07/11/2011 (12:52 pm)

Quirky mutual funds may ride wave, then sink

Filed under: economics, uk |

Unusual stock funds come and go.

In the “gone” category is the Golf Associated Fund, which invested in golf-related items ranging from tour sponsors to magazines and course fertilizers.

Also history is the StockCar Stocks Mutual Fund that invested in companies related to what was then the NASCAR Winston Cup Series through its racing teams or sponsors.

Gabelli Global Interactive Couch Potato Fund did not last long either. It was destined for changes in name and portfolio.

Some unusual funds are whacky, and some adhere to overly focused strategies. However, others work fine for investors seeking to add spice to predictable portfolios that had been formulated by the book.

And ideas for funds keep coming, even if they don’t all get off the ground.

“I once talked with a woman who was researching chocolate companies and how they had performed historically, since they tend to outperform the Standard & Poor’s 500 over a long time period,” recalls Jack Bowers, editor of the independent Fidelity Monitor newsletter (www.fidelitymonitor.com) in Rocklin, Calif. “She was thinking that maybe there would be interest in launching a fund on that theme and doing all sorts of fun stuff with it.”

That sweet fund didn’t become a reality, but other unique concepts have come and are still around. For example, investors distrustful of the shenanigans of our elected officials in Washington have a fund that invests in stocks only when Congress isn’t meeting no fax cash advances.

“The Congressional Effect Investor Fund (CEFFX) invests in the U.S. stock market on days when Congress is out of session and is out of the U.S. stock market on days when Congress is in session,” Tom Roseen, head of research services for Lipper Inc. in Denver, said of that fund, which is up 9 percent over the past 12 months.

One unique fund that’s gotten a lot of publicity, the Vice Fund (VICEX), seeks long-term growth of capital by looking for firms that derive most of their revenues from products considered ’socially irresponsible,” such as tobacco, gambling and alcohol. It then selects stocks from that group based on their financial soundness and growth potential. It is up 30 percent over the past 12 months.

“There have been all kinds of strange industry-specific funds over the years, such as the legendary Steadman Oceanographic Fund that was built around the idea that there were companies building communities under the sea,” said Russel Kinnel, director of fund research for Morningstar Inc. in Chicago. “None of these are around anymore.”

Some quirky funds seem to speak to people who basically want to have something different in their portfolios, Kinnel expects. It is possible to run a mutual fund out of your basement these days, he noted. If it happens to have awesome returns, you will attract a lot of money in the beginning

07/01/2011 (9:08 pm)

E.coli death toll increases to 50

Filed under: business, economics |

German authorities have reported another death in the European E. coli outbreak _ bringing the total to 50.

The national disease control center said Friday 48 deaths have been reported in Germany, up from 47 a day earlier. One death in Sweden and another in the United States are linked to the outbreak, according to the World Health Organization.

A total of 3,999 people have now been reported ill in Germany, including 845 suffering from a complication that can lead to kidney failure business cards. Another 122 cases have been reported in 16 other countries.

New infections have been declining for weeks but the total tally is still rising due largely to delays in notification.

European health experts warned Thursday that contaminated Egyptian fenugreek seeds are likely the source of the deadly outbreak.

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06/01/2011 (10:04 pm)

WH: Obama-GOP meeting productive without progress

Filed under: economics, marketing |

The White House says a meeting between President Barack Obama and House Republicans was worthwhile even if it didn’t bridge the partisan divide that exists over how to reduce the deficit.

Press Secretary Jay Carney said it’s useful for Republicans and Democrats to sit down and talk in a non-confrontational environment. But also he said that a large meeting like the one between Obama and dozens of House Republicans Wednesday isn’t the right forum for specific advances in negotiations.

House Republicans pressed Obama at the session for more specifics, and more leadership. One leading Republican also asked Obama to stop “mischaracterizing” a GOP Medicare proposal that’s at the center of the spending debate. But Carney made clear that Obama will continue to criticize the Medicare plan.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

Top House Republicans said they pressed President Barack Obama Wednesday for more leadership and a detailed plan on budget cuts, with one leading lawmaker accusing him of mischaracterizing a GOP Medicare proposal at the center of a partisan divide over spending.

The meeting at the White House came as the GOP sought to build pressure on Obama for trillions in spending cuts in exchange for any increase in the government’s ability to borrow. The White House had no immediate comment.

After the meeting, dozens of rank-and-file GOP lawmakers streamed out of the front door of the White House and into a caravan of blue buses waiting for them on Pennsylvania Avenue, while members of the GOP leadership stopped on the driveway to speak to reporters and camera crews awaiting them in under a steaming sun.

“Any day Republicans and Democrats are actually having a dialogue, this is a good thing, said Republican Rep. Jeb Hensarling of Texas.

Yet it was hard to see any concrete progress from a meeting that, based a description by Republican lawmakers, amounted to a face-to-face accounting of each side’s positions, but no breakthrough on how to reach a debt-reduction deal. The talks came as Aug. 2 deadline approaches for the federal government to raise the debt limit or go into unprecedented default.

“Unfortunately what we did not hear from the president is a specific plan of his to deal with the debt crisis,” Hensarling said. Instead, according to a GOP official briefed on the meeting, Obama noted that he’s deputized Vice President Joe Biden to lead talks on deficit reduction.

House Speaker John Boehner, R-Ohio, said, “I told the president, one more time, this is the moment. This is the window of opportunity where we can deal with this on our terms. We can work together and solve this problem. We know what the problems are. Let’s not kick the can down the road one more time.”

According to the GOP official briefed on the meeting, Boehner and other leaders told Obama that he hadn’t put a specific plan for spending cuts on the table. They brought up a speech he gave at George Washington University in April in which he called for deficit reduction totaling $4 trillion through spending cuts, tax increases and other measures. The Republicans said a speech isn’t a plan.

House Budget Committee Chairman Paul Ryan, R-Wis., had attended the speech only to hear Obama excoriate Ryan’s proposal to have future Medicare beneficiaries shop for insurance in the private market. On Wednesday Ryan told the president he’d viewed that as a sign that Obama was thinking about the 2012 elections and wanted fellow Democrats to turn up the political heat, according to the GOP official.

The official, who spoke on condition of anonymity to discuss the private meeting, said Ryan told the president that leaders have to lead and Obama hadn’t shown leadership.

Pressed on that after the meeting Ryan said: “I just said we got to take on this debt and if we demagogue each other at the leadership level then we’re never gonna take on our debt.”

Ryan said he explained his Medicare plan to the president to get him to stop mischaracterizing it. Obama and Democrats routinely label Ryan’s proposal a “voucher” plan that would undo Medicare as it is now known.

“It’s been mis-described by the president and many others and so we simply described to him precisely what it is we’ve been proposing so that he hears from us how our proposal works so that in the future he won’t mischaracterize it,” Ryan said.

Ahead of Wednesday’s meeting, Boehner released a statement signed by more than 150 economists backing his position on coupling spending cuts with any debt limit increase.

“Increasing the debt ceiling without significant spending cuts and budget reforms will send a message to American job creators that we still are not serious about ending Washington’s spending addiction,” the Ohio Republican said in the statement.

The session between Obama and House Republicans came on the heels of a symbolic and lopsided vote the day before against a GOP proposal to raise the cap on the debt limit by $2.4 trillion. The proposal, intended to prove that a bill to increase the borrowing cap with no spending cuts is dead on arrival, failed badly Tuesday on a 318-97 vote.

Democrats said the vote was aimed more at giving tea party-backed Republicans an opportunity to broadcast a “nay” vote against the administration’s position that any increase in U.S. borrowing authority should be done as a stand-alone measure uncomplicated by difficult spending cuts to programs like Medicare. A more painful vote to raise the debt ceiling looms for Republicans this summer.

In fact, Biden is leading talks on attaching spending cuts to the debt measure in advance of the Aug. 2 deadline set by the Treasury Department.

In Tuesday’s vote, House Democrats accused the GOP of political demagoguery, while the Obama administration maneuvered to avoid taking sides _ or giving offense to majority Republicans.

The House floor debate was brief, occasionally impassioned and set a standard of sorts for public theater, particularly at a time when private negotiations continue among the administration and key lawmakers on the deficit cuts Republicans have demanded.

Roughly two months remain before the date Treasury Secretary Tim Geithner has said the debt limit must be raised. If no action is taken by Aug. 2, he has warned, the government could default on its obligations and risk turmoil that might plunge the nation into another recession or even an economic depression.

The government already has reached the limit of its borrowing authority, $14.3 trillion, and the Treasury is using a series of extraordinary maneuvers to meet financial obligations.

By no longer making investments in two big pension funds for federal workers and beginning to withdraw current investments, for example, the Treasury created $214 billion in additional borrowing headroom.

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Associated Press writers Ben Feller and Erica Werner contributed to this report.

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04/28/2011 (8:26 pm)

More people applied for unemployment benefits

Filed under: economics, marketing |

More people sought unemployment benefits last week, the second rise in three weeks, a sign the job market’s recovery is slow and uneven.

The Labor Department says applications for unemployment benefits jumped 25,000 to a seasonally adjusted 429,000 for the week ending April 23. That’s the highest total since late January.

The four-week average of applications, a less volatile measure, rose to 408,500, its third straight rise and the first time it has topped 400,000 in two months.

Applications near 375,000 are consistent with sustained job creation. Applications peaked during the recession at 659,000.

Some economists predicted that auto factory shutdowns, stemming from supply disruptions in Japan, would cause applications to rise. But a Labor Department analyst said only one state reported auto-related layoffs and the increase was modest.

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04/17/2011 (10:01 am)

China Tightening to Continue ‘Some Time,’ PBOC’s Zhou Says - Bloomberg

Filed under: economics, money |

China will continue tightening monetary policy for “some time,” central bank Governor Zhou Xiaochuan said a day after the world’s second-biggest economy reported inflation accelerated to the fastest pace since 2008.

“We will remove the monetary factors that are related to inflation,” Zhou said at a briefing today in the southern Chinese province of Hainan, where he’s attending the Boao Forum for Asia. “Our monetary policy will continue to move from moderately loose to prudent. This means properly tightening. The trend will continue for some time.”

China may increase the reserve requirement ratio for the nation’s banks this month in an effort to curb inflation, which the government said yesterday accelerated to 5.4 percent in March, according to Barclays Capital and Citic Securities Co. The People’s Bank of China has raised interest rates four times and increased reserve requirements six times since the third quarter of last year in a bid to rein in consumer prices.

“Policy tightening should remain firm,” Chang Jian, a Hong Kong-based economist with Barclays Capital, said by phone today. “Inflation risk remains significant. If they maintain the tightening stance and continue to withdraw liquidity and continue to control credit as well as the pace of lending, that at least gives you a higher chance of success.”

Economic Growth

China’s economy grew 9.7 percent in the first quarter, faster than the 9.4 percent median estimate in a Bloomberg survey, according to figures released by the National Bureau of Statistics yesterday.

The central bank reported a day earlier that M2 money supply grew a faster-than-expected 16.6 percent in March, and that new yuan loans for the month also exceeded economists’ estimates at 679.4 billion yuan.

China last increased the reserve requirement effective from March 25 and raised benchmark lending and deposit rates from April 6. The central bank has also imposed differentiated reserve requirements on the nation’s lenders. The reserve ratio is 20 percent for China’s biggest banks and the one-year benchmark for borrowing costs is 6.31 percent.

Zhou said today China would continue to use differentiated regulations for financial institutions based on their systemic importance. He also said there isn’t an absolute ceiling for the level of banks’ reserve requirements.

“I agree with the general view that there is no absolute line or limit for where to set the reserve requirement ratio,” Zhou said. “It depends on many conditions. When those conditions change, the force and room for reserve requirement ratio adjustments will also change.”

Inflation in March was largely driven by food costs, which rose 12 percent last month from a year earlier. Non-food inflation accelerated to 2.7 percent.

–Eva Woo, Henry Sanderson. With assistance from Huang Zhe in Beijing. Editors: Bloomberg News, Reinie Booysen

To contact Bloomberg News staff on this story: Eva Woo in Beijing at +86-10-6649-7537 or ewoo9@bloomberg.net

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02/27/2011 (6:25 am)

Berkshire Hathaway’s 4Q net income up 43 percent

Filed under: economics, legal |

Warren Buffett’s Berkshire Hathaway has reported a 43 percent jump in fourth-quarter profit thanks to the strong performance of BNSF railroad and a paper gain of $1.4 billion on the company’s derivative contracts and investments.

Buffett said Saturday in his annual letter that the acquisition of the Burlington Northern Santa Fe railroad was the highlight of 2010 for his Omaha, Neb.,-based company.

Berkshire reported $4.38 billion net income, or $2,656 per Class A share, in the fourth quarter instant credit report. That’s up from the $3.1 billion net income, or $1,969 per Class A share, a year ago.

The three analysts surveyed by FactSet expected Berkshire to report earnings per Class A share of $1,690 in the fourth quarter.

Berkshire’s revenue grew nearly 20 percent to $36.2 billion from $30.2 billion last year.

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02/22/2011 (9:09 am)

Moody’s downgrades Japan rating outlook on debt

Filed under: economics, technology |

Moody’s Investors Service on Tuesday downgraded its outlook for Japan’s credit rating because of concerns over its massive national debt.

The rating agency changed its outlook for Japan’s Aa2 rating from stable to negative.

In January, Standard & Poor’s cut Japan’s credit rating from AA to AA- for the first time in almost nine years due to concerns over ballooning debt.

Moody’s said the downgrade was due to “increasing uncertainty” over Japan’s ability to implement effective measures to rein in rising debt guaranteed payday loan.

Japan’s debt ratio is already among the highest in the developed world.

The finance ministry estimated in January that the country’s public debt would swell to 997.7 trillion yen ($12 trillion) by March 2012, up from 943 trillion yen this year.

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02/11/2011 (12:36 am)

Wentzville aldermen keep minimum lot size

Filed under: economics, legal |

WENTZVILLE

01/30/2011 (4:05 pm)

First Banks narrows fourth-quarter loss to $51 million

Filed under: economics, uk |

First Banks narrowed its loss in the fourth quarter as it reduced costs associated with bad loans.

First Banks, the privately-held holding company for Clayton-based First Bank, posted a loss of $51.4 million in the quarter compared to a $153.8-million loss a year ago.

First Banks reduced its provision for loan losses to $52 million in the fourth quarter, compared to $63 million in the same quarter a year ago.

First Banks’ nonperforming assets, including nonaccrual loans, and other real estate and repossessed assets, decreased 16.1 percent in the fourth quarter, to $103.2 million, compared to a year ago.

“We strengthened our balance sheet significantly during the fourth quarter as a result of the significant decline in both nonperforming assets and construction loans, as well as the payoff of our remaining term secured borrowings,” said First Banks’ president and Chief Executive Terrance McCarthy in a statement. “While these actions contributed to our net loss for the fourth quarter, we believe they better position us for earnings improvement in 2011.”

For all of 2010, First Banks reported a loss of $191.7 million, compared to a loss of $427.6 million in 2009.   

Additionally, holders of First Banks’ trust preferred securities agreed to changes in its securities agreement in an effort to boost capital for the holding company. First Bank initiated a consent solicitation for holders of preferred securities in October and extended a November deadline for the consent until Jan. 21  

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01/12/2011 (8:39 am)

SEC watchdog examining claim on Citigroup execs

Filed under: economics, real estate |

The internal watchdog of the Securities and Exchange Commission is investigating an allegation that the agency’s enforcement chief gave a break to two Citigroup executives when the bank settled charges of misleading investors.

Inspector General David Kotz confirmed Tuesday that his office recently began a review at the request of Sen. Charles Grassley, R-Iowa. Grassley passed the anonymous written allegation to Kotz. It said that the SEC enforcement director, Robert Khuzami, directed his staff to drop planned civil fraud charges against the executives after having a “secret conversation” with an attorney representing Citigroup who is “a good friend” of Khuzami.

An SEC spokesman says the Citigroup settlement followed a careful review of evidence and held the executives accountable.

Kotz’s review was reported earlier Tuesday by Bloomberg News.

Citigroup agreed in July to pay $75 million to settle the SEC’s charges it misled investors on about $50 billion in potential losses from securities linked to subprime mortgages. The agency also settled charges with former Chief Financial Officer Gary Crittenden, who agreed to pay a $100,000 civil penalty, and the former head of investor relations, Arthur Tildesley Jr., who agreed to pay $80,000.

The charges against Crittenden and Tildesley involved negligence rather than fraud. They neither admitted nor denied the allegations under terms of the settlement.

SEC spokesman John Nester said Tuesday the settlement “appropriately held the company and individuals accountable. It was the product of a thorough investigation and a careful evaluation of the evidence and the applicable law.”

“We stand ready to assist and cooperate fully” with the inspector general’s review, Nester said in a statement.

Jon Diat, a spokesman for New York-based Citigroup, declined to comment.

Grassley said that if the allegation is true, it is “exactly” the sort of conduct that he and another senior members of the Senate Judiciary Committee urged the SEC to stop in their report on the agency’s handling of an insider trading case.

“It isn’t appropriate for senior SEC officials to secretly meet with lawyers for the other side and then make major decisions about the case without the knowledge or involvement of the career government attorneys doing the day-to-day work,” Grassley said. “The SEC supposedly implemented a policy to stop this.”

A federal judge initially declined in August to approve the settlement, asking SEC attorneys why the bank’s shareholders should be punished for the alleged misdeeds of Citigroup executives. She approved it in October after Citigroup pledged to maintain new policies it adopted to avoid similar violations in the future.

The anonymous letter also was sent to Rep. Darrell Issa, R-Calif., the incoming chairman of the House Oversight and Government Reform Committee.

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