and Europe, Rupert knows exactly what corporates require in a digital communication strategy. As an ex-Bloomberg journalist, he also has an acute understanding of what stakeholders look for in communications. Rupert holds an MBA from INSEAD in France. Rene Milner Rene brings huge experience to his role of CFO. Previously, he held a similar position at AIM Technology and at Virgin Digital Studios, and spent four years as a principal of a UK venture capital fund. His business philosophy is that finance is a service business and must deliver the highest quality to both external and internal customers. In addition to finance, Rene is responsible for the legal and commercial aspects of the business, addressing everything from pricing and contracts to the intricacies of India’s STPI regulations. Alex Booth As COO, Alex ensures all client solutions are delivered efficiently, to the right spec., and on time. In turn, this entails the seamless integration of our teams and resources in London, New York, Würzburg, Helsinki, Milan and Vadodara. Since our earliest days, Alex’s can-do attitude has played a key part in the company’s success. Outside of work, it also led him to train for four months, as a complete novice, for a white collar boxing tournament. He is a keen linguist with exposure to six European languages and holds a first class degree in Modern Languages from Nottingham University. Director of New Business, UK & Southern Europe Neil has worked in a variety of roles since joining the company in 2000. Along the way he set up and managed the Client Strategy team which has been instrumental in helping our clients maximise the effectiveness of their online digital communications. In his current role, Neil is driving the activity of the UK and Southern Europe's new business and account management teams. When he is not directly supporting the sales effort, his attention is directed to training and development, building skills and knowledge across the business. When he is not working, there is not much than can beat a game of ‘frisbee tag’ in the park with his kids or a long swim in Tooting lido. Ashish Parasharya Managing Director – Indian Operations Ashish has led the rapid growth and transformation of our Indian operations. Joining us as General Manager in 2007 to run a small team of 12, today he heads up a team of over 180 people. Based in our Indian office, Ashish is constantly working to improve the processes, cost efficiencies, quality and innovation we deliver to our clients. His excellent team-building skills are of incalculable worth to the people he manages in India. When it comes to detail, Ashish is absolutely meticulous – but with one exception: he admits that his cupboards are never organised. Claudia Breitenberger-Cerny CEO Germany, Switzerland, Austria Claudia takes great pride in running both the team in Würzburg and some 350 client relationships across Germany, Switzerland and Austria. She offers unrivalled knowledge of the DACH market. Claudia joined the Investis family when Flife AG, the influential IR company she founded a decade before, became part of Investis in 2008. As a counterpoint to working in online technology, Claudia enjoys more tactile pastimes ranging from property renovation to painting, knitting and playing the piano. Tua Stenius-Örnhjelm Business Director, Nordic Region Tua is responsible for sales and client relationships across the Nordic Region She joined Investis in 2012 after working for more than 10 years in corporate and financial communications, both in-house and as a consultant. Her long experience and strong understanding of communications ensures she is in an excellent position to find solutions to our clients’ challenges. Away from work, Tua enjoys an active outdoor life and cooking for family and friends. Michael Jenner Director of Solutions As Director of Solutions, Michael has overall responsibility for the delivery of projects at Investis. He is responsible for ensuring that whatever the size or nature of the project, every client receives exceptional service at all stages of the project process. With over 20 years experience in software development, Michael has developed a deep understanding of the stresses associated with complex and time critical projects. He has been with Investis for over 7 years, during which time he has been instrumental in the development of our world class project delivery operation. Not surprisingly, when not working his focus is on stress relief. These days this includes Tae Kwon Do and helping his teenage son become the next Mark Zuckerberg. Dianna Winegarden Director of Client Services Dianna leads our Client Services teams across the globe. She brings with her a wealth of experience from years of working in online advertising technologies and understands the challenges of a quickly changing digital landscape. Dianna is passionate about providing great experiences for our clients and is one of those rare people who enjoys filling out customer service surveys. As a result she is the perfect person to ensure that our clients receive the very best care no matter their location. Originally from Seattle, Dianna now resides in London and holds an MBA from the University of Washington. Simon Gittings If he could, Simon would start every meeting by shouting ‘say no to dull’. It’s very easy to take the safe route but it’s only by challenging expectations that great results can be achieved. As Creative Director, Simon leads clients and our in-house teams through the creative process, to get the ideal mix of design, messaging, words and media to effectively tell clients’ unique stories. He pushes everyone to engage their audience and to communicate effectively: it’s not just about providing information and there is nothing worse than a vast, infrequently updated site with little substance. Outside of work, Simon is passionate about climbing but these days his kids go along too. He also likes bikes – with and without engines – and reading. Nicolas Bruel Director of Sales, UK Nico heads up our Sales operations for the UK (as well as in Ireland, Russia, France and the Benelux). He has been involved with many of the most significant, recent corporate transactions in the UK, guiding clients’ digital communications through both IPO and M&A situations. Before Investis, Nico worked in the Middle East and Southern Africa, where he supervised the editorial and commercial production of economic TV documentaries for CNBC. He has an MA in International Relations from the University of Warwick and an MA in International Business from ESC Rennes / the University of Miami. Kate Rowe Director, Product Implementation Nobody knows what makes Investis tick better than Kate, something that comes in useful when responsible for the sales and delivery of a constantly evolving product suite at the leading edge of digital technology. Before joining Investis in 2004, Kate worked at Clockwork Web, The Institute of Chartered Accountants and The Cabinet Office, where she delivered the governments first ever web based systems for Prime Ministers Questions and Crisis Management. Kate is a passionate London cyclist who rides the 10 miles from Wimbledon to the City every day, come rain or shine. Vineet Gandhi Vineet is responsible for the technical development of Investis’ product program. He acts as an evangelist and technology thought leader within the company and leads the Product Management team in Baroda. Before joining Investis five years ago, Vineet worked in the e-learning industry in several client-facing capacities and managed over 40 custom e-learning implementation projects for clients across the globe. Away from work, Vineet enjoys spending time with his family, travelling and improving his not-so-good snooker skills. Consulting Director Mark is responsible for the creative and strategic account development of key accounts, across a range of sectors, from financial services through to mining and utilities. Mark works closely with clients at a senior level, helping them to better define their digital communication strategies, establish measurable business benefits and identify the best means with which to communicate. With almost 20 years’ experience, Mark understands the corporate brand and how it should be communicated to the wide range of stakeholders that today’s global organisations need to reach. Justin Walters Justin was Investis’ founder and was CEO before stepping down in October 2012. He continues to be a great friend of the company and to work with Investis in an advisory capacity. Justin combines an academic background (he’s a Fellow of All Souls College, Oxford) with his experience as a management consultant at OC&C and as Head of New Media at the Guardian, in which role he launched Guardian online. @Investis Join uson LinkedIn Watch uson YouTube Sign up forall our news Call ordrop us a line UK+44 (0) 20 7038 9000 USA+1 646 512 5176 Germany+49 (0) 931 35610 Finland+358 40 748 8864 Rest of World+44 (0) 20 7038 9000

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Jeff Bergstrand: Free trade agreement research recognized as 'most cited' Free trade research recognized as ‘Top 20 Most-Cited’ Awards, Economy, Faculty, Finance, Global Business, Public Policy The purpose of a free trade agreement is straightforward: to remove or reduce tariffs, quotas and other non-tariff barriers on goods and services traded between two or more countries. The goal is to enhance the trade among countries in a wider variety of goods and services and where each country has a comparative advantage producing. The United States currently has agreements in place with 17 countries.But do free trade agreements actually work?Finance Professor Jeffrey H. Bergstrand of the Mendoza College of Business at the University of Notre Dame was recently honored for his research paper that sought to answer the question. “Do free trade agreements actually increase members' international trade?” co-authored withScott L. Baier of Clemson University, was recognized as one of the “Top 20 Most-Cited Articles” published in the Journal of International Economics 2005-2009. Amsterdam-based publisher Elsevier compiles the list of most cited articles and bestows the award. The global company publishes approximately 2,000 journals and 20,000 books and major reference works. In the paper, Bergstrand and Baier stated that despite 40 years of analysis of the effect of free trade agreements on trade flows, there has not been a clear answer to the question of whether they work to increase international trade. The authors said this was because the model commonly used to measure the effect – the gravity model of international trade – has a significant drawback. While the model can account for important factors influencing trade flows – such as countries’ economic sizes and the distance between them – the measurement of the influence of free-trade agreements on trade flows typically had been compromised by the fact that countries self-select into these agreements.The authors found a method to overcome the bias introduced by self-selection. In analyzing all free-trade agreements among 100 countries, they found that the agreements have a very significantly impact: A free-trade agreement on average doubles the level of trade between two member countries compared to two countries without an agreement. The stability of such estimates across many alternative data sets now provides policymakers with a potential method for assessing with more confidence the ex post effect of free-trade agreements. This methodology is now being pursued, for instance, by the European Commission in evaluating the effectiveness of European Union (EU) agreements with non-EU countries.The paper originally was published in the March 2007 issue of the Journal of International Economics (Volume 71, number 1). The research underlying this paper was supported financially by the National Science Foundation.Bergstrand has been a finance professor in the Mendoza College of Business for more than 20 years, as well as a fellow of Notre Dame’s Kellogg Institute for International Studies, and a research associate of CESifo, an international network of researchers based in Europe. His research on international trade flows, free trade agreements, foreign direct investment, multinational firms and exchange rates has been published in more than 50 articles in such journals as the American Economic Review and as chapters in books. Bergstrand’s current research focuses on economic determinants of multinational firm behavior and foreign direct investment, and the growth of regionalism. He also is advising the European Commission on the effects of free-trade agreements on trade flows.For more information, contact Jeffrey Bergstrand at (574) 631-6761 or [email protected]. 2013 Research News Articles2012 Research News Articles2011 Research News Articles2010 Research News Articles2009 Research News Articles2008 Research News Articles2007 Research News Articles2006 Research News Articles2005 Research News Articles

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The BRICs Have Hit a Wall Major emerging markets are suffering — and frankly that's not very surprising By Michael Schuman @MichaelSchumanJan. 10, 20140 Share Prakash Singh / AFP / Getty ImagesIndian Prime Minister Manmohan Singh delivers a speech during the inauguration of the 3rd BRICs International Competition Conference in New Delhi on Nov. 21, 2013 Email Only a short time ago, the world’s emerging markets, especially the BRICs — Brazil, Russia, India and China — were supposed to be the saviors of the global economy. As the West sank into a recession in the wake of the 2008 financial crisis, China, India and many other developing economies continued to post strong growth, helping to prevent the world economy from tumbling into an even deeper and more painful downturn. As the U.S. and Europe struggled to recover, talk that the giants of the developing world were destined to take their place at the top of global economic and political affairs accelerated. Now, however, with the opening of 2014, many emerging markets look like they’re the ones that need saving. Investors are fleeing markets from Latin America to Asia, tanking currencies, stocks and sentiment. The good money is now betting on the once battered advanced nations. While stock markets in the U.S. and Japan have soared, those in the developing world have slipped. What’s gone wrong? Some of the turmoil has been inadvertently brought on by the U.S. Federal Reserve. After flooding the world with billions of dollars through unorthodox bond-buying programs to boost the U.S. economy, the Fed is beginning to scale back — or “taper” — those efforts, and jitters over the impact of that unprecedented unwinding is scaring investors from assets perceived as high risk. Especially vulnerable are emerging economies that have become dependent on cheap and easy foreign funds to finance current-account deficits, like Turkey and Indonesia. Turkey’s currency, the lira, hit a record low in recent days, while Indonesia’s rupiah has sunk to levels not seen since the Asian financial crisis of the late 1990s. (MORE: Viewpoint: How Elections Could Impact Five Emerging Economies) However, there are more fundamental reasons why investors have soured on emerging economies. Their prospects just aren’t what they used to be. China, the granddaddy of them all, is in the middle of its most severe slowdown since the late 1990s. Fears are rising that India could be trapped in stagflation — that nasty combination of slow growth and high inflation. Once high-flying Brazil is expected to grow no faster than the U.S. in 2014. Research firm Capital Economics forecasts growth in emerging markets overall to be around 4.5% in 2014 — well below the average of 6.0% since 2000. Of course, no economy, no matter how bright its prospects, can expect to expand quickly forever. But the problems facing emerging markets are not just cyclical. The fact is that complacency has torpedoed the emerging world. Politicians in developing nations, made overconfident by their economies’ stellar performances and talk of their inevitable dominance in a “post-American world,” failed to press forward with the reforms necessary to sustain their growth miracles. In New Delhi, political bickering tanked efforts to further the liberalization that had set the economy free and sparked rapid development. China’s new leaders are facing a long, difficult process of reshaping the country’s tapped-out growth model and contending with rising debt levels that threaten the nation’s financial stability. New President Xi Jinping has only just embarked on long-stalled free-market reforms that could lay the foundation for further success. In Brazil, overbearing taxes, red tape and poor infrastructure have hampered competitiveness. Though some emerging markets continue to excel — such as the Philippines and Nigeria — many are being held back by similar political hurdles and foot-dragging. None of these problems can be solved easily. Xi will have to take on China’s entrenched interests — state-owned enterprises, a powerful bureaucracy — to implement the bold reforms outlined in an important party plenum in November. India and Indonesia are facing critical elections this year that could determine their outlook for some time to come. All emerging nations are in the process of learning a difficult lesson: even those economies with the brightest prospects and biggest advantages can’t continue to grow without timely reform and bold political action. While the giants of the emerging world deal with the fallout, the post-American world will have to wait.

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Commissioner Šemeta launches Tax Policy Group to push forward fundamental issues in taxation IP/10/1312Brussels, 12 October 2010Commissioner Šemeta launches Tax Policy Group to push forward fundamental issues in taxation Commissioner Algirdas Šemeta will today chair the first meeting of the new Tax Policy Group, which brings together personal representatives of EU Finance Ministers to discuss key tax policy issues. The Group will work on fundamental topics such as how taxation can contribute to a stronger Internal Market, to the growth and competitiveness of Europe's economy and to a "greener" economy. It will also serve as a forum for deeper discussion on priority matters, such as financial sector taxation, common consolidated corporate tax base and the new VAT Strategy. Commissioner Šemeta said: "Fiscal coordination is essential if the EU is to re-build a strong and robust economy. The Tax Policy Group will be a very important tool in ensuring that Member States' tax policies complement, rather than contradict each other, and that the right measures are taken at EU level to promote growth and prosperity." Commissioner Šemeta announced the establishment of the Tax Policy Group as one of his top priorities as Taxation Commissioner, seeing it as a crucial means of maintaining political momentum on key issues related to taxation at EU level. The Group will provide a regular fixed forum for high-level discussions to explore the scope and priorities for tax policy coordination within Europe. It will help the Commission and Member States to exchange views on proposals before they are put on the table, and to push forward discussions on important taxation dossiers. At today's meeting, the group will look at the recommendations in Professor Monti's report on the re-launch of the Internal Market (click here), including how to address obstacles and bottlenecks in areas such as corporate taxation, consumption taxes and environmental taxation. It will also look at how tax policy coordination could better contribute to fiscal consolidation and improve the effectiveness of national strategies. At the request of the ECOFIN Council at the end of September, the Tax Policy Group will also focus today on the issue of financial sector taxation, taking into account the Commission's recent policy orientations in this area (see IP/10/1298, MEMO/10/477).Background:The Tax Policy Group was established in 1996 as a high-level group for strategic discussion on tax policy issues at a European level. It played an important role in the success of the "Tax Package" in the late 90s. Reference information

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Will health care law hurt insurers' profits? Obamacare may not be as good for insurance companies as some people seem to think.By Stock Traders Daily Nov 14, 2012 12:43PMBy Barry S. Cohen, Stock Traders Daily Now that President Obama has been reelected, the 2010 Affordable Care Act is here to stay. And the biggest change to the U.S. health care system since the implementation of Medicare and Medicaid in 1965 may signal tougher sledding for health care insurers. That could be bad news for the largest U.S. medical insurer, UnitedHealth (UNH), as well as other big industry players Aetna (AET), Wellpoint (WLP), Cigna (CI) and Humana (HUM). These companies could be facing profit limits and new taxes to cover some of the cost of expanding health care coverage to as many as 30 million uninsured people starting in 2014. So how do investors trade these stocks? ObamaCare, as it's become known, imposes fees and restrictions on insurers, and it cuts funding for Medicare Advantage, the privately run version of the government's Medicare program for the elderly and disabled. These changes are troublesome to investors, and some also are worried that insurers will be stuck with skinnier profit margins from the business they gain via new online exchanges that will be set up to help people buy coverage, the Associated Press reported. However, a couple of analysts see the glass as half full when it comes to the stocks of the health insurers. Bernstein's Ana Gupte said in a recent research note that the risk of thin profits in the commercial business is manageable and already priced into company stocks, according to the AP story. She added that Medicare and the state-federal Medicaid program for the needy and disabled represent attractive growth opportunities for insurers. Among her favorite picks are Aetna, Humana and UnitedHealth. In the same story, Citi analyst Carl McDonald said in a note that the overhaul is already cutting funding for Medicare Advantage plans, and he doesn't think the program will see additional cuts. Even if they do happen, McDonald said that doesn't necessarily hurt profitability. At least one health insurance executive agreed that the election changes nothing for his company. Mark Bertolini, Aetna CEO told Bloomberg that Obama's victory makes the game plan the third-biggest U.S. health plan by enrollment has been executing "one we can stick with." Among health insurers, two smaller companies that may prosper from the health-care law are St. Louis-based Centene Corp. (CNC) and WellCare Health Plans (WCG), headquartered in Tampa, Fla. Both companies focus largely on Medicaid, the joint state- federal program for the poor. The health law expands the system, accounting for half of the new people to be covered. As a result many cash-strapped states are likely to turn to private contractors like Centene and WellCare to handle much of the growth. For more information about stocks in this space, Stock Traders Daily's real time trading reports help investors identify opportunities before they happen.Tags: AETCNCHUMUNH< Back to Top Stocks

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What the Smart Crowd is Thinking Every August, veteran Wall Street strategist Byron Wien hosts a series of lunches for leading financial professionals. Here's what's on their minds. By Every August for the past several decades I have organized a series of Friday lunches for serious financial professionals who spend their summer weekends in eastern Long Island. What started as a single lunch for half a dozen people has grown to four lunches at different locations for more than eighty. Participants include many well-known names, of whom some are billionaires, but others, though widely respected for their intellect and insights, have a net worth that may be more modest. They are a reasonably diverse group...

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Home Debates 2012 June 19th Debates of June 19th, 2012 The word of the day was trade. Question PeriodCommittees of the HouseCanada Genuine Progress Measurement ActCanada Shipping Act, 2001Safe Drinking Water for First Nations ActPetitionsQuestions on the Order PaperQuestions Passed as Orders for ReturnsPoints of OrderCANADA-PANAMA ECONOMIC GROWTH AND PROSPERITY ACTCorrectional Service CanadaQueen's Diamond Jubilee MedalBlood DonationChildren's HealthBirthday CongratulationsCanada-Wide Science FairDemocracyFiesta WeekThe Prime MinisterDiesel ExhaustChristiane BlanchetPyrrhotiteFree Trade AgreementsPolioFree Trade AgreementsCanadian Coast GuardInternational TradeGovernment LegislationGovernment AccountabilityEthicsFederal-Provincial RelationsEthicsThe EconomyInternational TradeNational DefenceEthicsCanada Revenue AgencyEthicsCanadian Wheat BoardRoyal Canadian Mounted PolicePrivacyEmployment InsuranceInternational TradeEthicsHealthThe BudgetFisheries and OceansThe EconomyCitizenship and ImmigrationNatural ResourcesPoints of OrderPrivilegeCanada-Panama Economic Growth and Prosperity ActCommittees of the HouseCANADA-PANAMA ECONOMIC GROWTH AND PROSPERITY ACTWorld Autism Awareness Day ActCanada-Panama Economic Growth and Prosperity ActProtecting Canada's Seniors ActFinancial Literacy Leader ActStrengthening Military Justice in the Defence of Canada ActSearch and Rescue [For continuation of proceedings see part B] [Continuation of proceedings from part A] The House resumed consideration of the motion that Bill C-24, An Act to implement the Free Trade Agreement between Canada and the Republic of Panama, the Agreement on the Environment between Canada and the Republic of Panama and the Agreement on Labour Cooperation between Canada and the Republic of Panama, be read the second time and referred to a committee, and of the motion that the question be now put. Canada-Panama Economic Growth and Prosperity ActGovernment Orders The hon. member for Leeds—Grenville has six minutes left to conclude his remarks. Gord Brown Leeds—Grenville, ON Mr. Speaker, as I was saying before I was interrupted for private members' business, what has been the result of these initiatives for Canadians? In recent years, bilateral trade between Canada and Panama has been steadily growing. From just under $50 million in total trade in 2002, we are up to a total of $235 million per year by 2011. We are now in 15th position as a supplier of goods to Panama, and much of this is very diversified and includes pork, vegetables and vegetable preparations, vegetable oils, industrial machinery, electrical and electronic machinery, motor vehicles including ambulances, ships and tugboats for the Panama Canal, paper products, pharmaceutical products, iron and steel products, coins and precious stones and metals. Meanwhile, we are now Panama's second most important market for exports, which include gold, fish and seafood, fruits and nuts, mainly bananas and pineapple, and coffee. Canadian companies have also demonstrated a recent interest in Panama as an investment destination. The stock of Canadian direct investment abroad in Panama was estimated at $121 million by Statistics Canada at the end of 2010, and Scotiabank established itself in Panama in 1973 and has expanded to become the fifth largest commercial bank in Panama. However, it is in the mining sector where Canada is now poised to play its most visible role as a commercial partner for Panama. According to public sources, the book value of assets owned by Canadian mining companies in Panama in 2010, which is the last year for which data is available, was $658.7 million. The government of Panama has ably steered the economy through the global downturn with a stimulus package of large, strategic projects that aim to maintain employment levels, address gaps in social development infrastructure and transform Panama into a world class logistics hub. Going forward, the completion of the Panama Canal expansion must surely rank as one of the most dynamic undertakings in the Americas. We have already seen some Canadian participation in this venture, a contract to analyze the lifespan of the concrete, for example. The government's ambitious infrastructure development plan includes the metro public transportation project and the building and improvement of the national network of roads, airports, hospitals and ports. Education, energy and the environment also feature prominently in this program, much of which will be materially assisted by the Inter-American Development Bank and the World Bank. Panama's strong commercial banking, insurance and service sectors, along with its achievement of an investment grade rating, lend credence to projections that the country will continue to be a lead performer in the region. According to the World Bank, Panama ranks highest in Central America in terms of the ease of doing business. Canada wants to be part of this exciting program that would contribute to the welfare of all Panamanians. We need this free trade agreement now, not only to help maintain this pace of growth but to protect our existing base, since Panama has already been out there, being aggressive and going after bilateral programs and trade agreements, which already benefit many of our competitors, such as Taiwan, Singapore and Mexico, and shortly will also benefit the United States and the European Union as well. I strongly endorse our government's pro-trade, pro-jobs agenda that we are pursuing as we pursue many different trade agreements throughout the world. Canada is a trading country. Jobs in my riding of Leeds—Grenville are heavily dependent on trade with the United States and with other countries around the world. We are located on all of the major corridors, whether it be the main rail route through Canada or the main road infrastructure through Highway 401, and we are also located right on the St. Lawrence Seaway with the Port of Prescott. All of these things help jobs in my riding of Leeds—Grenville. This is yet another opportunity for our country to conclude a trade agreement with another country that would help create jobs here in Canada, as well as open up another market for many of our producers here in Canada. I encourage all members to support this important trade bill. I look forward to it being passed in the very near future. Mr. Speaker, I would like to thank my colleague across the way for his speech. In the last few minutes, he mentioned the extent to which trade is important, especially for the people in our ridings. I think that it is beneficial for most people in all regions of Canada to be able to trade with other countries. For example, several business owners in my riding of Alfred-Pellan are small-scale importers–exporters and rely heavily on trade. I agree with him on this point. However, I agree less on others, especially when it comes to the fact that no tax information exchange agreement has been signed with Panama. It is a little strange. All that has been signed with Panama, in terms of taxation, is a convention on double taxation. Only legitimate revenue is traceable, and not illegitimate revenue, which would be traceable under a tax information exchange agreement based on OECD data. Why has this not been included in the free trade agreement, especially given that Panama enters into this kind of agreement with other countries, just like Canada does? Canada has this kind of agreement with the Cayman Islands and the Bahamas, and Panama has one with the United States. So why do we not have something that is so key to our economy? Mr. Speaker, I would like to thank the hon. member for her question, but my question is this: if members are representing ridings that are heavily dependent on trade for their jobs, why are these members on the opposite side not standing in support of these free trade agreements? We know they have opposed every single trade agreement. There was some division on whether they supported the Canada-Jordan free trade agreement. In any event, directly to the question the member asked about the financial issues, the bill would in fact have a section and a chapter of comprehensive rules governing investment, and the rules would provide great protections and predictability for Canadian investors in their investments in Panama. I think the bill does address the issues that the hon. member is concerned about, and I would hope she would in fact support this bill because she even said it is important for jobs in her riding. Mr. Speaker, I would like to thank my colleague for his excellent presentation. I want my colleague to try to square this for me. The NDP is a party that claims to be for workers, yet it does so much that kills jobs, quite frankly. As an example, it is against the expansion of the oil sands. It is against almost every major natural resources project developed in this country. It is against the pipeline to the west coast, which would add $30 a barrel, probably, to the price of oil. It is also against free trade, yet these things all create a lot of jobs. In fact, the free trade agreements, I think, together created about 30% of all the jobs in Canada. However, it wants to kill those jobs. I would like the member to comment upon the importance of free trade agreements and jobs. Mr. Speaker, I would like to thank the hon. member who has stated very clearly his understanding of how important it is for resource development here in Canada and the jobs it creates. It not only creates jobs in the province of Alberta. This has been an argument, that it only creates jobs in Alberta. It creates jobs across Canada. It creates manufacturing jobs in machinery and other sectors in Ontario, for example, which is the province I am from, and there are so many jobs that are dependent upon manufacturing. I do not understand how the members on the other side can stand there and actually oppose these free trade agreements that would create jobs. They say they want to improve the quality of life in their ridings for their constituents. Here is an opportunity for them to stand up to help create those jobs, create the free trade agreements that would create those jobs and make life better for everyone here in Canada. Mr. Speaker, as members know, the Liberal Party is very supportive of free and fair trade, frankly, so we do support this agreement in principle. However, I have a question. I wonder to what extent the member opposite has investigated the effectiveness of any collateral agreements, with respect to the environment. I know that the member for Kings—Hants, several years ago, was able to have one of those collateral agreements respecting labour and the environment attached to the Colombia free trade agreement. I also understand that we are having difficulty overseeing the effectiveness of that agreement and undertaking the proper investigations to make sure it is being complied with. I ask the member what degree of satisfaction he has with the content of any of these collateral agreements and their actual enforceability. Mr. Speaker, I am encouraged that the Liberal Party is supporting these free trade efforts. In fact, over the last number of years it has supported them. It is the NDP that has opposed every single trade agreement that has come before this House. In terms of the parallel agreements, there is one on the environment and one on labour co-operation. If we do these types of agreements and we continue to work with these countries, we are in a much better position to help ensure that these sorts of things are enforced, rather than walking away and not being engaged with these countries. The benefits to Canada for these types of agreements are large. They create jobs throughout Canada. They help in our ridings and improve the employment situation. I am encouraged that the Liberal Party is in fact— Order. Resuming debate, the hon. member for Saint-Hyacinthe—Bagot. Marie-Claude Morin Saint-Hyacinthe—Bagot, QC Mr. Speaker, I admit that I rise today in this House with a certain amount of anxiety to state my views concerning Bill C-24, an act to implement the Canada-Panama free trade agreement. Obviously, this legislation is very important for the people of Canada and Panama. If it is enacted, there will be many lasting consequences, and they will not necessarily be positive. Before telling my colleagues what I really think, however, I believe it would be a good idea to give an overview of what is really in this bill. First, the negotiations between Canada and Panama addressed a number of major changes to trade relations between the two countries. Several points drew my attention. First, it provides that Canada would eliminate all customs duties on non-agricultural products, and the vast majority of duties on agricultural products. The best estimates available indicate that this means that 99% of customs duties on Panamanian imports would disappear with the stroke of a pen. Over a 15-year period, once the agreement is ratified, other duties would also be gradually eliminated. The various products that would still be subject to customs duty include dairy products, poultry and eggs, and certain products containing sugar. In return, about 90% of Canadian exports to Panama would be exempt from customs duty. Obviously, that 90% includes numerous agricultural products. At the end of a 5- to 10-year period, it will be possible to export most agricultural products, in fact virtually all of those products, free of customs duty. Knowing that at present, Panama’s customs duties come to nearly 70% on certain agricultural products, we can understand how significant the consequences of ratifying this agreement will be for both countries. Apart from agricultural products, there will be a series of equally important changes if the agreement is ratified in this House. Those that cause the most concern obviously include the expansion of free trade in the service sector, such as information technologies, for example, and also increased access to government contracts in both countries. The agreement also addresses other points. For example, it mentions an agreement on the environment, an agreement on labour and provisions dealing with investments. As we can see, this agreement is very wide-ranging and will have consequences for many different spheres of society. Earlier I mentioned agriculture, the services sector, government procurement, the environment, investment and labour law. It will have major consequences. For this reason, I believe we should think long and hard about the agreement before deciding whether or not to support it. This is what I and my party have done. We have been watching the negotiations leading to Bill C-24, which we are currently studying. We were also in attendance at the meeting of stakeholders and experts. Our analysis of these many discussions has had a chilling effect on our support. Above all, we heard a great deal of very convincing evidence that Panama is a tax haven. According to Todd Tucker, research director at Public Citizen's Global Trade Watch, Panama is home to an estimated 400,000 corporations, including many offshore corporations and multinational subsidiaries. In comparison, as just one example, this is four times the number of corporations registered in Canada. It is a number that speaks volumes. According to the OECD, the government of Panama does not have the legal resources to efficiently verify the essential information concerning these corporations, including the information with regard to their capital structure. When we are talking about tax havens, needless to say, it is obvious that caution needs to be exercised. This is also the reason why my colleague, the member for Burnaby—New Westminster, put forward a number of amendments that would help to resolve part of this issue. Unfortunately, the Conservative government, with the support of the Liberals, refused to listen, as it was probably too blinded by its ideology and by its disregard for compromise. Another aspect that I have serious problems with is the rights of workers. In fact, the agreement we are examining today gives no specific protection to the right of association or the right to strike. A number of stakeholders raised this issue during the consultations. There is cause for concern, especially since the fines prescribed in the event of infractions are virtually non-existent. We must be very aware of Panama's specific context in order to see how the rights of workers will be impaired by this agreement. Recently, demonstrations and strikes were held in Panama when the government made a full frontal attack on the rights of workers. Some of the government's repressive measures included the authorization to bring in strikebreakers, an end to environmental studies for certain projects and a prohibition on collecting mandatory union dues. During the demonstrations in Panama, the police used excessive force to suppress protests. Six demonstrators were killed during confrontations with the police and 300 union leaders were detained. This is particularly worrisome if we consider that, with the government we have right now, workers are losing more and more of their rights. I therefore do not see how it will be useful to support a free trade agreement that does not respect workers' rights. Unfortunately, the state of workers' rights in Panama is far from rosy. We have every reason to be concerned given that the free trade agreement set out in Bill C-24 will likely make the situation worse rather than better. Once again, the hon. member for Burnaby—New Westminster proposed sound and intelligent amendments to fill this gaping hole in the agreement. These amendments could have protected unionized workers by guaranteeing them the right to bargain collectively. These amendments also would have required Canada's Minister of International Trade to speak with union representatives on a regular basis, which is a healthy thing in a balanced democracy. It is nothing, for a democratic country like Canada, to make demands when signing a free trade agreement. That seems obvious. But the government simply brushed off my colleague's suggestions, which were realistic and showed a lot of compromise. For all of the reasons I just listed, my party and I are opposed to Bill C-24. The NDP has always opposed trade models like this one. We saw it with NAFTA. These agreements put the interests of multinational corporations ahead of the interests of workers and the environment, which is unacceptable. They also promote inequalities and erode the quality of life of people and honest workers. It is not surprising that this government is pushing so hard for this agreement. It is rather ironic, though. The agreement we are studying today is another step in the strategy adopted by Canada and the United States, which focuses on serial bilateralism through the use of trade agreements that are unfair to honest people, as I already mentioned. For a long time, the NDP has been preparing and suggesting a multilateral approach based on a fair, sustainable model that respects the environment and workers. I urge my House of Commons colleagues to carefully consider the consequences of passing Bill C-24. I do not think we should pass it. This agreement will not help honest workers. The government has been utterly uncompromising and has rejected all of my colleague's fitting amendments. I will never vote in favour of such an unfair agreement. Colin Carrie Parliamentary Secretary to the Minister of Health Mr. Speaker, I want to thank my colleague for her speech. My concern, though, was the tone of her speech, the disrespect for Panamanians, the pejorative language she used and the misinformation in calling Panama a tax haven. The reality is that Panama was listed on the grey list, but the democratically elected Government of Panama and the Panamanian people have worked hard and Panama is no longer on that list. It is now on what is called the white list. It has been working hard to open its markets to create jobs. Why does the NDP feel that it is in better shape to decide what is good for Panamanians? This agreement was negotiated between the democratically elected governments of Canada and of Panama, but the NDP members seem to feel, and have the arrogance to say, that this is not a good deal and they are fighting against it. They have not stood up for any of the free trade agreements that have benefited this country. What puts the member in a position to decide what is good for Panamanians? Mr. Speaker, I have to laugh when my colleagues challenge the facts that the NDP brings forward. When we deliver a speech on an issue, we do our research and we present the facts. My information is not wrong. Maybe my colleague should do some fact-checking. Maybe he is a little behind on his research. As I said before, I cannot support a bill that does not respect workers' quality of life and tramples their rights. That is all I can say in answer to the question. It being 6:55 p.m., pursuant to an order made Thursday, June 7, it is my duty to interrupt the proceedings and put forthwith every question necessary to dispose of the second reading stage of the bill now before the House. Is it the pleasure of the House to adopt the motion that the question be now put? Agreed. No. « Prev12...2223242526...3334AllNext »

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Economic plan proposes fee waivers, rebates By James Robinson Local government staff, key elected officials and the Archuleta Economic Development Association (AEDA) have unveiled and endorsed an economic development plan intended to revitalize the local economy; however, plan particulars leave some questioning the architects’ underlying motives and the plan’s efficacy in addressing deeper economic issues and the root causes of the local economic downturn. The two-year plan, the outgrowth of discussions between Town of Pagosa Springs Manager David Mitchem, members of the Archuleta County Board of County Commissioners, members of the AEDA and key county staff, focuses primarily on providing incentives for new construction with development fee waivers and sales tax rebates. For example, in 2009, the plan proposes that the town and county waive all development fees. For the county, that means a waiver of the building permit fee and the road and bridge fee. For the town, it means a waiver of the building permit fee, the road and bridge fee, impact fees and the sewer fee. The county does not currently levy a “road and bridge” fee. In addition, the plan mandates that the town and county agree to rebate up to 25 percent of the total county and town sales tax paid on construction-related costs, provided the purchases were made in Archuleta County. Secondly, the plan indicates the town and county will rebate up to 25 percent of the sales tax paid on construction related costs provided “the applicant can demonstrate ... that labor costs incurred related to the project were residents of Archuleta County.” The fourth piece of the plan suggests that the Pagosa Area Water and Sanitation District (PAWSD) reduce its “water meter fee,” the water resource fee, capital investment fee and sewer fee. According to PAWSD staff, the agency does not levy a “water meter fee.” That said, the plan must be referring to the water connection fee. If that is the case, the connection fee added to the other PAWSD development related fees totals $15,073 for a home with a standard 5/8 inch meter and one equivalent unit. Under the plan, PAWSD would be required to waive $7,536.50 in fees. Mitchem said the town had not estimated its average total waiver amount because many variables are involved in calculating town development fees. Combined town impact fees currently total $3,815. According to town documents dated May 2006, the residential impact fee breakdown equals — $818 for roads, $450 for county administration of public facilities, $859 for a recreation center, $368 for park land, $464 for trails, $574 for fire protection and $283 for school land. The foreshadowing for an economic development plan that largely targets PAWSD development-related fee structure came during the 2008 election, when Archuleta County Commissioner John Ranson decried impact fees and the PAWSD fee structure, saying both had discouraged and crippled development in the Pagosa Springs area. During July 2008, discussions on the PAWSD fee structure and its detriment to the community continued, with Steve Van Horn, and Realtor Mike Harrity encouraging the council to advocate for changes in PAWSD fee structure. In addition, Council member Mark Weiler called for suspension of all town impact fees, building fees, plan review fees and sewer related fees for development within the downtown area. Fast forward to April 19, 2009 and the county’s “Roads to Recovery” economic forum when impact fees and PAWSD’s fee structure came up again when one audience member called for the ouster of the PAWSD board. The proposition was supported by many in the audience. Most recently, the Pagosa Springs Area Association of Realtors (PSAAR) fired off a vitriolic memo to PAWSD staff and the board calling for changes to board leadership and the fee structure, stating, “The PSAAR believes the rate of decline in the total number of sales in the Pagosa Springs area directly corresponds to the Pagosa Area Water and Sanitation District and the Town of Pagosa Springs impact fees.” Should PAWSD not adhere to PSAAR’s requests, the group says it “will support the resignation of the current PAWSD Board of Directors and top management.” At its simplest, the plan is predicated on rewarding new construction activities while offering little economic relief to other facets of the local economy. And this, in contrast to Mitchem’s presentation to the Town Tourism Committee June 23, that the key to Pagosa Springs becoming financially self-sufficient is to attract and grow “the full spectrum of businesses ...” Moreover, and perhaps more interesting is the plan’s attempt to provide economic relief through tax rebates and fee waivers, while failing to acknowledge previously passed legislation that does the same, town and county planning documents, existing limitations on new construction, the realities of the PAWSD fee structure and the state of the local real estate economy. To begin, three moratoriums currently exist, thus limiting new development. The first is a defacto moratorium unofficially imposed and caused by the town’s overburdened and out-of-compliance waste water treatment plant. The others are official and imposed by PAWSD as the agency struggles with waste water treatment issues of its own. The town sewer treatment plant issue has gone unresolved since before 2007, and although neither the state nor town council have imposed an official moratorium on new construction, the plant, per state regulations was pushed to capacity two years ago. Unfortunately, and as of June 18, the town council still had not plotted a decisive course to rectify the problem. Meanwhile, town residents are paying sewer rates 114 percent over the state average, and double what they paid in 2008. During a town council meeting March 6, 2007, former Town Manager Mark Garcia reported the ailing plant could handle roughly 100 additional taps until the new wastewater treatment plant was built. Nevertheless, and despite the plant was poised to run over capacity, the town council, just hours before, approved five units at the Sixth Street Townhomes project, the final plan for 38 townhomes at Sunridge Villas Planned Unit Development, the sketch plan for 119 single family lots at Pradera Pointe, and the preliminary plan for 218 units at the Dakota Springs planned unit development, for a total of 380 possible new taps. Moreover, the planning cue for that same month totaled 900 residential units at various stages of the planning process, not to mention the 187 units slated for Blue Sky Village, which recently annexed to the town. Although plant modifications proposed then might have bought the town additional time, Town Council member Stan Holt, said during the session, “I’m sitting here thinking how do we handle this? If they all come on line, we’d be in a world of hurt.” Although the state has not yet fined or sanctioned the town for releasing inadequately treated effluent into the San Juan River, state sanctions may come soon depending on how town council chooses to proceed. Meanwhile, and with existing PAWSD moratoriums and the town sewer treatment plant in violation of state regulations, it’s unclear why the town, county and AEDA might endorse an economic development plan that could arguably add taps to system that is stressed, out of compliance and in desperate need of a fix. The legislative trail Although the plan, as currently presented, proposes fee reductions to boost the local economy, a clear legislative trail exists that shows similar measures have already been enacted, although building permits — and corresponding revenues — in both the town and county remain at virtually unprecedented lows. • On July 1, 2008, the Pagosa Springs Town Council approved Ordinance 714 which provides a 10-year impact fee deferral program for land development activities deemed by the council to provide public benefit to town residents. • Also in July 2008, PAWSD approved a five-year impact fee amortisation program and a new method of calculating equivalent units (upon which the fee structure is based) to provide a more accurate and fair method of calculating equivalent unit-based fees. The board reapproved the five-year amortisation program in January 2009. (The Town of Pagosa Springs still used PAWSD’s old, and arguably less accurate method.) • Also in January 2009, the San Juan Water Conservancy District voted to suspend its impact fee. The deferral saves homebuilders $1,129 per equivalent unit. • In April 2009, the PAWSD board also approved up to a 50-percent waiver of the water resource fee for affordable housing projects. The current water resource fee is $5,617. Other sources of economic decline During the fall of 2008 and early winter of 2009, Archuleta County staff proposed merging the town and county building and planning departments. The rationale for the merger was simple: to streamline an arguably convoluted, inefficient and cumbersome planning process that many elected officials and staff in each organization said had driven away development dollars. In short, the culprit responsible for our economic decline was the planning process, not development related fees. The Pagosa Springs Town Council ultimately voted against the merger. ‘Development should pay its own way’ The Archuleta County Community Plan, PAWSD policy and past town and county legislation indicates that new development should pay for its impact on public infrastructure facilities and services. Most recently, the town and county demonstrated a commitment to impact fees when they jointly funded a $30,000 dollar impact fee study. If the economic plan suspends impact fees for two years, it is likely that study will have to be undertaken again, at additional expense to the taxpayer. Moreover, with a policy drafted to waive impact fees, the question remains: Who will pay for impact wrought by new development? PAWSD fee structure and existing real estate inventory PAWSD Manager Carrie Weiss said she is concerned about an economic development plan that largely targets PAWSD fees. “The district is not in the business of economic development. We are in the business of providing clean, safe, drinking water and wastewater services,” Weiss said. “There are a lot of factors as to why people will or will not come here, and I think the community as a whole should look at those factors. And, there is a lot of real estate out there that wouldn’t be subject to our fees anyway.” According to local Realtor Lee Riley, as of the end of June 2009, there were 569 homes on the market, 135 condos, 1,121 listings for vacant land and 122 commercial listings. Weiss said none of the PAWSD fees targeted in the economic development plan would be applicable to the existing real estate inventory as long as the equivalent unit calculation on the property in question doesn’t change. With building moratoriums — defacto or otherwise — already limiting new construction and existing legislation that already provides impact fee relief, questions remain why the town, county and AEDA would support an economic policy that runs counter to stated agency planning documents and policies, rewards one narrow sector of the local economy while ignoring existing businesses and limits key revenue streams that fund the town building and planning department and both organizations’ general funds. “These are certainly meaningful and particularly very powerful incentives to jump-start this economy,” Mitchem said. “The intent is to get more purchasing done locally and to hire more local contractors. No one says this is a panacea, it’s just one of many tools we can use to help the local economy.” Mitchem also acknowledged that the plan, in its current iteration, falls short in its failure to address supporting other existing businesses. “The memo does not address supporting existing business. There needs to be strong support of existing business and we will have those discussions. There are additional tools we can put in an incentive portfolio,” Mitchem said. Mitchem said sales tax revenue makes up more than 70 percent of the town’s revenue stream, and when asked why the town would voluntarily cut its financial lifeblood when it was already trickling in well under expectations, Mitchem said, “These (construction-related sales tax dollars) are revenues we’re not receiving now.” In essence, Mitchem and Archuleta County Administrator Greg Schulte said some tax collections are better than zero. When asked how cutting the town’s planning and building revenue stream would impact those departments, Mitchem said, ”There is no doubt that if the revenue doesn’t come in on fees, the general fund will have to pick up the cost.” The county, depending on the perspective of Wells Fargo, may soon have to answer similar questions of its own. In May, the county borrowed $5 million from Wells Fargo for road repair, part of which will be used to pave Park Avenue. Loan repayment is based in large part on steady collections of sales tax revenue, and it is unclear how Wells Fargo will respond to the county waiving away a portion of that revenue stream. Ultimately, the Pagosa Springs Town Council, the Archuleta County Board of County Commissioners and the Pagosa Area Water and Sanitation Board of Directors will decide whether to implement the plan. According to Mitchem, the plan will go before the town and county boards July 7 and the PAWSD board July 14. The AEDA endorsed the plan in a joint meeting with town and county officials June 29. [email protected]

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This transcript was sent to 823 people who get email alerts on . Progressive Q2 2010 Earnings Call Transcript | About: PGR by: SA Transcripts Executives Brian Domeck - Chief Financial Officer and Vice President Glenn Renwick - Chief Executive Officer, President, Director and Member of Executive Committee Clark Khayat - Head of Corporate Development Bill Cody - Chief Investment Officer Vinay Misquith - Crédit Suisse AG J. Paul Newsome - Sandler O'Neill Michael Nannizzi - Oppenheimer & Co. Inc. Ian Gutterman - Adage Capital Matthew Heimermann - JP Morgan Chase & Co Meyer Shields - Stifel, Nicolaus & Co., Inc. Joshua Shanker - Deutsche Bank AG Progressive (PGR) Q2 2010 Earnings Call August 6, 2010 10:00 AM ETOperator Welcome to the Progressive Corporation's Investor Relations Conference Call. [Operator Instructions] The company will not make detailed comments in addition to those provided in this quarterly report on Form 10-Q, Shareholders' Report and Letter to Shareholders, which have been posted to the company's website, and will use this conference to respond to questions. Acting as moderator for the call will be Clark Khayat. At this time, I will turn the call over to Mr. Khayat. Clark Khayat Thank you, and good morning. Welcome to Progressive Second Quarter Conference Call. Participating on today's call are Glenn Renwick, CEO; and Brian Domeck, CFO. Also on the line is Bill Cody, our Chief Investment Officer. The call is scheduled to last about an hour. Statements in this conference call that are not historical facts are forward-looking statements that are subject to certain risks and uncertainties that could cause actual events and results to differ materially from those discussed herein. These risks and uncertainties include, without limitation, uncertainties related to estimates, assumptions and projections generally; inflation and changes in interest rates and security prices; the financial condition of, and other issues relating to the strength of, and liquidity available to, issuers of securities held in our investment portfolios and other companies with which we have ongoing business relationships, including counterparties to certain financial transactions; the accuracy and adequacy of our pricing and loss reserving methodologies; the competitiveness of our pricing and the effectiveness of our initiatives to retain more customers; initiatives by competitors and the effectiveness of our response; our ability to obtain regulatory approval for requested rate changes and the timing thereof; the effectiveness of our brand strategy and advertising campaigns relative to those of competitors; legislative and regulatory developments, including but not limited to, healthcare reform and tax law changes; disputes relating to intellectual property rights; the outcome of litigation pending or that may be filed against us; weather conditions; changes in driving patterns and loss trends; acts of war and terrorist activities; our ability to maintain the uninterrupted operation of our facilities, systems and business functions; court decisions and trends in litigation and healthcare and auto repair costs; and other matters described from time to time by us in other releases and publications. In addition, investors should be aware that Generally Accepted Accounting Principles is prescribed when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when a reserve is established for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude if additional information regarding claims activity becomes known. Reported results therefore may be volatile in certain accounting periods. With that, we are now ready for our first question. [Operator Instructions] Our first question today is from Vinay Misquith with Crédit Suisse. How's the rollout of the new product model that you refine segmentation resulted in lower overall pricing? Glenn Renwick That rollout continues on and it's always hard to sort of answer a question on a relative basis. But for the most preferred sector, I think when we told you may be in June that, that product design had a lot of good features in it across the board. But if you had to single out one significant change, it was a little bit more of an opportunity to go up to the preferred market in a way that is continuing to build on the information we've had. Clearly, that's not new for us, but we get more and more experience in that area, and that model reflects it. So if I was to answer that question, I would say in general, a little bit more aggressive pricing. Actually, I'll take that word back. It's not aggressive, just good pricing for the preferred sector and generally reflecting all of our best product features and where we can give greatest segmentation opportunity and discounts to those who deserve it. This product is our best in the market ever. And has it changed the pricing on non-preferred customers? The nonstandard sector, the answer is yes. It changes the prices because we do that sort of all the time. But this product model, while good for that sector, the real emphasis is more on the preferred. Having said that, let me make sure that there's no doubt that our emphasis on nonstandard mid-market is an area we have lots of experience in. So the rate of change of our knowledge and product is not as great as it might be of the other end of the spectrum, and our interest and intensity on that marketplace doesn't waver at all. In this particular climate, we are seeing perhaps a little bit more pressure in that environment, little less demand. But for the most part, our nonstandard in both channels is actually performing very well for us. As a follow-up, this is more a philosophical question. Has the Personal Auto business become more transactional, whereas in the past, you might have bought Homeowners and Auto and stayed with a carrier for a long time? Do you feel that customers are now willing to shop around more instead of disaggregate these two pieces? I'll break that part into two pieces, more transactional and disaggregation. I would say on average, yes, it is more transactional today, and you reach that conclusion simply by thinking that we're collectively, as an industry, putting several billion dollars into advertising, telling people to be more aware of the choices that they have available to them and they can make. And probably, if I contrast that to -- I don't know, just go back to sort of early 1990s Proposition 103, one of the key things that consumers ultimately were saying through that Proposition is we didn't understand that prices between insurance companies were that much different. Frankly, after that, we created a comparative pricing service, which you're well aware of. I think that environment has changed dramatically. I don't think consumers today think that all insurance companies are the same. They've got lots of messages that say that they're not. So they're interests are well served in looking around. And then we reported during the aftermath of really the height of the economic crisis that we had a very high demand in our direct channel, and it has continued for some time. And again, while we can't always know what motivates a consumer, we always speculated that was simply people taking a great deal more interest in their personal finances and saving money where they could. So the transaction volume has increased simply because: a, marketing; b, greater availability of means and channels, the internet being primary amongst them. Mobile will sort of be in that league in a few years. So transactional, I would say yes. Absolutely. Doesn't, on the other hand, mean that retention has failed. So for those who actually have good services and products and those transactions that brought new customers, we've been able to show you, and we showed you in June, that our retention has monotonically increased now for several years. With regard to bundling, as much as it would be in Progressive's best interest to see everybody buy the best-of-breed product, Auto and Homeowners, and combine those in a way that makes sense, I would say the predominant prices in the industry today is still bundling from the same carrier. However, as you've seen from our reported results and some others, GEICO would be another company that tends to use their own best-of-breed auto products combined with an accommodating homeowners' product, that is something that the offer -- that offering really, for all intents and purposes in the market, is relatively new, sort of within the last decade and more concentrated in the last five years, and seems to be appealing to people in ways that perhaps reflects to the strength of the brand that the company is offering them. So we offered under the Progressive Home Advantage moniker, and the Progressive brand is appealing for people. And we're selling a very comfortable amount of our package policies. And we hope that that'll become something that consumers accept in even greater numbers. And from what we see so far, we are very encouraged. Our next question is from Meyer Shields with Stifel, Nicolaus. Glenn, does the pricing for the segmentation data from Snapshot indicate any significant market segments where Progressive can earn better than the 96% combined ratio? Surely, from Snapshot, as we talked to you in June about, I think we really are well advised just to say, "Let's talk about that in two quarters from now." The data from Snapshot at that configuration is way too immature to draw conclusions to the extent that, clearly, the UBI, and it was just really the usage base that's the core of all of this is something that we had a lot of experience with. And we've actually showing you on different locations that we believe that as a predictor of pure premium segments, it's extraordinarily good. So the answer is yes, it's an extraordinarily good segment there for pure premium. Snapshot, as the reconfiguration of it, we really don't have a significant data to report on that. And to get to the other phraseology of the question, not really a question of whether we would find a segment that we could write at a combined ratio of less than 96%. We try to normalize all segments. And frankly, if that segment was sizable enough, we would use the pricing power of that segmentation to allow us to get greater numbers in that and still meet our target combined ratio. Right, that's assuming that there is enough elasticity, I guess, on the margins. Yes. I mean, the fact is there are segments of this business. I don't know that we got a lot of specific facts on this. There are segments of this business that are relatively inert, people that have bought their insurance policies and they're not quite, in response to the first question, not as transaction-oriented as others. This is an opportunity for us to have an offering, which is new, different, distinctive and might very well appeal to a segment that we don't get at. And if that segment is such that their loss cost, and this exposes those loss cost to be favorable, it may be our opportunity to really get some serious marketing influence. We've been talking for a while about the agent's shift to competitive raters, and I'm wondering if we're at a point now where sort of the bulk of that mindset has changed so that you can track the trends in your hit ratio as being meaningful. Can you just say the last piece of that question again? You faded out. I'm trying to understand whether there are credible trends in your hit ratios that would delineate the overall competitive position based on how you're doing with non-competitive raters? Brian, maybe you got that as well. I'm sure that I totally got your question, so redirect if you need to. But to the extent that we talked about comparative rating become a shifting paradigm, I think that shift is largely in place now and that the sort of results in conversion ratios and quoting activity that we see is more normalized. So we probably went through a period of knowing it was going to change somewhat, and it did. Now I think that we are actually very comfortable with that, and we've reported that we've responded in our own presentation of rates well in that regard. But I don't see a mega shift happening. There may be states that are a little bit more active than others, but for the most part, that shift is over. Brian, can you talk on that? Brian Domeck I think the shift to comparative raters and the usage in the agency channel, I mean, it's in a migration over time. And I think it's fairly entrenched in those agents if they're going to avail themselves of that. Certainly, that has driven what we call our "volume up", in particularly in the more preferred segment of the marketplace. As a result of more closed, we have actually seen our conversion rate decrease slightly relatively in the second quarter, relatively flat for the year. But I think most of that migration is over now. And certainly, we actually look at conversion rates on an individual state level relative to our positioning in that front. But in terms of the migration, I think it's largely already done. Our next question is from Matthew Heimermann with JPMorgan. First, can you just -- and I apologize, I can't remember if this was covered at the Analyst Day or not, but with respect to kind of the efforts to improve agency relations, for lack of a better description, can you talk a little bit about two things, one, whether or not, changes in commission ratios will play a significant role on that? And the second thing is, from an outsider's perspective, how would you recommend that we think about monitoring the progress in that area? We touched on it, but not necessarily those exact questions. When we talk to the first question, we really don't have any macro changing commissions planned, so we've talked to you before that we run our commission level of 10, 10.5 in the agency channel. What we did talk about was a bullet point in our Progressive on a Page strategy that we shared with you, and that was that specific agents who have engaged with us and who sell more preferred policies. And in their agency, we are a valued writer of preferred business. But we are planning -- we're more than planning. We've already rolled out, and we'll continue to roll out a program we call Signature, and that is a multi-product program for an agent, including some marketing activities that we can support them on and other things that John Barbagallo covered in his comments. But it does involve increased commission. And that's a program that needs to be somewhat earned by the agencies. So it's really a contractual commitment to give us a certain volume of business and keep that program, and that program carries with it an increased commission. We also talked about what's the implication of an increased commission, does that mean pricing effect? And what we said is far from clear yet, if we get the kind of business that we're looking for, we may very well be able to handle that commission load with relatively little pricing impact. To the second point on progress with agent relationships, while there are always different views, we have our own monitoring and NPS, Net Promoter Score, that we track our agents with. And while there may be issues in the marketplace from time to time, and there's always going to be some issues around commission, we feel very comfortable with our agent relationships that we have. Comfortable is not a state that we necessarily rest on. And our sales leadership, our agent relationship sales are doing a lot of work to continually improve that. We've got agent advisory councils. We bring our agents into Cleveland and share with them what's going on in the company. We try to do many special events. Again, we got the Signature Program. So our own internal measure of NPS is the way that we would track that. To be perfectly frank with you, I am not aware of any measure that I would feel totally comfortable with being global enough with 38,000 agents to suggest that there is anything credible from an external perspective. And our internal measures are really vast, so I don't plan to change and share those. They are favorable and showing a continued favorable improvement, but there's nothing particularly dramatic to report there. First, with respect to, for the preferred agent. I'm assuming that part of the goal there is to sell the packaged products. So I guess, should we think about the potential commission upside for those agents being similar to what other independent agency companies might pay for a package, which is probably at least on new business, probably more like 15? Yes. I think that's reasonable of thinking that we will have a split between new and renewal, but 15 is probably a better way to think about the net. And then with respect to tracking the agency progress, I guess, is it fair to say that Net -- I would assume that Net Promoter, there's a relationship between share of office and Net Promoter Score. But I guess maybe more broadly, can you may be touch on of those 38,000 agents that you might have a business relationship with, I guess, how many of those agents are you in the top three of their office from an auto production standpoint? That's a fair question, and I don't know that they -- right off the top of my head, so I'd rather not even take a stab at that. And it may well be off by more than I would like to be. So fair question, I don't know the answer. Happy to report on that if you... Well, I'm just curious, if going forward, do you think that might be a fair way to think about the relationship you... You made a comment that is NPS a way to think about share of agency. That may not necessarily be quite as direct relationship as we might all like. There are many, many agents that think extremely highly of Progressive, but they have other credible carriers. In some cases, they are comfortable packaging, as I said, the home, and home and auto together, with a carrier that they've got a long-established relationship with. But it doesn't mean that they don't have a very strong feeling and relationship with us. It's just a question of how they use us in the agency. We clearly are trying to become more of a first choice, a more mono-line preferred auto. We are clearly in many, many, many, many agents. And I wish I knew the number, I don't know how to wing it. But I think sort of preferred choice for nonstandard mid-market. I think we're there in maybe even in the vast majority of agencies. We're not necessarily there as the preferred carrier of choice, and we're gaining in that regard. Maybe your question is prompted some thinking of just how can we calibrate and report some credible measure of that gain. I'll take that as a to-do. And with regard to the Homeowners combination, that's another way of giving agents something that truly is an opportunity to give us a different positioning in the agency. And while that will remain a work in progress for some time, we've got off to a very good start, but I think we've still got more work to do on making those two products work exactly the way the agents would like them to work, and we're very committed to getting that done. So your question is really sort of how are we penetrating agents from the many, many, many years ago. We were a Asia [ph], a good choice for market of last resort. We're very, very differently perceived in the agency channel today, and we've still got our ways that we think we can penetrate agents even greater. I will give some thought to how we might be able to calibrate that and give you some meaningful measure. Our next question is from Michael Nannizzi with Oppenheimer. Just a portfolio question, if I could. So the duration came down from 2.3 years to a couple of years. It looks like you sold some longer-term security, bought short term, which makes sense. One question, just how much of that lower duration is a result of the change in fair value in the mortgage backs? None, I would say. Nothing material. This is Bill Cody, by the way. That was a conscious effort on our part to reduce the portfolio duration as rates came down. It looks like you're allocating more funds to corporate. Have you talked about how much is BBB? You mentioned investment grade and below, but just the BBB and below category of your runoff for cash flows from operations? Cash flows from operations, we treat cash from operation as same as cash from the portfolio and the runoff when we look at investments. So we have our overall portfolio credit rating constraint, which we've held relatively steady at the AA level. Corporates that we've added have been mostly in that BBB range more recently. But I don't think we've broken that out publicly. We consider doing that though. And so it's shorter duration, is it fair to assume that the intersection of you're buying shorter duration, lower-rated corporates? Or you're buying lower-rated corporates and also short duration, maybe treasuries or something else? What we've added, let's say, in the quarter has been a mix of corporates in that intermediate duration range, I think, in the kind of two- to five-year range and a little bit out longer than that where they've been some opportunities in corporates. We've probably added a little bit over $400 million of corporates on the quarter. We also added some of the ABS sector and in the CMBS sector, where we saw some opportunities there. Most of the ABS and CMBS has been in the higher-rating categories. So the orientation clearly, sensitive to inflation. As the environment has changed, I mean, do you have thoughts on your outlook for inflation and maybe how any changes there might change your perspective on reinvestment in the portfolio? Sure. I think what you're noting is where we are defensively positioned on the rate front. Our view is that inflation, although it's low and likely to stay low near term, the deflation stories that we're hearing about or the discussions about deflation, it's certainly not our base case or very high-probability case. So we're just more defensively positioned against, let's say, even a rising or steady rate of inflation or reasonable rate of inflation. As you look at that rates at very low levels, say, two-year treasuries at 50 basis points and three is at 75, and five, it's at 1 1/2%, that really doesn't buy us much in the way of protection against the rising rates at any point before we have a loss from a total return perspective. So what we've done is keep the duration short and look for solid credits, whatever they happen to be rated because we don't focus on that as much, but solid fundamental credits that will perform well in even a weak economy and provide us with some reasonable return on an absolute basis under most any plausible circumstance. Just as a follow-up, we did shrink our treasury and cash position net together on the quarter. So if you look at the net buying, those will reduce a small amount over the quarter. Our next question is from Paul Newsome with Sandler O'Neill. One of your competitors mentioned to me the other day that they felt that advertising spend, which had gotten, obviously, it's a lot through you folks and through the rest in the industry, had reached essentially a point of diminishing returns. And I think some of this argument was the direct business was going to end up with a rising expense ratio as the ad spends sort of -- each of the incremental dollar gives you less. I was curious if you had seen that in your own data and if this is that that's something that could actually happen? Let me answer that without necessarily commenting on someone else's view of it. We clearly have communicated pretty often, I hope, that we'll spend as much money in advertising as we think is appropriate relative to the yield we get from that. So on numerous occasions, even on this call, we've discussed, we don't have a fixed budget, so we're not out there spending it. So we're calibrating all the time to the yield that we get on our advertising dollar spent. Any advertising dollar spent is going to be additive to the expense ratio. That's by definition. We have not spend as much as some in the marketplace, and we intend to do that because we're focused on the effective yield. I would tell you that there is probably -- there is almost mathematically a cost at which the marginal dollars spent can become ineffective. We're always trying to spend up to the point that we think that the marginal dollar, the last dollar we've spent, is still effective relative to the overall yield on the book. Knowing exactly where that is, hard to know. We look at it simply from our own results, and I wouldn't be in major opposition to saying that the amount of advertising for the entire industry now may be close to its long-term peak than they're not, but we'll see. I think all we can really do is just manage our own spending very wisely, and we have resisted it many times in the past, where we didn't feel we should spend more because the yield didn't seem to be worth it. When we've got our products priced at a great level and our conversion rates are high, we can afford to spend. It's also a function of the effectiveness of the creative. So right now, we feel that our creative is working quite well for us. So it's a combination of things, I think, on a macro basis. Yes, I don't think we're going to see advertising in the industry doubled, and we may be at closer to the top, but only time will tell. This is Brian. Just a few additional thoughts. As Glenn talked about and we mentioned in June, we measure our yield based on cost per sale relative to a targeted acquisition cost, that which we've incorporated in our pricing. And that cost per sale would be a function of a couple of things. One, how many people do we get to quote with us and then our conversion rate on that. So even if the number of prospects or the number of shoppers, which has still increased for us, but if that were to -- the rate of change were to slow down, as our conversion rate has improved, that has enabled our cost per sale to still meet our targeted acquisition cost. And the other component piece is, if your policy life expectancy stays longer, you can increase as you can have a higher targeted acquisition cost. So our policy life expectancy has been growing over the last few years, and so it's a combination of those. But if the question were really the advertising spend relative to the number of shoppers, that incremental cost is likely increasing. And for us, we have seen it increase. I suspect, in the whole industry, it has increased somewhat. [Operator Instructions] Our next question is from Josh Shanker with Deutsche Bank. My question, which I think might have been answered in Meyer Shields' question, I was wondering when we might see the first commercial advertising of Snapshot, and likewise, when I might be driving by the first agency that I see a Progressive sign outside of it and the new Signature Agent-type formats? I'm happy to give you more information on that next time we talk, but I would set your expectation at first quarter for commercials on Snapshot. And the reason to that is the effectiveness of advertising that we really put our money behind is national. We don't advertise something on a national basis when we don't have it deployed in sufficient quantity to appeal to almost all viewers. So the first quarter would be my guidance on your first question, and I'll update that at the next conference call, if you remind me. With regard to Signature, you should've already been able to drive by many agents countrywide for many years, displaying Progressive signs. And specifically, the Signature Agent designation, we have no current plans for changing that sign. The Progressive sign is really all that's important. The Signature is really a business-to-business relationship between Progressive and the agent. I don't think that's of great value to the consumer at this point. And then in terms of the rollout of Snapshot, how many states should we expect then by the end of 3Q? And how about by the end of 4Q? I'll give you the guidance relative to your first question of advertising. We would expect to have it in about 75% of our written premium base before we did advertising to the general public. Our next question is from Ian Gutterman with Adage Capital. I also had a Snapshot question if I can. How common will it be for someone to get close to that 30%, say, 20% to 30% discount, or is more normal going to be, say, 5% or 10%? Brian, do you have some data on that? The expected average discount would be higher than that 5% to 10% range that you referenced. Modestly higher than that 10% range is what we expect, and we'll see over time, as we figure out which customers take advantage of the program, et cetera, and then what their experience is. But based upon what we have seen to date in our models, we would expect the average to be higher than that 10%. Is 20% to 30% going to be relatively small percentage, maybe less in a quarter? I'm actually not hedging the question there. Ask it again next time. But we'll roll this out in June in two states. July, we've actually increased the number of rollouts, but we're really talking about June here, so two states. We just don't have that distribution. I think the way to talk about this would be a distribution of the percentage discount. We have a very clear understanding of what our expected mean, mode and distribution looks like, but when you throw something out in the marketplace, we'll see how consumers respond to that. The reason I'm asking is I was trying to get sort of the price data points and more. I was wondering how you thought about this from a marketing standpoint. If you're going to be advertising, you can save up to 30%. My guess is the average person is going to think, "Hey, I should be getting pretty close to 30%." And if they get 12%, maybe they're going to say, "Hey, Progressive doesn't think I'm not good a driver." And then they get mad at you as opposed to -- you know what I mean? If it's a regular commercial that you can save 15% in 15 minutes, I only save 8%, I'm like, "I don't think it's a judgment on me." So if I only save 12%, and I hear I can save 30%, it means Progressive is telling me, every other guys are better driver than me, and I get frustrated. Can I answer that with a -- you are sounding very similar to some internal discussions. And we have acted upon that because this is way too good to have people feel like, "Gee, I didn't get an A even if I got a passing grade in the test and makes me better than others." So yes, you're highlighting a very real marketing issue, and you may well see that reflect in our marketing messages. We don't want to set an expectation, have someone feel that they didn't get that expectation, but they were still far better than anything they could've gotten in the marketplace but somehow don't have the kind of feelings toward Progressive that we would all like. So we're conscious of exactly the same thing. Initial marketing, yes, we did say up to 30%. We will be very conscious about marketing message. And as we do with almost everything that we roll out, we'll make sure that we double back on all sort of the positives and the potential negatives to see exactly how it's being received, what are the pitfalls. And that is the beauty of having -- there are times that I could say, "It's not beautiful to have 50 regulatory environments." But given that we can roll it out, we actually get the benefit of the rollout and some measurement before we have to commit to the bulk of the states. [Operator Instructions] Our next question is from Vinay Misquith of Crédit Suisse. On the higher retention, it seems that your retentions are increasing. I am wondering how much of that is pricing because you're keeping pricing flattish because the average premium of policy, I believe, on the agency is down about 0.5 percentage point, and on the direct, it's also done about three to four percentage points. So how much of that is pricing? And how much of that is maybe Name Your Price, where people are selecting also a lower price point for their insurance coverage? Yes, what you're referencing is what less what we would call pricing and more of the average premium. Average premium's been changed for lots of different reasons, especially when you look it during the aggregate. That can be mixed geographies as we talked about several times. Cars are getting older, so we're seeing sort of a negative premium trend there, which hopefully will be one source of inflation in few years to come. No question when consumers have a rate that's not going up. That will contribute to retention. I wish I could tell you after a lot of years of thinking about it exactly how can pull out the individual pieces. It is a piece. I think our brand strength is a piece. We've talked to you a fair amount about the work that we've done and continue to do about eliminating reasons customers leave, giving them reasons to stay, like our loyalty program. So we've had a good number of these things. Unfortunately, while I love to be able to say, here is the contribution value of each of them, we know the activities we're taking. We measure each of those activities individually before we sort of commercialize them. If they look good, Name Your Price. We clearly were able to test that. We told you, I think, that the selective price by a consumer tends to differ by less than 1% over the recommended price, so we don't think that's a great driver of average premium reductions, but it may be a driver of customer satisfaction in their selection. Those are very hard to pull out. So all I can really tell you is all the actions that we do, we try to test them individually. When we put them together, we are then at the point of only being able to measure the aggregate outcomes. The aggregate outcomes are good. Individual pieces seem good, but I can't tell you the relative contribution value when we put them together. And in terms of loss cost trends, they seem to be reasonable right now. So are you moving pricing at all? Or have you been moving pricing over the last three months because the loss cost trends are more reasonable? We're always moving pricing, and I mean that to be a less-than-full disclosure answer. We're always moving pricing. That's what we expect that our product managers managing every product, every state. So it continues to move. Over the first six months of this year, the average price changed slightly positive a couple of points. And while I'm make no predictions of the future, I would expect it more likely to be slightly positive but not a lot. You're right, trends are quite moderate at this point in time, both on a frequency level and a severity level. My suspicion is, again, we've talked about a couple of activities that could reverse trends and could accelerate them. We don't know. That's why we'll continue to watching the data and act very quickly. We talked about medical cost trend shifting. We talked about that in June. I referenced that cars are getting considerably older. That means that when a car has been in an accident, the likelihood of it being totaled is much higher now than it is of it being repaired, relative to what it was a few years ago. That trend will eventually change, and we'll start to see newer cars and shifting dynamics of the claims process. All of which could bring about new trends that we'll have to stay on top of. And those are the things that can happen reasonably quickly. With that, there are no more questions, so we'll end the call. And we look forward to speaking with you in the third quarter. Thank you. That concludes the Progressive Corporation's Investor Relations Conference Call. An instant replay of the call will be available through August 20 by calling 1(800) 839-3139 or can be accessed via the Investor Relations section of Progressive's website for the next year. Thank you for participating. You may disconnect at this time. Source: Progressive Q2 2010 Earnings Call Transcript All PGR Transcripts Progressive Corporation released its FQ4 2013 Results in their Earnings Call on August 06, 2010. Do you feel more positive or less positive about Progressive Corporation after ready these results?

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SiTiTRUST & Admininstrator Ltd. It's all possible Getting There Links Labuan FSA Labuan Financial Services Authority Website. Labuan Tourism Come visit the Pearl of Borneo, Where Business and Leisure Meet. Take a moment and see why Malaysia is one of those countries you should consider living in. Labuan IOFC, Malaysia Legal Framework Offshore Business Activities Taxes Offshore Banking Leasing Mutual Funds Insurance Limited Liability Partnership Trusts International Ship Registration Clients are advised to take professional advice for tax and other financial considerations. Please do not hesitate to contact us and ask for any help or information. ..................................................................................................................... LABUAN IOFC, MALAYSIA The island of Labuan, which lies to the northeastern coast of Borneo, was once part of the Sultanate of Brunei. It was ceded to the British in 1846 with James Brooke as its first governor. The Japanese took possession of Labuan on January 3, 1942 but restored it to the Allied Forces on June 10, 1945. Labuan gained its independence on September 16, 1963 when it, being part of Sabah joined the newly formed Federation of Malaysia. On March 8, 1984 the Sabah State Legislature enacted the law which handed Labuan to the Federal Government. In October 1990 several laws were introduced turning Labuan into an International Offshore Financial Centre (IOFC). It was recently renamed International Business and Financial Centre (IBFC) Labuan's offshore legal framework and Malaysia's extensive double taxation treaties had made Labuan an ideal place for structuring intermediate offshore holding and trading companies. Labuan has also created a niche as a centre for Islamic investments and financing and is now poised to become a centre for the establishment and administration of collective investments scheme and special purpose vehicles both for Sharia compliant and conventional business structures. < Back to Top ..................................................................................................................... LEGAL FRAMEWORK Offshore Companies Act 1990 Labuan Trust Companies Act 1990 Offshore Banking Act 1990 Offshore Insurance Act 1990 Labuan Offshore Business Activity Tax Act 1990 Income Tax (Amendment) Act 1990 Labuan Offshore Trust Act 1996 Labuan Offshore Financial Services Authority Act 1996 Labuan Offshore Limited Partnership Act 1997 Labuan Offshore Financial Services Authority (Amendment) Act 1998 Labuan Offshore Securities Industry Act 1998 Merchant Shipping Ordinance 1952 on Malaysian International Ship Registry. Anti Money Laundering Act 2001 < Back to Top OFFSHORE BUSINESS ACTIVITIES The Labuan Offshore Financial Services Authority or LOFSA was established on February 15, 1996 as the single body corporate to regulate and supervise the conduct of offshore financial services in Labuan IBFC. In the supervision of the IBFC, LOFSA administers seven major sectors, namely, banking, insurance, trusts, securities, company incorporation and registration, limited partnership and Islamic finance and instruments. LOFSA has successfully established Labuan as a respectable and progressive intergrated offshore financial centre supported by a legal framework conducive for the developmet of the IBFC Offshore companies carrying on the following business in Labuan are required to obtain the relevant license from LOFSA. Offshore banking including investment banking and leasing. Offshore insurance including reinsurance, insurance broking and captive insurance. Offshore dealing in securities, fund management, administration and custodianship. Offshore mutual fund including unit trust fund. Offshore company management. Offshore public trusts. < Back to Top The Labuan Offshore Business Activities Tax Act 1990 sets out the tax treatment of offshore entities. The Act divides offshore companies into two categories :- Non-trading or investment holding Labuan companies which are not liable to tax and, Labuan trading companies which are liable to tax but with a choice of either paying an annual flat rate of RM 20,000 or 3% of the company's audited net profit. Malaysia has entered into 42 effective Double Taxation Agreements as at 26 April 2000. Most tax treaty partners recognise Labuan offshore companies as Malaysia taxpayers and would apply the provisions of the DTA on Labuan offshore companies. There are many Exemption Orders made under the Income Tax Act 1967 which include exemptions from tax on dividends received by an offshore company, and interest received from an offshore company by a resident person (other than persons licensed to carry on business under BAFIA 1989, the Islamic Banking Act 1983, the Insurance Act 1963 or the Takaful Act 1983). Exemptions from stamp duty have also been made on the following instruments :- All instruments executed by an offshore company in connection with an offshore business activity All memorandum & articles of association of an offshore company All instruments of transfer of shares in an offshore company OFFSHORE BANKING Offshore banks may carry on a wide range of banking business in foreign currencies including offshore investment banking business, Islamic banking business and such other activities as prescribed by the Minister of Finance. Offshore banks are required to maintain substantive physical presence in Labuan and are not permitted, among others, to open an account for a customer, whose identity is not known to the banks, dealing in Malaysia currency except as permitted by Bank Negara Malaysia, or accepting cash cheques and opening a chequing account. Leasing is indeed another growing sector in Labuan with a number of international players already using Labuan for this purpose. Offshore companies incorporated or registered in Labuan, leasing companies registered under the Banking and Financial Institution Act 1989 and special-purpose vehicles (SPVs) incorporated in Labuan to facilitate inter-company leasing transactions are eligible to apply for leasing licenses. MUTUAL FUNDS The law on mutual funds regulates the dealing of securities in Labuan and provides for the establishment of a facility for the listing of securities on an exchange. This led to the establishment of the Labuan International Financial Exchange (LFX) in July 30, 1999. Mutual funds may be established either in the form of an offshore company, unit trust or a partnership. Mutual funds are further categorised as either private fund or public fund. The consent of or registration with LOFSA is required for the establishment of a Labuan private fund or public fund respectively. < Back to Top The insurance sector in Labuan had shown tremendous growth in recent years. The insurance laws in Labuan provide for the establishment of a complete spectrum of insurance activities such as direct insurance for life and general, offshore reinsurance, captive insurance, insurance management, underwriting management and insurance broking. Captive insurances are gaining popularity with more and more residents and non-residents conglomerates alike resorting to self-insurance. Offshore Companies are the more popular vehicles when setting up a business in Labuan although limited partnerships are gaining momentum. The share capital of a Labuan offshore company may be denominated in any currency other than Malaysian Ringgit. An offshore company may have a single shareholder. Other attractions include a single director and the ability to re-domicile offshore companies from Labuan elsewhere or vice-versa. Offshore companies are required to keep their books in Labuan and an audit is not mandatory under certain instances. A limited liability partnership is an alternative to setting up offshore companies. An offshore limited partnership consists of not less than two partners of whom one must be a general partner and at least one shall be a limited partner. An offshore limited partnership may be in the form of a general offshore limited partnership, an offshore professional partnership and an offshore project partnership, thus making the partnership ideal vehicle for projects or ventures meant for a specific period of time. < Back to Top Trusts business in Labuan is relatively new and therefore has huge potential. Offshore trusts in Labuan may continue to exist for a period not exceeding one hundered years unless otherwise stated in the trust instrument, which effectively permits the trusts to be in perpetuity. Registration of trust is not mandatory in Labuan thus its confidentiality is guaranteed. The laws also allow the re-domiciliation of foreign trusts to Labuan and vice-versa. The term of the trust may determine its proper law and the subsequent change of that proper law, thus enabling a trust to first test the suitability of a particular jurisdiction and change to another should the need arises. Statutory recognition has been given to the role of protectors and the letter of wishes and there are sufficient provisions on the protection of assets held under trusts. < Back to Top INTERNATIONAL SHIP REGISTRATION Malaysia's only International Ship Registry (MISR) was recently established in Labuan. Labuan offshore companies maybe formed for purposes of owning ships and such ships maybe registered at the MISR. Subject to the due completion of documents submitted and fullfillment of the required survey the Certificate of Survey, provisional and permanent maybe issued in seven working days by the registry. *The legislation is subject to ammendments from time to time* *This webpage serves only as a general guide. SiTiTRUST deserves the right to amend any of the text at any time.* Copyright © 2008 SiTiTRUST & Administrator Limited (Company No. LL03986). All right reserved.

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Investment Profile LP Investor Login Mashable Closes $13.3 Million in Its First Ever Capital Raise to Expand Media-Tech Company for the Connected Generation; Investment Led by Updata Partners New York, NY (PRWEB) -This is the company’s first capital raised since its founding in 2005. The capital will go to bolster Mashable’s editorial operations, grow its global audience, develop new technology products, expand its BrandLab and advertising offerings, and open up a larger headquarters in New York City and offices in Los Angeles and London. Additional investors who participated in the Series A round include New Markets Venture Partners; Social Starts; Michael and Kass Lazerow, serial entrepreneurs and co-founders of Buddy Media; Elio Leoni Sceti, CEO of Iglo Group and tech private investor; and David Jones, Global CEO of Havas and Founder of One Young World. “Mashable thrives at the intersection of media and technology,” said Pete Cashmore, Founder and CEO, Mashable. “What’s exciting is that we are only just beginning to realize the potential we have to build a new kind of company, which is equal parts media and technology.” Over the past year the company has grown significantly: Reaching a record of more than 34 million unique global readers in December (source: Adobe Marketing Cloud). Growing its social community to over 14 million followers across social networks; it is one of the top followed brands on Pinterest, LinkedIn, Vine and Google+. Increasing engagement; it was recently named as the most socially efficient publisher of original content with an average of more than 2,500 social interactions per article (source: Newswhip). Expanding its editorial depth and breadth with the addition of Jim Roberts, formerly of Reuters and The New York Times, as Chief Content Officer and Executive Editor. Bringing on Chief Revenue Officer Seth Rogin to expand the advertising team, and to elevate awareness of Mashable’s highly powerful advertising platforms. Achieving record revenue in 2013 with fourth quarter revenues up 50.6% year over year, fueled by rapid growth in advertising sales, particularly in the area of branded content, and by the introduction of new display products such as Mashable’s exclusive social amplification platform, Social Lift. Developing new capabilities through the expansion of the technology team to include data science and artificial intelligence to drive development of Mashable Velocity, Mashable’s proprietary viral prediction platform, and other technology products. Furthering the company’s mission to spread ideas and innovation for social good through such initiatives as #GivingTuesday, G-Everyone, and its annual Social Good Summit; which included participation from 204 countries and territories, was translated into seven languages, and featured such voices as Al Gore, Samantha Power, U.S. Ambassador to the United States, Melinda Gates, co-chair, Bill and Melinda Gates Foundation and Malala Yousafzai, author and activist. Expanding staff with a current headcount of 120 people. “I am proud that our team has grown Mashable into a competitive and profitable media company. It’s from this solid footing that we take our next step,” Cashmore said. “I’ve never been more confident in the stable foundation that we’ve set, nor more convinced of the need to build upon it. As the pace of technology grows ever quicker, so too does our need to make sense of it.” “Mashable’s growth reflects the evolving nature of digital media, where the next generation of successful companies are creating strong editorial paired with smart technology, and a passionately engaged community,” said Jon Seeber, Partner at Updata Partners. “Mashable has a talented management team, a global brand, a highly desirable social audience and a culture built on innovation. We look forward to helping them build upon the success they have already achieved.” “We will use the capital to grow our reach, technology capabilities, invest in video and new storytelling formats, grow the company’s BrandLab, which now engages with some of the world’s best brands, and work on new products that will be announced next year,” said Mike Kriak, Mashable’s Chief Operating Officer and Chief Financial Officer. “This means we’ll be increasing headcount by as much 50%, and we will move to a new headquarters in New York City to house our rapidly growing team, and be opening up new offices in Los Angeles and London.” About Mashable: Mashable is a leading source for news, information and resources for the Connected Generation. Mashable reports on the importance of digital innovation and how it empowers and inspires people around the world. Mashable’s record 34 million unique visitors worldwide and 14 million social media followers are one of the most influential and engaged online communities. Founded in 2005, Mashable is headquartered in New York City with an office in San Francisco. About Updata Partners: Updata Partners is a leading technology-focused growth equity firm with nearly $500 million of capital under management. Updata invests in high-growth technology-enabled services, software, and Internet companies with innovative intellectual property and market-leading solutions. Led by an investment team averaging more than 20 years of experience in the technology industry, Updata seeks investments where the combination of the firm’s financial backing and the operating expertise of its partners will accelerate growth. The full release can be found here. Logi Analytics Reimagines Data Discovery With Logi Vision Mashable raises $13 million to launch expansion effort New Investments Recent Posts BJ Arun Named Chief Executive Officer of July Systems Amber Road Announces Closing of Initial Public Offering and Full Exercise of Underwriters’ Option to Purchase Additional Shares Amber Road Files Registration Statement For Proposed Initial Public Offering RES Software Launches a Full-Service IT Store Solution Business Insider: 23 CEO’s to Watch in 2014 News BJ Arun Named Chief Executive Officer of July Systems To reach Updata Advisors click here. ©2014 Updata

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hide Obama: Fed chair will prevent asset bubbles, focus on jobs U.S. President Barack Obama delivers remarks alongside Americans (unseen) the White House says will benefit from the opening of health insur WASHINGTON (Reuters) - President Barack Obama said on Wednesday the person he selects to head the Federal Reserve when Chairman Ben Bernanke's term ends in January will prevent asset bubbles from forming and try to bring down the unemployment rate. "They're going to be making sure that they keep an eye on inflation, that they're not encouraging some of the bubbles that we've seen in our economy that have resulted in busts," Obama said in an interview on CNBC. "But they're also going to stay focused on the fact that our unemployment rate is still too high." The president said the budget standoff that has led to a government shutdown has not hindered the selection process. "Ben Bernanke's still there and he's doing a fine job," Obama said. "This is one of the most important appointments that I make, other than the Supreme Court. So, no, the shutdown's not slowing down the vetting." He said the person he would appoint would "reflect the Fed's dual mandate." The Fed is charged by Congress with both keeping inflation steady and low and ensuring maximum employment. Current Vice Chair Janet Yellen, a veteran of the Fed system, is the front-runner to replace Bernanke in January, a White House official has said. (Reporting By Mark Felsenthal; Editing by Sandra Maler and Stacey Joyce)

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WichitaLiberty.TV Voice for Liberty Radio Kansas Economic Freedom Index Sedgwick county government Wichita Intrust Bank Arena profit, in perspective February 15, 2012 Bob Weeks 1 Comment Last week the Sedgwick County Commission heard a report from county managers regarding the financial performance of the Intrust Bank Arena. The arena, located in downtown Wichita, is owned by the county. The main facts are that revenue and profits are down. A Wichita Eagle article holds more details about the numbers. What citizens need to know is this: The honeymoon is over. The promised boost to downtown that arena backers promised has yet to materialize in any broad sense. When it does poke through — an example being the Ambassador Hotel — it requires many millions of taxpayer subsidy. But perhaps most important is the realization that county leaders are not being honest with its citizens. The “profit” shown by the arena is not reckoned using anything like businesses use, or even most branches of government, for that matter. As explained in the following article from last August, Sedgwick County doesn’t recognize the large capital investment made by citizens to build the arena. Instead, it treats that sacrifice as having no relevance to the economics underlying the arena. On top of that, the profit statement presented to commissioners is accompanied by this qualification, which the county does not explain to citizens: “[These statements are] not intended to be a complete presentation of INTRUST Bank Arena’s financial position and results of operations and are not intended to be a presentation in conformity with accounting principles generally accepted in the United States of America.” Intrust Bank Arena depreciation expense ignored By Bob Weeks Reports that income earned by the Intrust Bank Arena is down sharply has brought the arena’s finances back into the news. The arena, located in downtown Wichita and owned by Sedgwick County, is deemed to be a success by the county and arena boosters based on “profit” figures generated during its first year of operations. But these numbers are not an honest assessment of the arena’s financial performance. When the numbers were presented to Sedgwick County commissioners this week, commission chair Dave Unruh said that he is “pleased that we we still are showing black ink.” He then made remarks that show the severe misunderstanding that he and almost everyone labor under regarding the nature of the spending on the arena: “I want to underscore the fact that the citizens of Sedgwick County voted to pay for this facility in advance. And so not having debt service on it is just a huge benefit to our government and to the citizens, so we can go forward without having to having to worry about making those payments and still show positive cash flow. So it’s still a great benefit to our community and I’m still pleased with this report.” The contention of Unruh and other arena boosters is that the capital investment of $183,625,241 (not including an operating and maintenance reserve) on the arena is merely a historical artifact, something that happened in the past and that has no bearing today. This attitude, however, disrespects the sacrifices of the people of Sedgwick County and its visitors to raise those funds. Since it is only one year old, presumably the arena could be sold for something near its building cost, less an allowance for wear and tear. If not, then the county has a lot of explaining to do as to why it built an asset that has no market value. But even if the arena has no market value — and I suspect that in reality it has very little value — it still has an economic cost that must be recognized, that cost being the sales tax collected to pay for it. While arena boosters dismiss this as past history, the county recognizes this cost each year, and will continue to do so for many years. The county, however, doesn’t go out of its way to present the complete and accurate accounting of the arena’s cost. Instead, the county and arena boosters trumpet the “profit” earned by the arena for the county according to an operating and management agreement between the county and SMG, a company that operates the arena. This agreement specifies a revenue sharing mechanism between the county and SMG. Based on the terms of the agreement, Sedgwick County received payment of $1,116,442 for the 2010 year. While described as profit by many — and there was much crowing over the seemingly large amount — this payment does not represent any sort of “profit” or “earnings” in the usual sense. In fact, the introductory letter that accompanies these calculations warns readers that these are “not intended to be a complete presentation of INTRUST Bank Arena’s financial position and results of operations and are not intended to be a presentation in conformity with accounting principles generally accepted in the United States of America.” That bears repeating: This is not a reckoning of profit and loss in any recognized sense. It is simply an agreement between Sedgwick County and SMG as to how SMG is to be paid. Commissioner Karl Peterjohn has warned that these figures — and the monthly “profit” figures presented to commissioners — do not include depreciation expense. That expense is a method of recognizing and accounting for the large capital cost of the arena — the cost that arena boosters dismiss. In April Sedgwick County released that depreciation number in its 2010 Comprehensive Annual Report. The number is pretty big: $4.4 million, some four times the purported “earnings” of the arena. Any honest accounting or reckoning of the performance of Intrust Bank Arena must take this number into account. Unruh is correct in that this depreciation expense is not a cash expense that affects cash flow. That cash was spent during the construction phase of the arena. But depreciation expense provides a way to recognize and account for the cost of long-lived assets like buildings over their lifespan. It recognizes and respects the investment of those who paid the sales tax. When we follow standard practices like recognizing the cost of capital assets through depreciation expense, we’re forced to recognize that there’s a $4.4 million gorilla in the room that arena boosters don’t want to talk about. Using information about arena operations contained in the operations report, we can construct what an actual income statement for the arena would look like, following generally accepted business principles. According to the statement, total operating income for 2010 was $7,005,224. Operating expenses were $4,994,488. Subtracting gives a figure of $2,010,736. This number, however, is not labeled a profit in the report. Instead, the report calls it “Increase in Net Assets Arising from Operating Activities Managed by SMG.” An accounting of profit would have to subtract the $4.4 million in depreciation expense. Doing that results in a loss of $2,389,264. This — or something like it — is the number we should be discussing when assessing the financial performance of Intrust Bank Arena. Fiscal conservatives — and sometimes even liberals — often speak of “running government like a business.” But here’s an example of conservative government leaders ignoring a basic business principle in order to paint a rosy picture of a government spending project. Without honest discussion of numbers like these, we make decisions based on incomplete and false information. This is especially important as civic leaders agitate for another sales tax or other taxes to pay for more public investment. The sales pitch is that once the tax is collected and the assets paid for, we don’t need to consider the cost. They contend, as is the attitude of Unruh and arena boosters, that we can just sweep it under the rug and pretend it doesn’t exist. This is a false line of reasoning, and citizens ought not to be fooled. Downtown Wichita arenaDowntown Wichita revitalizationEconomic developmentIntrust Bank arenaSedgwick county government Previous PostWichita convention businessNext PostOn Streeter and Anderson One thought on “Wichita Intrust Bank Arena profit, in perspective” Anonymous says: February 15, 2012 at 8:42 pm As a independent, small businessman, I suspect Dave Unruh has forgotton more about what it takes to run a business than you will ever know. Your email address will not be published. Name Email Website Comment You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> Featured thoughts We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness — Declaration of Independence The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people. — Ninth Amendment to the U.S. Constitution Government is essentially the negation of liberty. — Ludwig von Mises It is the responsibility of the patriot to protect his country from its government. — Thomas Paine It does not take a majority to prevail, but an irate, tireless minority keen to set brushfires of freedom in the minds of men. — Samuel Adams You do not know, and will never know, who the Remnant are, nor where they are, nor how many of them there are, nor what they are doing or will do. Two things you know, and no more: first, that they exist; second, that they will find you. — Albert Jay Nock A major source of objection to a free economy is precisely that ... it gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself. — Milton Friedman As the coercive power of the state will alone decide who is to have what, the only power worth having will be a share in the exercise of this directing power. — F.A. Hayek The kind of rules we should have are the kind that we'd make if our worst enemy were in charge. — Walter E. Williams Your principle has placed these words above the entrance of the legislative chamber: “whosoever acquires any influence here can obtain his share of legal plunder.” And what has been the result? All classes have flung themselves upon the doors of the chamber crying: “A share of the plunder for me, for me!” — Frederic Bastiat This was all before politicians gave us the idea that the things we could not afford individually we could somehow afford collectively through the magic of government. — Thomas Sowell While the short-run prospects for liberty at home and abroad may seem dim, the proper attitude for the Libertarian to take is that of unquenchable long-run optimism. — Murray N. Rothbard Barbra Streisand told Diane Sawyer that we're in a global warming crisis, and we can expect more and more intense storms, droughts and dust bowls. But before they act, weather experts say they're still waiting to hear from Celine Dion. — Jay Leno The great virtue of free enterprise is that it forces existing businesses to meet the test of the market continuously, to produce products that meet consumer demands at lowest cost, or else be driven from the market. It is a profit-and-loss system. Naturally, existing businesses generally prefer to keep out competitors in other ways. That is why the business community, despite its rhetoric, has so often been a major enemy of truly free enterprise. — Milton Friedman Increasingly, it seems that the biggest difference between conservatives and liberals is that the conservatives know government is force. But that doesn't stop them from using it. — John Stossel One of the annoying things about believing in free will and individual responsibility is the difficulty of finding somebody to blame your problems on. And when you do find somebody, it's remarkable how often his picture turns up on your driver's license. — P.J. O'Rourke Late one night in Washington, D.C. a mugger wearing a ski mask jumped into the path of a well-dressed man and stuck a gun in his ribs. "Give me your money!" he demanded. Indignant, the affluent man replied, "You can't do this. I'm a United States Congressman!" "In that case," replied the robber, "give me my money!" — Related by Walter Block The libertarian creed, finally, offers the fulfillment of the best of the American past along with the promise of a far better future. Even more than conservatives, who are often attached to the monarchical traditions of a happily obsolete European past, libertarians are squarely in the great classical liberal tradition that built the United States and bestowed on us the American heritage of individual liberty, a peaceful foreign policy, minimal government, and a free-market economy. Libertarians are the only genuine current heirs of Jefferson, Paine, Jackson, and the abolitionists. — From "For A New Liberty: The Libertarian Manifesto" by Murray N. Rothbard No matter how disastrously some policy has turned out, anyone who criticizes it can expect to hear: “But what would you replace it with?” When you put out a fire, what do you replace it with? — Thomas Sowell Here’s Williams’ law: Whenever the profit incentive is missing, the probability that people’s wants can be safely ignored is the greatest. — Walter E. Williams I would remind you that extremism in the defense of liberty is no vice. And let me remind you also that moderation in the pursuit of justice is no virtue. — Barry Goldwater A society that puts equality — in the sense of equality of outcome — ahead of freedom will end up with neither equality nor freedom. The use of force to achieve equality will destroy freedom, and the force, introduced for good purposes, will end up in the hands of people who use it to promote their own interests. — Milton Friedman When it becomes dominated by a collectivist creed, democracy will inevitably destroy itself. — F.A. Hayek The most dangerous man, to any government, is the man who is able to think things out for himself, without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane and intolerable, and so, if he is romantic, he tries to change it. — H.L. Mencken Of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end, for they do so with the approval of their own conscience. — C.S. Lewis When the people find they can vote themselves money, that will herald the end of the republic. — Benjamin Franklin What is euphemistically called government-corporate "partnership" is just government coercion, political favoritism, collectivist industrial policy, and old-fashioned federal boondoggles nicely wrapped up in a bright-colored ribbon. It doesn’t work. — Ronald Reagan Those fighting for free enterprise and free competition do not defend the interests of those rich today. They want a free hand left to unknown men who will be the entrepreneurs of tomorrow. — Ludwig von Mises The problem is big government. If whoever controls government can impose his way upon you, you have to fight constantly to prevent the control from being harmful. With small, limited government, it doesn’t much matter who controls it, because it can’t do you much harm. — Harry Browne Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place. — Frederic Bastiat It is indeed probable that more harm and misery have been caused by men determined to use coercion to stamp out a moral evil than by men intent on doing evil. — F.A. Hayek Freedom in economic arrangements is itself a component of freedom broadly understood, so economic freedom is an end in itself ... Economic freedom is also an indispensable means toward the achievement of political freedom. — Milton Friedman Be thankful we're not getting all the government we're paying for. — Will Rogers The American people will never knowingly adopt socialism, but under the name of liberalism, they will adopt every fragment of the socialist program until one day America will be a socialist nation without ever knowing how it happened. — Norman Thomas [The political system] tends to give undue political power to small groups that have highly concentrated interests; to give greater weight to obvious, direct and immediate effects of government action than to possibly more important but concealed, indirect and delayed effects; to set in motion a process that sacrifices the general interest to serve special interests rather than the other way around. There is, as it were, an invisible hand in politics that operates in precisely the opposite direction to Adam Smith's invisible hand. — Milton Friedman I'd rather be governed by the first 2,000 names in the Boston telephone directory than by the faculty of Harvard. — William F. Buckley Jr. Liberty is not a means to a political end. It is itself the highest political end. — Lord Acton The great virtue of a free market system is that it does not care what color people are; it does not care what their religion is; it only cares whether they can produce something you want to buy. It is the most effective system we have discovered to enable people who hate one another to deal with one another and help one another. — Milton Friedman It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow citizens. — Adam Smith Democracy is a pathetic belief in the collective wisdom of individual ignorance. — H.L. Mencken This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the "hidden" confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard. — Alan Greenspan, “Gold and Economic Freedom” [1966] Fundamentally, there are only two ways of coordinating the economic activities of millions. One is central direction involving the use of coercion — the technique of the army and of the modern totalitarian state. The other is voluntary cooperation of individuals — the technique of the marketplace. — Milton Friedman The compelling issue to both conservatives and liberals is not whether it is legitimate for government to confiscate one’s property to give to another, the debate is over the disposition of the pillage. — Walter Williams In Germany, they came first for the Communists, And I didn’t speak up because I wasn’t a Communist; And then they came for the trade unionists, And I didn’t speak up because I wasn’t a trade unionist; And then they came for the Jews, And I didn’t speak up because I wasn’t a Jew; And then ... they came for me ... And by that time there was no one left to speak up. — Pastor Martin Niemöller There is no virtue in compulsory government charity, and there is no virtue in advocating it. A politician who portrays himself as "caring" and "sensitive" because he wants to expand the government's charitable programs is merely saying that he's willing to try to do good with other people's money. Well, who isn't? And a voter who takes pride in supporting such programs is telling us that he'll do good with his own money — if a gun is held to his head. — P.J. O'Rourke The difference between libertarianism and socialism is that libertarians will tolerate the existence of a socialist community, but socialists can't tolerate a libertarian community. — David Boaz When the people fear their government, there is tyranny; when the government fears the people, there is liberty. — Thomas Jefferson After all, only the imagination limits the kind of laws and restrictions that can be written in the name of saving the planet. — Walter E. Williams One of the methods used by statists to destroy capitalism consists in establishing controls that tie a given industry hand and foot, making it unable to solve its problems, then declaring that freedom has failed and stronger controls are necessary. — Ayn Rand People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the publick. ... It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary. — Adam Smith Act only on that maxim through which you can at the same time will that it should become a universal law. — Immanuel Kant When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that justifies it. — Frederic Bastiat Wichita Liberty on Facebook Bob Weeks on Facebook Individual liberty, limited government, economic freedom, and free markets in Wichita and Kansas Illustrative videos Wichita campaign finance reform Open government in Kansas Kansas needs pay-to-play laws Climate change and alarmism Downtown Wichita revitalization Wichita city government Kansas state government Wichita and Kansas schools Get email updates Don't miss a single article! Click here to receive email updates two or three times weekly. Bitcoin You may send it to me. Click here. Important liberty sites Cato Institute Ludwig von Mises Institute Foundation for Economic Education What to Read Libertarianism.org | Exploring the theory and history of liberty What is libertarian? 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Click here to learn more. The Kansas Economic Freedom Index identifies Kansas legislators who vote in favor of economic freedom — and those who don’t. Ballotpedia, providing an interactive almanac of Kansas state politics, including the Kansas Senate and the Kansas House.

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hide Ecuador's Correa enjoys re-election, seeks investment Saturday, February 16, 2013 11:30 p.m. CST Ecuador's President Rafael Correa (L) addresses supporters during his final closing political rally in Quito February 14, 2013. Correa, one By Eduardo Garcia and Brian Ellsworth QUITO (Reuters) - Ecuadorean President Rafael Correa on Monday reveled in a sweeping re-election victory that allows him to deepen his socialist revolution even as he seeks to woo foreign investment in the resource-wealthy Andean nation. The pugnacious 49-year-old economist trounced his nearest rival by more than 30 percentage points on Sunday to win a new four-year term. He has already been in power for six years, winning broad support with ambitious social spending programs. His resounding victory could set Correa up to become Latin America's most outspoken critic of Washington as Venezuelan President Hugo Chavez is locked in a battle with cancer and may be unable to stay in power. "We will be present wherever we can be useful, wherever we can best serve our fellow citizens and our Latin American brothers," Correa told supporters who celebrated in front of the presidential palace in Quito, waving the ruling Alianza Pais party's neon-green flags. Chavez made a surprise return to Venezuela on Monday after two months of cancer treatment in Cuba, but his health is delicate and it is not clear if he will be able to stay in power and maintain his decade-long role as Latin America's leftist standard bearer. Correa is now the region's loudest voice arguing against the free-market reforms promoted by Washington and in favor of state-driven economies and expanding ties with China. Still, the continued success of Latin American socialism will depend on strong commodities prices that underpin generous social spending, and Correa needs to both improve Ecuador's stagnant oil production and spur a nascent mining industry. In a sign he wants to deepen socialist reforms, Correa's legislative agenda includes a new law that would regulate television and newspaper content, part of his ongoing confrontation with opposition media. He also plans a land reform campaign to redistribute idle land to the poor. "Our Ecuador needs a president like Rafael Correa. He has been strong and has not allowed anyone to intimidate him," said Julieta Moira, an unemployed 46-year-old as she celebrated outside the presidential palace on Sunday night. "I'm very excited, happy and thankful." Correa is also expected to seek changes to a mining law that would help close a deal with Canada's Kinross to develop a large gold reserve. That will be a major test of his ability to offer investment security while ensuring the state keeps a large portion of revenue. "Correa's electoral-victory statements suggest he would single out domestic economic groups, as part of his policy to support the poor. The sectors most likely to be affected by Correa's renewed radicalism would be the banking, media and banana industries," risk consulting firm IHS said on Monday. "On mining, however, we expect Correa to ease conditions as he is very keen in attracting foreign direct investment to this sector." LEFTIST ALLIES Chavez, in a statement sent by Venezuela's government, celebrated Correa's re-election as a triumph for the ALBA bloc of leftist nations in Latin America and the Caribbean. The group has been left rudderless since Chavez was sidelined with cancer. "It is a victory for ALBA, for the Bolivarian and socialist forces of our America, and will help to consolidate an era of change," the statement said, referring to Venezuelan-born South American independence hero Simon Bolivar. Correa dedicated his victory to Chavez. With almost two-thirds of votes counted by Monday morning, Correa had 57 percent support, compared to 24 percent for nearest opposition candidate Guillermo Lasso. Lasso, a former banker from the coastal city of Guayaquiil, did better than expected on Sunday and established himself as the face of the opposition by winning about a quarter of the votes. The six other opposition candidates including former Correa ally Alberto Acosta, former President Lucio Gutierrez and banana magnate and five-time presidential hopeful Alvaro Noboa. Critics call Correa a dangerous authoritarian who has curbed media freedom and controlled state institutions. Even some supporters disapprove of his tempestuous outbursts, fights with media and bullying of adversaries. Ecuadoreans also chose a new Congress on Sunday, and Correa said he expected the ruling Alianza Pais to win a majority. That would let him avoid negotiating with rivals to pass proposed laws, including the new media law and land reform measures. Correa needs to lure investors to diversify the economy and finance the investment in social welfare and infrastructure that helped him win another four-year term. Ecuador has been locked out of capital markets after a 2008 debt default on $3.2 billion in bonds, and Correa's government has taken an aggressive stance with oil companies to squeeze more revenue from their operations. PRAGMATIC APPROACH Foreign investment will be key to boosting oil output that has been stagnant for five years and to expanding a mining industry that has barely begun to tap the country's gold and copper reserves. "We can't be beggars sitting on a sack of gold," is a catch phrase Correa has used in recent months to argue that Ecuador needs to better exploit its natural resources despite opposition from rural communities to some projects. In that vein, Correa appears to be cautiously willing to cut deals and soften his image as an anti-capitalist crusader. "The advantages of our country for foreign investment are political stability, a strong macroeconomic performance ... and important stimulus to new private investment," he said last week while hosting the emir of gas-rich Qatar. Foreign direct investment has generally been less than $1 billion a year since Correa took office in 2007. By comparison, neighboring Peru and Colombia last year received $7.7 billion and $13 billion, respectively. Correa's government is also in talks with China to secure funding for the $12.5 billion Pacifico refinery, which would allow Ecuador to save up to $5 billion a year in fuel imports. (Editing by Andrew Cawthorne, Kieran Murray and Sandra Maler)

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U.S. Postal Service Is Doing Something Right The U.S. Postal Service Accounting Help desk in St. Louis, Missouri, has earned highly coveted recognition as a Certified Center of Excellence from the Center for Customer-Driven Quality at Purdue University, which benchmarks the performance of more than 20,000 customer service call centers in 40 different industries throughout North America. The Accounting Help desk, which was established just over three years ago, is operating in the top 10 percent of call centers in the consumer products industry. Low Cost Accounting Software Support Provider of low cost support, consulting, training and custom report writing for MAS 90, MAS 200 and MAS 500 accounting software systems. Call us toll free at 1-866-762-3990 to learn how we can help. http://www.saveonsupport.com “Your call center has effectively optimized the use of people processes and technology to consistently deliver a level of customer service that surpasses most others in your industry,” said Dr. Jon Anton, Director of Benchmarking at the Center for Customer-Driven Quality said in a prepared statement. “Our certification process requires that your call center be both efficient and effective.” The Postal Service Accounting Help Desk, with 100 agents, responds to an average of 4,000 calls a day concerning payroll, daily financial reporting, money orders and accounts payable issues. In addition to scoring high in the areas of effectiveness and efficiency, the Accounting Help desk also scored high in agent job satisfaction, which is one of the most challenging goals faced by customer call centers. “To have achieved this certification in three short years is amazing,” said Pat Queen, Manager of Accounting Center Support. “Last week, I attended a Call Center Conference along with about 150 call center professionals and received many questions about how we achieved certification on the first try and in such a short time. I told them it has been a team effort-from the Chief Financial Officer and controller, to the agents taking the calls. In partnership with Information Technology, we implemented new technologies – some external and some external and some on the cutting edge of help desk processes. We work with people who aren’t afraid to try something new and have a group of agents who are proud of the job they do and dedicated to ‘thrilling’ our customers.” In another announcement that should thrill customers, the Postal Rate Commission has recommended making the Parcel Return Service (PRS), which was launched as a two-year experiment in October 2003, permanent. The PRS offers added convenience to consumers by allowing approved merchants, or their parcel consolidators, to include a prepaid return label in original packages shipped to customers or to make the labels available for download from the internet, should the customer need to return the package. In addition to offering a cost-effective way for merchants to obtain items returned by their customers, the PRS program lowers processing and transportation costs for the Postal Service. Bramwell’s Lunch Beat: Are Audits Suffering Due to Data Analysis? Internal audit: Know when to discloseIn an excerpt from his book, Lessons Learned on the Audit Trail, Institute of Internal Auditors President and CEO Richard F. Chambers said if you analyze enough audit reports, you can... GASB Sets Guidelines for Measuring Assets and Liabilities The Governmental Accounting Standards Board (GASB) on Monday defined two approaches for measuring assets and liabilities, which officials said will guide the standard-setting organization in establishing accounting and... FASB Tweaks Rules for Discontinued Operations Reporting The criteria for reporting a discontinued operation on financial statements was revised by the Financial Accounting Standards Board (FASB) on Thursday.According to Accounting Standards Update No. 2014-08, Presentation of... View the discussion thread. Email sign-up

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Study: Money is addictive By Jena McGregor WASHINGTON — There's a fundamental principle in economics that applies to food, clothing and even all those shiny tech gadgets that start with the letter "i": The more of them we have, the less we value them. But that may not be true when it comes to money. New research from Jeffrey Pfeffer, a professor at Stanford Graduate School of Business, and his colleagues at the University of Toronto and Renmin University of China finds that the more money people make, the more they value it. The research, published in the journal ILRReview, examined data from a longitudinal survey known as the British Household Panel Survey, as well the results from new experiments. Pfeffer and his colleagues calculated respondents' hourly income, as well as its growth over time, to separate money earned by actual work and money earned from other sources, such as investments. It then compared hourly earnings to respondents' views on how important it was to them to "have a lot of money." "We thought it was quite possible that money was different because of its symbolic nature — when I pay you, I'm also signaling your worth," Pfeffer says. And that's what they found. The more that people earned, the more they said money mattered to them. The same correlation was not true when it came to money made from sources unrelated to work. That kind of income, Pfeffer says, has "much less implication for one's sense of mastery or worth." Pfeffer says the research provides implications for how chief executives and other workers are paid. When it comes to motivating employees, he thinks it's a reminder for managers to emphasize — instead of money — the organization's mission. He recalls the story of a human resource executive who spoke to his Stanford class about how his software company didn't give stock options — an idea that sounded like sacrilege in Silicon Valley. "He said, 'Look, a raise is only a raise for 30 days. After that, it's a salary.' "

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The Winkler Way—Okay? With Bloomberg News at a crossroads, an audience with its maximum leader By Dean Starkman I am deep inside Bloomberg LP’s global headquarters, the Lexington Avenue office of the financial-information giant. With its post-modernist design—sweeping interior vistas, bristling clusters of computers, oversized screens blinking up-to-the-minute sales figures, streaming stock tickers, TV studios, financial radio chatter in various languages, swoopy futuristic red couches, puzzling art—it conveys a sense of energy, power, certainly, but mostly, for me, of self-containment. The free bananas, breakfast cereals, energy bars and coffee available near the elevators on Level Six do nothing to detract from the sensation that this is a place where all biological needs are provided for. You can leave, but you don’t have to and it’s not encouraged. I am in a glass-walled conference room with Matthew Winkler, the powerful chief of Bloomberg News, and Judith Czelusniak, Bloomberg’s PR chief, who is gamely working a Bloomberg terminal to help Winkler explain what much of the world does not understand about what he calls the “Bloomberg Way.” The topic turns to a delicate subject, and I tread carefully as Winkler is known to have a temper: Is it true that Winkler, a famously iron-fisted manager, has banned the use of the word “but,” from Bloomberg copy, as well as “despite,” “however,” along with adverbs and modifiers generally? I add, “There’s sort of a top-down feel to it… You know, um, these are pros, and, I …” “To answer that question,” Winkler breaks in. He begins to unwind an answer that grows more emphatic and intense, even angry, the longer it continues: David Pauly, who spent [eighteen] years at Newsweek and was Maynard Parker’s go-to guy when Maynard Parker said, scramble the jets we’re ripping up the magazine—here we go at Newsweek—okay?—he turned to David Pauly who joined Bloomberg in 1991 and said, “Would ya please rewrite this?” and David Pauly has been with us every since, okay? He certainly knows how to write. He’s had a “but” or two and a “despite” or two and all sorts of other things in his columns, but he knows what I’m talking about, okay? And he’s never obviously had a problem with it, okay? And if you ask anybody in the profession of journalism about David Pauly, people at Newsweek, they’ll tell you this is a writer’s writer. This is a guy who knows how to write better than anybody. He’s been at Bloomberg since 1991. Okay? So all I’m saying is for people who understand what we’re trying to do here—and again my son who you just met who walked out the door when you showed up and who’s a student at Columbia University—okay?—and got eight fives on eight APs—okay?—he took the Bloomberg Way in high school, and if you ask him he’ll tell you the Bloomberg Way was the single best thing that he used to teach him how to write, and when he got to Columbia University, he said he could write an essay a lot better than other people, and “I gotta tell you, dad, it’s because of what the Bloomberg Way did for me,” and his older brother went to Swarthmore, who is even more distinguished as an academic, did the same thing, so I did try this out on a bunch of kids, okay? And they didn’t find it confining, and they didn’t find it you know restricting. They actually found it liberating, and it enabled them to compete with high school students who went to elite schools—because they went to public schools—and they did just fine, and they learned how to write, and they grew up with the Bloomberg Way. Pause. Me: “There you go.” (Pauly, a Bloomberg columnist, says he was actually a writer, not an editor, at Newsweek and that Winkler misstates his relationship with Parker. “I was not anywhere near his right-hand man,” he says. But he says Winkler is right about the main point: “I can get along with the Bloomberg Way.”) Facebook Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014).Follow Dean on Twitter: @deanstarkman. ALSO BY DEAN STARKMAN In the Crisis, the Journal Falls Short Bloomberg Rakes Muck Access Uber Alles

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Occupy Cooperative Seeks Almost $1 Million to Start Up September 17, 2013 • Reprints The Occupy Money Cooperative, the financial organization organizers of the Occupy Wall Street protests seek to establish, said it is raising almost $1 million dollars for its initial budget and product. Organizers announced the cooperative's founding in July, and the revelation that it would begin offering a prepaid card drew initial criticism. But the organizers countered that the prepaid card was the most affordable and easiest financial product to offer lower-income people and said they might be open to starting a credit union later. In an email message to supporters, organizers said they sought to raise $900,000 starting Tuesday to formally set up the organization and launch the Occupy Card. They also promised transparency. “The Coop will account for every dollar donated. We will publish full and transparent accounts frequently and regularly,” they said on the organization's website. As of the morning of its initial announcement, the group had raised just more than $1,000, according to its website. The budget organizers provided set initial start-up costs at $460,000 and starting costs to launch the card and provide start-up capital at $450,000. The startup costs for the organization included $330,000 for staff and more than $35,000 for rent and utilities on office space. Organizers reiterated the pledge that the card will carry FDIC insurance, but still have not revealed which bank would issue the card for the group, nor have they shared any details of how the group chose the issuer or whether it has finished that process. However, while the organizers did not reveal the name of its card issuer, they did share the card's schedule of fees. While a $5 donation to the group will get supporters a card, the cards themselves will be free, the organizers said, and will cost 99 cents per month unless the cardholder pays an unspecified amount and opts to become a “no monthly charge” member. Second or third cards will cost $1.99 each, according to the schedule. Direct deposits to the card will be free, but if cardholders deposit cash onto the cards at one of several different retail locations, those locations will charge fees of between $3.74 and $4.95. Depositing checks to cards instantly will cost cardholders 1% of business or payroll checks and 4% of personal checks, though the organization said cardholders could avoid this fee by agreeing to a seven-day hold on funds deposited from checks. Accessing money from the card at ATMs will cost $1.95 per use, but there will be no charge for cash back at the point of sale and no costs to use the card with a signature or PIN. The card will also offer the option of accessing funds by check, but each of these options will carry a fee and the organization suggested finding out if a bill can be paid with the card alone, which remains free. Show Comments

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Fibre FCU Continues Expansion With First Oregon Branch September 23, 2013 • Reprints One year after being approved to expand into Oregon, Fibre Federal Credit Union of Longview, Wash., has announced the establishment of its first Oregon branch. The $750 million community credit union will build a full-service branch in Rainer in Columbia County, one of three counties for which it received NCUA approval to serve in 2012 under a rural designation. The other two counties, Clatsop in Oregon and Wahkiakum in Washington, constitute a rural area with a population of less than 200,000, part of the criteria that helps define the regulator’s rural designation, according to Angie Leppert, Fibre FCU’s vice president of marketing. This year NCUA approved expanding the rural designation to include Pacific County in Washington, Leppert added “A lot of people were traveling significant distances to use our services,” Leppert said. “We’re excited to be able to offer our first Oregon branch, as well as serve a new county.” The new branch will have the same footprint as the credit union’s other branches, offering an ATM, drive-up lanes and a full slate of financial services. Fibre FCU, founded in 1937 to serve members of the Longview Fibre Co., became a community-based credit union in the 1970s. NCUA’s rural designation approval in 2012 enabled the credit union to make its first forays into Oregon. Show Comments

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Home Archives July/August 2011 GCC: High Oil Prices Support Government Spending Rise GCC: High Oil Prices Support Government Spending Rise | Global Finance GCC: High Oil Prices Support Government Spending Rise GCC REGIONAL REPORT: OIL MARKETS By Gordon Platt Global politics, supply dynamics and the fiscal needs of the GCC’s governments are combining to cloud the prospects for oil prices. Oil prices have been volatile in recent months, reacting to political unrest in the Middle East and North Africa and changes in the outlook for the global economy, but hydrocarbon prices will remain high this year, leading analysts in the Arab Gulf say. This is good news for the GCC economies as they step up spending programs to create job opportunities and improve the welfare of their populations. In Saudi Arabia, the world’s largest oil exporter, local energy consumption is growing rapidly, in step with the economy, says Brad Bourland, chief economist and managing director of proprietary investment at Riyadh-based Jadwa Investment. “If the growth in Saudi oil consumption continues at the current rate of 7% annually and the kingdom’s overall oil output stays roughly the same as it is, then within 20 years the country will have no oil left to export,” Bourland says. Bourland, Jadwa: “Above $100 a barrel you get demand destruction” The logical range for the oil price, based on fundamentals, is $80 to $95 a barrel, according to Bourland. “The $80 floor is determined by the cost of bringing new production online, such as from tar sands,” he says, adding that OPEC producers, including Saudi Arabia, need $80-a-barrel oil to meet their fiscal requirements. “Above $100 a barrel, you start to get demand destruction,” Borland says. With some inflation, the $80 to $95 price range should go up by as much as $5 a barrel per year, he says. There are a number of other factors that could affect oil prices in the next few years. For one thing, Iraq will become a co-leader in oil production, along with Saudi Arabia, as it ramps up production and increasingly flexes its muscle in OPEC, Bourland says. The US State Department estimates that Iraqi oil production will increase by 25% to 35% this year to 3 million barrels per day, which would allow for exports of 2.4 million bpd, the highest in two decades. Another potential game-changer is the growing use of shale gas, an increasingly important source of natural gas in the US. “If natural gas can find an increased role as a transportation fuel, this could have a meaningful impact on oil demand in the coming decades,” Bourland says. The US is now a net exporter of natural gas, and the big terminals built on the US coasts to receive LNG shipments from the Middle East and elsewhere are now being turned into export terminals, he says. Meanwhile, Saudi Arabia continues to subsidize domestic gasoline prices, which average about 45 cents a gallon, among the lowest in the world. The kingdom is using its low energy costs to promote the development of petrochemical and plastics industries. The kingdom’s plastics exports rose by 79% last year to $11.2 billion. Easing Oil Demand Saudi Arabia is planning to build 16 nuclear reactors over the next 20 years, at a cost of more than $100 billion, to keep up with its rapidly rising energy needs, according to Abdul Ghani bin Melaibari, coordinator of scientific collaboration at King Abdullah City for Atomic and Renewable Energy. He told a conference in Jeddah that each reactor would cost about $7 billion. Melaibari said the kingdom would launch a 20-year plan in 2011 to introduce renewable, clean energy. In June, National Bank of Kuwait boosted its forecast for Saudi Arabia’s GDP growth this year to 6.9% from 4.2%, which would make it the region’s second-fastest-growing economy after Qatar. After stagnating for most of last year, the kingdom’s crude oil production jumped 7% in the three months to February 2011, NBK says. This partly reflects increases in broader OPEC production in response to surging oil prices, as well as a move to partially offset the drop in Libya’s oil output. “The price of oil will stay around $100 for the coming year,” says Randa Azar-Khoury, group chief economist at National Bank of Kuwait. The price could range between $90 and $120 a barrel under various scenarios, she says, noting that strong demand is coming from emerging markets. “Demand should remain on the high side during the summer months, and China will face its most severe power shortages,” Azar-Khoury says. Global oil inventories are low in terms of general historic trends, she says. “On the supply side, Libya is out of the market, and non-OPEC producers are unable to fill the gap,” Azar-Khoury says. “Saudi Arabia accounts for two-thirds of the spare capacity in the market, but it doesn’t produce the same type of light sweet crude that was lost with Libya shutting down.” Meanwhile, regional consumption is rising in response to population growth and increasing demands from the petrochemicals, plastics and power-generation industries, Azar-Khoury says. “The countries in the region are not conservationists,” she says. After rising through most of April, oil prices slumped in early May, losing all of the gain made in the previous two months. The declines were part of a broader sell-off among commodities. Silver fell by 26% in just over a week, according to NBK. “However, few analysts are calling an end to the latest spell of high prices, particularly with Libyan crude remaining off the market, OPEC increasing its supplies only cautiously and demand growth in emerging markets remaining strong,” the bank says. Oil prices have recovered somewhat after May’s 15% plunge, when markets reappraised geopolitical concerns and global growth conditions, according to a report published in June by the economics department of Riyadh-based Samba Financial Group. “Forward-looking supply concerns continue to trump indications that current supply and demand conditions are well balanced, despite the loss of Libyan production,” the report says. With the overwhelming majority of oil trading now accounted for by financial investors, it was their changing perceptions of geopolitical risks and global economic prospects that caused prices to drop steeply, Samba says. For now, the bank is holding firm on its $95-a-barrel West Texas intermediate (WTI) average projection for 2011. It says there remains some potential for even higher prices, since fundamentals could tighten in the second half of the year. Oil prices rose 2% on June 8 to above $100 per barrel, after OPEC said it could not reach agreement to raise production at its quarterly meeting in Vienna. Although Saudi Arabia says it will pump as much oil as the world market needs, OPEC ministers said there was no consensus on production limits. One factor affecting OPEC’s negotiations was an apparent shift by Saudi Arabia away from its long-held target of $70 to $80 a barrel, to an unspecified figure below $100 a barrel, according to Samba. In common with other GCC producers, Saudi Arabia wants to secure prices high enough to support its expanding domestic-spending program, but not so high as to threaten global economic growth. “This will be a difficult balancing act,” according to Samba. “As long as the global economy, and particularly key emerging markets such as China and India, continues to grow, then concerns will remain about whether the oil supply can keep up.” Regional Report : GCC Big Changes Loom Banks Remain Reluctant To Lend Back to Main Article Hot Commodities (9 matches) Archives Going Under (9 matches) Archives Regional Report: Asia (8 matches) Archives Milestones : Oil Prices Slide Below $100 A Barrel, But Support Looms (8 matches) Archives Cover Story : Project Finance Activity Reaches Fever Pitch (8 matches) Archives GCC Regional Report: Seeking More-Inclusive Growth (7 matches) Archives Country Report: Saudi Arabia (7 matches) Archives GCC: Banks Remain Reluctant To Lend (7 matches) Archives GCC: Big Changes Loom (7 matches) Archives Debt: Investors Fear Inflation (7 matches) Archives

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By using www.lloydsbankinggroup.com you agree to the outlined use of cookies in our cookie notice. Share price info Our Group Functions Lloyds Bank Lloyds Bank International Scottish Widows Sources for Family History Sources for Local History Our Museums Sampson Lloyd has his Head Examined Travellers' Money Blackballed! 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It is Scotland's first and oldest bank, and post-dates the Bank of England by just one year. The Bank was set up primarily to develop Scotland's trade, mainly with England and the Low Countries. It began business in February 1696, with a working capital of £120,000 Scots (£10,000 sterling). The 172 original shareholders (including 36 based in London) were largely from Scotland's political and mercantile elite. They hoped to create a stable banking system, which would offer long-term credit and security for merchants and landowners alike. Bank of Scotland coat of arms, granted March 1701. Matters of Note In 1696, Bank of Scotland became the first commercial bank in Europe to successfully issue paper currency. This was an invaluable service, given the unreliability of Scots coinage at that time. These first notes were issued in denominations of £5, £10, £50 and £100 - the first £1 note did not appear until 1704.The Bank's note issue continues to this day. However, there have been various threats to it over the years. In 1826, for example, there was outrage in Scotland at the London Parliament's attempt to outlaw banknotes for under £5. Sir Walter Scott wrote a series of thinly-disguised protest letters to the Edinburgh Weekly Journal, under the pen-name Malachi Malagrowther. These letters provoked such a sensation that the Government relented. The Scottish £1 note was saved. For this reason, Scott's portrait appears on Bank of Scotland notes today. A selection of Bank of Scotland notes, including the oldestsurviving Scottish banknote (1716) and the current £20 (2007). Testing Times Bank of Scotland's early years were turbulent ones. Under the terms of its founding Act, the Bank had been granted a banking monopoly in Scotland for 21 years. After this expired, a new bank was founded by royal charter, in 1727 - the Royal Bank of Scotland. There followed a generation of intense rivalry as the two banks competed to drive the other out of business. During the Jacobite Rebellion of 1745, Bank of Scotland was forced to close its doors when Bonnie Prince Charlie's army occupied the City of Edinburgh. All the Bank's papers and valuables were transferred to Edinburgh Castle for safe-keeping. There they remained for two months, until the rebel army finally departed. Bonnie Prince Charlie by Cosmo Alexander, 1752 (The Drambuie Collection). Early attempts to establish a branch network proved unsuccessful. It was not until 1774 that the first branches were opened, in Dumfries and Kelso. Twenty-one years later, the Bank had 27 branches. This had risen to 43 by 1860, and 265 by 1939. Bank of Scotland opened its first permanent office in London in 1867.During the latter half of the 18th and the early 19th centuries, significant changes to Scotland's banking system occurred. The focus of economic development shifted away from Edinburgh, to Glasgow and the West. Large-scale joint-stock banks also sprang up. These presented serious competition for Bank of Scotland, particularly as most of the newcomers had large branch networks. But the increased numbers of banks, some of which pursued reckless lending policies, led to occasional failure... Bank of Scotland London office: architectural plan by W. W. Gwyther, 1892, and photograph, 1956. Disastrous Failures In 1857, the Western Bank collapsed. Bank of Scotland, along with the other major Scottish players, stepped in to bolster confidence in the banking system. They ensured that all holders of the Western Bank's notes were paid in full. Twenty-one years later, the City of Glasgow Bank failed in spectacular fashion. All but 254 of its 1,819 shareholders were ruined. This disaster resulted in Scotland's financial focus shifting back to Edinburgh and its more conservative bankers. New Century, New Challenges The early years of the 20th century brought new business to Bank of Scotland. Companies such as British Aluminium and Barr and Stroud (manufacturers of optical range finders for the British Navy) sought sophisticated finance, on a scale previously unknown. Computer department staff, 1963. The outbreak of war meant the Bank had to refocus its policies on national need. The inter-war years proved difficult too, and it was only after the Second World War that the economic climate improved. The 1950s sparked a series of mergers and acquisitions right across the financial sector. Bank of Scotland began this phase of its development by merging with the Glasgow-based Union Bank of Scotland in 1955. Three years later, it expanded into consumer credit with the acquisition of North West Securities (later Capital Bank). Then in 1971, it merged with the British Linen Bank.The '50s also heralded the age of computerisation, which was to revolutionise British banking. Bank of Scotland was at the forefront. In 1959, it became the first UK bank to install a computer for processing its accounts centrally. Then in 1986, the Bank again led the way with the introduction of HOBS, its Home and Office Banking Services. An early application of internet technology, this gave customers direct access to their accounts, via a television screen and Prestel telephone network. Overseas Development and Subsequent Mergers The Bank was swift to appreciate the massive potential of North Sea Oil. By the early 1970s, it had set up its own specialist Oil Division, financed exploration of the Forties Field, and played a leading role in establishing the International Oil and Energy Bank. In 1975, Bank of Scotland opened its first overseas office in Houston, Texas. Branches followed in other U.S. states, Moscow, Hong Kong, and Singapore. Inroads were subsequently made into Australasia, with the 1987 purchase of Countrywide in New Zealand, and that of the Bank of Western Australia (BankWest) in 1995.In 2001, Bank of Scotland merged with the Halifax to form HBOS plc. Then in January 2009, following unprecedented turbulence in the global financial markets, HBOS plc was acquired by Lloyds TSB. The new company, Lloyds Banking Group plc, immediately became the largest retail bank in the UK.Its registered office, and Scottish headquarters, is the historic Bank of Scotland building on The Mound, Edinburgh. Lloyds Banking Group plc registered office, the Mound, Edinburgh. To find out more about the history of Bank of Scotland and some of the companies it acquired, return to the Bank of Scotland family tree. Bank of Scotland 1695-1995: A Very Singular Institution by Alan Cameron (Mainstream Publishing, Edinburgh, 1995). Bank of Scotland A History 1695-1995 by Richard Saville (Edinburgh University Press, Edinburgh, 1996). The Bank of Scotland 1695-1945 by Charles A. Malcolm (R. & R. Clark Ltd, Edinburgh, [1945]). Extensive archives relating to Bank of Scotland are maintained by Lloyds Banking Group Archives in Edinburgh - for further information see our archive collections. Records and artefacts charting the history of Bank of Scotland are also on display in the Museum on the Mound. Site terms and conditions Lloyds Bank plc, TSB Bank plc and Bank of Scotland plc (members of Lloyds Banking Group), are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Authorisation can be checked on the Financial Services Register at: www.fca.org.uk

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HomeBill Black Interview: The Great Global Bank Robbery, Part 2 Bill Black Interview: The Great Global Bank Robbery, Part 2Apr 22, 2010William K. BlackWhen it comes to White-Collar Crime and Control Fraud, the economist William K. Black is surely the leading expert to ask. In an exclusive and comprehensive interview in two parts, he answers questions related to some major causes for the financial / economic crisis, the SEC charges against Goldman Sachs and the connection between drug money and the survival of the international banking system. The following exclusive interview with William K. Black is a Joint Venture between New Deal 2.0 in the USA and MMNews in Germany. PART TWO: ECONOMIC WARFARE Mr. Black, Lehman Brothers, founded in 1850, failed in September of 2008. What broke its neck after all those years? The bankruptcy examiner conducted an investigation of Lehman Brothers. The report reveals that Lehman Brothers was engaged in large scale accounting and securities fraud by failing to recognize losses so large that it had failed as an enterprise. Lehman's senior executives sought to cover up its failure with a series of very large ($50 billion) quarter end REPO transactions. Curiously, the report puts no emphasis on the underlying fraud that drove the fraud concentrates on the second-stage REPO cover up. What are your thoughts on Goldman Sachs facing serious difficulties with the SEC related to fraud? Is this what you get when you do "God's Work on Earth"? We have learned from the SEC charges related to Goldman Sachs that it should be added to the list of elite financial frauds. It is a tale of two (unrelated) Paulsons. Hank Paulson, while Goldman's CEO, had Goldman buy large amounts of collateralized debt obligations (CDOs) backed by largely fraudulent "liar's loans." He then became U.S. Treasury Secretary and launched a successful war against securities and banking regulation. His successors at Goldman realized the disaster and began to "short" CDOs. Mr. Blankfein, Goldman's CEO, recently said Goldman was doing "God's work." If true, then we know that God wanted Goldman to blow up its customers. Goldman designed a rigged trifecta: (1) it turned a massive loss into a material profit by selling deeply underwater, toxic CDOs it owned, (2) helped make John Paulson (CEO of a huge hedge fund that Goldman would love to have as an ally) a massive profit - in a "profession" where reciprocal favors are key, and (3) blew up its customers that purchased the CDOs. Paulson and Goldman were shorting because they believed that the liar's loans were greatly overrated by the rating agencies. Goldman let John Paulson design a CDO in which he was able to pick the nonprime packages that were most badly overrated (and, therefore, overpriced). Paulson created a CDO "most likely to fail." Goldman constructed, at John Paulson's request, a "synthetic" CDO that had a credit default component (CDS). The CDS allowed John Paulson to bet that the CDO he had constructed (with Goldman) to be "most likely to fail" would in fact fail - in which case John Paulson would be become even wealthier because of the profit he would make on the CDS. Now, any purchaser of the "most likely to fail" CDO would obviously consider it "material information" that the investment was structured for the sole purpose of increasing the risk of failure (and getting rid of Hank Paulson's worst investments). The SEC complaint says that Goldman therefore defrauded its own customers by representing to them that the CDO was "selected by ACA Management." ACA was supposed to be an independent group of experts that would "select" nonprime loans "most likely to succeed" rather than "most likely to fail." The SEC complaint alleges that the representations about ACA were false. Also, I'd add a fourth advantage to Goldman from the Abacus scheme. When you're shorting (and its critical that both Goldman and John Paulson were shorting the same thing) you want more shorting. So Goldman and Paulson were a mutual aid society. The obvious question is: did John Paulson and ACA know that Goldman was making these false disclosures to the CDO purchasers? Did they "aid and abet" what the SEC alleges was Goldman's fraud? Why have there been no criminal charges? Why did the SEC only name a relatively low-level Goldman officer in its complaint? Where are the prosecutors? And there is the key question that we (Eliot Spitzer, Frank Partnoy and I) asked in our December 19, 2009 op ed in the New York Times - why haven't the AIG emails and key deal documents been made public so that we can investigate the elite control frauds? (I have called for the same disclosures of Fannie and Freddie's key documents. ) Goldman used AIG to provide the CDS on these synthetic CDO deals and Hank Paulson used our money to bail out Goldman when AIG's scams drove it to failure. Mr. Black, can you put the crisis we're going through into an international perspective? Finance has become a parasite in most developed nations. It is supposed to serve the "real economy as an "intermediary." Its function is to move capital to its most valuable use at the lowest possible cost. Instead, it creates massive bonuses and crises when it works badly. When it works "well" it misallocates capital and funds speculative attacks on commodities and national currencies. It is particularly harmful to workers in Europe and the U.S. None of this requires any conspiracy. Finance is not run in the interest of financial firms. It is run in the interests of the senior officers that control the financial firms. They simply maximize their income (often through accounting control fraud). They enter into tactical coalitions, but they have no permanent alliances. They are not loyal to the nation or the firm. They represent the closest thing to "homo economicus" - the rational, selfish, ethics-free, and wealth-maximizing economic agent that neoclassical economists imagined. As authors in the triumphal book about market economies (Moral Markets) conclude, "homo economicus is a sociopath." Increasingly, our most elite business leaders (and this gives them great political power as well) are sociopaths. This is a recipe for recurrent, intensifying crises and increasing inequality. One of the most distressing elements of the crisis, which is true in both Europe and the United States, is the death of accountability of our financial elites. Europe went overwhelmingly to anti-regulation. Strict regulation was the evil. It smacked of retributive American approaches. Elite bankers were the solution, not the problem. The Brits called the approach "softly, softly." Regulation was not delegitimized. Markets were inherently self-regulating. It was all very clubby. Germany and France emulated the Brits. The Eastern European nations never had serious regulatory capacity and they generally followed the lead of the two European financial centres - the UK and Germany. President Bush picked regulators designed to signal his administration's intent to end effective regulation. He chose Harvey Pitt to head the SEC precisely because Pitt was infamous as the leading opponent of serious securities law enforcement. Pitt's first major speech continued this symbolism. He spoke to a meeting of accountants and bemoaned the fact that the SEC had not always been a "kinder and gentler" place for accountants. He blamed this on his agency - not the top tier firms that consistently gave clean audit opinions to the financial statements of massively insolvent accounting control frauds that falsely purported that the firms were highly profitable. This regulatory rot began in the U.S. under President Reagan (who demonized regulation and regulators), was reduced under the first President Bush, and began to decay again under President Clinton. Europeans' first thought when they hear the name "Gore" is probably global climate change, but when he was Vice President his priority was "reinventing government." The premise of reinventing government was that it needed to be fundamentally changed to more closely resemble a private corporation and to partner with private firms. Financial regulators were instructed to refer to the banks and S&Ls they were supposed to regulate as their "customers." Former OTS Director John Reich, who served from 2005 to 2009, referred to WaMu Chief Executive Kerry Killinger as "my largest constituent" in a 2007 e-mail. Reich also appears in the signature photo of the U.S. contribution to the global crisis. The star of the photo is "Chainsaw Gilleran" (then the OTS Director). (The OTS is supposed to regulate S&Ls.) He is holding a chainsaw. The next three individuals are the top U.S. banking lobbyists, and Reich, then Deputy Chair of the FDIC, rounds out the group. They are all grinning. Everyone but Gilleran is holding pruning shears. They are posed over a pile of federal regulations and the message they are sending is that the industry/anti-regulator partnership will work together to destroy financial regulation. Well, "Mission accomplished!" The anti-regulators were so incapable of shame that they were proud of this tableau (which most resembled Soviet agitprop) and placed it in the 2003 annual report of the FDIC, which your readers can access online. It is no surprise that the federally regulated (sic) financial institutions which produced the worst frauds (or, at least, the worst we know of at this point) were S&Ls. How long will it be economic warfare? Are we heading into a major war as a Last Exit Strategy?(xiv) No one knows. The next severe economic crisis could be substantially worse than the Great Recession. I don't think there is any grand conspiracy of financiers or that financiers as a group are eager to produce a war. In your analysis: What is Germany's role in all of this? Do you agree with Chancellor Merkel's proposals do deal with the crisis? Germany was a typical weak financial regulator. German banks are far larger than in many nations, and more integral to the economy, so they caused severe damage to the German economy. Germany played a significant role in the U.S. decision to terminate one of the most successful Great Depression-era U.S. reforms - the Glass-Steagall Act. Glass-Steagall required a separation between commercial and investment banking because of the inherent conflicts of interest of combining both operations in the same entity. (And everyone knows that "Chinese Walls" fail when they are most needed.) U.S. opponents of Glass-Steagall (our largest banks) argued that we had to do away with Glass-Steagall to end their competitive disadvantage vis a vis German "universal" banks. This was dangerous nonsense (there are no economies of scale to the German banks - and the conflict endangers the bank), but it also kept alive a perverse dynamic, the "competition in laxity." This dynamic creates incentives to weaken continuously financial regulation to the point that it will fail. This was the goal of the anti-regulators. They made regulatory failure a self-fulfilling prophecy. The Fed, through Patrick Parkinson, made the same "race to the bottom" argument in favour of passage of the Commodities Futures Modernization Act (which banned all regulation of credit default swaps). He claimed that if the U.S. regulated CDS the major players would move to the City of London and New York and the U.S. would be the losers. We should have been so lucky! Americans would have been overjoyed had AIG run it CDS scams out of a corporation in the City of London. Germany is playing a negative role in responding to the crisis. The Euro stability pact is inherently unsound. Nations facing serious recessions make things far worse when they respond with "austerity." Even conservative economists - even the IMF - had come to a general understanding that the IMF austerity strategy made crises worse. Germany, of all nations, should understand that demanding the economic (not moral) equivalent of "reparations" from Iceland or Greece cannot work. It will make the regional economic crises worse (and harm German exports). Germans can understand what the reaction of any Greek has to be to a suggestion from German leaders that Greece should sell its land (islands in this case) to other nations. Merkel seems to have backed off some of her strongest demands against the Greeks, but she has been leading the charge for IMF austerity policies. Absent the (U.S.) Fed's interventions on behalf of nations like Switzerland (or, more precisely, its banks), the EU banks would have had to engage in massively greater bailouts of their banks. What is your opinion on Mr. Bernanke being Time's Man of the Year 2009? Bernanke is a failed regulator that ignored every warning and refused on ideological grounds to act under HOEPA to stop the fraud epidemic. If he had any moral strength he would resign. Your readers need to know that he remains an active force against the public. He appointed, in late 2009, another failed economist, Patrick Parkinson, to run all examination and supervision at the Fed. Parkinson has no experience as an examiner or supervisor. He is notorious for taking the lead at the Fed in the successful effort to destroying Ms. Born's efforts to protect the nation by regulating financial derivatives, particularly CDS, in 1999 and 2000. Bernanke also took the lead in encouraging the banks to use their lobbing power to induce Congress to extort the Financial Accounting Standards Board (FASB) (the professional group that determines U.S. GAAP accounting standards) to change GAAP so that banks would not have to recognize currently the great bulk of their losses on bad assets (including those financial derivatives that Bernanke, Parkinson, and Greenspan championed). This unprincipled power play was successful. The ability to hide the massive losses has been attractive to the Obama administration (which regularly trumpets the false claim that it has resolved the crisis at virtually no ultimate cost to the taxpayers) and to bank officers. Overall, if the banks had to recognize their losses the bank bonuses could not be paid at many banks. I am frank enough to ask one question that many people in the world have: Shouldn't the Federal Reserve, as it exists today, being abolished for the sake of humanity? It depends on what one means by "as it exists today." My colleague Randy Wray is the expert on this. He makes the persuasive point that the Fed's essential operations are extremely limited and not terribly complex. There is also no reason to keep so many of their operations opaque. A first step to "The Fed's End As We Know It", I assume, could be the Audit the Fed bill. Do you support the House Resolution 1207 Federal Reserve Transparency Act of 2009? Yes, I'm one of the signatories of a letter supporting that audit. A colossal problem in this crisis are derivatives in the global financial system of at least 600 trillion US-dollars (xv). How was this mess created? How can this mess can be fixed? Isn't a collapse of the system inevitable? It exists because it is unregulated and (a very few) financial firms exploit this regulatory black hole to benefit their senior officers. Exchange traded derivatives can be valuable and pose little risk, but they are a tiny percentage of the outstanding derivatives. The overwhelming bulk of derivative transactions produce no value to the real economy. They are, however, capable of creating immense damage to the real economy. They are a ticking time bomb (except those that have already blown up.) That derivatives will cause - as Johnny Carson would put it - "a really, really BIG" problem was predicted from early on, like Adam Hamilton did, when he wrote on September 7, 2001 about "The JPM Derivatives Monster"(xvi). How could it be that this problem was allowed to grow for years and years - and is there anybody out there responsible for it? No, there is literally no one in charge. Greenspan, Bernanke, Geithner, Summers, Rubin, and Parkinson all got their way in eliminating any protection for the public. Short Selling is one more aspect of the financial mess we're in, I believe, especially Naked Short Selling. Short selling is not inherently evil, but it is at best a "second-best" solution. Consider accounting control frauds like Charles Keating's Lincoln Savings and Loan. Some market participants decided that Lincoln Savings' purported profits were fraudulent. They entered into "short sales" in which they would gain if the share price of Lincoln Savings' parent company fell. Such sales could serve to signal regulators that there was something suspicious happening at Lincoln Savings. (In reality, the causality ran the opposite direction. The regulators' concerns prompted the short sales.) The best solution would be to fix what ails regulation (which is primarily appointing anti-regulators as leaders) and have the bank regulators and the SEC attack the underlying accounting control fraud directly. The SEC action against Goldman confirms one of the reasons we should be concerned about short selling. According to the SEC complaint, John Paulson (who runs one of the world's large hedge funds), wanted to "short" nonprime loans in mid-2007. Note that this is far too late to provide the vital price signal that such loans were massively overvalued. By mid-2007, the secondary market in nonprime loans had already collapsed. Mortgage brokers were going bankrupt every week. Housing prices were declining. So, at best, Paulson was speculating in a manner that could not contain the crisis. Paulson's actions were despicable. If he knew that Goldman was making false securities disclosures his actions could even be criminal. But they did not cause the decline in nonprime prices. The collapse in CDO prices was because CDOs were backed by nonprime mortgages that were endemically fraudulent and were made near the peak of the largest bubble in history because the epidemic of mortgage fraud hyper-inflated the bubble. What kind of damage caused Naked Short Selling during the last years? Shouldn't it be illegal rather today than tomorrow? That is hotly contested. We have too few facts because data on short selling, and most other securities transactions is often not collected and was rarely subject to competent, critical examination by aggressive regulators. You can't make short selling illegal today. One can construct credit default swaps (which remain unregulated) that create the economic equivalent of shorting a security. Again, this is why Eliot Spitzer, Frank Partnoy, and I have called for the release of the AIG emails and the relevant pricing models and data on CDS and other financial derivatives (and why I've called for the same public release by Fannie and Freddie). We should not have to guess about these matters. The facts should be made public. I know that you pay close attention to what's going on at A.I.G. Bob Chapman from "The International Forecaster" wrote not so long ago on the hearings before the House Oversight and Reform Committee: "Each day brings more revelations of efforts of the NY Fed and Goldman Sachs to hide the details of the criminal conspiracy of the AIG bailout. . . . This is a real crisis on the scale of Watergate. Corruption at its finest" (xvii).Is this an exaggeration or an understatement? Well, "each day" is an exaggeration. It is also hard for federal officials to commit a crime through bad regulation unless they are actually bribed or commit perjury. But the heart of claim is correct. Put aside for a moment any focus on criminal law and ask whether a nation can long prosper under crony capitalism. Crony capitalism is inherently corrupt and corrupting. It leads to terrible business decisions. It creates massive inequality and resentment. Our crony capitalism is a different model than Suharto. It is not based on family. But it is built on connections and Goldman has exploited its connections to an unprecedented degree. The key problem is that there is not a U.S. consensus that Goldman's role is a national disgrace and a grave threat to our economy, democracy, and souls. Hank Paulson engaged in such a blatant conflict of interest, and cost the American people such large amounts of money by bailing out Goldman (and many others) that he should have been persona non grata among his peers. But he lacks any moral compass and the elites no longer make even a pretence of having norms demanding civilized behaviour. Can you discuss the importance of liquid cash flow generated through drug trafficking within and without the U.S.A. for banks primarily based in New York City and London via their off-shore connections (sic!)? A.I.G. seems to be also heavily involved in drug money - at least for sure in the past (xviii). And the UN-chief on drugs, Antonio Maria Costa, stated that "liquid investment capital" generated from drug trafficking helped to keep the financial system going in 2008. He said: "In the second half of 2008, liquidity was the banking system's main problem and hence liquid capital became an important factor ... Inter-bank loans were funded by money that originated from the drugs trade and other illegal activities ... There were signs that some banks were rescued that way" (xix). Isn't that a little bit of an embarrassing problem for the global financial system? Yes, but I repeat that we do not know (and Mr. Costa does not know) the facts. There are two "first-best" solutions. One, we should legalize drugs. (For the readers who are about to stop reading; please continue a bit. First, I am 58 and I have never tried an illegal drug. I don't even drink. I do not think drugs are good. I think they do awful things to people. Second, my policy advice is shaped by my experience as a criminologist, regulator, and teacher of economics. I'm with Milton Friedman on this issue.) We should legalize drugs because our policy of criminalizing it has failed - and will fail. That failure is catastrophic. The price of drugs gives us excellent market evidence on the success of our current policies. Drugs are generally cheaper now. I don't care how many photo ops we stage of drug busts - the drug war has failed. Our current policies make rich the worst, most dangerous people in the world and caused tragedy in nations like Columbia and Mexico (a tragedy spreading to the U.S.). We do not know how much money really goes to the druggies, terrorists, and corrupt politicians, but the number is large. We could defund many of the people out to harm our nation if we end this failed effort at Prohibition. The other first-best solution is to get the facts and to seize as many billions as possible of those funds from the cartels, Taliban, and corrupt officials. The way to do that is to (1) end the tax havens (which are also havens for the scum of the earth), (2) to use undercover investigators and electronic surveillance against financial institutions with suspicious cash flows, and (3) to seize the existing proceeds. The OECD launched an initiative against the tax havens. The Bush administration blocked the initiative because it wanted to create a "race to the bottom" of taxation by encouraging tax evasion through the use of tax havens. After the 9/11 attacks (which were funded through tax havens), the administration allowed a weakened version of the OECD initiative to proceed. The Obama administration should, with the aid of the OECD (Germany would likely be very supportive on this given its intelligence services' recent initiatives on your neighbouring tax haven), should lead a campaign to end all tax havens. The U.S. has the economic power, even if had to act unilaterally without OECD support, to end the tax havens. The Fed could use its leverage for something constructive! Antonio Maria Costa said furthermore, that drug money is by "now a part of the official system." Is this naïve or deceptive to say that from Mr. Costa's side? It is widely known that the Pakistani bank BCCI for example was involved with drug money during the 1980's and then-Secretary of Treasury, James Baker III, did nothing against it "because he thought a prosecution of the bank would damage the United States' reputation as a safe haven for flight capital and overseas investments." So my question is: Nothing New in the West, is it? Yes, BCCI (informally, and accurately, known as the "Bank of Crooks and Criminals, International") was a massive control fraud. Yes, there is nothing fundamentally new about fraud schemes. The U.S. has long been complicit in refusing to crack down on the tax havens. The deal it made with UBS was scandalous. We have to end the "race to the bottom." We can end it. It would do enormous good for the world in a wide range of spheres - and it would be immensely political popular. It would, however, enrage the richest Americans who evade taxes (but make political contributions). From a criminological point of view: it's the criminalized status of drugs that makes this whole business possible, right? Yes, as I just explained, that is the key. Prohibition "sells" in politics, but it fails in the real world. One last question, Mr. Black. Does John Lennon's 1968 expression of the illness of our society apt today? "Our society is run by insane people for insane objectives.... I think we're being run by maniacs for maniacal ends ... and I think I'm liable to be put away as insane for expressing that. That's what's insane about it" (xxi). We face recurrent, intensifying economic crises (and economic stagnation for the working and middle class in the developed West) because our financial elites are unworthy. They are too often outright criminals - control frauds. They have no sense of accountability, no sense of duty to the nation (or community or world). Herr Henkel demonstrates how pathetic they have become. Their anti-regulatory, pro-greed ideology triumphed and produced a global Great Recession. But for government intervention and bailouts they would have caused a second Great Depression worse than the original. And what do our elites do? They blame the least powerful citizens for the crisis the elites designed, implemented, and grew rich on. Herr Henkel even descends to the last refuge of a modern scoundrel - racism. Thank you very much for taking your time, Mr. Black! (Sources listed here). Consumer financeCrisis, recession, and recoveryHousing View the discussion thread. Sign Up for the Daily Digest

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Home > MINING PRESS RELEASES > PRESS RELEASE STORY 1/6/2014 9:13:03 AM | Marketwired News Email to friend Western Copper and Gold Submits Casino Project Proposal 2014-01-06T14:13:03+00:00 VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan. 6, 2014) - Western Copper and Gold Corporation ("Western" or the "Company") (TSX:WRN)(NYSE MKT:WRN) is pleased to announce that its wholly owned subsidiary, Casino Mining Corp. ("CMC"), has submitted the final Casino Project Proposal (the "Proposal") to the Yukon Environmental and Socio-Economic Assessment Board ("YESAB") for Screening.Knight Piésold Ltd. led the team of top environmental scientists and engineers that prepared the Proposal under the direction of Paul West-Sells, President and Jesse Duke, Vice President Environmental Affairs of Casino Mining Corp. The Proposal is the result of over six years of effort and over $18 million of investment. It is anticipated that it will take another $1 million to $2 million to complete permitting. As of September 30, the Company had over $26 million dollars in cash and short term investments and no debt. The Company is still on target to be permitted for construction by early 2016. "Submission of the Proposal is an important first step," said Dale Corman, Chairman and CEO of Western. "Once the Proposal has been declared adequate, which we expect in the next few months, we will shift our focus toward detailed engineering and financing of the Casino Project." Screening of the Proposal by YESAB is the first stage in the assessment and permitting of the Casino Project. Once the project receives a positive recommendation from YESAB, the Company will secure a Quartz Mining License and Land Use Permit from the Yukon Government and a Water Use License from the Yukon Water Board. These licenses and permits will allow for the construction and operation of Casino Project. ABOUT WESTERN COPPER AND GOLD CORPORATIONWestern Copper and Gold Corporation is a Vancouver-based exploration and development company with significant copper, gold and molybdenum resources and reserves. The Company has 100% ownership of the Casino Project located in the Yukon Territory. The Casino Project is one of the world's largest open-pit gold, copper, silver and molybdenum deposits. For more information, visit www.westerncopperandgold.com.On behalf of the board, F. Dale Corman, Chairman & CEO Cautionary Disclaimer Regarding Forward-Looking Statements and InformationCertain of the statements and information in this news release constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking statements and information generally express predictions, expectations, beliefs, plans, projections, or assumptions of future events or performance and do not constitute historical fact. Forward-looking statements and information tend to include words such as "may", "could", "expects", "plans", "estimates", "intends", "anticipates", "believes", "targets", "forecasts", "schedules", "goals", "budgets", or similar terminology. Forward-looking statements and information herein include, but are not limited to, the technical and financial viability of mining, leaching and processing operations at Casino; the economic potential of the Casino mineral deposit; the existence and size of the mineral deposit at Casino; estimated timeframes and costs to obtain permits; ability to secure financing for mine construction and development on acceptable terms; Information concerning mineral reserves and mineral resources also may be deemed to be forward-looking information in that it reflects a prediction of the mineralization that would be encountered if a mineral deposit were developed and mined.All forward-looking statements and information are based on Western's or its consultants' current beliefs as well as various assumptions made by and information currently available to them. These assumptions include, without limitation, the economic models for Casino; estimated capital costs of the project; costs of production; success of mining operations; projected future metal prices; engineering, procurement and construction timing and costs; the timing, costs, and obtaining of permits and approvals; the geological, metallurgical, engineering, financial and economic advice that Western has received is reliable, and is based upon practices and methodologies which are consistent with industry standards; and the continued financing of Western's operations. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Forward-looking statements and information are inherently subject to significant business, economic, and competitive uncertainties and contingencies and are subject to important risk factors and uncertainties, both known and unknown, that are beyond Western's ability to control or predict. Actual results and future events could differ materially from those anticipated in forward-looking statements and information. Examples of potential risks are set forth in Western's most recently filed Form 40-F with the U.S. Securities and Exchange Commission and its most recently filed Annual Information Form with the Canadian Securities Administrators as of the date of this news release. Accordingly, readers should not place undue reliance on forward-looking statements or information. Western expressly disclaims any intention or obligation to update or revise any forward-looking statements and information whether as a result of new information, future events or otherwise, except as otherwise required by applicable securities legislation.Western Copper and Gold Corporation Paul West-Sells President & COO Western Copper and Gold Corporation Chris Donaldson Julie Kim Pelly [email protected] www.westerncopperandgold.com

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Pension assets used to create jobs Author: Clarisse Butler Banks Since committing up to $10 billion in private and public pension funds to create jobs by investing in infrastructure projects, a partnership that includes the AFL-CIO, the American Federation of Teachers and National Education Association is already off to a good start. In New York City, the AFL-CIO Housing Investment Trust (HIT) is funding a $134 million energy efficiency and asbestos removal project. And the AFL-CIO has issued a request for proposals for a $3 million energy efficiency retrofit of its headquarters in Washington, D.C. "We know America wants to work. And we can't wait for Washington," said Richard Trumka, AFL-CIO president. "We look forward to working together to see that workers' capital is invested profitably in rebuilding our country." Indeed, the AFL-CIO trust has created more than 10,000 union construction jobs during the past two years and has used investments of union pension capital to generate nearly $2 billion of economic activity. It's part of a growing movement of putting public and private pension assets to work to create jobs. In June, a broad coalition chaired by the AFT, and including Service Employees International Union (SEIU), American Federation of State, County & Municipal Employees (AFSCME), International Association of Fire Fighters (IAFF), the AFL-CIO Building and Construction Trades Department and investment funds affiliated with the labor movement, announced a commitment to work with other partners to help put Americans back to work. The AFL-CIO, working with the coalition, pledged to invest $10 billion in job-creating infrastructure as well as at least $20 million in specific energy retrofits over the next year; the pledge extends to training tens of thousands of workers as well. "Public employees, unions, investment groups and others want to be part of a renewed America," said AFT President Randi Weingarten. "What we're talking about today is America's retirees, and future retirees, helping their country recover economically and invest in projects that might never have gotten off the ground because of budget crises." Weingarten said the AFT has been working for more than a year with a committee of union leaders in an effort to invest public pension fund assets in job creation. Two of the nation's largest public pension funds — the California State Teachers' Retirement System and the California Public Employees' Retirement System — have committed to investing up to $800 million in their state's infrastructure projects. Similar talks are also taking place in New York. "We have seen so much finger-pointing and scapegoating directed at public employees and unions," Weingarten said. "The commitments by public pension funds show that public employees are focused on solutions in a fiduciarily sound way to revitalize our communities, create jobs and strengthen our economy." « Previous Article

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First Niagara executive to leave firm First Niagara Financial Group Inc.’s chief banking officer, Daniel Cantara III, will leave by the end of February after 13 years with the company, representatives said Friday. Cantara was promoted to executive vice president and chief banking officer in December 2012. He joined First Niagara in 2001 to oversee financial services businesses including insurance, benefits consulting and wealth management. He has led the commercial services group since 2007. The chief banking officer position has been eliminated, representatives said. The bank has begun a search for an executive vice president of commercial financial services, they said. “I thank Dan for his contributions and years of service to First Niagara,” President and CEO Gary Crosby said in a statement. Cantara was thought to be a possible candidate to replace John Koelmel as president and CEO before Crosby was selected last month after serving on an interim basis since Koelmel departed in March 2013. Cantara will receive $1.5 million in enhanced severance benefits over 18 months, and will be reimbursed up to $10,000 for costs related to outplacement services, the bank reported in a filing Friday with the U.S. Securities and Exchange Commission. He and Chief Financial Officer Gregory Norwood were granted temporary eligibility for enhanced severance benefits if they were let go within one year of a new CEO taking over. First Niagara also announced that Inder Koul and Julie Signorille have been promoted to the bank’s executive board. Koul is executive vice president and chief information officer. Signorille is executive vice president and managing director of operations.

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Trade deal won't boost US investment in local films Paul Weston (Letters, July 29) is misinformed if he thinks that the free trade agreement with the United States will promote American investment in Australian film and television. The agreement contains no incentives that would increase the relatively small amount of US finance for Australian production. Mr Weston is simply wrong to think that by employing Australian actors, such as Toni Collette, in US productions any thing is being done to promote the growth of a truly Australian industry. Nor does the agreement guarantee that the US would open its markets to Australian film and television, which mainly go to New Zealand and Europe. The size of the US domestic market and the inward looking nature of its cultural production make it entirely self-sufficient and the world's largest net exporter of film and television. Nick Herd, Clovelly, July 29. Ian Hayman (Letters, July 29), why can't Toni Collette speak her views? She was being interviewed which involves answering questions. She is as entitled as anyone, even you, to have an opinion and to let it be known. Being an actor doesn't mean one must take a vow of political silence. Jane Oakley, Enmore, July 29. If the Government is so confident the people of this country would want a free trade agreement, how about a referendum? Kerry Austin, Box Hill, July 29. There has been a great deal of debate, caution and even a Senate committee preview as to the benefits of taking up the free trade agreement on offer. Why wasn't this same degree of caution exhibited when a decision was made to invade Iraq? Ray Armstrong, Tweed Heads, July 28. Can't see why the free trade agreement is believed to be a tunnel at the end of the light? Economics 101 taught us that abolishing tariff walls means less competitive industries go down under fire, but then redirected investment for new competitive job creation is freed, and jobs and all, go up. Everybody comes out of it in the middle term with bigger wallets and lots of smiles, even the quite loud protesting vested interests who were non-competitive in the first place. Takes patience, that's all. Go for it, Mark. Frank Hainsworth, Burleigh (Qld), July 29. Contrary to the view of Benjamin Smith (Letters, July 29), the Labor Party would be quite right to oppose the free trade agreement with the US while simultaneously supporting free trade deals with Asian nations, because the agreements on offer are completely different. As relatively equal partners with Asian nations, Australia is able to negotiate terms which are reasonable to both sides, whereas the agreement reached with the giant US is completely biased in favour of the Americans. The trade agreements already signed with Singapore and Thailand do not threaten Australian culture because they do not apply to local content rules for television. Similarly, they do not threaten the pharmaceutical benefits scheme or intellectual property users because the terms of the agreements do not relate to the scheme or intellectual property. If a future Australian government ever negotiates a free trade agreement with the US that does not impinge on the scheme, local content rules, quarantine enforcement and intellectual property use, then there would be no problem. Tom Nilsson, Sandy Bay (Tas), July 29. Would anyone ask Mr Howard these simple questions: if the free trade agreement is so good for us, why are the Americans so keen for us to sign? Since when has American big business shown generosity? Robert Crawford, Nambour (Qld), July 28. Come on, Labor, dare to be different and give us some real choice. Declare your opposition to the US free trade agreement and campaign against it. We can do much better than this and many of us know it, so please think carefully when counting the numbers. Bruce Tulloch, Cammeray, July 28. So, according to the Prime Minister, John Howard, the Opposition Leader, Mark Latham, is damned if he agrees to the free trade agreement, for he will be folding for political reasons, and damned if he doesn't for being a ditherer and beholden to the sectional interests of the unions and others. Victoria Collins, Killcare Heights, July 28. I am sick and tired of my fellow Australians urging Mar

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Publication Dates 2014 Subscription Card 2014 2013 Farmfest Annual 2013 Festivals Guide 2013 County Fairs Guide J.C. Penney heads for 9th quarter of plunging sales By Matt Townsend The Land Online J.C. Penney countered criticism from investor Bill Ackman last week by saying it's focused on stabilizing the business and winning back customers. Results next week will show what little progress has been made. Analysts predict a wider second-quarter loss and the ninth straight sales drop when J.C. Penney reports on Aug. 20, though improvements are projected for the second half of the fiscal year. The quarter was the first entirely under Chief Executive Officer Mike Ullman, who returned in April to undo the failed strategy put in place by former CEO Ron Johnson. Ullman has ramped up discounts and run ads apologizing to the department-store chain's customers, even while he's forced to work with Johnson's store remodels that so far have driven away shoppers and led to almost $1 billion in losses. Ackman, who pushed for the retailer to hire Johnson initially, resigned from J.C. Penney's board this week and relented in his latest fight to replace Ullman faster than his fellow directors wanted. "They do have a lot of work ahead of them," said Rick Snyder, an analyst for Maxim Group LLC in New York. "Eliminating the distraction is positive, so they can focus on the business." J.C. Penney said Friday it entered into an agreement with Ackman under which its largest investor may make as many as four requests to the company to register for the sale of some of his stake. The rights granted under the Aug. 13 agreement end when Ackman and his funds own less than 5 percent of the retailer's stock, according to a regulatory filing Friday. Ackman holds an almost 18 percent stake in the company. Analysts project J.C. Penney's second-quarter net loss will widen to about $1.20 a share from 67 cents a share a year earlier and sales will fall 8 percent to $2.78 billion, according to the average of analysts' estimates compiled by Bloomberg. In the past four weeks, analysts have only become more bearish, with the average estimates for both profit and revenue declining. Macy's Inc.'s performance during the second quarter doesn't bode well, either. The second-largest department-store chain's sales fell for the first quarter since 2010 and earnings per share trailed analysts' estimates for the first time since 2007. CEO Terry Lundgren blamed cool weather for slowing sales of summer apparel and consumers reducing purchases because of economic uncertainty. Ullman, who led the Plano, Texas-based company for about seven years in his first stint as CEO, returned to stabilize the century-old chain after Johnson's costly overhaul failed to attract younger and wealthier customers while alienating longtime shoppers. That combination led to a 25 percent sales decline last year that, coupled with heavy spending on remodeling stores, caused a net loss of $985 million. The company consumed so much cash during Johnson's time that within three weeks of returning, Ullman drew down $850 million of the company's revolving credit line and negotiated a $2.25 billion loan. The company continues to use cash, including an estimated $1.2 billion during the second quarter, and that could prompt it to seek more outside funds by the end of the year, according to Matthew Boss, an analyst at JPMorgan Chase &amp; Co. in New York. J.C. Penney this month estimated it had about $1.5 billion in cash at the end of last quarter. The retailer also denied a report that CIT Group Inc. had stopped funding some of its vendors. After improving the company's balance sheet, Ullman made a slew of changes to revive sales. He reinstated brands and tried to improve customer service by bringing back cash registers and revamping the store employee uniform to make it easier to identify workers. Advertising shifted to a value message to promote the return of doorbusters and sales events. Some of the merchandise Johnson swapped in hasn't been a hit with the chain's core customers, and it can't be changed as quickly. That has dragged on results, especially in the remodeled home section, according to analysts and three former store managers who left the retailer as recently as June. The home overhaul was the most expensive and last part of Johnson's plan to turn J.C. Penney stores into collections of branded boutiques. After months of construction, the renovated departments opened in about half of the chain's 1,110 stores in the second quarter after Johnson was gone. Ullman had little choice but to finish the construction and get the stores fully operational as quickly as possible because home goods account for about 15 percent of floor space at those stores. While there are low-priced private-label items, much of the sections are occupied by designer goods such as $60 toasters from architect Michael Graves and big-ticket goods including a $1,695 chair from Happy Chic by Jonathan Adler. "The new home department has failed to drive traffic, and high price points on the new product have not resonated with J.C. Penney's customer," Deborah Weinswig, an analyst at Citigroup Inc. in New York, wrote in a note to clients. The merchandising missteps "could lead to markdowns," said Weinswig, who recommends selling J.C. Penney shares. The managers, who all left during the second quarter and didn't want to speak publicly about a former employer, reiterated the pricing concerns and added that the redesign of these areas into so-called shops separated by partial walls only accentuated the issue. With their track lighting and ornate fixtures, they stand out from the rest of the store and look more like a pricey showroom than a place to browse, they said. One of the most disappointing parts of the home departments has been the Martha Stewart Celebrations section, the managers said. The area sells party supplies such as gift bags, napkins and wrapping paper. One manager said the area generated about $350 of revenue in its first month while taking up more than 1,000 square feet of prime floor space. That would equate to sales per square foot of about $4, compared to $116 a foot last year for the entire chain. Claudia Shaum, a spokeswoman for Martha Stewart Living, and Daphne Avila, a spokeswoman for J.C. Penney, declined to comment. The party items aren't part of the legal battle involving Macy's, J.C. Penney and Martha Stewart Living Omnimedia Inc. The dispute, now awaiting a judge's decision, involves Martha Stewart-designed products for the bed, bath and kitchen that Macy's says it had exclusive rights to sell. J.C. Penney took Martha Stewart items it already made in those categories and re- branded them "JCP Everyday." There are still ways to boost sales in the home department, according to Maxim's Snyder. He expects the company to swap out the underperforming brands by the holiday shopping season. Liz Dunn, an analyst at Macquarie Group in New York, predicts the chain will clutter up the wide aisles that Johnson installed with lower-priced, fast-moving goods like towels. "It's definitely going to be hard to reverse," said Dunn, who rates J.C. Penney shares neutral, the equivalent of a hold. "And expensive to reverse for a company that is trying to conserve cash." The Land :: www.TheLandOnline.com. All rights The Land's Twitter Feed 418 South Second Street, PO Box 3169

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SEC, FINRA Enforcement Roundup: Allianz, TheStreet Charged Fine of $12M for Allianz; accounting fraud charges for TheStreet.com; censures and fines imposed by FINRA Among recent enforcement actions taken by the SEC were charges against Allianz for violations of the Foreign Corrupt Practices Act that resulted in penalties of more than $12.3 million; against a Connecticut-based advisor for telling clients it was investing in the same collateralized debt obligations it recommended for them; against TheStreet Inc. and three executives for accounting fraud; against a Toronto-based brokerage firm and two executives for allowing layering; and against two investment advisory firms and two portfolio managers in the collapse of a mutual fund. FINRA, meanwhile, imposed censures and fines for a Toronto firm that inappropriately shared transaction-based commissions with non-FINRA entities, and censures and fines for a Chicago-based firm after it was found to be an introducing broker-dealer established to facilitate U.S. market access for a single large entity and it had failed to design or implement an anti-money-laundering program to track possible violations. Allianz SE Agrees to Pay Penalty of $12.3 million-plus on FCPA Violations The SEC charged German-based insurance and asset management company Allianz SE with violating the books and records and internal controls provisions of the FCPA for improper payments to government officials in Indonesia during a seven-year period. In its investigation, the SEC found 295 insurance contracts on large government projects that were obtained or retained by improper payments of $650,626 by Allianz’s subsidiary in Indonesia to employees of state-owned entities. Allianz made more than $5.3 million in profits as a result of the improper payments. According to the SEC’s order instituting settled administrative proceedings against Allianz, the misconduct occurred from 2001 to 2008 while the company’s shares and bonds were registered with the SEC and traded on the New York Stock Exchange. Two complaints brought the misconduct to Allianz’s attention. The first complaint, submitted in 2005, reported unsupported payments to agents, and a subsequent audit of accounting records at Allianz’s subsidiary in Indonesia uncovered that managers were using “special purpose accounts” to make illegal payments to government officials in order to secure business in Indonesia. Despite the audit, the payments continued. According to the SEC’s order, the second complaint was made to Allianz’s external auditor in 2009. Allianz failed to properly account for certain payments in its books and records. The improper payments were disguised in invoices as an “overriding commission” for an agent that was not associated with the government insurance contract. In other instances, the improper payments were structured as an overpayment by the government insurance contract holder, who was later “reimbursed” for the overpayment. Excess funds were then paid to foreign officials who were responsible for procuring the government insurance contracts. Allianz lacked sufficient internal controls to detect and prevent the wrongful payments and improper accounting. Without admitting or denying the findings, Allianz agreed to cease and desist from further violations and pay disgorgement of $5,315,649, prejudgment interest of $1,765,125, and a penalty of $5,315,649 for a total of $12,396,423. Connecticut Advisor Charged for ‘Skin in the Game’ Lies to Clients Connecticut-based Aladdin Capital Management was charged by the SEC with falsely telling clients to whom it recommended two different CDOs that it had “skin in the game” and was investing in the CDOs along with them. The SEC’s investigation found that Aladdin Capital Management’s co-investment representation was a key feature and selling point for its Multiple Asset Securitized Tranche advisory program involving CDOs and collateralized loan obligations. For example, Aladdin Capital Management asked in one marketing piece, “Why is an investor better off just investing in Aladdin sponsored CLOs and CDOs?” It then emphasized that the “most powerful response I can give to your question is that Aladdin co-invests alongside MAST investors in every program. Putting meaningful ‘skin in the game’ as we do means our financial interests are aligned with those of our MAST investors.” Aladdin Capital Management in fact made no such investments in either CDO, and its affiliated broker-dealer Aladdin Capital collected placement fees from the CDO underwriters. According to the SEC’s order against one of the firms’ former executives, Joseph Schlim, he was significantly involved in the MAST program on a day-to-day basis. He made sales calls to potential clients and negotiated with CDO and CLO underwriters about the amount of equity in those securities that Aladdin Capital

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This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, click the "Reprints" link at the bottom of any article. From the 2013 Career Guide issue of Investment Advisor • Subscribe! December 21, 2012 A Next-Gen Shot in the Arm Craig Pfeiffer draws inspiration from the medical field for young advisors’ professional development If you want an idea of how to help and support the next generation of advisors, look no further than the medical profession. Sure, it’s more about modern portfolio theory than appendicitis, but few would ever argue that medical students should hit the phones and begin cold calling immediately upon graduating. While medical residents are learning to save lives and comfort the afflicted, how is ensuring a client’s financial solvency well into retirement any less important? It’s a question Craig Pfeiffer has asked and answered. The CEO of Advisors Ahead, a firm dedicated to the successful development of financial advisors and that counts such industry notables as Texas Tech associate professor Deena Katz among the staff, looked specifically to the type of training young doctors receive right out of medical school when he founded the company—internships, residency programs and all. Pfeiffer is a former wirehouse guy, but recognizes that the problem of career support (or lack thereof), which results in high washout rates, doesn’t discriminate by distribution channel. He spent 29 years with Morgan Stanley Smith Barney and “predecessor firms.” He left Morgan Stanley in October 2011, where he was vice chairman and a member of the executive committee, to devote himself to career development and support full-time. “I started off as a retail stock broker and went through every evolution from 1980 until now,” Pfeiffer said. “Throughout that time I was an advisor, a branch manager, a regional director and had a hand in all those other various roles, in addition to playing the role of a corporate executive and, ultimately, vice chairman.” Over that time, the human capital, training and professional development departments all reported to him, which resulted in what he calls “a late career mission;” one that is threefold. The first is advocacy; the second is training and support for the next generation; and the third is the practical application of that training. “That’s the charge,” he added. “At its core, it is rooted in a pretty big gap around a need for

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Archivio / Cerca Our Employees (eng) History of UBS (eng) Di cosa ci occupiamo La nostra strategia Research II nostro impegno Codice di condotta Corporate Responsibility (eng) Fondazioni UBS Arte contemporanea (in inglese) Filiali Glossari Contatto & servizi Servizi web Aggiornamento della strategia di UBS La nostra strategia Quarterly reporting (eng) Corporate calendar (eng) Azioni UBS (eng) Rating sul credito (eng) Maggiori informazioni per analisti e investitori (eng) Comunicati stampa e maggiori informazioni su UBS per giornalisti (eng) Novità UBS Annual General Meeting of UBS AG | 19 Apr 2006, 20:00 At the Annual General Meeting held on April 19, 2006, the shareholders of UBS approved the dividend of CHF 3.20 per share proposed by the Board of Directors. They also elected two new members - Gabrielle Kaufmann-Kohler and Jürg Wolle - to the Board of Directors and re-elected both Rolf A. Meyer and Ernesto Bertarelli to their respective offices for another three years. UBS shareholders approved the creation of conditional capital. The Annual General Meeting was attended by 2311 shareholders, representing 242,545,009 votes. At the Annual General Meeting (AGM) held on April 19, 2006, the shareholders of UBS AG approved the Annual Report and Group Financial Statements for 2005 and granted discharge to the members of the Board of Directors and Group Executive Board. Elections to the Board of Directors The 2006 AGM marked the end of Peter Böckli's term of office as non-executive Vice Chairman of the Board of Directors, a post he had held since 2002 and gave up after reaching the maximum age limit. The AGM elected both proposed new candidates to the Board of Directors for a three-year term. Gabrielle Kaufmann-Kohler, partner at the law firm Schellenberg Wittmer and a professor of international private law at the University of Geneva, becomes a non-executive member, as does Jörg Wolle, Chairman and CEO of DKSH Holding Ltd. The directorial mandates of Rolf A. Meyer and Ernesto Bertarelli, Chief Executive Officer of Serono International SA in Geneva, were confirmed for a further three-year term. Dividend of CHF 3.20 UBS shareholders approved the dividend of CHF 3.20 per share proposed for the 2005 financial year. The 7% year-on-year increase reflects the good results for 2005 and the bank's policy of returning cash not needed for operations to shareholders in the form of dividends and via buybacks of shares for cancellation. The dividend will be distributed on April 24 to all shareholders holding shares on April 19. Starting April 20, UBS shares will be traded ex-dividend. Par value repayment and share split The shareholders additionally gave their approval for a par value repayment in the amount of CHF 0.60 per issued share. The purpose of this one-time, tax-privileged payout is to give UBS shareholders a share in the extraordinary income from the sale of the private banks & GAM to Julius Baer. The Board of Directors' proposal to carry out a two-for-one split of outstanding shares, thereby halving the par value per share and doubling the number of shares in circulation, was also approved. Share capital reduction, new buyback program As part of the 2005/2006 share buyback program, UBS bought back a total of 37,100,000 shares, worth some CHF 2.5 billion, via a second trading line on the SWX Swiss Exchange. The AGM approved the definitive cancellation of these shares and the corresponding reduction in share capital. It also agreed to a new 2006/2007 buyback program, again with a view to reducing share capital. How far the maximum approved sum of CHF 5 billion is used will depend on how much free capital is used for investments to support the growth of the bank's core businesses. Creation of conditional capital The shareholders voted in favor of creating conditional capital in the amount of up to CHF 15 million. This will be used for future option awards to employees and executive members of the Board of Directors. Until now, these options were serviced with treasury shares. The creation of conditional capital increases UBS's flexibility to manage its capital. UBS at the service of clients, shareholders, and society In his address as Chairman, Marcel Ospel talked about the bank's relationship with its clients and shareholders and with society at large. A service company such as a UBS, he said, can only be successful over the long term if it continually strives to balance the interests of its key stakeholders, a fundamental principle that is firmly rooted in the UBS Vision and Values and is expressed succinctly by the current advertising slogan "You & Us". All the bank's efforts, Ospel explained, are geared to its clients' success. This requires first-class advice, innovative products and services, and - in view of the market's rapid evolution - a strategic long-term view on the part of the Group Executive Board. According to the Chairman, there are close ties between UBS clients and UBS shareholders. In fact, about 65% of shareholders are also clients. Ospel explained, "People who have good experiences as clients may well want to benefit from an investment in the bank. And people who are rewarded with high returns as investors might choose to trust their other financial affairs to us as well." Concerning the bank's social commitments, the Chairman noted that these have long since become an integral part of the corporate culture, identity, and business practices of UBS. Corporate responsibility, he said, has many facets, ranging from equality for all employees to environmentally friendly production processes, funding for charitable projects, concerted efforts to combat money laundering and the financing of terrorism, and sustainable investment opportunities for clients. Successful business model - successful employees Group CEO Peter Wuffli gave some background concerning the bank's business success and the impressive performance of its share price. He said that the integrated business model allows UBS to meet its clients' growing demands for tailored solutions and structured products thanks to strong partnerships that span geographical and organizational boundaries. At the same time, he added, UBS is able to anticipate broader trends within the financial sector more effectively and enhance the efficiency of its internal processes. To put this ambitious business strategy into practice, he said, UBS needs highly qualified staff. "We can only recruit, motivate, and develop the best employees if we can offer them an attractive corporate culture featuring a performance-based environment based on the will to learn and the desire for success in a spirit of partnership," noted the CEO. Peter Wuffli promised shareholders that UBS will not rest on its laurels but will seize the opportunity its currently outstanding position provides for continued success going forward. Basel, April 19, 2006UBS The speeches by Marcel Ospel, Chairman of the Board of Directors, and Peter Wuffli, CEO, can be found on the Internet at www.ubs.com/media or www.ubs.com/agm. Iscrivere Ultima modifica al 03 lug 2012, 14:57 Condizioni di utilizzo

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Finance December 20, 2010 IRS Steps Up Scrutiny of Colleges and Other Nonprofit Groups By Eric Frazier The Internal Revenue Service says it plans greater scrutiny of a wide range of charity activities in the next year, including compensation and loans that colleges and other nonprofit groups make to top officials and whether they paid sufficient employment taxes. Most important for colleges, the agency said it would continue to focus on the results of a compliance questionnaire sent to 400 public and private institutions in 2008, asking about unrelated business income, endowments, and executive-compensation practices. A preliminary report on the findings of those questionnaires was released this year, and more than 30 of the colleges have been audited as a result of the agency's inquiries. The IRS's plans follow stepped-up efforts over the past few years to oversee nonprofits. Figures released last week in a new report by the Internal Revenue Service show its audits of charities increased from 7,861 in 2008 to 10,187 in 2009, a jump of 30 percent. In 2010 the number of audits jumped 12 percent, to 11,449. Michael Peregrine, a tax lawyer in Chicago, said nonprofits should pay close attention to the increasing number of audits, "The IRS is still fully engaged in oversight of tax-exempt organizations," he said. That greater oversight is largely the result of an increased number of IRS employees. The report shows the IRS has added 100 employees since 2008 to the unit that handles audits of charities. Employment Taxes IRS officials also said their enforcement efforts had benefited from increased collaboration with the Social Security Administration and with state regulators, yielding valuable electronic data that allowed them to spot organizations that were trying to avoid paying employment taxes. The collaboration also helped the IRS zero in on employment taxes as one of its areas of focus for next year, the agency said in a document outlining its 2011 priorities. The IRS has been studying the employment-tax reporting practices of about 4,000 tax-exempt organizations each year since 2007, comparing information reported to the Social Security Administration against data reported on tax forms. The agency was able to pinpoint organizations that reported paying wages to employees but didn't file a federal form to report employment taxes. Others showed compensation for officers on their informational tax forms but didn't file wage or employment tax documents for those workers. Loans to executives, trustees, and other key employees are also drawing more scrutiny. The agency said it had studied the issue by conducting 169 audits and now will make this a regular part of its examination of charities. Agents found loans to charity officials that were not correctly reported on the organizations' Form 990 in 91 cases; the IRS assessed more than $5-million in penalties. The report also described IRS scrutiny of: Consumer-credit counseling agencies, with which the IRS has found widespread problems in the past. The agency examined 63 of the largest credit-counseling organizations and revoked, terminated, or proposed revoking the tax-exempt status of 41 groups that the IRS said had failed to provide a charitable service. Down-payment assistance groups, which offer financial and educational help to low-income homebuyers who cannot afford the initial down payment. The report says many of the groups offer the help through self-serving arrangements that disqualify them for tax-exempt status. Supporting organizations, which are charities that typically collect and channel money to a specific nonprofit. The IRS says some nonprofit officials have established those organizations for their own financial benefit. New Tax Forms The report also contained data on filings using the redesigned Form 990. It suggested the full impact of the new form and its expanded disclosure requirements has yet to hit for many of the nation's smaller charities. That's because many charities took advantage of the three-year transitional window the IRS established, in which small organizations could file Form 990-EZ instead of Form 990. (Form 990-EZ wasn't changed when the IRS revamped Form 990 for the 2008 tax year.) The new Form 990 requires more-detailed reporting about organizations' governance policies and executive compensation, among other things. Many groups, however, are avoiding using that form until they are required to do so. For the 2008 tax year, for instance, organizations with gross receipts of $25,000 to $1-million and assets of less than $2.5-million could file Form 990-EZ. That led to a big change as the number of groups that filed the regular Form 990 on paper fell 51 percent from the 2007 to the 2008 tax year. Meanwhile, the number of Form 990-EZ paper returns shot up by 80 percent. Eric Frazier is a contributor to The Chronicle of Philanthropy. Eric Kelderman, of The Chronicle of Higher Education, contributed to this article. 1. jbarman - December 20, 2010 at 03:57 pm I knew it! Those non-profit IHE's are up to something, and it's about time there was stricter government oversight.I suggest that Tom Harkin create a commission to reign in these bad actors. He should formulate legislation requiring all non-profit colleges to prove that the loans they make lead to gainful employment for the recipients. s/b "rein". 3. henr1055 - December 20, 2010 at 04:18 pm Hay Barman they are already doing so. Executive Compensation is nothing compared to the For Profits. There is a university in my town with 2400 students one graduate program with a Pres making 2 million dollars per year. Kind of a joke really since they had a billion dollar endowment before he arrived.By the way my non profit institution with 3800 FT students gives 100 million in financial aid, not counting gov loans and pell grants. That is 100 mil shareholders of some fly by night degree mill will never see.TH 4. tessareed - December 20, 2010 at 05:32 pm I hope the

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Home > Research > Data > Yield Curve > 2012 > 0612 > Yield Curve Links Current Readings Joseph G. Haubrich | Vice President and Economist Joseph Haubrich is a vice president and economist at the Federal Reserve Bank of Cleveland, where he is responsible for leading the Research Department's Banking and Financial Institutions Group. He specializes in research related to financial institutions and regulations. Read full bio Meet the Author Patricia Waiwood | Research Analyst Patricia Waiwood is a research analyst in the Research Department of the Federal Reserve Bank of Cleveland. She joined the Bank in October 2011, and her work focuses on macroeconomics, financial economics, and banking. Read full bio Archives Policy Discussion Papers Economic Review Search articles by topic Yield Curve and Predicted GDP Growth, May 2012 Covering April 26, 2012–May 25, 2012 3-month Treasury bill rate (percent) 10-year Treasury bond rate (percent) Yield curve slope (basis points) Prediction for GDP growth (percent) Probability of recession in 1 year (percent) Overview of the Latest Yield Curve Figures Over the past month, the yield curve has flattened, as short rates stayed even and long rates fell. The three-month Treasury bill inched up to 0.09 percent (for the week ending May 18), just up from April’s 0.08 percent and even with the March number of 0.09 percent. The ten-year rate dropped back below 2 percent, coming in at 1.74 percent, a drop of over one-quarter percentage point from April’s 2.00 percent, itself a fair drop from March’s 2.21. The twist dropped the slope to 165 basis points, down from April’s 192 basis points, nearly half a percentage point below March’s 212 basis points, and even below February’s 186 basis points. The flatter slope was not enough to cause an appreciable change in projected future growth, however. Projecting forward using past values of the spread and GDP growth suggests that real GDP will grow at about a 0.7 percent rate over the next year, equal to the past two months. The strong influence of the recent recession is leading toward relatively low growth rates. Although the time horizons do not match exactly, the forecast comes in on the more pessimistic side of other predictions but like them, it does show moderate growth for the year. The flatter slope did lead to a less optimistic outlook on the recession front, however. Using the yield curve to predict whether or not the economy will be in recession in the future, we estimate that the expected chance of the economy being in a recession next May is 8.7 percent, up from April’s 6.4 percent and from March’s 5.0 percent. So although our approach is somewhat pessimistic as regards the level of growth over the next year, it is quite optimistic about the recovery continuing. The Yield Curve as a Predictor of Economic Growth The slope of the yield curve—the difference between the yields on short- and long-term maturity bonds—has achieved some notoriety as a simple forecaster of economic growth. The rule of thumb is that an inverted yield curve (short rates above long rates) indicates a recession in about a year, and yield curve inversions have preceded each of the last seven recessions (as defined by the NBER). One of the recessions predicted by the yield curve was the most recent one. The yield curve inverted in August 2006, a bit more than a year before the current recession started in December 2007. There have been two notable false positives: an inversion in late 1966 and a very flat curve in late 1998. More generally, a flat curve indicates weak growth, and conversely, a steep curve indicates strong growth. One measure of slope, the spread between ten-year Treasury bonds and three-month Treasury bills, bears out this relation, particularly when real GDP growth is lagged a year to line up growth with the spread that predicts it. Predicting GDP Growth We use past values of the yield spread and GDP growth to project what real GDP will be in the future. We typically calculate and post the prediction for real GDP growth one year forward. Predicting the Probability of Recession While we can use the yield curve to predict whether future GDP growth will be above or below average, it does not do so well in predicting an actual number, especially in the case of recessions. Alternatively, we can employ features of the yield curve to predict whether or not the economy will be in a recession at a given point in the future. Typically, we calculate and post the probability of recession one year forward. Of course, it might not be advisable to take these numbers quite so literally, for two reasons. First, this probability is itself subject to error, as is the case with all statistical estimates. Second, other researchers have postulated that the underlying determinants of the yield spread today are materially different from the determinants that generated yield spreads during prior decades. Differences could arise from changes in international capital flows and inflation expectations, for example. The bottom line is that yield curves contain important information for business cycle analysis, but, like other indicators, should be interpreted with caution. For more detail on these and other issues related to using the yield curve to predict recessions, see the Commentary “Does the Yield Curve Signal Recession?” Our friends at the Federal Reserve Bank of New York also maintain a website with much useful information on the topic, including their own estimate of recession probabilities. Careers | Diversity | Privacy | Terms of Use | Contact Us | Feedback | RSS Feeds

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This Discount Retailer Earns Dollars Beyond Expectations By ABHISHEK JAIN - DG, DLTR, FDO ABHISHEK is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited. Dollar General Corporation (NYSE: DG) saw a fifth straight quarter of double digit growth. Dollar General is a discount retailer in the United States and operates convenient-sized stores that deliver low priced products that families use in day to day life. Dollar General has pleased its investors by providing an encouraging performance. Also during the third quarter, it repurchased 296 million shares of its common stock, increasing its year-to-date repurchases to $596 million. A Look Into the Numbers The third quarter saw a total sales increase of 10.3% to $3.9 billion, with same-store sales up by 4%. However, total sales were impacted by later than expected store openings in the second and third quarters, and resulting slower ramp up. The gross profit was 30.9% for the quarter, down by 11 basis point from last year’s third quarter rate and slightly below expectations. Higher markdowns, lower price increases compared to last year, higher consumables mix and higher shrink all pressured the gross margin. For the quarter operating profit was $361 million or 9.1% of sales, a strong improvement over last year. Finally, the third quarter adjusted net income increased by 22% to $210 million and adjusted earnings per share increased from 26% to $0.63 per share. The results beat Wall Street expectations. It is notable that the company's sales were better than expected and many of its customers view Dollar General prices as lower than those of retail giant Wal-Mart. Plans are in place to build onto four key operating priorities: driving productive sales growth, increasing gross margins, leveraging process improvement and information technology to reduce costs and further strengthening Dollar’s culture of serving others. Capital expenditures in 2013 are expected to be in the range of $600 million to $650 million. Other’s in the Sector Dollar Tree (NASDAQ: DLTR) operates a discount variety store chain in the United States and Canada. Operating margin increased significantly and the Company delivered record third quarter earnings per share. Earnings per diluted share for the third quarter were $0.68, including a one-time gain of $0.17 per share relating to the company's previously announced sale of its ownership interest in Ollie's Holdings. The opportunity for Dollar Tree in Canada is huge as it is committed to build infrastructure, develop store teams and improve the consistency of offerings across the chains and hence pose a threat to Dollar General. Family Dollar Stores (NYSE: FDO) is a national discount store chain. The Company operates stores which are located throughout the United States and offers consumables, home products, apparel and accessories and electronics. Family Dollar Stores has a market cap of $8.17 billion and is part of the retail industry. Shares of Family Dollar are up by 12.2% year to date as of the close of trading on Tuesday. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. These strengths outweigh the fact that the company is trading at a premium valuation based on its current price compared to such things as earnings and book value. Take Away Advice Dollar General continues to excel in the discount store space, and the company continues to be the favorite in the industry. Further Dollar General plans to have another distribution center operational by 2014 and plans to open approximately 635 new stores, including approximately 20 Dollar General Market stores and 40 Dollar General Plus stores. Dollar General can be considered a good investment option because of the consistent growth in its net income and its continually expanding network of stores. abhishekjain524 has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own! Email ABHISHEK JAIN abhishekjain524 ABHISHEK JAIN is a member of The Motley Fool Blog Network DLTR FDO Also On This Topic Five Things To Watch For In Five Below's Upcoming Quarterly Report Discount Retailers Boosted by Change What is Wal-Mart Signaling About The Health of The Consumer? This Company Is Quietly Growing August 15, 2013 Five Below's Continued Success

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A Locked Door, A Secret Meeting And The Birth Of The Fed Share Tweet E-mail Print By Robert Smith & Jacob Goldstein Originally published on Mon December 23, 2013 10:01 am Listen J.P. Morgan: Not a pussycat. In 1907, the U.S. economy was in the grip of a financial crisis. Unemployment was up. The stock market was down. People started panicking. They were lining up overnight to pull their money out of healthy banks. This can be deadly for an economy: Healthy banks have to shut down, businesses can't get credit, they lay people off, and the economy gets worse. At the time, the U.S. government had no way to deal with the panic. There was no institution that could step in to stop the run on healthy banks. So the job of stopping the panic fell to one man: J.P. Morgan (of JPMorgan fame). He summoned dozens of the leading financiers in New York to his private library on Madison Avenue and essentially ordered them to contribute to a $25 million pool that would be used to backstop the system. Then he locked them in and made them stay there through the night, until they all agreed to his plan. The plan worked — it essentially ended the Panic of 1907. But some powerful people in Washington wondered: What about the next panic? Do we really want the fate of the U.S. economy to hinge on one rich guy in New York? One person in particular decided this was a problem: Sen. Nelson Aldrich, chairman of the Senate finance committee. Aldrich knew there was something America could do so that it would no longer have to rely on one guy to end panics: The U.S. could create a central bank. This was not a new invention. Countries in Europe already had central banks. And, during panics, the central banks basically did what J.P. Morgan did in the U.S.: act as lenders of last resort for healthy banks. When depositors were lined up out the door yelling for their money, banks that were basically sound could borrow from the central bank. But just consider that name: central bank. Throughout American history, both of those words — "central" and "bank" — had been deeply unpopular. The thought of a bunch of rich bankers in New York controlling a powerful central bank did not inspire confidence. Still, Aldrich realized he needed bankers' help to draw up a plan for a central bank. So he came up with a plan to gather in secret. He told a handful of New York bankers to go on a given night, one by one, to a train station in New Jersey. There they would find a private rail car hitched to the back of a southbound train. To conceal their identities, Aldrich told the bankers to come dressed as duck hunters and to address each other only by first name. The train headed south, and the bankers got off in Georgia. They spent the next week holed up in a private club at a place called Jekyll Island. (Apparently, the name didn't sound as sketchy then as it does today.) At Jekyll Island, Aldrich and the bankers came up with a plan. They knew many Americans thought a central bank could become too powerful, too influential in the economy. So they came up with a classic American workaround: They decided the U.S. should create lots of little central banks, scattered all around the country. The plan they came up with still had a long way to go. It got shot down the first time in Congress. The plan for a central bank was debated, changed significantly, renamed. But the basic idea held up. And on Dec. 23, 1913, President Woodrow Wilson signed the Federal Reserve Act into law. Creating the Fed didn't solve the nation's economic problems. In fact, a few decades after the Fed was created, its policies made the Great Depression worse. And the Fed has changed significantly over the course of a century. But even after all those changes, there are still a dozen Federal Reserve banks scattered around the country in cities like Dallas, Richmond and, of course, New York.Copyright 2013 NPR. To see more, visit http://www.npr.org/. KTEP

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Economic Beat Tax-Refund Delays Could Trigger Recession Failure to resolve issues related to the alternative minimum tax would push $200 billion in refunds into the second quarter, weakening an already weak recovery. Congress seems bent on simultaneously debating the fiscal cliff, where the remedy is a short-term widening of the deficit, and the fiscal crisis, where the remedy is a long-term narrowing. Difficulties of reaching an agreement over both problems at the same time make it increasingly likely that the fiscal cliff, or more accurately the tax shock, will not be averted before January. One part of that shock has so far gone little noticed: Tax refunds may get delayed until the second quarter, with more than $200 billion at risk. In the first quarter of this year, the Internal Revenue Service cut checks totaling $212.8 billion to 75.3 million taxpayers, with each check averaging $2,826. Similar figures apply to first quarter 2011. The risk of a delay in sending out these huge sums is not based on mere speculation. Paul Cherecwich Jr., chairman of the IRS Oversight Board, warned in a Nov. 19 letter to the Senate Finance Committee that "more than 60 million taxpayers would have to wait until late March or later to file their returns and receive a refund." If, as the IRS official warned, any substantial portion of those refund checks gets deferred to the second quarter, there could be a noticeable hit to consumer spending in the first quarter. Over the past four quarters, consumer spending in nominal dollars has increased by an average of $90 billion per quarter. If $100 billion in refund checks gets deferred, that alone could put consumption in negative territory. While there would no doubt be a bounce-back in the second quarter, when the money would get sent out, it might not be enough to offset the first-quarter effect. Now add the automatic hit to paychecks from the rescission of the payroll-tax holiday, which will reduce take-home pay by an average of $30 billion per quarter. Add also that, another part of the tax shock, the rise in rates on the 2% of taxpayers, worth about $25 billion per calendar quarter, will probably not be reversed. Even if all other parts of the tax shock get blunted early next year, you have the makings of an economic downturn in the first quarter. The problem faced by the IRS, as Acting IRS Commissioner Steven T. Miller explained in a detailed letter of Nov. 13 to the House Committee on Ways and Means, is a classic example of how a key agency of government has to engage in educated guesswork -- in Commissioner Miller's words, "a risk-based decision" -- on what the politicians will do next. It mainly involves the alternative minimum tax, or AMT. Geared to exact an extra tax on incomes above a certain threshold, the AMT has been consistently "patched" to prevent it from being imposed on middle-income taxpayers. Accordingly, Miller "instructed IRS staff again this year to leave our core systems 'as is' with respect to AMT." Unless the patch is reinstated, "the magnitude and complexity of the changes" required would take "until late March, if not even later," to take effect. For that period, nearly everything else would grind to a halt. In a talk he delivered Dec. 6, Commissioner Miller was asked how soon he would need to get new guidelines on the AMT. His reply: "As soon as possible would be great." SPEAKING OF CONSUMER SPENDING, it's been said that books make terrible presents. The naysayers have a point. Unless you know in advance that the recipients want to read the tome you've bought for them, it's presumptuous to make such a huge claim on their time. Accordingly, these four stocking-stuffers do not have to be read straight through, but can be dipped into, like literary finger-food. All four are collections of pieces, although on unified themes. Perhaps the best value for the money is a collection by economist George Reisman, The Benevolent Nature of Capitalism and Other Essays, available only for e-readers at $2.99. I especially recommend the third essay, "Capitalism: The Cure for Racism," the clearest presentation of this important idea that I have ever read. A collection with even shorter takes is The Maxims of Wall Street: A Compendium of Financial Adages, Ancient Proverbs, and Worldly Wisdom, compiled by economist and investment advisor Mark Skousen. A Barron's reviewer (not me), called this book "welcome on Father's Day." Now in its second edition, it would be even more welcome any day. Building Blocks for Liberty: Critical Essays by Walter Block is an entertaining tour of the playful and persuasive thoughts of economist Walter E. Block. Try him especially on "Environmentalism and Economic Freedom: The Case for Private Property Rights," which if it doesn't change your mind, might at least alter your way of thinking about such issues. Finally, the collection Hypocrites & Half-Wits was called by a Barron's reviewer "the perfect stocking-stuffer for the friend or relative who has everything -- except the economic wit and wisdom of [author] Donald Boudreaux." That astute reviewer was me. Comments? E-mail: [email protected] Email

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Blueprint for the Euro Zone Hedge-fund chief Pierre Lagrange wants the unified-currency region to guarantee troubled member nations' bonds—but only if they hew to budget- and debt-reduction targets. Leslie P. Norton Practically every investor has an opinion on how the euro zone should dig itself out of its crisis, but few have a proposal as straightforward as that of the legendary money manager Pierre Lagrange, co-founder of London hedge-fund firm GLG. Lagrange believes that the euro zone could solve its problems quickly and simply, by having the European Central Bank conditionally guarantee the bonds of its member nations in financial difficulty. Specifically, Lagrange proposes that the euro zone guarantee the future long-term debt of its sovereign governments, if they achieve their budget- and deficit-reduction targets within a specified period of, say, five years. The schedule would vary by nation, much as ordinary debtors have different debt schedules in restructurings; if the sovereign misses the targets, the guarantee vanishes. He would also like to see the ECB guarantee short-term debt in return for a member nation paying a fee in the area of 0.5% a year. The latter idea came from Italian banks, which were eager to pay 0.8% for a sovereign guarantee earlier this year. He believes that this would address the problem of moral hazard, buttress the financial system, give governments time to implement the reforms that investors demand and, ultimately, reduce government meddling in the markets. THE LANKY, SOFT-SPOKEN LAGRANGE, 50, whose firm is a unit of $53 billion-in-assets Man Group EMG.ln +1.68% Man Group PLC Nov. 15, 2012 6:14 pm Volume : GBp1.76 Billion EMG.ln in (ticker: EMG.U.K.), developed the basic concepts while "trying to understand how much of what I do is actually being put at risk by what governments are doing." Enlarge Image Hedge-fund chief Pierre Lagrange says governments' incessant intervention in the markets creates so much risk that "it is a nightmare." Steve Marcus/Landov In a recent interview at Man's New York offices, he added that euro-zone officials are "very proud of how much they've done over the past two years…but it is a complete misunderstanding" of the market's needs. Incessant intervention creates so much risk that "it is a nightmare." Is his proposal legal? That's debatable, the fund chief acknowledges. It is certainly more radical than palliatives unveiled by euro-zone authorities, such as a euro-zone banking regulator, since Lagrange wrote to investors about his proposal in late June. The legality of the U.S.'s Troubled Asset Relief Program, a/k/a TARP, was questioned during the 2008-2009 financial crisis, but legislators passed it. Lagrange's proposal could be executed by the proposed European Stability Mechanism and funded by the ECB. In a tough period for hedge-fund managers, Lagrange's European Long/Short fund was up 5.4% in the six months through June, versus 1.8% for the Eurostoxx index. In the five years through the same date, it advanced 4.7% annually, while Eurostoxx fell 12.6% a year. Partly as a result, even as asset growth has suffered at Man this year, the GLG operation that it bought in 2010 has pulled in assets, which now total $26 billion. SOLVING EUROPE'S TROUBLES might gain urgency once spreads between the yields on German bunds and the peripheral nations' bonds widen so much that a sovereign fails, or when the debate over what to do grows more fierce, as seems likely before Italy's general election early next year, he says. Italian Prime Minister Mario Monti won't serve again, suggesting that other leaders will come forward, including, Lagrange says, possibly one who will point out "that the reforms and the speed at which they're needed are killing the corporate sector." Borrowing costs for Italian companies are much higher than for comparable German corporations. "Some people are going to fight and say there's an alternative," including exiting the euro zone, he adds. But unlike Greece's economy, he insists, Italy's "could actually stand on its own." Another thing he says might help: Greece's exit from the euro zone and a possible planned re-entry, with conditions. After GLG was acquired, Lagrange became chairman of MAN's Asia operations. He has traveled monthly to the region, where GLG is preparing long/short offerings. In China, companies are cautious about spending before the 18th Communist Party Congress leadership change in the fall, particularly following the upheaval that accompanied the disgrace of former official Bo Xilai. At the same time the government has kept credit far tighter than investors had hoped. When this transition is over, China will rebound, he predicts: "It's one of the best places on earth for growth, It is the right time to start looking at more consumer-specific stories in China." While he wouldn't name any, he likes logistics, e-commerce, health care, and education in general. Lagrange isn't a huge fan of China's big banks, saying "We are puzzled by financials because we can see that the loan growth is going to be in line with GDP growth and not more." The Asia fund is focusing on China, Korea, Hong Kong, the Philippines, Singapore, and Taiwan. Lagrange is also a well-known art collector, who sued New York's now-defunct Knoedler Gallery for allegedly selling him a fake Jackson Pollock painting. The litigation is continuing, but he remains passionate about art. In Asia, Lagrange is finding lots to like, including a South Korean collage artist who is expanding his artistic horizons. And what of India, another ancient civilization that investors watch closely? Lagrange is keeping a wide berth. "So few people are really able to make money out of India." he says, noting it remains "a mystery." E-mail: [email protected] Email

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Board Opens Fifth Regional Office Washington, D.C., Aug. 16, 2004 The Public Company Accounting Oversight Board today announced the opening of a regional office in southern California, bringing the total number of regional offices to five. The new office, located in Orange County, joins existing locations in Atlanta, Dallas, New York and San Francisco. In addition, the Board is in the process of establishing offices in the Chicago and Denver areas. The regional offices primarily support the PCAOB’s inspections program, which is headquartered in Washington, D.C. The Board’s standards-setting, registration and enforcement groups are also based in Washington. “It is through PCAOB’s regional offices that our duties under the Sarbanes-Oxley Act move from theory to practice,” said PCAOB Chairman William J. McDonough. “All of our offices are currently looking to add to their ranks qualified audit professionals who want to be in the forefront of defining change in the public accounting profession.” Members of the PCAOB’s Office of Registration and Inspections are currently conducting annual inspections of firms with more than 100 public company audit clients, as well as a selection of other registered firms. “We are striving to build a highly motivated, professional and experienced, world-class team of inspectors to play a critical role in the restoration of public confidence in the accounting profession and in our markets,” said George Diacont, Director of Registration and Inspections at PCAOB. The southern California office is led by Associate Director of Inspections Gary McCormick, a former partner at Deloitte & Touche and former president of the Fraud Discovery Institute. Mr. McCormick began his auditing career in 1980, in the financial services and real estate industries. He spent five years as the Professional Practice Director for the San Diego office of Deloitte & Touche. He graduated from San Diego State University with a Bachelor of Science degree in Business Administration. PCAOB’s Dallas office and its inspections team are led by Deputy Director of Inspections Dennis Jennings, a former partner at PricewaterhouseCoopers. Mr. Jennings has 33 years of experience in auditing, specializing in energy, manufacturing, hospitality and consumer products. Mr. Jennings was a member of PricewaterhouseCoopers’ international executive committee in the Global Risk Management Solutions Group and led the group’s international energy and mining practice. He holds a Bachelor of Arts degree in accounting from Texas Tech University. The San Francisco office is led by Associate Director of Inspections Helen Munter, a former partner at Deloitte & Touche where she held various positions over a 16-year span. Most recently she was an Audit Partner and Deputy Director of Professional Practice for Northern California. In this capacity, she performed internal control assessments, handled all communications with audit committees, and provided consultation on matters of risk management, technical accounting, auditing, and oversight of engagement teams. She earned her Bachelor of Arts degree in Political Economies of Industrial Societies from the University of California at Berkeley. The Atlanta office is headed by Associate Director of Inspections Jeffrey Hughes. Prior to joining the PCAOB, Mr. Hughes was an audit partner at Ernst & Young in the Washington, D.C., area. While at Ernst & Young, he served clients in multiple industries and participated in the firm’s local and national recruiting and education initiatives. He earned his Bachelor of Business Administration degree from the College of William and Mary. The New York regional office’s inspection team is led by Deputy Director of Inspections Paul E. Bijou, a former partner at PricewaterhouseCoopers. Mr. Bijou has 26 years of experience in auditing, specializing in banking, manufacturing, automotive and consumer products. Mr. Bijou was a leader in the internal controls services group of PricewaterhouseCoopers and led the New York practice for the firm. He holds a Bachelor of Arts degree in accounting from Iona College in New York. Contact PCAOB

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Economic & Banking Resources Economic Release Calendar Speech Calendar Home > Newsroom > Press Releases > 2009 Releases > Fretz, Groff Elected to Bank Board of Directors Fretz, Groff Elected to Bank Board of Directors December 16, 2009 For immediate release Contact: Katherine Dibling, senior media representative, (215) 574-4119 Philadelphia, Pa. - The Federal Reserve Bank of Philadelphia has announced the election of Deborah M. Fretz, president and CEO of Sunoco Logistics, and the re-election of Aaron L. Groff, Jr., chairman, president, and CEO of Ephrata National Bank to the Bank's board of directors. Groff will begin his new term and Fretz will begin her first term on January 1, 2010. Each of the 12 Reserve Banks has a nine-member board of directors that oversees Bank operations. The directors provide information about economic conditions in their industries to monetary policymakers. Deborah M. Fretz Fretz works for Sunoco Logistics Partners, which is a publicly traded master limited partnership founded in 2001 to acquire, own, and operate crude oil and refined products pipelines, terminals, and storage facilities. Before assuming her current position in 2001, she was senior vice president, mid-continent region, Sunoco, Inc. From January 1997 to November 2000, she was senior vice president of the lubricants business at Sunoco, Inc. Fretz is also a director of GATX Corporation, a Chicago-based transportation company. She has a bachelor's degree in biology and chemistry from Butler University and an MBA from Temple University. Aaron L. Groff, Jr. Groff began his career at Ephrata National Bank in 1967 as a clerk. After a short hiatus in 1969, he returned to the bank in 1971 as a teller. Groff worked his way up to vice president and cashier in 1984 and was promoted to his current position in 1999. He was a member and then chairman of the Philadelphia Fed's Community Bank Advisory Council from 2003 to 2005. Groff is a graduate of the American Institute of Banking, the New Jersey Bankers Data Processing School, and the International Business Machines Data Processing School. The Federal Reserve Bank of Philadelphia helps formulate and implement monetary policy, supervises banks and bank holding companies, and provides financial services to depository institutions and the federal government. One of the 12 regional Reserve Banks that, together with the Board of Governors in Washington, D.C., make up the Federal Reserve System, the Philadelphia Federal Reserve Bank serves eastern Pennsylvania, southern New Jersey, and Delaware. Related REsource Board of Directors E-Mail Notification Stay informed by getting the latest press releases from the Philadelphia Fed. Marilyn Wimp, ABC Manager of Media Relations Katherine Q. Dibling Public Affairs Specialist Daneil Mazone Media Relations Representative

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hide Exclusive: Microsoft in talks with ValueAct over board seat - sources Friday, July 19, 2013 4:38 p.m. EDT People visit the Microsoft booth at the 2013 Computex exhibition at the TWTC Nangang exhibition hall in Taipei in this file photo from June By Nadia Damouni and Bill Rigby NEW YORK/SEATTLE (Reuters) - Members of Microsoft Corp's board have held talks with ValueAct Capital Management LP in recent days over the activist shareholder's demands to secure a seat on the company's board, two sources close to the matter said on Friday. ValueAct, which wants a say in the way the world's largest software company is adapting to the new world of mobile computing, is seeking to nominate a person from its own organization, the sources said. The news comes as Microsoft had its biggest sell-off in four years, wiping $34 billion off its market value, after quarterly results were hit by weak demand for its latest Windows system and poor sales of its Surface tablet. San Francisco-based ValueAct, which manages more than $10 billion for clients, owned 33 million Microsoft shares as of March, which is 0.4 percent of total shares outstanding, but it is believed to be buying more. The fund, co-founded by finance industry veteran Jeff Ubben in 2000, has made a reputation for building stakes in companies and working with management in private to change fundamental strategy. ValueAct's other major holdings include Adobe Systems Inc, Motorola Solutions Inc and Valeant Pharmaceuticals International Inc. In recent months a number of Microsoft's top institutional investors have contacted ValueAct, expressing concern over management execution and strategy, the sources said. High among the issues in the talks, which the sources described as ongoing, is the apparent lack of succession planning at the top of the company. Steve Ballmer has held the chief executive job since 2000 and shows no signs of relinquishing it. Ballmer, 57, once remarked that he envisaged staying on until his youngest child goes to college, which would be around 2017 or 2018, but since then he has not publicly addressed the matter. ValueAct and Microsoft declined to comment. The software company has previously said there is a CEO succession plan in place, but has declined to give details of it. Microsoft's huge stock drop on Friday, prompted by its financial results and a $900 million write-down on the value of unsold Surface tablets, provoked fresh skepticism of Ballmer's new plan to reshape Microsoft around devices and services. "The recent reorganization does not fix the tablet or smartphone problem," Nomura analyst Rick Sherlund said in a note to clients on Friday. "The devices opportunity just received a $900 million hardware write-off for Surface RT and investors may not even like the idea of wading deeper into this territory." ValueAct is thought to oppose Microsoft's recent foray into making its own devices. Microsoft and Ballmer have been the targets of much criticism over the past decade, chiefly for falling behind Apple Inc and Google Inc in the shift toward mobile computing. The company, however, has not been subjected to much overt protestation from shareholders. The most public challenge came two years ago, when Greenlight Capital's David Einhorn, who made his name warning about Lehman Brothers' financial health before the investment bank's collapse, called for Ballmer to step down. Microsoft never responded publicly to that call, and the company's board has never indicated any major disapproval with Ballmer's performance, although it did trim his bonus last year for sagging Windows sales and a mistake that led to a massive fine by European regulators. ValueAct may find it difficult to stir up change at Microsoft, even if it does get a seat on the board, given that co-founder and Chairman Bill Gates has long been a solid supporter of his old friend and colleague Ballmer. Gates, who founded Microsoft in 1975 with Paul Allen, still owns about 4.8 percent of the company and is the largest individual shareholder. Ballmer, who is also on the board, owns about 4 percent. Alongside Gates and Ballmer, seven independent directors make up Microsoft's nine-person board. The lead independent director is John Thompson, a former Symantec Corp and IBM executive. Microsoft's shares closed down 11.4 percent at $31.40 on Nasdaq on Friday, but recovered slightly to $31.58 in after-hours trading, after the news that board members were in talks with ValueAct. (Reporting by Nadia Damouni in New York and Bill Rigby in Seattle; Editing by Edward Tobin, Gary Hill, Toni Reinhold)

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hide Ex-Virginia bank executives guilty in financial crisis case (Reuters) - The former chief executive of a failed U.S. bank in Norfolk, Virginia, and three others were convicted Friday of conspiracy to commit bank fraud and other charges in connection with a scheme to conceal loan losses that contributed to the bank's collapse in 2011. Edward Woodard, the former chief executive of Bank of the Commonwealth, was found guilty along with two other executives by a federal jury in Norfolk following a multi-week trial, the U.S. Justice Department said. Federal prosecutors are pursuing several cases stemming from the U.S. financial crisis, which battered large and small banks alike. Bank of the Commonwealth, which at one time had $1.3 billion in assets, cost the Federal Deposit Insurance Corp an estimated $268 million when it failed, prosecutors said. The bank's assets were acquired by Southern Bank and Trust Co at the time of the 2011 failure. Prosecutors secured the indictment against Bank of the Commonwealth's former executives in July 2012. Neil MacBride, the U.S. Attorney for the Eastern District of Virginia, said in a statement that the verdict "sends a clear message to top executives and insiders in the financial services industry." "The brazen greed and dishonesty of these four defendants toppled one of Virginia's largest financial institutions and intensified the impact of the 2008 financial crisis on the public during the height of the fiscal storm," MacBride said. According to prosecutors, Bank of the Commonwealth began an aggressive expansion in 2006 beyond its historical focus of Norfolk and Virginia Beach. Many of its loans were funded without regard to industry standards, prosecutors said. By 2008, losses mounted as loans soured. From 2008 to 2011, Woodard and Stephen Fields, a former executive vice president and commercial loan officer at the bank, hid the bank's financial condition, authorities said. Bank insiders also gave preferential financing to troubled borrowers to buy properties Bank of the Commonwealth owned, prosecutors said. Woodard, 70, was convicted of charges, including conspiracy to commit bank fraud, bank fraud and false entry in a bank record. Other defendants convicted on conspiracy to commit bank fraud and other charges included Fields, Troy Brandon Woodard, Woodard's son and an employee of a mortgage loan specialist at a bank subsidiary, and Dwight Etheridge, a bank customer. Simon Hounslow, an executive vice president and chief lending officer until the bank's closing, was acquitted of all charges, the Justice Department said. "We have long believed he never should have been charged in this case and, after careful deliberation, it is clear the jury came to that view," John Adams, a lawyer for Hounslow at McGuireWoods, said in an email. Lawyers for the others defendants did not immediately respond to requests for comment. A separate lawsuit filed in January by the U.S. Securities and Exchange commission against Woodward, Fields and another executive remains pending. The case is U.S. v. Woodard, et al, U.S. District Court, Eastern District of Virginia, No. 12-cr-00105. (Reporting by Nate Raymond in New York.; Editing by Andrew Hay and Andre Grenon)

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< Comedy And The Economic Crash Of 1929 October 26, 2009 4:00 PM ET Copyright ©2009 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required. MELISSA BLOCK, host: People need comedy during tough times. But during the great stock market crash of 1929, there was a problem. Large numbers of entertainers lost everything too. Well, this week is the 80th anniversary of the market crash, and NPR's Robert Smith went in search of what happened to humor. (Soundbite of music) ROBERT SMITH: In 1929, everything was booming - the stock market, radio, movies. And riding that wave were four brothers named Marx: Groucho, Chico, Harpo and Zeppo were even making their first talking movie about a speculative bubble, "The Florida Land Rush." (Soundbite of movie, "The Florida Land Rush") Mr. GROUCHO MARX (Comedian): Do you know that property values have increased 1929 to 1,000 percent? Unidentified Woman: You told me about this yesterday. Mr. MARX: I know, but I left out a comma. SMITH: But the Marx brothers were obsessed with a different kind of investment. After Groucho finished filming each scene, he'd call his broker. Groucho had stuffed all of his money into stocks. Professor MAURY KLEIN (History, University of Rhode Island): He became just your classic innocent investor. He didn't have a clue what was happening. He didn't know why the prices went up when they did. SMITH: Maury Klein is a professor of history and the author of "Rainbow's End: The Crash of 1929." Prof. KLEIN: Every day he'd go in and he'd look on the big board and he'd see that his stock had climbed X number of prices, and he had made several thousand dollars without lifting a finger. And he thought, well, this is easy. (Soundbite of song, "I'm In the Market for You") Mr. GEORGE OLSEN (Singer): (Singing) I'll have to see my broker, find out what he can do, 'cause I'm in the market for you. SMITH: Show business and Wall Street hadn't always mixed. But by 1929, everyone was in the market. The Marx Brothers were getting hot tips from Joe Kennedy. They even left an audience waiting one afternoon because they were trying to buy up shares of Anaconda Copper. You'd think they would have known better, since the entire plot of their movie "Cocoanuts" was about bad investments. (Soundbite of movie, "The Cocoanuts") Mr. MARX: You can have any kind of a home you want. You can even get stucco. Oh, how you can get stucco. Now is the time to buy while the new boom is on. Remember that old saying: A new boom sweeps clean. And don't forget the guarantee. If these lots don't double in value in a year, I don't know what you can do about it. Prof. KLEIN: Groucho was very conservative. But there's this increasing belief that almost becomes a fantasy that all you have to do is put your money in the market and the story will have a happy ending, which, of course, in Hollywood is supposed to happen. SMITH: But not on Wall Street. Their script called for a tragedy. Over six days at the end of October 1929, the stock market plunged by a third. Groucho Marx later recalled the exact words from his financial adviser. Marx, he said, the jig is up. Groucho lost a quarter of a million dollars. He later joked that he would've lost more, but that was all the money he had. Harpo was also wiped out. Their friend and fellow vaudevillian Eddie Cantor was no longer a millionaire. Mr. EDDIE CANTOR (Performer): Well, folks, they got me in the market just as they got everybody else. I know thousands and thousands of married men who will have to leave their sweethearts and go back to their wives. SMITH: Canter was left with $60 in his pocket and a debt of $300,000. Mr. CANTOR: Personally, I shouldn't worry about my stocks. I know my broker is going to carry me. Yes, sir - he and three other pallbearers. SMITH: Sure, it was dark, but at least they were still making jokes. You have to remember, stocks had crashed before and then gone right back up. The Great Depression was a year off and there was still a hope that everyone could laugh this whole thing off. Singer Arthur Fields. (Soundbite of music) Mr. ARTHUR FIELDS (Singer): (Singing) I'm the chump you heard about, there's more like me without a doubt, when stock reports are given out, oh, what a sucker. My stocks come tumbling down, my stock come tumbling down when I listen to the ticker tick, I figured I could get rich quick, but the bunch of bears were too darn slick. My stock come tumbling down. SMITH: Groucho Marx still didn't think it was funny. The Marx Brothers were scheduled to do a show in Baltimore right after the crash and Groucho couldn't go on. He was sick, depressed. The crash of '29 gave him insomnia that he never recovered from. Groucho's next movie was "Animal Crackers," and you could tell the whole thing still haunted him. (Soundbite of movie, "Animal Crackers") Mr. MARX: (As Captain Jeffrey T. Spaulding) Hideous, stumbling footsteps creaking along the misty corridors of time and in those corridors I see figures, strange figures, weird figures: Steel 186, Anaconda 74, American Can 138. SMITH: The audience would've recognized those stocks. But by the time the movie was released, Anaconda Copper had dropped even lower. It would go down to $3 a share. That's why in the movie "Horse Feathers," Groucho was using the stock name as a swear word. (Soundbite of movie, "Horse Feathers") Mr. MARX: (As Professor Quincy Adams Wagstaff) Jumping Anaconda. SMITH: They couldn't know it at the time, but the Marx Brothers and Eddie Cantor and the rest of the comedians would have the last laugh. The movie business was one of the few industries not devastated by the Great Depression. And the Marx Brothers' cynical brand of humor was perfect for the mood of the public. They were soon rich again. But they didn't forget. In 1937's "A Day at the Races," Groucho buys into a horse-picking scam that seems awfully familiar. (Soundbite of movie, "A Day at the Races") Unidentified Man: Come on, do you want to win? Mr. MARX: (As Dr. Hugo Z. Hackenbush) Want to win, but I don't want the savings of a lifetime wiped out in the twinkling of an eye. SMITH: It's the one line in the movie where Groucho seems dead serious. Robert Smith, NPR News, New York. Copyright © 2009 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information. NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. 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Joseph BarratoCEO, Director of Investment Strategies Joe is a founding member of Arrow Investment Advisors, LLC, the advisor to Arrow Funds. His responsibilities include investment strategy, business development and marketing. Joe's experience of more than 20 years includes six years at Rydex Investments, where he was positioned at the helm of Rydex research, educating financial intermediaries on how to use Rydex Funds. He created fundamental and technical research tools and developed momentum models with Rydex sector funds. As Director of Product Development, he was responsible for researching new strategic opportunities, as well as creating high-quality investment products and services. He also initiated the research to create and launch the firm's first buy-and-hold mutual fund, the Rydex Sector Rotation Fund. Prior to Rydex, Joe spent 12 years at the Federal Reserve Board of Governors. As a financial analyst, he assisted economists and analyzed monetary aggregate data. As a senior financial examiner, he advised Fed officers and board officials on financial, operational and managerial enhancements. He holds a bachelor's degree in business administration from The George Washington University, where he majored in finance and minored in accounting. Jake GriffithPresident, Director of Sales Jake is a founding member of Arrow Investment Advisors, LLC, the advisor to Arrow Funds. His primary responsibilities include sales and key accounts. Before starting Arrow Funds, Jake spent 10 years at Rydex Investments, where he established a new investment advisor to provide mutual fund wrap strategies utilizing institutional money managers. As part of the firm's business development group, he was responsible for the development and promotion of unique mutual fund and variable trust fund asset allocation programs designed to deliver dynamic asset allocation strategies to the financial intermediary marketplace. He also spent two years as RIA Sales Manager, where he managed the inside sales team supporting lead generation and client service for the RIA channel. Prior to Rydex, he worked in various roles at a family-owned business. Jake holds Series 3, 7 and 63 securities registrations. John CadiganNational Sales Manager As National Sales Manager, John leads Arrow’s product distribution and advisor education efforts surrounding alternative investments and exchange traded funds (ETFs). During his more than 25 years of financial services industry experience, he has played a key role in creating and implementing various strategic corporate initiatives and building effective sales distribution teams for both traditional and alternative investments. Prior to joining Arrow, John served as the Managing Director/National Sales Manager for Direxion Funds with responsibility for the firm’s alternative and ETF lineup distribution strategy within the Broker/Dealer and Registered Investment Advisor (RIA) channels as well as the retail and institutional marketplaces. He also spent more than ten years at Rydex Investments where he helped to establish the firm as an early entrant in the alternative investment mutual fund space. In addition to his distribution responsibilities, John has served as a portfolio strategist charged with providing financial advisor education on alternative investments and ETFs through various speaking and media engagements. William E. Flaig, Jr.Chief Investment Officer Bill joined Arrow Investment Advisors in February of 2007. His experience of more than 16 years includes two years as a principle of Paladin Asset Management, where some of his original research in Absolute Return Factors evolved into the Arrow Alternative Solutions Fund. During his five years at Rydex Investments, he was Director of Portfolio Management and managed the entire portfolio team. While at Rydex, Bill defined the concept of hedge fund replication, initiated the research and investment strategies on which several alternative funds are based, and then directed the management of those strategies. He also developed best practices for creating leverage within the constraints of an actively traded open-end mutual fund. Bill also spent six years at Bankers Trust Company in a range of roles including currency trading, proprietary trading, derivatives structuring, emerging market fixed income and currency trading. Bill graduated from Purdue University with a degree in management. Ray AmaniDirector of Product Development Ray joined Arrow Investment Advisors as Director of Product Development in January 2011. His primary responsibilities include overseeing new product launches, strategic partnerships and business development opportunities. Prior to joining Arrow, Ray spent 12 years with Thomson Reuters where, he spearheaded a number of successful initiatives, including key research projects for CDA/Wiesenberger. As a subject matter point-person, he oversaw the evolution of the Wealth Management Division, which includes Lipper Analytics. He was also instrumental in creating a partnership to launch ETF Connect, an industry website for tracking exchange traded products. Ray has been quoted in numerous industry publications including Financial Times, Financial Planning, Investment News and The Wall Street Journal. Before working at Thomson Reuters, Ray held positions at Prudential Securities, ECM Hedge Fund and ADP Institutional Brokerage Services. He graduated from George Mason University with a double major in government politics and economics. Neil E. KaysDirector of Marketing Neil joined Arrow Funds in February 2008 as Director of Marketing. Prior to joining Arrow, he was Vice President of Marketing Communications for Steben & Company, a managed futures firm. He was previously the Senior Product Marketing Manager for mutual funds at Rydex Investments, including more than 60 traditional and alternative products totaling over $10 billion AUM. Since beginning his career in 1992, Neil has gained years of financial services experience through various sales and marketing roles with T. Rowe Price, Old Mutual and Legg Mason. Neil has a bachelor's degree in mass communications from Towson University and holds the Series 7 and 63 securities registrations.

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First Manitowoc Bancorp Changes Ticker Symbol May 17 - First Manitowoc (Wis.) Bancorp Inc., parent company of Bank First National, announced the company's stock ticker symbol has changed. Effective May 15, 2013, the company's common shares commenced trading on the OTC Markets under the trading symbol 'BFNC' (OTCQB: BFNC). The previous trading symbol was 'FMWC.' "This change will better align the Bank First brand and name with the ticker symbol. We have discovered that customers and potential shareholders have had difficulty making the connection with our previous ticker symbol," stated Mike Molepske, president and CEO at Bank First. "Furthermore, the holding company will seek shareholder approval in early 2014 to change the holding company name to also better align with the Bank First brand and name." First Manitowoc Bancorp Inc. (BFNC) provides financial services through its sole subsidiary, Bank First National, which was incorporated in 1894. The bank is an independent community bank with 12 banking locations in Manitowoc, Brown, Sheboygan and Winnebago counties. The bank offers loan, deposit, investment advisory and trust products at each of its banking offices. Insurance products are available through Ansay & Associates LLC. Trust, investment advisory and other financial services are offered through the bank's partnership with Legacy Private Trust and through an alliance with Morgan Stanley Smith Barney. The Bank is a co-owner of a data processing subsidiary, United Financial Services Inc., which provides data services for over 40 Wisconsin banks. The bank employs approximately 159 full-time equivalent staff and has assets of $972 million as of March 31, 2013. Further information about First Manitowoc Bancorp Inc. is available by clicking on the Investor Relations tab at www.BankFirstNational.com.

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Bridge Bank Adds 18,000 Square Feet to Its Downtown San Jose Office Sept 26 - Bridge Capital Holdings (Nasdaq: BBNK), whose subsidiary is Bridge Bank, a full-service professional business bank headquartered in Silicon Valley and with offices located nationwide, has signed a 10-year lease agreement with Embarcadero Capital Partners for the renewal and expansion of its operations at 55 Almaden Boulevard in downtown San Jose. The 10-year lease agreement, effective January 2014, includes the renewal of the bank's current lease of three floors in the Almaden Financial Plaza building, plus an additional 18,000 square feet located in the seventh floor of the building. John Peckham, executive vice president and head of Bridge Bank's Information Systems Division, along with Scott Daugherty at Colliers International, represented Bridge Bank in the negotiations with Embarcadero Capital Partners. The additional leased space will be used to accommodate Bridge Bank's growing number of employees, in addition to providing space for client events and additional conference rooms. "We continue to see demand in the market for our unique approach to business banking," said Tim Boothe, executive vice president and chief operating officer of Bridge Bank. "This additional leased space will allow for Bridge Bank to scale up to meet that demand, and is yet another sign of our continued commitment to being the business bank of choice for the entire Bay Area and throughout the country in select regions." The bank recently reported that its assets had reached over $1.4 billion, driven by an 18 percent year-over-year increase in loan growth as of June 30, 2013. Bridge Bank first moved to 55 Almaden Boulevard in San Jose in 2003, with an initial lease for nearly 36,000 square feet of space on the first and second floors of the building. Since then the bank has expanded its lease multiple times, adding new floors to accommodate for new banking divisions and additional administrative staff. Currently, the bank occupies three floors of space in downtown San Jose; this new expansion will bring the bank to 50 percent of the building's occupancy. Bridge Bank recently announced an expanded presence in San Francisco to accommodate for similar growth of its banking team there. Back

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EU Short Selling Rules Spark Confusion Brooke Masters and Vanessa Kortekaas, Financial Times Thursday, 1 Nov 2012 | 2:47 AM ETFinancial Times Late and complex guidance from regulators has left the markets unprepared and confused ahead of today's imposition of the first pan-EU rules on short-selling, according to brokers, traders and investors. Alessia Pierdomenico | Bloomberg | Getty Images A visitor looks at a plaque commemorating the 200th anniversary of the Borsa Italiana, inside Italy's stock exchange, which is part of the London Stock Exchange Group Plc, in Milan, Italy. The far-reaching regulation, which was finalized in March, imposes tough disclosure requirements for investors who place large bets that the prices of EU-listed shares or bonds will fall. The legislation also tightens rules against "naked" shorting – selling shares without arranging to borrow them first – and bans investors from buying credit default swaps on debt issued by sovereigns in the 27-nation bloc unless they can show they are hedging a long position. But investors and their lawyers have complained that the European Securities and Markets Authority, the pan-EU regulator, has failed to give them enough guidance on how to calculate the size of their short positions. "It's a shambles," said Darren Fox, a partner at Simmons & Simmons who advises hedge funds. "People are crying out for clarity. I can't remember another piece of European legislation being implemented this badly." Dealers are even angrier. The regulation contains important exemptions to the rules for market makers but Esma is not expected to issue final guidance on what counts as market making until later in November. "The regulators aren't ready for this," said Paul Cluley, a partner at Allen & Overy who has been advising market participants. "Esma isn't ready. It is coming into force because there is a political will to be seen to be doing something, even if no one knows quite how, or indeed if, it will work." The regulation also marks one of the first times that the EU has sought to regulate transactions outside its borders – any shorting of a security with a primary listing in the EU is covered. "This is really the first time that non-US regulation has impacted directly [on] US market traders," said Stephen Wink, partner at Latham & Watkins, the law firm. "I think this was a real surprise for many folks in the US market." The UK's Financial Services Authority recently set up an application procedure for institutions that think they fit under the market-making exemption but the City watchdog has told banks and brokers to look to Esma to define what is covered. Esma officials acknowledged that the guidance on market makers would not be ready in time. But they noted that the EU regulator has already published two sets of frequently asked questions and downplayed the importance of the market-maker guidelines. "The requirement regarding the market-maker and primary-dealer exemption is already set out in the regulation," Esma said in a statement. "The proposed guidelines, which are currently under discussion, are aimed at clarifying and explaining the application of the regulation, but do not change its scope." But dealers said they needed the final guidelines to see whether Esma had responded to complaints that the draft version was significantly more restrictive than the regulation itself. "There isn't total clarity on how that market-making exemption will work," said Richard Metcalfe of the International Swaps and Derivatives Association. "There is still debate about what actually constitutes market making and whether that has to be a frequent activity. That shouldn't be the case." The new law also calls for the EU watchdog to opine whether national regulators are being reasonable when they impose emergency bans on selling equities and bonds short. Esma is expected to issue its view of the current Greek and Spanish bans this week.

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From the March-28, 2001 issue of Credit Union Times Magazine • Subscribe! NASCUS, state and federal regs, league officials confer on international branching March 28, 2001 • Reprints SACRAMENTO, Calif. - Discussion of issues concerning field-of-membership and branching expansion by credit unions within the borders of the 50 states is almost an everyday occurrence. But what about international branching? This and related issues were the subject of discussion at a day-long, intensive meeting held March 21 at the Senator Hotel Office Building here between NASCUS and NCUA officials, regulators from about nine states including California and Washington, and presidents of the California and Washington credit union leagues. "The world is going global, and it's crucial that credit unions aren't left behind in that globalization," said NASCUS President/CEO Doug Duerr. The North American Free Trade Agreement (NAFTA) is changing the entire financial services landscape, he added. The March 21-meeting, which also featured the by-phone participation of the New York State regulator, is in fact the latest in a series of meetings on the subject of international branching that has been held between NASCUS and NCUA. Two years ago, an international branching summit was held between the association and the agency. In Dec. 2000 the topic was discussed at the executive committee meeting between NASCUS, NCUA Board members and regional directors. A second international branching summit was recently held in Orlando the week of March 12 at the annual NASCUS and NCUA Regulators Conference. The meetings not only reflect the increased interest among state-chartered credit unions to branch out internationally, but also the recognition of the safety and soundness risks involved with U.S. credit unions doing business in foreign countries. "Keeping in mind that no credit union, either on the state or federal side, has had experience with international branching, this is understandably a tall order," said Duerr. "The NCUA is mindful of this, they have legitimate questions and concerns. Their interest is in preserving the integrity of the insurance fund while giving state-chartered credit unions the flexibility to branch internationally." Indeed, citing its safety and soundness concerns over the prospect of state-chartered CUs branching outside the U.S., NCUA published an Advance Notice of Proposed Rule Making (ANPR) 12 CFR 741, "Requirements for Insurance and Foreign Branching" in Sept. 2000, asking for comments on whether NCUA should insure share activity that originates in international branches of state-chartered credit unions, and for suggestions on rules the NCUSIF should write if it agrees to cover CUs operating international branches. In its Nov. 13, 2000-comment letter to NCUA on ANPR 12 CFR 741, NASCUS urged "the NCUA to work with State Regulators to develop insurance requirements that mitigate risks associated with foreign branching while preserving a real ability for qualified credit unions to operate foreign branches." Noting in his letter that both the FDIC and the Federal Reserve already have found ways to facility international branching for U.S. banks, and for overseas banks to operate in the U.S., "it is evident that the NCUA in its role as the insurer should be able to do the same with a goal of mitigating risks but with a commitment to make workable and realistic rules which facilitate international branching when allowed by state legislatures and state regulators," Duerr wrote then. Among the questions and issues that came up at the joint regulators conference in Orlando between NASCUS and NCUA were: *how would the NCUSIF regulate the safety and soundness of international branches? *what approaches should be taken to mitigate the risk to institutions and the NCUSIF without completely foreclosing the option of foreign branching? *what would the costs of supervision of international branches be and who would pay for it? *what would be the special capital requirements for foreign branches? *do regulators have the ability to truly examine an institutions with foreign branches? *interest rate variation and currency fluctuation; *compliance with bonding requirements, and foreign laws and regulations; *how can the NCUSIF be integrated with foreign deposit insurance? *sovereignty issues; "There are no easy answers to any of these questions and issues, but there is a significant history of international branching in the banking environment for us to refer to," Duerr said. Even as state and federal regulators continue to hold lengthy discussions about state-chartered credit unions operating international branches, there are already four states that include international branching permissive language, albeit in a variety of forms, in their state credit union act - California, Washington, Florida, and Michigan. There are currently no state-chartered credit unions from any of the four states that have branches outside the U.S. or its territories. But there has been interest expressed already by several credit unions in Washington and California concerning opening branches in Canada and Mexico. Parker Cann, director of credit unions, Washington State said he's received inquiries from several state-chartered credit unions which expressed an interest in setting up branches in Vancouver, British Columbia. Being a border state, Cann said many credit unions in Washington, such as Weyerhauser Employees CU in Longview, have select employee groups in their field-of-membership which include employees in Vancouver. "We're still trying to get our hands around the issue of international branching," said Cann. "There's a slew of issues that have to be addressed before anything happens." Cann enumerated some of his own concerns that he's also shared with NASCUS on the association's online discussion forum on international branching. Cann for example, cites several structural issues such as: Does the law of the foreign country allow a U.S. credit union to branch into the foreign country or allow a U.S. credit union's CUSO that is not organized as a U.S. credit union, to open a credit union branch in the foreign country? If so, does the relevant U.S. law allow the CUSO to do so? John Annaloro, president/CEO of the Washington Credit Union League echoed some of Cann's concerns. "Each state regulator has to come to its own decision," said Annaloro. "I hope we can achieve permissibility for our credit unions to operate branches internationally." [email protected]

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Antonakes Named CFPB Acting Deputy Director January 31, 2013 • Reprints The Consumer Financial Protection Bureau announced that Steve Antonakes, currently associate director for supervision, enforcement and fair lending, will now serve as acting deputy director effective Friday. Departing Deputy Director Raj Date last day with the CFPB was Thursday. "We will be forever grateful to Deputy Director Raj Date for his tremendous work to protect American consumers. As the CFPB's first deputy director, Raj has helped to lead the agency's organizational, strategic, and policy efforts and put in place key new mortgage rules that will benefit all Americans,” said CFPB Director Richard Cordray. “Although we will miss Raj, he has helped to build a strong, talented team and I am pleased that Steve will be taking on the role of acting deputy director,” Cordray said. “Steve’s knowledge, expertise, and judgment will continue to be invaluable as we move forward with our important work --making markets work for consumers and responsible businesses.” Antonakes’ background includes more than two decades as a financial services regulator. He first joined the CFPB in November 2010 as the assistant director of large bank supervision and was named to his current position in June 2012. He began as an entry level bank examiner with the Commonwealth of Massachusetts Division of Banks in 1990 and worked his way up to Commissioner of Banks, serving in that capacity from December 2003 until November 2010. Date, who was seen as the heir apparent to take over the bureau after Cordray’s term expires, served as the CFPB’s first deputy director and spent more than two years helping to build the agency. He filled a number of key leadership roles, including special adviser to the Secretary of the Treasury and associate director for research, markets and regulations.

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Agencies still fail to comply with key financial law, says GAO By Jason Peckenpaugh Most federal agencies are still unable to use data from their financial systems to make daily management decisions, but the Bush administration's emphasis on financial management is improving systems at some agencies, according to a new report from the General Accounting Office. In its sixth annual report on implementation of the 1996 Federal Financial Management Improvement Act (FFMIA), GAO found that incompatible financial systems, poor accounting practices, and weak security controls are the main reasons why most agencies still fail to comply with the law. Earlier this year, agency inspectors general found that 20 of 24 agencies covered by the 1990 Chief Financial Officers Act failed to meet FFMIA's mandates, which require agencies to comply with the Standard General Ledger and other federal accounting tools. Agencies with numerous financial systems must rely on costly, labor-intensive tactics to get clean audits, GAO concluded in its report, "Financial Management: FFMIA Implementation Necessary to Achieve Accountability" (03-31 ). For example, the Education Department relied on a mix of manual and automated methods to balance its books in 2001-a risky process, according to GAO. And a clean audit does not provide financial information that managers can use to run their programs, a main goal of FFMIA. "While more CFO Act agencies have obtained clean or unqualified audit opinions…there is little evidence of marked improvements in agencies' capacities to create the full range of information needed to manage day-to-day operations," the report said. GAO noted that several agencies are trying to capture the full cost of their operations, a precursor to using financial data to make management decisions. Agencies such as the Small Business Administration, the Interior Department and the Marine Corps are using activity-based costing, an accounting method that provides managers with useful cost data. But the technique does not work for everyone, according to GAO. The report also noted that the Bush administration's focus on financial management has improved financial systems at some agencies, such as the Labor Department. Earlier this year, Labor was upgraded from "red" to "yellow" on the president's management scorecard, a sign of progress. The administration has also used the Joint Financial Management Improvement Program (JFMIP) as a way to improve financial management practices. JFMIP leaders, who include the comptroller general, director of OPM and OMB comptroller, have been meeting quarterly to address financial management policy. JFMIP and OMB are crafting new performance measures for financial management that give agencies targets beyond obtaining clean audit opinions. Federal managers would also like to have more usable financial information. In a recent survey by the Association of Government Accountants and Government Executive, 74 percent of respondents said they would like more access to information that ties costs to performance. More than 800 senior executives and federal managers responded to the survey.

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Hedge Fund News From HedgeCo.Net ← Klarman’s Baupost to Set Up in London to Cash In on European Debt Crisis $800 Million Raised For Black Diamond Hedge Fund → Jay Gallagher Joins FletcherBennett To Expand Institutional Hedge Fund Coverage May 6, 2011 : Permanent Link New York – FletcherBennett Capital LLC announced the hire of James J. (“Jay”) Gallagher, Jr. as a Principal to expand FletcherBennett’s institutional hedge fund investor coverage. FletcherBennett is a consulting firm for the hedge fund industry, specializing in business development and institutional investment on a global basis. Mr. Gallagher joins the firm with extensive experience covering investors during his 14 years in the investment industry. Prior to joining FletcherBennett, Mr. Gallagher was Vice President of the Capital Introduction group at Bank of America Merrill Lynch, where he covered key institutional relationships in the endowment and consultant channels, as well as family office and fund of funds investors in the New York area and Southeastern U.S. Previously, Mr. Gallagher was Director of Marketing and Client Service at Bennett Lawrence Management, an investment management firm which managed long/short equity hedge funds and traditional growth equity portfolios. Prior to that, he held positions at Bear Stearns & Co., and Salomon Smith Barney. Mr. Gallagher earned a BA in History from Dickinson College and an MBA in Finance from University of Notre Dame. In his new role, Mr. Gallagher will be responsible for FletcherBennett’s coverage of institutional hedge fund investors, including family offices, endowments and foundations, pensions and consultants, as well as banks, insurers and funds of funds. “Industry flows have improved, investors are again actively sourcing new hedge fund products, and FletcherBennett has recently added new clients,” said Howard Eisen, Managing Director, FletcherBennett Capital LLC. “As a result, we’re very pleased to incorporate Jay’s extensive experience and relationships into our comprehensive services.” About FletcherBennett Group LLC FletcherBennett Capital LLC is a division of FletcherBennett Group LLC, which is a hedge fund strategy and consulting firm, working with both hedge fund managers and institutional investors on a range of topics including: strategic marketing, business development, operational and investment infrastructure, managed accounts, prime brokerage, manager sourcing, and risk management. FletcherBennett was formed in June of 2009 by Andrew Dabinett and Howard Eisen, each of whom have over 20 years experience in hedge funds, prime brokerage, and the capital markets. The firm is based in New York City and is a registered broker/dealer and a member firm of FINRA and SIPC. Editing by Alex Akesson For HedgeCo.net This entry was posted in Press Releases. Bookmark the permalink. ← Klarman’s Baupost to Set Up in London to Cash In on European Debt Crisis

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Oct. 7, 2005, 9:01 a.m. EDT Stupid Investment of the Week Devilish details trip up equity-indexed annuities By Chuck Jaffe, MarketWatch BOSTON (MarketWatch) -- A whole lot of people would settle for "some" of the stock market's gains in exchange for a promise that they would never lose money, no matter how ugly the market gets. The entire equity-indexed annuity business is built on just that promise. And while it sounds like a great deal, all too often it isn't. To get a no-lose guarantee, investors often wind up with a hard-to-win-by product like the MasterDex 5 Annuity from Allianz Life Insurance Co. of North America, an investment that sounds good until you get past the simple sales pitch into some devilish details. That's why MasterDex 5, a product that is fairly typical of the entire genre of equity-indexed annuities, is a clear choice for Stupid Investment of the Week. Stupid Investment of the Week showcases the danger zones that make an investment less-than-ideal for the average consumer, in the hope that spotlighting trouble in one situation makes it easier to root out elsewhere. The column is not intended as an automatic sell signal, especially with annuities, which can be the "roach motel" of investments, where your money goes in but it's hard to get out. MasterDex 5 carries surrender charges for 10 years, and the penalty is 15% for anyone who bails out within the first three years. The surrender haircut is more than 6.6% through the first seven years of the contract. Ouch. Some in the insurance business would argue that MasterDex 5 should not be considered an "investment" at all. Although it combines the features of a traditional insurance product (guaranteed minimum return) with features of securities (return tied to an index), MasterDex 5 -- like most equity-indexed annuities -- is not registered with the Securities and Exchange Commission. Buyers plunking down a minimum of $25,000 may think they are buying a regulated security, but they're not. Failing to understand the difference is a problem, as investors who miss this basic issue will have real trouble spiriting out danger in the sales literature. Pat Foley, chief marketing officer at Allianz, sums up MasterDex 5's audience as people "who want tax-deferred growth on their money with no downside risk," and noted that MasterDex 5 fits in somewhere between the buyer's more traditional fixed-income and equity investments. Equity-indexed annuities are a contract between the buyer and an insurance company. During the accumulation period -- the time when the buyer makes either a lump-sum payment or a series of premium payments -- the insurer credits the buyer with a return that is based on changes in a stock index, like the Standard & Poor's 500. The insurer typically guarantees a minimum return, provided the money stays in place long enough. The potential index return is limited; in the case of MasterDex 5, the monthly cap stands at 2.6%. MasterDex 5, according to its sales literature, "tracks point-to-point monthly changes in the market index. Once a year, those 12 months' values are automatically added up and credited, if positive. ... MasterDex 5 can deliver 100 percent of market index growth." The first point is confusing. The second, while true, is highly unlikely. Here's why: Point-to-point progress means you get the index's value, not its total return. Say goodbye to dividend growth; a few percentage points may not seem big, but they add up when an investment is being held for more than a decade.

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HomeThe CFPB Stands Up to Banks' Overblown Financial Firepower The CFPB Stands Up to Banks' Overblown Financial FirepowerSep 7, 2011Bryce Covert Republicans claim that allowing Richard Cordray to head the CFPB imbues him with too much power, ignoring the immense influence on the other side of the equation. This week's credit check: The 10 Republicans blocking Richard Cordray's nomination have received over $31 million in campaign cash from the financial sector. The median American family saw yearly earnings fall $5,261 over the past decade. The least remarkable part of yesterday's Senate Banking Committee hearing on Richard Cordray, President Obama's nominee to head the new Consumer Financial Protection Bureau (CFPB), was Cordray's testimony itself. In fact, Republicans made it clear that his credentials are not what's up for debate. Sen. Bob Corker (R-TN) called a recent meeting with him "pleasant" and Sen. Richard Shelby (R-AL) said he has a "good background." Rather, they want to debate whether his post should exist at all. Their reasoning? That having one person in charge of this new watchdog will imbue Cordray with far too much power. As Shelby put it, "No one person should have so much unfettered power over the American people." But what of the power of the opposition, the banks themselves, who stand to have new oversight and regulation from someone on the side of the average consumer? If we're going to talk about power imbalances, we might want to look at what the financial sector can marshal against the American people. Elizabeth Warren herself, the originator of the idea for the CFPB, estimates that it will police a $3 trillion consumer financial services industry. And Wall Street, along with its other corporate counterparts, is doing pretty well compared to the rest of us. Corporate profits have taken in 88 percent of the raise in national income since the recovery began, while household incomes only took in 1 percent. It's not just profits banks wield in this fight, however. That money can easily turn into lobbying and campaign contributions. As Ari Berman reported in June, "According to the Center for Responsive Politics, 156 groups -- the vast majority representing corporate interests -- lobbied the government about the CFPB in the second half of 2010 and the first quarter of 2011. The list ranged from JPMorgan Chase to McDonald's." The Chamber of Commerce even has an entire division devoted to fighting Dodd-Frank, and it spent $17 million on federal lobbying in the first quarter of this year with a dozen lobbyists focused on just the CFPB. Sign up to have the Daily Digest, a witty take on the morning’s key headlines, delivered straight to your inbox. Individual Republican Senators are also getting lavish gifts from the financial sector while opposing its newest regulator. The 10 Republican members of the Senate Banking Committee, who signed a letter to Obama in May demanding debilitating changes to the CFPB before any candidate can be confirmed, have received over $31 million in campaign cash from the financial sector during their time in Congress. Meanwhile, Sen. Shelby himself has taken $6.2 million from the financial sector, including about $1 million from commercial banks. His top career donors include JP Morgan ($140,771), Citigroup ($109,199), and Goldman Sachs ($67.600). Compare all that financial firepower to what's going on for everyday Americans. A new report from the Pew Charitable Trusts shows that nearly one in three Americans who grew up middle-class has fallen out of that group. It's not hard to see why so many people are moving down the ladder when wages have been heading in the same direction. While the financial sector is bringing in $3 trillion, the median American family saw yearly earnings fall $5,261 over the past decade, from $52,388 in 2000 to $47,127 in 2010. Things are even worse for low-income families. Over the past 10 years, the percentage of children living in poverty has soared, increasing by 18 percent, or 2.4 million more, from 2000-2009. These children and their families are set to fall on even harder times, as states slash vital services to balance their budgets. They face the loss of unemployment benefits, income tax credits, and cash assistance, among other safety net supports. Those who find themselves in such financial hardship have one place to turn when they can't make ends meet: debt. Credit card companies already employ a variety of tactics to entice middle-class families into debt and keep them there. But those tactics will be under strict scrutiny if the CFPB has its full powers. Low-income families often find themselves prey to unregulated non-banks like payday lenders and check cashers, but those will also come under the supervision of the Bureau. The CFPB isn't taking on dictatorial powers. It's standing up to the formidable forces preying upon struggling American consumers. Bryce Covert is Assistant Editor at New Deal 2.0. BusinessConservativesCrisis, recession, and recoveryEconomic inequalityEconomyFinancial sectorMoney in politics View the discussion thread. Sign Up for the Daily Digest

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Ponzi scheme victims try to move on Sullivan fund manager fleeced investors out of their life savings Ex-Sullivan County investment fund manager Lloyd Barriger lost millions invested by his clients – some of whom were close friends – after wining and dining them and promising above-market returns. Barriger now lives on his elderly mother's farm in Pennsylvania.TOM BUSHEY/Times Herald-Record By Jessica DiNapoli Published: 2:00 AM - 08/03/13 Lloyd Barriger was a minister, but his god was money, said Lloyd Heller.Heller, 74, was in his office Tuesday at Ramsay's Funeral Home in Liberty, where he went back to work three years ago, after his $286,000 in retirement savings evaporated in the failed Gaffken & Barriger fund, managed by Barriger.Heller said the Sullivan County investment fund manager — once one of his best friends — wanted to become a multimillionaire, to live in a mansion with a gate, cooks and maids. Barriger, who pleaded guilty last week to defrauding investors in the nearly $50 million fund, disputed Heller's theory on his personal beliefs. People who make money their god are "sadly disappointed," he said.He could have been speaking about his own life.Barriger now lives in a barn on his elderly mother's property in Damascus, Pa., and does odd jobs. "I certainly didn't get rich," Barriger said. "I went in the opposite direction."His personal situation suggests that the investors in the fund won't see much restitution. But the federal government still plans to go after Barriger for $12.6 million, the amount he raised from investors by lying about the fund's performance.In addition to restitution, Barriger faces up to 65 years in prison when he is sentenced in November for securities fraud, conspiracy to commit securities fraud, mail fraud and conspiracy to commit mail fraud.Jail time is not enough to satisfy Gregg Semenetz, the former Town of Callicoon supervisor who said he invested more than $100,000 with Barriger, but wouldn't give an exact amount."I'd like to see him in a federal prison in Alaska with no heat for the next 40 years," Semenetz said.Barriger's admission to lying to investors sent shock waves through Sullivan County. Investors in the fund know each other exceptionally well, even now, five years after it crumbled.Lots of 'special exceptions'The county's tight-knit community helped the holdings of the Gaffken & Barriger fund grow to nearly $50 million in less than 10 years. Word spread quickly that the fund paid 8 percent annual dividends, and Barriger was well-known and liked in the community, Heller said."He had a way of inducing people to love him," Heller said.The fund was launched at a bed and breakfast in Jeffersonville in the late 1990s, Heller said. Barriger invited 15 to 20 people — all of whom Heller knew — and pitched it to them, explaining it made real estate investments.By then, Heller and Barriger were close friends. They met in the 1970s, when Heller owned funeral homes in Jeffersonville, Roscoe and Callicoon. He hired Barriger, then a bank teller, to conduct funeral services as a minister.Heller didn't think twice about investing with Barriger, and was very happy with the fund for a couple of years. After he invested, he brought another one of his close friends, Maria Grimaldi, now 69, of Youngsville, on board. The 8 percent Barriger offered was better than her other investment — tax-free municipal bonds paying 4 to 5 percent, she said.She invested about $38,000. She said Barriger told her the minimum investment was $75,000, but that he would "make a special exception" for her.At the time, she didn't know he made "special exceptions" for many investors. She got to know Barriger, and enjoyed the luxury perks that came with being his friend.More investors encouragedGrimaldi, Heller and Barriger went out socially all the time, with Barriger footing the bill.The fund manager became known for lavish annual dinners at Bernie's restaurant in Rock Hill. Investors imbibed at an open bar and feasted on steak and caviar.Heller said Barriger encouraged investors to bring potential new investors to the parties.He always had an air of "glowing optimism" at the events, and reported that the fund was growing, Grimaldi said.As the real estate market slowed in the mid-2000s, developers fell behind repaying their loans to the fund. By 2005, the fund began to suffer, according to the U.S. Department of Justice. It lost $600,000 that year.From 2006 until the fund collapsed in 2008, Barriger failed to mention to clients that the fund's investments weren't generating enough income to pay the promised 8 percent.The fund became a Ponzi scheme when Barriger started using new investments to pay dividends to existing members.Barriger declined to discuss specifics of his case."I had good intentions through all of this," he said in a phone interview Thursday.In early 2008, just a few months before the fund was frozen, Heller took Barriger's word that the fund had been performing well and invested another $42,000. "It hurt more than anything when he lied to me about how great the fund was doing," Heller said.Months later, his last words to Barriger were "batten down the hatches, you're going to be sued." He said Barriger's response was "Really?"Extravagant parties are now a distant memory for Barriger. He leads a frugal life, like many of the investors who lost their life savings after trusting him. Barriger has no TV or Internet service and drives a 1999 Jeep."I'm not riding on a yacht," Barriger said. "I have no income or assets."Partner commits suicideFrank Owens, one of the last investors Barriger fleeced, experienced a dramatic reversal of his own. Owens, now 64, was a New York City fashion photographer. He sold the Manhattan building that housed his studio in 2007 and then invested $2 million of the proceeds with Barriger.Now, he's on public assistance.He's also facing charges that he put false information on application forms for $8,900 in benefits he received. In July, he was charged with third-degree grand larceny and first-degree offering a false instrument, both felonies.Owens is working on resolving the issue. He's also waiting for restitution that seems unlikely ever to come. Owens sued Barriger in 2008, and in early 2012 a jury ordered Barriger to pay him $1.56 million in compensatory damages and $5 million in punitive damages.Heller has made slow progress moving on financially and emotionally. He still thinks of Barriger every day and plans to attend his former friend's sentencing.Heller sold his Lake Placid, Fla., home a few years ago, and lives in an apartment in Kauneonga Lake, behind one of the Ramsay's Funeral Homes where he works.Grimaldi has also returned to work. She and other investors hope Barriger or the fund may have some money to repay them, or that the government will go after people Barriger worked with and seek restitution from them. Andy McKean, the other principal of the Gaffken & Barriger fund, committed suicide in 2008."I don't know if the federal government can invest that kind of time," Grimaldi said. "Do I think they should? Yes."[email protected] Reader Reaction

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FINANCE (P) Ltd. Know Us Promoters & Investors Non-Financial Partners Impact We Make Progress Reports Resources Publications Contact Us It is with the support and the common vision that we share with our partners that we have been able to establish ourselves as a learning and a growing institution and strive hard towards better life for a large section of un/under privileged community that we work with. Our Approach Our Philosophy Our People The Bellwether Microfinance Fund The Bellwether Microfinance Fund has been conceived by a small group of experienced Indian microfinance professionals and foreign investors as a Equity-Debt Fund, independently managed and run by professional fund managers. A US$ 20 million fund, Bellwether is the first fund in India dedicated to investing in the equity and debt of microfinance institutions across the country that are in line with the Fund's mission and investment philosophy. Bellwether Website Friends of Women's World Banking Friends of Women's World Banking (FWWB) was established in 1982 as an affiliate of Women's World Banking. It's initial activities were limited to guarantee of bank loans to poor women in the state of Gujarat and counseling on savings and credit to women groups. In 1989 the byelaws were modified to take up a larger role in the areas of financial services for poor women beyond the state of Gujarat. The scope of its activities in Microfinance, as well as its geographical coverage, increased to 91 organisations in 12 states as on March 2006. FWWB India has adopted a 'Credit Plus' approach and its current activities include two broad program areas. FWWB India has a Revolving Loan Fund, which serves to refinance partner organizations that provide financial services to the poor. FWWB India also supports these partner organizations by the provision of institutional development programs to expand their capacity to manage credit and savings activities. In addition to above, FWWB has also been involved in micro insurance, supporting innovations in Microfinance etc. FWWB India Website HDFC Bank HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the bank's risk appetite. HDFC Website ICICI Bank is India's second-largest bank with total assets of about Rs.1,676.59 bn(US$ 38.5 bn) at March 31, 2005 and profit after tax of Rs. 20.05 bn(US$ 461 mn) for the year ended March 31, 2005 (Rs. 16.37 bn(US$ 376 mn) in fiscal 2004). ICICI Bank has a network of about 573 branches and extension counters and over 2,000 ATMs. ICICI Bank Website Axis Bank was the first of the new private banks to have begun operations in 1994, after the Government of India allowed new private banks to be established. The Bank was promoted jointly by the Administrator of the specified undertaking of the Unit Trust of India (UTI - I), Life Insurance Corporation of India (LIC) and General Insurance Corporation Ltd. and other four PSU companies, i.e. National Insurance Company Ltd., The New India Assurance Company, The Oriental Insurance Corporation and United Insurance Company Ltd. The Bank today is capitalized to the extent of Rs. 281.63 crore with the public holding (other than promoters) at 56.89%. Axis Bank Website ABN AMRO Bank ABN AMRO Bank offers microfinance in India, to fulfil its mission of Sustainable Development. The bank believes microfinance is a very powerful tool that can be used effectively to address poverty, empower the socially marginalised poor and strengthen the social fabric. Especially when directed at women, the benefits of microfinance multiply many folds. Through microfinance, the bank believes, human as well as financial capital can be enhanced for the future to leave behind a better world for our children. The microfinance program of the bank is aimed at delivering credit to the target community, through Microfinance Institutions (MFIs). ABN Amro Website SIDBI Bank SIDBI a wholly owned subsidiary of IDBI was established in 1990 for promotion, financing, development of industry in small scale sector. SIDBI Foundation for micro credit (SFMC) was launched by the bank in january 1999 for channelising funds for the poor in line with the success of pilot phase of Micro Credit Scheme. SFMCs mission is to create a national network of strong, viable and sustainable microfinance institution (MFIs) for the informal and formal financial sector to provide micro finance services to the poor, specially women. SIDBI Bank DCB Bank DCB is one of the emerging private sector banks in India. It was converted into a scheduled commercial bank in May 1995. It was the only cooperative bank, which successfully crossed over and thrived in the face of change. It created its own microfinance business with the help of Aga Khan Development Network (AKDN), the manager of a network of ten microfinance institutes MFIs. The banks principle owner is Aga Khan Fund for Economic Development (Akfed), an agency with AKDN which holds 68% of the stake in the bank. DCB Bank Yes bank launched Yes Microfinance India, a specialized and dedicated division focused on developing a pioneer strategy of Direct Intervention for Microfinance. For this, Yes Bank has entered into a memorandum of Understanding for technical collaboration with ACCION International, a leading global microfinance institution. YES Bank Advanced Search Know Us ~ Want to work with us... If you too have a common vision and share the same passion we would like to welcome you to come onboard and become a part of the Sonata Finance team. Offers Resources The Miracle Report The Mix Market Report Business Projection FWWB Bellwether Fund Craft Silicon Current Outstandings Designed by ~ Dezine SEVEN sitemap

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Published: April 1, 1997 / Second Quarter 1997 / Issue 7 Compensation Structures in the Mutual Fund IndustryBy Keith C. Brown and Laura T. Starks If asked to name their 10 favorite sports heroes or movie stars, most people would have little trouble complying. However, if asked to list their 10 favorite professional money managers, the results would be far different. For those who could muster even a single name, the list might go no deeper than Peter Lynch (who is retired) and Warren Buffett. In short, the men and women working in the money management profession are virtually invisible. Considering the amount of money at stake, this anonymity is quite surprising. A recent study by Goldman, Sachs & Company reported that by 1995, investment management companies controlled more than $6 trillion in mutual funds, pension plans, endowments and foundations. Perhaps more disturbing is how little attention investors have paid to how money managers get compensated and whether these compensation schemes provide managers with the incentive to act in the investors' best interests. Our research has concluded that certain money managers, due to the generally accepted method of compensation in the mutual fund industry, are likely to increase their portfolio's risk level in an effort to improve their chances of receiving higher bonuses. The altering of the risk level, one of a fund's most fundamental investment characteristics, might bolster a money manager's short-term goals, but it is almost certainly at odds with the long-term motivations of investors. Previous research in the mutual fund industry has reached three important conclusions: When selecting a fund, the primary attraction for investors is past investment performance, with the more successful funds able to attract the majority of new assets. The rapid growth in the fund industry as a whole created a surprising result: funds that have been "winners" in the past see their assets under management grow while assets in "loser" funds do not shrink, but rather stay the same. Finally, most funds receive as a management fee some percentage of those assets under management, typically about 25-hundredths to 60-hundredths of 1 percent. Building on these findings, our own research has shown that compensation in the mutual fund industry -- both to the company as a whole and to the individual manager -- can be viewed as a tournament in which the top performers receive the largest amount of remuneration. Like participants in a tennis or golf tournament, mutual fund managers are paid, in part, based on how their performance compares with that of a set of peers, i.e., managers at similar funds. What matters in any tournament, of course, is not a participant's absolute performance but his or her relative standing at the end of the contest. Indeed, a very typical compensation scheme in this business pays the manager a base salary as well as a bonus that depends on where his or her performance ranks in the relevant comparison "universe" at the end of the compensation period. This bonus might be structured as follows: 100 percent of base salary if the manager finishes in the top quartile of the universe, 50 percent if in the next highest quartile and zero percent if below the median. Exhibit I illustrates the essential nature of this compensation arrangement. In particular, notice that the manager's compensation cannot be worth less than the base salary but will increase proportionally with the manager's relative performance after some point. In this example, the manager starts receiving a bonus when he or she generates a return for the fund's investors that is in the upper half of the peer group. Conversely, the manager whose performance falls below the median receives no bonus, whether finishing just below the mid-point or dead last in the rankings. Indeed, the crucial factor is that any manager whose performance is below the median near the end of a compensation period (e.g., Manager L in the exhibit) has little to lose by increasing portfolio risk in an attempt to finish in the top half. Do the “Side Hustle” for Your Next JobGeorge Harrison: Now That Guy Knew How to ListenOrganize Like a StartupBest of Multimedia: Bitcoin’s Turbulent HistoryThe Importance of Being MindfulHow Women Leaders Have Transformed ManagementBuilding a Megaproject Without the Mega ProblemsEncouraging the Next GenerationNo More Business as UsualMuckraking Is Alive and Well

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TechNewsWorld > Business > Boardroom | Next Article in Boardroom Best Buy Founder Makes His Move Best Buy's founder and deposed chairman, Richard Schulze, has offered to buy the retail chain. The amount he's offered is north of Best Buy's current value, though skeptics say it still may not be enough. The certainty of his financial backing has also been questioned. In addition, Schulze was the one steering the ship when it hit the choppy competitive waters it finds itself in now. Best Buy founder Richard Schulze has submitted a written proposal to buy the electronics retail chain in a deal that would value the company at as much as US$8.8 billion. Schulze is currently the company's largest stakeholder with about a 20 percent share of the business. He stepped down as chairman of the company he founded in June amid a scandal involving CEO Brian Dunn and a female employee. At the time, he declared that he was exploring all his options for his 69 million shares. Since then, Schulze has reportedly made moves to assemble a team of financial backers and possible fellow executives. On Monday, he wrote current Best Buy Chairman Hatim Tyabji and offered to pay $24 to $26 per share in cash to buy the company he founded, valuing the business at as much as $8.8 billion. The price is based on the stock's Aug. 3 closing price of $17.64 per share. Best Buy confirmed that its board received the letter Monday, calling it an "unsolicited, highly conditional indication of interest," from Schulze, the company said in a statement provided to the E-Commerce Times by Susan Busch, senior director of media relations. The board will "review and consider the letter in due course." Not Biting It's unclear how seriously the board will review Schulze's offer, however. The board has already made moves to block Schulze from various buyout avenues. After his resignation, the board upped the minimum threshold of ownership required for a shareholder to call a special meeting related to change of control from 10 to 25 percent. It kept the company's policies in line with Minnesota state law -- and also prevented Schulze from being able to call his own meeting with the board. The company's interim CEO, Mike Mikan, also appears to be vying for the permanent position. He outlined a growth plan for the company at the last shareholder meeting that included shrinking the size of stores and expanding employee training. Even if the board would entertain the idea of a Schulze buyout, it probably wouldn't bite at his current offer, said Anthony Chukumba, senior research analyst at BB&T Capital Markets. "Even at the higher end with $26, that's 9 percent below the 52-week low," he said. "Investors are likely going to take their chances with a soon-to-be-named CEO and whatever turnaround plan that person has. The probability is still low of a buyout, maybe going from about a 5 percent to 25 percent, but I don't think that $24 to $26 gets it done." Good Buy for Best Buy? Schulze didn't indicate in his letter that private equity firms or investors were sure to shell out the cash needed to buy the company, said R.J. Hottovy, analyst at Morningstar. Schulze notes that his financial advisor, Credit Suisse, is "highly confident" that it can arrange the financing, although he lacks a guarantee. "There are still a lot of questions about whether or not he would have the financial backing," Hottovy told the E-Commerce Times. "And if he does, there might be current shareholders that believe he could turn the business around, but $24 to $26 per share isn't going to be enough." Schulze said in his letter that he has done an "extensive amount of work" on a plan to address the company's needs, including meeting with private equity firms and former Best Buy senior executives such as Brad Anderson and Allen Lenzmeier. The retailer, he added, needs "bold and extensive" changes to remain a competitor in the space, but he didn't indicate what strategic plans he might have in mind. Considering the company's current struggle to stay relevant as online and discount retailers such as Amazon and Wal-Mart experience a rise in sales, Schulze would need a better pitch to finally win over the resistant board. "There wasn't anything in his letter about what he strategically plans to do with the business," said Hottovy. "These were the guys responsible for building the big-box stores and other moves that made the company what it is now, so there are a lot of questions about whether or not these are the right people to lead a turnaround."

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Is AIG's Asian Unit Sale Good News For Taxpayers? Daniel Indiviglio Mar 1 2010, 3:23 PM ET Today, we learn that AIG will sell its Asian life insurance arm for $35.5 billion to Prudential. This appears to be pretty great news for taxpayers. The sale moves the firm a little bit closer to actually being able to repay its massive $180 billion bailout. Or does it?On one hand, AIG is $35.5 billion richer. It could use those proceeds to repay a sizable chunk of its bailout. That's great, right? Bloomberg thinks so: The sum raised in the sale would exceed the total of more than 20 other deals announced by AIG since its 2008 rescue. The agreement is "very good news for AIG and a major step toward quickly repaying U.S. taxpayers at a time when, in our view, the company appeared resigned to carrying out a time- consuming IPO," said Emmanuelle Cales, an analyst at Societe Generale SA. I'm not as convinced. Asia is likely one of the best bets for growth in the years to come. Through this sale, AIG surrenders any potential revenue that the unit might have achieved. That income could also, of course, have been used to repay the bailout, though it would have trickled in more slowly than the unit's sale. Indeed, profits could exceed the sale price over the course of the next several years. The sale is only a good deal for taxpayers if the present value of all future revenues that the unit could have produced was less than or equal to $35.5 billion. This move might also speak to the question of the future of AIG. If it's shedding its profitable business lines, then the firm is just winding down. And if that's the case, then its hope of repaying the bailout will be dependent on how fair the prices are it gets for the sum of its parts. Alternatively, if the firm hoped to continue to operate, then the bailout could be repaid over some number of years -- as long as it takes. I'm not sure which approach is a more likely means of taxpayers getting their money back. If the damage to AIG's brand is too great for the firm to continue, then it might as well close up shop and sell off units as quickly and effectively as possible. I just worry that, even if it successfully sells every division, it wouldn't get near the $180 billion amount it owes. But if the firm could continue to function well for years to come and rebuild its business, then I think that would be a much more likely route to getting taxpayers their money back in full. That's why, despite the seeming success of the Asian division sale, I worry it indicates that AIG will just rely on selling itself piece-by-piece for the best prices it can get. This alternative could lead to a pretty big taxpayer loss on the bailout. Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation. Indiviglio has also written for Forbes. Prior to becoming a journalist, he spent several years working as an investment banker and a consultant. All Posts Follow @indiviglio Meagan Campbell Apr 16, 2014 Are Families the Key to Reducing Poverty?

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- Shipping SCI panel against $33-m bridge loan to Greenfield P. Manoj NEW DELHI, May 9 A SUB-COMMITTEE set up by the board of Shipping Corporation of India (SCI) is not in favour of providing a bridge loan of $33 million to the troubled Greenfield Shipping Company to help it manage the cash-crunch. The stage is thereby set for a confrontation with the other joint venture partners - - Japan's Mitsui O.S.K.Lines and Government of the Sultanate of Oman. The five-member sub-committee after deliberations spread over three sittings was of the view that the problems facing Greenfield was not of SCI's making and hence any consequences for non-payment of $33 million, including exiting from the project, should take into account a "fair compensation" to be paid to SCI, sources aware of the developments said. "The board of SCI is expected to meet in the next few days to consider the recommendations of the sub-committee and take a final view on the matter," the sources said. SCI has invested $11 million for a 20 per cent stake in Greenfield, a joint venture company registered in the Cayman Islands for owning and operating a 1,37,000 cubic metre capacity LNG tanker for the now-controversial Dabhol Power Company (DPC). Mitsui and the Government of the Sultanate of Oman, which holds 40 per cent stake apiece in Greenfield, had asked SCI to contribute a bridge loan of $33 million either in cash or by providing a bank guarantee from a bank having a rating of not less than A - (A Minus) to retire the original senior loan of $110 million taken from a consortium of banks led by ANZ Investment Bank. The bridge loan was to be given by all the three joint venture partners in proportion to their equity holdings at 80 basis points above Libor. "But, no single Indian bank with an A- rating is willing to extend a loan of $33 million in view of the cash flow problems facing LNG Laxmi," the sources said. If SCI were to approach a foreign bank to arrange for the $33 million, it will result in a total liability of about $ 40 million which would have to be shown on the balance sheet of SCI, thereby reducing SCI's borrowing capacity to that extent. The board sub-committee felt that the Oman Government should take the blame for the crisis facing Greenfield. "The Oman Government has not honoured its obligation with respect to the new time charter party agreement signed with Greenfield," the sources said. After the time charter party agreement with DPC was annulled and the Oman Government became the new charterer besides acquiring a 40 per cent stake in Greenfield, the plan was to sub-charter the ship to Oman LNG. Significantly, the Oman Government is understood to have said that it is not possible to sub-charter the vessel to its subsidiary, Oman LNG, for several reasons. This has raised doubts over the certainty of cash flows from chartering out LNG Laxmi. The vessel is now being deployed with Oman LNG for undertaking 9 voyages to France. Meanwhile, Gulf International Bank, which was mandated to raise funds for the project, has not made much progress on the matter as the charter party agreement signed with Oman Government could not be enforced so far. The Gulf International Bank has re-valued LNG Laxmi at $160 million as against the original building price of $222.5 million. "The cash flow problems facing LNG Laxmi has made a tremendous impact on the net worth of Greenfield. There is very little equity left in the project now," the sources said. AI floats tender for lease of Boeing aircraft Airport lease drags over `world class' -- Technical consultants mulled GVK consortium bags expressway project Indfex to link Chennai to China, far-eastern ports SCI panel against $33-m bridge loan to Greenfield XPS Cargo into cold containers with Japan co

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Resource Center Current & Past Issues eNewsletters This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, click the "Reprints" link at the top of any article. Know When to Walk Away Campbell Soup’s Emily Waldorf, one of the executives on T&R’s 2012 Under 40 list, says it’s important to learn when to say no to an M&A transaction. By Hilary Johnson January 15, 2013 • Reprints Since joining Campbell Soup just a year ago as director of corporate development, Emily Waldorf has already worked on the $7.7 billion company’s largest deal ever, the $1.5 billion purchase of Bolthouse Farms, a $689 million provider of fresh carrots, beverages and dressings. During the deal process, Waldorf led the due diligence and valuation efforts and oversaw the complicated project as a whole, ensuring that the acquisition was a good one for shareholders. She always remained ready to say no, she recalls. “One of the things I was challenged with in the Bolthouse deal, and in every deal, was learning when to walk away, and being able to say no,” Waldorf says. “I think it’s one of the hardest things in M&A, knowing when to say no, when to walk away and when the value is destructive. There were multiple times throughout this process, like every other, where we needed to make sure going forward was the right decision. Fortunately, we were able to get the deal done before we got to that point. You need to know when any given deal doesn’t make sense. We were lucky to not be tested, and have to say no.” Waldorf, 35, began her career at AT&T and has also worked for Discovery Communications, Johnson & Johnson and the FBI. In addition to her work on the Bolthouse deal, Waldorf led Campbell’s recent divestiture of its agricultural seeds business. How did you get into finance? I’ve always loved numbers. I started out in math in college, but the job opportunities weren’t exactly what I wanted to do. So a counselor advised me to consider finance, and I decided to try it out. I loved it right away. My first job out of school was in the financial leadership program for AT&T, and one of my rotations was in the M&A group. I fell in love with the fast pace and the strategic view, the project orientation that doing deals allows me to do. I was fortunate to have the opportunity to make a career out of that. You also worked for the Federal Bureau of Investigation at one time. Tell me about that.The Special Advisor Program in the FBI was a program designed to bring M.B.A. grads into the FBI, particularly those with experience working in the private sector prior to business school. The purpose of the program was to help the FBI apply those private sector learnings to the government in order to make it more efficient and less reliant on external advisers. I really wanted to learn more about project management and strategy and to really be able to apply those when I came back to corporate development, because, obviously, strategic thinking and project management are what corporate development is all about. It’s really about getting those cross-functional people together and having that single objective. What was involved in the Bolthouse Farms transaction? The really complicating factor around Bolthouse Farms was the complexity of the different businesses that it owned. It had the carrot business as well as the premium juice business and some other smaller businesses. So the due diligence efforts related to this transaction were quite complex. We had 20 different workstreams going on at any given time, and over 70 different stakeholders. My role was focused on working with the banks and outside advisers, as well as our internal folks, to coordinate diligence, and really manage the project. I worked on and led the valuation efforts as well. It was a very exciting deal for us. What was interesting and different about it was that the strategic rationale was just so clear. Campbell Soup really wanted to get into the perimeter of the store, where the consumer trends were leading us, and Bolthouse was one of the few and the strongest brands in the perimeter of the store, and really leads the packaged fresh space. It was exciting to be able to execute on such a strong strategic vision for the co

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Has Greece Been Prescribed Bad Medicine For Crisis? Share Tweet E-mail Print By Sylvia Poggioli Greek police unions, coast guards and firemen protest outside the finance ministry in Athens against the new austerity package. Loisa Gouliamaki Next week, the Greek government will reveal a five-year austerity plan drafted by the European Union, International Monetary Fund and European Central Bank. Parliament's approval is required if Greece is to receive an installment of $17 billion as part of last year's international bailout. But the new measures include even deeper spending cuts and tax hikes than those that have triggered weeks of massive street demonstrations. Many economists believe Greece's international lenders are prescribing a harmful and inefficient medicine. Apostolos Vranas, who gives English lessons, has seen his earnings slashed by some 40 percent in the year since the government introduced austerity measures. Like many other angry Greek demonstrators, Vranas now considers himself a budding economist. He says Greece's international lenders have pushed the country into a debt trap — with no way out. He calls it extortion. "So next time they will loan us more money to save us from the previous debts and make sure that we accumulate even more debt," says Vranas. Greece has already achieved a remarkable 5 percent reduction of its deficit through massive cuts in wages and pensions of public sector workers and steep tax hikes. Now, the EU, IMF and European Central Bank — known as the troika — have demanded even tougher measures for further funds. In addition to more wage cuts, the tax-exempt ceiling will drop from an annual income of $17,000 to $11,000, and there will be a tax increase on heating oil. The government will have to privatize state assets — including the telephone and postal companies, the ports of Piraeus and Thessaloniki, the national railway system, vast real estate holdings and the national lottery. The protesters in the streets accuse the government of selling the country off. Aware of such intense popular resistance, the troika had hoped the opposition party would show bipartisan support. "If this is a rescue plan, I don't want to be rescued. But I want to be rescued with a different plan," says Chrysanthos Lazaridis, an adviser to the leader of the opposition party. He says New Democracy wants to renegotiate the terms imposed by the troika. "We should not implement heavy taxes on an economy that's been already in deep recession. That is exactly what happened and it didn't work." But Spyros Kouvelis, a leading member of the ruling socialist Pasok party, says the prime minister's task is extremely difficult. "It's a give and take, and at this stage you do not have much room to maneuver," he says. "I wouldn't want to be in the position of George Papandreou. It's a very difficult case, because he has to do a thing which is almost a one-way street to avoid bigger damage." Several analysts, however, are questioning the wisdom of lending money at high interest rates to a bankrupt country reeling from deep recession. "The crisis is getting worse. It deepened in Greece; it spread its wings to the rest of the eurozone. It's doing this as we speak," says economist Yanis Varoufakis. He says with the economy shrinking by 4 percent this year, sovereign debt is spiraling by the day. International lenders, Varoufakis adds, should realize that Greece's default is inevitable. "What are they going to do about it? They have no clue. And this is why they keep giving Greece and Spain and Ireland and Portugal these astonishingly mindless ... expensive loans to the bankrupt just to buy time," he says. The troika, Varoufakis says, is prescribing new doses of a failed policy. "Europe has to realize that this is simply a symptom, just like Lehman Brothers was a symptom, it was not a cause of the problem," he says. "This is a systemic crisis, and Greece is simply the canary in the mine." The Greek crisis has revealed the shortcomings of the single currency — a "one size fits all" euro for 17 sharply different countries, without common fiscal and economic guidance. The outcome of the crippling debt crisis in Athens could determine how and whether the entire eurozone can survive.Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/. WYSO

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Home > Learning Center > For Teachers > Discussion Questions > Commentary > Time-Consistent Rules in Monetary and Fiscal Policy Time-Consistent Rules in Monetary and Fiscal Policy When households and businesses are uncertain whether or not a government policy will remain unchanged over its scheduled tenure, the outcome the policy aimed to achieve can be distorted by the public’s expectation of how strictly it will be enforced. How can you mitigate uncertainty so that the public will not adjust their response to it? One way of mitigating the uncertainty is to add time-consistent rules to new policies. When they are enacted, time-consistency rules make altering the policies very difficult in the future. Explain how election turnover can have an effect on how households and businesses respond to policies. In a democracy, no elected official's position is guaranteed. If a policymaker loses office, subsequent office holders may alter or even completely change the policies of their predecessors. For this reason, households and businesses can't be certain that a policy will remain unchanged over its scheduled tenure, and their response to the policy should adjust to reflect this uncertainty. Discuss how optimal policy depends on whether policymakers can commit to the policy. What does it mean when a policy is time-inconsistent? Finn Kydland and Ed Prescott wrote in a Nobel-prize winning paper that when households and businesses can rely on government policy, it helps them make decisions about how much income to save or how many workers to hire. But if a policymaker can't convince households that the policy it sets won't be changed (that is the government can't commit to policy in the future), households and firms will weigh the possibility that policy may change. This can temper their actions and can alter the effectiveness of the original policy. Generally, policymakers can't commit, therefore, optimal policy with commitment most often is time-inconsistent. This means that at some point in the future the government will be tempted to change its policy. Even though the policy seemed optimal in the past, once the future arrives, the government no longer finds it desirable to follow its original plan. Explain a scenario in which the dilemma of time-inconsistency appears directly in the conduct of monetary and fiscal policy. There is a democratically-elected government that has an incentive to provide more resources to its constituents through spending and transfers (promised payments to subsets of a population, such as social security), but doing so requires financing. Taxation is probably the least desirable because voters react negatively when their take home pay shrinks. Historically, inflation is a more attractive revenue source for politicians. Voters may not immediately be able to distinguish growth from inflation and so recognize what the government has done. However, when they become savvy to inflationary policy, they will expect future inflation to be higher, increasing inflation expectations and raising the nominal interest rate. This makes the government’s cost of servicing the debt larger, and its need for financing even greater, ultimately leading to a world characterized by high inflation rates and high expected inflation. Give examples of the effects that an independent central bank may have on inflation. A widely-used measure of independence designed by Cuckierman, Webb, and Neyapti (1992) is based on four categories: The degree to which the head of the central bank is sheltered from the executive and legislative branches of government. The degree to which a central bank has exclusive authority over monetary policy and indulgence over the budget process. The concentration of the central banks’ mandate on price stability. The limitations placed on the central bank in regards to lending to the government. How do you make time-consistent rules work? The key to making time-consistent rules work is to make violating the commitment costly. Without meaningful penalties, governments can ignore rules. In addition, penalties should be enforced from outside the government, for example by the market. Independent central banks satisfy this criterion because they act as a signal to the market of the government’s stance on inflationary monetary policy. Careers | Diversity | Privacy | Terms of Use | Contact Us | Feedback | RSS Feeds

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What's Next comments Don't expect a bond bloodbath in 2014 By Jesse Solomon @JesseSolomonCNN December 20, 2013: 11:54 AM ET Bond yields spiked in 2013. But many experts don't expect another big surge in rates next year. Click chart for more on the bond market. NEW YORK (CNNMoney) It's no secret that 2013 was a rough year for bonds. The Barclays U.S. Aggregate Bond Index (LAG) has lost nearly 2% while the S&P 500 is up more than 25%. After pouring into these supposedly safe assets in the wake of the financial crisis, investors have already yanked a record $77.5 billion from bond funds in 2013, according to research firm Trimtabs. But the bursting of a "bond bubble" -- that dreaded scenario in which bond prices fall further and a sharp spike in interest rates would leave bond investors saddled with heavy losses -- never came to pass. Long-term rates are still relatively low. So what about 2014? With the Fed finally beginning to wind down, or taper, its $85 billion per month bond-buying program, economists think rates will go higher next year. "There's so much of an expectation that rates are going to rise that it's going to become a self-fulfilling prophecy," said Jim Vogel, who oversees interest rate strategy at FTN Financial. But Fed chairman Ben Bernanke's announcement Wednesday that the central bank would begin dialing back its stimulus by $10 billion per month did little to move the needle on bond yields. Bernanke on Fed taper in 90 seconds That's a far cry from this summer, when taper fears sparked widespread selling in the bond market and pushed the yield on the 10-year Treasury note from 1.6% in May to nearly 3% by September. (Bond yields rise when prices fall.) Related: Is the economy as good as it looks? Matt Freund, who manages over $13 billion in mutual fund assets for USAA, thinks the market has already priced in more tapering. "We already went through this drill once," Freund said of the so-called "taper tantrum" earlier this year. "The markets are a quick study." However, the bond market's muted reaction Wednesday may have to do less with the taper, and more with the fact that Bernanke said the Fed would keep its key federal funds rate near zero for some time. Chris Gunster, head of fixed income portfolio management for U.S. Trust, forecasts a difficult year for bonds in 2014, but he doesn't think it will be catastrophic. He likens the market to a helium-filled balloon sitting on a ceiling. "Bubbles tend to burst, balloons just tend to glide down," he said. Of course, there is more to the bond market than Treasuries. Gunster recommends short-term corporate bonds that will be more insulated from interest rate movements than Treasuries. Related: Why stocks soared on the taper He also anticipates that mortgage-backed bonds, bid up by a hot housing market fueled by low rates, will become attractive in 2014. Freund is excited about municipal bonds, despite a highly publicized bankruptcy in Detroit and escalating fears of a Puerto Rican debt crisis. He notes that in many cities "taxes are going up and services are going down... that's rough for the people who live in the municipality, but very good for bondholders." But even if you have no interest in buying bonds for your own investment portfolio, it's still important to keep an eye on interest rates. Related: 5 reasons stocks will go up in 2014 Mortgages, auto loans, and credit card rates are all tied to various bond rates. And some economists have worried that higher interest rates could derail the still fragile recovery. The housing market, which has been a main economic driver of growth this year, could be particularly vulnerable to higher bond yields because that could push up mortgage rates. But Guy LeBas of Janney Capital Markets shrugs off those concerns. He envisions a 3.4% yield on 10-year Treasuries by the end of 2014, hardly a dramatic leap. It's also still a historically low rate. "The broad perception that rates are going to rise meaningfully is a dangerous perception," he said. First Published: December 20, 2013: 11:02 AM ET Join the Conversation Most Popular

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GE brings good things to startups October 15, 2009: 8:00 AM ET Conglomerate invests money - and its considerable resources - in young energy firms. By Marc Gunther, contributing editor GE's Urquhart offers startups cash and connections. Photo: GE When A123 Systems (AONE), a startup company that makes advanced lithium-ion batteries, had a successful initial public offering last month, one of the big winners was General Electric (GE). That's because A123 Systems is by far the biggest holding of a venture capital fund run by GE that invests in energy startups. Over six rounds of funding, GE had invested $69 million in A123, which makes batteries for cars, trucks, buses, utilities and consumer products, like Black & Decker tools. Today, GE is A123's biggest shareholder and its stake in the company is worth about $190 million. With little fanfare, GE's venture fund has been investing in a broad variety of energy startups since 2006. Most of the investments are small—so far, GE has invested about $160 million in 20 companies. Besides its cash, the industrial giant brings credibility, relationships and expertise to its portfolio companies. "We're one of the top-tier players in energy," said Alex Urquhart, the president and CEO of GE Energy Financial Services, a unit of GE Capital that manages the fund. "We bring a lot more than money. We bring connections. We bring R&D." This week, GE invited executives from its portfolio companies and reporters to its Global Research Center in Niskayuna, N.Y., to talk about the venture business. GE has backed startups in wind, solar and wave energy, companies seeking to profit from energy efficiency and the so-called smart grid, as well as a handful of oil and gas firms. A "popcorn stand" today; tomorrow, the future of energy? To put the venture operation in context: GE Energy Financial Services has $22 billion of global energy investments, most in fossil fuels, pipelines, electricity transmission and distribution. Of that total, more than $4 billion is invested in renewable energy projects, like utility-scale wind farms or solar plants. By comparison, the energy venture fund is a popcorn stand. But GE is betting that at least a few of its startups will profit from big global trends: growing demand for power, long-term supply constraints, rising production costs and pressures to drive the world economy with low-carbon energy sources. "The people in this room have the opportunity to change the world we live in and create new $1 billion industries," Urquhart said. GE announced two new deals at the event. The company joined with venture capital funds in the U.S., Singapore and Israel in a $23-million round of investment in SolarEdge, an Israeli firm with technology aimed at increasing the output of solar photovoltaic panels. It also invested in a Colorado startup called Tendril, whose technology enables real-time communication between utility companies and their customers, as part of the smart grid. Financial details weren't disclosed. Kevin Skillern, who manages the venture fund, told FORTUNE that it has already more than earned out its $160 million in investment. Besides A123, two other GE-backed startups have gone public—a Chinese company now known as China High Speed Transmission Co. that makes gear boxes for wind turbines, and Orion Energy (OESX), a Wisconsin-based firm that does energy-efficient lighting retrofits for big companies. Both, it turns out, were helped by GE's cachet--and clout. The Chinese company, formerly known as Nanjing Gear, got GE's attention several years ago when GE rival Siemens (SI) acquired another Chinese firm that had been GE's biggest supplier of gear boxes, a critical component for GE's wind turbines. GE subsequently began buying gear boxes from Nanjing and invested about $20 million in the company, according to Skillern, who said that GE's stake is now worth $160 million. Orion, meanwhile, is a GE customer and supplier. It has sold its lighting retrofits to GE, as well as other FORTUNE 500 companies including Coca-Cola and Kraft. Orion buys light bulbs and electronics from GE. Since going public in 2007, Orion's shares have fallen in value by 75%, so GE has lost money on that deal. Other GE startups also have struggled. Think, an electric car company based in Norway, went bankrupt, but has since emerged with big plans for make cars for Europe and the U.S. Interestingly, while GE's own energy business, which had nearly $30 billion in 2008 revenues, focuses on large-scale, centralized gas, coal and nuclear power plants, its venture fund is betting on small-scale distributed energy. Boosts from subsidies and stimulus money Last spring, GE invested alongside Rockport Capital and Chevron's venture arm in Southwest Windpower, the world's largest manufacturer of small wind turbines. Based in Flagstaff, Arizona, Southwest Windpower makes wind turbines that sell for about $15,000 to homeowners, commercial and off-grid customers. Frank Greco, Southwest's CEO, said that after federal and state tax credits are factored into the cost, the electricity generated by its 2.5 kilowatt Skystream turbine "is currently competitive and in some cases lower than centrally supplied retail power." Government support is crucial to many of GE's investments. A123Systems and Southwest Windpower benefit from federal tax subsidies for renewable energy. A123 also received more than $600 million in federal and state stimulus funds to build a plant in Michigan to create so-called green jobs. GE executives said the energy venture fund looks at about 1,000 business plans a year. "We've got unbelievable depth in technology that helps us pick winners and, even more important, accelerate the commercialization of technology, which is really what the game is all about," said Steve Fludder, president of GE's ecomagination initiative. "Scale can turn these innovative companies into billion-dollar revenue streams." Posted in: A123 Systems, China High Speed Transmission Co., GE, green tech, Orion Energy, smart grid, SolarEdge, Tendril, Think Join the Conversation

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Regulation/Compliance How Legal Pot Makes Compliance More Complex for Banks Jonathan CamhiSee more from JonathanConnect directly with Jonathan Bio| Contact Colorado has revealed a new compliance problem for banks that regulators seem unprepared to deal with. Tags: Commercial Banking, Small Business Banking, Compliance, Regulation, Enterprise Risk Management, Legal, Anti-Money Laundering, Know Your Customer As bankers try to get a handle on the ever-shifting regulatory landscape, a new source of complexity for banking compliance is growing in Colorado - legalized marijuana. Colorado State law now allows marijuana stores to legally sell pot to the public for recreational use, but those involved in the legal sale and production of weed have been stonewalled by financial institutions when applying a bank account. Since marijuana is still illegal under federal law, banks are scared that of running afoul of anti-money laundering regulations if they provide banking services to marijuana shops or producers, according to an article published yesterday on Salon. Financial institutions don’t want to run afoul of the Anti-Money Laundering Act, which can charge fines of up to $500,000 per transaction for working with companies who sell illegal products. Though Colorado and Washington have been cleared for adult recreational use sales, and 21 states (plus the District of Columbia) have legalized pot for medicinal use, marijuana remains illegal under the federal Controlled Substances Act. Even a state-owned bank, which one Washington lawmaker has proposed, would have to abide by federal banking laws. The discrepancy between state and federal law puts financial institutions at risk of money laundering prosecution, and they want precise assurances before assuming that risk. The article tells the story of the first legal pot producer in Washington State, which is also legalizing marijuana, who lost his account with Boeing Employees Credit Union when the institution found out about his work. “We operated, by their own description, ‘an exemplary account,’” Cooley said. “It’s frustrating, because they were saying to us, ‘we found out about you because you’re trying to be legitimate. So now we’re going to close your bank account.’” The result is that many of legal marijuana businesses have to do all of their transactions in cash. One Washington congressman related a story about the owner of a medical marijuana stores showing up to pay his state taxes in $40,000 in cash. The Salon article rightly points out what an ironic twist this development is after HSBC was found last year to have knowingly laundered money for Mexican drug cartels and was fined $1.9 billion. But no bank is willing to do business with legal businesses involved in the same trade. Regulators have issued no guidance for banks though now that pot’s being legalized, and banks are playing it safe. The Bank Secrecy Act Advisory Group was supposed to address this issue in a closed meeting last month, but no guidance came out of the meeting. And whatever guidance regulators issue might be meaningless anyway: Any guidance would still be discretionary, and a zealous prosecutor or a change in administration could reverse that at any time. “It would be completely ridiculous for JPMorgan Chase to accept business from a marijuana shop,” said UCLA professor Mark Kleiman. “Why would they expose themselves to prosecution from President Huckabee’s attorney general?” Two Congressional representatives from Colorado and Washington have introduced a bipartisan bill to clear the way for banks to work with legal marijuana businesses. Regulators and government officials are going to be hard-pressed over the the next few years to come up with a solution for this problem. New York is now the latest state to contemplate legalizing marijuana, and it seems reasonable to expect more states to follow. And banks aren’t going to risk further court actions with the industry’s reputation slammed by recent legal settlements that have made big headlines. [For More Regulatory Coverage, See “JPMorgan $13B Mortgage Settlement May Be Only the Beginning”] Presumably as the legal marijuana business grows across the country, lawmakers aren’t going to want all of those transactions occurring in cash given the opportunity that creates for tax evasion. So it is certainly in the interest of government officials to make it legal for banks to service these businesses. In the meantime, for any banker suffering from a headache over all the regulatory change in the market, well, in Colorado they can give you a good prescription for that. ABOUT THE AUTHORJonathan Camhi is a graduate of the City University of New York's Graduate School of Journalism, where he focused on international reporting and interned at the Hindustan Times in Delhi, ...See more from Jonathan

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Luxury Goods & Duty Free | FMCG Retail & Distribution | Oil Gas & Utilities | Autos & Transport | Travel & Hospitality | Real Estate | Finance & Banking CategoriesPalestinian Territories Publicis enters Palestinian market Source: BI-ME , Author: Posted by Bi-ME staff Posted: Mon June 18, 2012 4:25 pm PALESTINIAN TERRITORIES. Publicis Groupe today announced its purchase of an equity stake in Ramallah-based Zoom Advertising, a subsidiary of Massar International. According to the terms of the agreement, Publicis Groupe immediately acquires 20% of the agency, and has the possibility of increasing its participation over the coming years. The transaction marks an unprecedented entry for a publicly-listed international communications group into the Palestinian market. Zoom will be renamed Publicis Zoom and will be aligned with the Publicis Worldwide global network. The acquisition remains subject to the approval of relevant authorities. Maurice Levy, Chairman and Chief Executive Officer of Publicis Groupe, signed the agreement today in Ramallah with Bashar Masri, Zoom's Chairman of the Board at a ceremony attended by private sector leaders and government officials from Palestine. Maurice Levy was accompanied by Jean-Yves Naouri, Chief Operating Officer of Publicis Groupe and Executive Chairman of Publicis Worldwide, and by Loris Nold, Member of the Executive Committee of Publicis Worldwide. Zoom was founded in 2004 and quickly established itself as the leading agency in the Palestinian communications industry, providing sophisticated digital and interactive tools. Along with its expertise in multimedia applications, Zoom is the local leader of creative and brand strategy, with corporate clients in virtually all market sectors. Zoom's clients include the Bank of Palestine, the Paltel Group, the Palestine Exchange, Coca-Cola, the European Union, UNICEF, UNRWA, Peugeot, Cairo-Amman Bank and the new Palestinian planned city of Rawabi. The agency employs a staff of 23 and will continue to be led by its current executive team, General Manager Firas Awad and Managing Partner Jane Masri. Palestine is the most recent addition to Publicis Worldwide's expanding Middle East presence, joining agencies in UAE, Egypt, Jordan, Kuwait, Saudi Arabia, and Qatar.Publicis Groupe's direct investment in a Palestinian company signals Mr. Levy's personal confidence in the Palestinian economy as well as a strongly optimistic long-term view of both the Palestinian and regional economies, and his hope for sustained peace in the region. "Today's transaction is important on several levels" said Maurice Levy, Chairman and CEO of Publicis Groupe. "One key element, of course, is Publicis' desire to serve our clients wherever they work. But the impact of this operation extends much further than that. It comes immediately after our announcement of the acquisition of BBR in Israel; symbolically, this speaks to every man's dream of seeing peace in the Middle East and between the Palestinian and Israeli peoples. Moreover, it is also a call to French and international companies to set up in the region and to contribute to creating the economic development without which there can be no durable peace." Jean-Yves Naouri, Chief Operating Officer of Publicis Groupe, added, "Zoom Advertising's excellent track record in the Palestinian digital and interactive marketsmade it a natural partner for Publicis Groupe, with its focus on fast growing markets and digital as its two strategic pillars. The Arab world is embracing digital technology at an unprecedented pace, as was demonstrated during the events of the Arab spring, and Palestine is no exception. We consider ourselves extremely fortunate to have found such a promising partner in Palestine and this deal underscores our commitment to strengthening our presence in the region." Bashar Masri, Chairman of the Board of Zoom, also expressed his confidence that the deal was a very positive signal for the Palestinian private sector. He stated, "Today's deal is a key step towards the goal of fostering an enabling business environment for private sector growth and development, and I am confident that more investments like this one are on the horizon. The fact that a Palestinian company passed the rigorous due diligence procedures of a global, publicly-listed company like Publicis Groupe should send a very strong message to the Palestinian private sector. I am particularly proud that Zoom was the company to achieve this milestone for the communications industry in Palestine." About Publicis Groupe Publicis Groupe [Euronext Paris FR0000130577, part of the CAC 40 index] is the third largest communications group in the world, offering the full range of services and skills: digital and traditional advertising, public affairs and events, media buying and specialized communication. Its major networks are Leo Burnett, MSLGROUP, PHCG (Publicis Healthcare Communications Group), Publicis Worldwide, Rosetta and Saatchi & Saatchi. VivaKi, the Groupe's media and digital accelerator, includes Digitas, Razorfish, Starcom MediaVest Group and ZenithOptimedia. Present in 104 countries, the Groupe employs 54,000 professionals. For more information, please visit www.publicisgroupe.com | Twitter:@PublicisGroupe | Facebook:http://www.facebook.com/publicisgroupe About Zoom Advertising Zoom Advertising is the leading agency in the Palestine for creative, digital and multimedia marketing services. Zoom offers clients a national network of outdooradvertising space, a national digital signage network, design and development of multimedia and web applications, brand management services, and a full roster oftraditional and non-traditional marketing tools. Zoom is a member of the Massar International group of companies. For more information, please visit http://www.zoom.ps

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FONT SIZE: PRINT: CPS Labor Force Statistics from the Current Population Survey CPS TABLES CPS PUBLICATIONS See How the Government Measures Unemployment and the BLS Handbook of Methods, Chapter 1, Labor Force Data Derived from the Current Population Survey, for more detailed information. Why does the Government collect statistics on the unemployed? Where do the statistics come from? What are the basic concepts of employment and unemployment? Who is counted as employed? Who is counted as unemployed? Who is not in the labor force? What about cases of overlap? How large is the labor force? How are seasonal fluctuations taken into account? What do the unemployment insurance (UI) figures measure? How is unemployment measured for States and local areas? Is there a measure of underemployment? Have there been any changes in the definition of unemployment? How are the unemployed counted in other countries? What is the American Community Survey (ACS)? Government statistics tell us about the extent and nature of unemployment. How many people are unemployed? How did they become unemployed? How long have they been unemployed? Are their numbers growing or declining? Are they men or women? Are they young or old? Are they white or black or of Hispanic ethnicity? Are they skilled or unskilled? Are they the sole support of their families, or do other family members have jobs? Are they more concentrated in one area of the country than another? After these statistics are obtained, they have to be interpreted properly so they can be used—together with other economic data—by policymakers in making decisions as to whether measures should be taken to influence the future course of the economy or to aid those affected by joblessness. Because unemployment insurance records relate only to persons who have applied for such benefits, and because it is impractical to actually count every unemployed person each month, the Government conducts a monthly sample survey called the Current Population Survey (CPS) to measure the extent of unemployment in the country. The CPS has been conducted in the United States every month since 1940 when it began as a Work Projects Administration program. It has been expanded and modified several times since then. The basic concepts involved in identifying the employed and unemployed are quite simple: People with jobs are employed. People who are jobless, looking for jobs, and available for work are unemployed. People who are neither employed nor unemployed are not in the labor force. Employed persons consist of: All persons who did any work for pay or profit during the survey reference week. All persons who did at least 15 hours of unpaid work in a family-owned enterprise operated by someone in their household. All persons who were temporarily absent from their regular jobs, whether they were paid or not. Not all of the wide range of job situations in the American economy fit neatly into a given category. For example, people are considered employed if they did any work at all for pay or profit during the survey reference week. This includes all part-time and temporary work, as well as regular full-time, year-round employment. Persons also are counted as employed if they have a job at which they did not work during the survey week because they were: Experiencing child-care problems Taking care of some other family or personal obligation On maternity or paternity leave Involved in an industrial dispute Prevented from working by bad weather Persons are classified as unemployed if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. Workers expecting to be recalled from layoff are counted as unemployed, whether or not they have engaged in a specific jobseeking activity. In all other cases, the individual must have been engaged in at least one active job search activity in the 4 weeks preceding the interview and be available for work (except for temporary illness). Persons not in the labor force are those who are not classified as employed or unemployed during the survey reference week. Labor force measures are based on the civilian noninstitutional population 16 years old and over. (Excluded are persons under 16 years of age, all persons confined to institutions such as nursing homes and prisons, and persons on active duty in the Armed Forces.) The labor force is made up of the employed and the unemployed. The remainder—those who have no job and are not looking for one—are counted as "not in the labor force." Many who are not in the labor force are going to school or are retired. Family responsibilities keep others out of the labor force. When the population is classified according to who is employed, unemployed, and not in the labor force on the basis of their activities during a given calendar week, situations are often encountered where individuals have engaged in more than one activity. Because persons are counted only once, it must be decided which activity will determine their status. Therefore, a system of priorities is used: Labor force activities take precedence over non-labor force activities. Working or having a job takes precedence over looking for work. The labor force is not a fixed number of people. It increases with the long-term growth of the population, it responds to economic forces and social trends, and its size changes with the seasons. On average in 2008, there were roughly 145 million employed and 9 million unemployed making up a labor force of 154 million persons. There were about 80 million persons not in the labor force. The seasonal fluctuations in the number of employed and unemployed persons reflect not only the normal seasonal weather patterns that tend to be repeated year after year, but also the hiring (and layoff) patterns that accompany regular events such as the winter holiday season and the summer vacation season. These variations make it difficult to tell whether month-to-month changes in employment and unemployment are due to normal seasonal patterns or to changing economic conditions. To deal with such problems, a statistical technique called seasonal adjustment is used. When a statistical series has been seasonally adjusted, the normal seasonal fluctuations are smoothed out and data for any month can be more meaningfully compared with data from any other month or with an annual average. Many time series that are based on monthly data are seasonally adjusted. The UI figures are not produced by the Bureau of Labor Statistics. Statistics on insured unemployment in the United States are collected as a by-product of UI programs. Workers who lose their jobs and are covered by these programs typically file claims ("initial claims") that serve as notice that they are beginning a period of unemployment. Claimants who qualify for benefits are counted in the insured unemployment figures (as "continued claims"). Data on UI claims are maintained by the Employment and Training Administration, an agency of the U.S. Department of Labor, and are available on the Internet at: http://workforcesecurity.doleta.gov/unemploy/claims.asp. These data are not used to measure total unemployment because they exclude several important groups. To begin with, not all workers are covered by UI programs. For example, self-employed workers, unpaid family workers, workers in certain not-for-profit organizations, and several other small (primarily seasonal) worker categories are not covered. In addition, the insured unemployed exclude the following: Unemployed workers who have exhausted their benefits Unemployed workers who have not yet earned benefit rights (such as new entrants or reentrants to the labor force) Disqualified workers whose unemployment is considered to have resulted from their own actions rather than from economic conditions; for example, a worker discharged for misconduct on the job Otherwise eligible unemployed persons who do not file for benefits See the Local Area Unemployment Statistics Frequently Asked Questions page. Because of the difficulty of developing an objective set of criteria which could be readily used in a monthly household survey, no official government statistics are available on the total number of persons who might be viewed as underemployed. Even if many or most could be identified, it would still be difficult to quantify the loss to the economy of such underemployment. The concepts and definitions underlying the labor force data have been modified, but not substantially altered, even though they have been under almost continuous review by interagency governmental groups, congressional committees, and private groups since the inception of the Current Population Survey. In January 1994, a major redesign of the Current Population Survey was introduced which included a complete revamping of the questionnaire, the use of computer-assisted interviewing for the entire survey, and revisions to some of the labor force concepts. The sample survey system of counting the unemployed in the United States is also used by many foreign countries, including Canada, Mexico, Australia, Japan, and all of the countries in the European Economic Community. More recently, a number of East European nations have instituted labor force surveys as well. However, some countries collect their official statistics on the unemployed from employment office registrations or unemployment insurance records. Many nations, including the United States, use both labor force survey data and administrative statistics to analyze unemployment. The International Labor Comparisons program of the Bureau of Labor Statistics adjusts foreign unemployment rates to U.S. concepts. Comparative labor force statistics tables showing annual averages from 1960 onward, as well as monthly estimates of unemployment rates approximating U.S. concepts for selected countries, are available. The ACS is a household survey developed by the Census Bureau to replace the long form of the decennial census program. For more information, see http://www.bls.gov/lau/acsqa.htm. Last Modified Date: April 18, 2011 U.S. Bureau of Labor Statistics | Division of Labor Force Statistics, PSB Suite 4675, 2 Massachusetts Avenue, NE Washington, DC 20212-0001 www.bls.gov/CPS | Telephone: 1-202-691-6378 | Contact CPS

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From the July 3, 2013 issue of Credit Union Times Magazine • Subscribe! Taxes: Banks, CUs Trade Shots as Debate Heats Up July 03, 2013 • Reprints Tax reform debate as it pertains to the credit union tax exemption shifted into high gear when bank lobby groups strongly advocated last week for its elimination as Congress mulls tax reform options from various working groups. But former congressman and retired CUNA president Dan Mica, who now runs his own lobby firm in Washington, said it’s unlikely any meaningful tax reform will occur this year. That didn’t stop the Independent Community Bankers of America, from urging tax reform leaders in the Senate and House to conduct separate hearings regarding the credit union exemption in a June 20 letter. “These hearings could examine the cost of the credit union subsidy to American taxpayers and whether it has become outmoded given the fundamental transformation of the credit union charter,” President/CEO Camden Fine wrote. The following day, American Bankers Association President/CEO Frank Keating called the exemption “a Depression-era tax break that has outlived its purpose” in a letter to President Barack Obama, Treasury Secretary Jack Lew and Gene B. Sterling, director of the National Economic Council. While Keating noted that some credit unions continue to serve those of modest means, large credit unions “have diversified to the point that they bear no resemblance to the traditional credit unions that Congress envisioned to be worthy of preferred tax status.” NAFCU President/CEO Fred Becker fired back that same day, penning a June 21 letter to Obama that disputed banker claims that the exemption costs the federal government $10 billion over five years. Instead, he said, eliminating the credit union tax exemption would have the opposite effect on the federal budget, costing $15 billion in lost revenue over the next 10 years. “These results match the findings of previous studies of the impact of eliminating the credit union tax exemption in Canada and Australia, where the number of credit unions was severely reduced following taxation,” Becker said in the letter. “Reduced competition for consumer financial services led to higher interest rates on consumer loans and lower interest rates on deposits in both countries.” Not satisfied with just defensive talk, Becker also went on the offensive, pointing out that nearly one-third of banks are Subchapter S corporations and don’t pay federal corporate income taxes. And, Becker charged that banks misused the Troubled Asset Relief Program’s small business lending fund program, using the funds to exit TARP rather than lend to small business. In addition to stressing that credit unions may not survive taxation, Becker also pointed out that while only two banks have converted to credit union charters in recent years, 33 credit unions have switched to banking charters. The lack of parity refutes banker claims of unfair competition, he said. Credit union lobbyist John McKechnie made note of the timing of the letters, because Congress has completed tax reform research, and the next step would be writing a tax reform bill. “Adding the ABA letter to ICBA’s, it appears that the bank lobby in D.C. feels the need to orchestrate some kind of new offensive,” he said. Perhaps, but Mica said he doubts major tax reform will be achieved. “There could be some piecemeal tax reform, but a major bill this year is going to be almost impossible,” Mica said. “Republicans are split among themselves, and until they get their act together, I don’t think anything is going to happen.” The Democratic party has some division, too, he said. Other influences Mica said will impact tax reform–or a lack thereof–include a recovering economy that takes the pressure off the federal government’s need for revenue, and a president who is cautious to sign any tax bill. “I’m not saying it will go away, but from the subtle signs I’ve seen, the issue of tax reform will be kicked under the table,” he said, adding, “but then again, I never say never when it comes to Congress.” Mica applauded CUNA’s “Don’t Tax My Credit Union” campaign that provides credit unions with marketing materials and directs members to a website that generates letters to members of Congress. Although he said he’s heard some criticize the campaign for launching before any tax reform legislation was written, Mica said credit unions should be proactive, not reactive. “Once you’re in the bill, you’re behind the curve,” he said. Richard Gose, CUNA’s senior vice president of political affairs, said the trade’s “Don’t Tax My Credit Union” campaign has received almost 300,000 hits on Facebook and Twitter, and CUNA’s website that generates letters to Congress supporting the tax exemption has received 135,000 visits. Should banks and credit unions face a tax reform show down, Mica said based upon history, he’s confident credit union members would rise to the occasion and lobby Congress in support of the exemption. Mica recalled the last time the exemption was threatened. And said he was stunned at how much support credit unions received during debates on television and radio in which he faced off against banking lobbyists. Not only callers, but even employees working in the studio voiced support for credit unions and opposition to banks. “And that was back when [banks] were in relatively good favor,” he said. Page 1 of 2 Next »

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