Finance & Business World

Viacom Inc.’s Philippe Dauman led the list of America’s top-paid CEOs in 2010 but his pay package for 2011 was nearly halved, mainly because he didn’t get stock bonuses for renewing his contract as he did a year ago.

Still, an Associated Press tally values Dauman’s pay package at $43 million, down from $84.5 million a year ago.

The figures were contained in a securities filing the media company filed Friday.

Another reason he won’t be the highest paid CEO last year: Apple Inc.’s Tim Cook was awarded a package valued at a whopping $378 million for replacing the late Steve Jobs at the helm.

Dauman’s base salary rose 33 percent to $3.5 million, but the bulk of his pay came in the form of a $20 million bonus for good performance, a 78 percent increase from a year ago. The company said operating profits came in above the mid-point of its target range and free cash flow generation was near the top of its range.

Dauman’s annual grant of stock awards was 68 percent smaller than a year ago at $13.3 million, and new stock options he was granted were valued at $6 million, down 79 percent from fiscal 2010.

He also received other compensation of $262,636, mainly for personal use of the company aircraft.

New York-based Viacom’s executive chairman and 88-year-old founder, Sumner Redstone, saw a 39 percent boost to his pay package to $21 million.

Redstone, who controls the company through a special class of voting shares, pulled down a base salary of $1.75 million, up a third from a year earlier, and a performance bonus up 78 percent at $10 million. New grants of stock and stock options came to about $8 million, the same as the previous year.

Redstone also benefited from a preferential executive pension plan that grew by about $1 million, with other compensation totaling $30,955 quick payday loan.

Over the fiscal year that ended Sept. 30, Viacom’s widely traded Class B shares rose 7 percent to $38.74 from $36.19. The company said its total shareholder return in fiscal 2011, comprised of $417 million in dividends and $2.5 billion in share buybacks, was 8.7 percent, compared to 0.8 percent for the companies of the S&P 500 Index.

Viacom owns pay TV networks such as MTV, Nickelodeon and VH1 and the Paramount Pictures movie studio.

The Associated Press formula calculates an executive’s total compensation during the last fiscal year by adding salary, bonuses, perks, above-market interest the company pays on deferred compensation and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in most cases from the total reported by companies to the Securities and Exchange Commission.

The value that a company assigned to an executive’s stock and option awards for 2011 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company’s stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options

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The war of words between Europe and private investors heated up Tuesday as talks to reduce Greece’s massive debt burden hit an impasse.

While the finance ministers of the countries that use the euro as their currency adopted a tough stance on how much rescue money they would pump into the Greek economy, the head of the group that represents the country’s private creditors _ banks and other investment firms _ warned that the future of Europe was being threatened if a voluntary debt reduction deal over Greece was not agreed.

Charles Dallara, the managing director of the Institute of International Finance, warned that Europe was putting “decade of progress at risk” over the management of Greek debt-reduction talks, which stalled over the weekend.

“European stability is at stake as well,” Dallara said in Zurich in a press conference.

On the front line of Europe’s sovereign debt crisis, Athens is trying to get its private creditors to swap their Greek government bonds for new ones with half their face value, thereby slicing some euro100 billion ($130 billion) off its debt. The new bonds would also push the repayment deadlines 20 to 30 years into the future.

However, the main stumbling block over the past few weeks to securing this deal has been the interest rate these new bonds would carry. A high interest rate could buffer losses for investors, but would also require the eurozone and the International Monetary Fund to put up more than the euro130 billion ($169 billion) in rescue loans they promised in October.

Dallara said the private creditors, which include banks, insurance companies and hedge funds, were acting in good faith and that the proposal made last week was in the spirit of last October’s agreement. At that time, Europe’s leaders said Greece should look to reduce the value of its private sector debts by 50 percent, or euro100 billion ($130 billion).

In the early hours of Tuesday, eurozone politicians drew a firm line on the Greek debt restructuring.

Jean-Claude Juncker, the Luxembourg prime minister who chaired a meeting of finance ministers on efforts to fight the crisis, said the average interest rate over the lifetime of the new Greek bonds must be “clearly below 4 percent,” with an average rate of less than 3.5 percent for the period until 2020. That is far below the 4 percent demanded by the Institute of International Finance, which has been leading negotiations for the private bondholders.

The European ministers’ tough stance on the interest rates underlines how the eurozone and the IMF are unwilling to increase new rescue loans above the promised euro130 billion, even though Greece’s economic situation has deteriorated. After already granting Greece a euro110 billion bailout in May 2010, the eurozone and the IMF are threatening to withhold further funding for the country, which has repeatedly failed to hit budget and reform targets required in return for the financial aid.

The interest rate caps will also seriously test the willingness of private bondholders to agree to a debt deal voluntarily.

Dallara said talks would continue over the coming days, adding that he was confident there would be “large-scale” participation by the private sector if a “voluntary” deal is clinched.

However, he refused to put a deadline on the discussions.

Given the complexity of the negotiations and the legal consequences that would ensue, many analysts think a deal has to be agreed soon if Greece is to meet a vital bond repayment deadline in March.

If it can’t pay its bond, Greece would be in default of its debts, a scenario that could lead to renewed panic in financial markets and potentially derailing a feeble global economic recovery.

Dallara said Europe must keep the support of the private sector, given the massive amounts of debt that have to be refinanced from France to Portugal.

He added that there wasn’t a country that didn’t need investment from the private sector.

“Investors need to feel confident in their investments … in sovereign debt,” he said.

Before Dallara’s latest comments, German Finance Minister Wolfgang Schaeuble said the current impasse was a normal part of difficult negotiations.

“We continue the negotiations (with investors) as happily, but also as little susceptible to blackmail as possible,” he told reporters in Brussels. “That exists in every bazaar _ a final offer _ one shouldn’t let oneself be overly impressed by that.”

The alternative to a voluntary deal would be to force losses on to investors _ a move that the eurozone has so far been unwilling to make. Some officials fear that a forced default could trigger panic on financial markets and hurt bigger countries like Italy, Spain or even France.

But several ministers indicated that they might be willing to accept a forced default if it puts Athens in a position where it can eventually repay its remaining debt _ including the rescue loans from the eurozone and the IMF. The eurozone has said that Greece’s debt is sustainable if it falls to some 120 percent of gross domestic product by 2020. Without a restructuring it would reach close to 200 percent by the end of the year.

Even Olli Rehn, the EU’s Monetary Affairs Commissioner, said that forcing some holdouts to accept a restructuring that has the support of the majority of bondholders would be acceptable.

“That is possible within the framework of achieving a voluntary agreement on private sector involvement,” Rehn said, referring to so-called collective action clauses that Greece could write into its old bond contracts to allow majority decision making. The Commission has so far always been opposed to any forced losses for investors.

But ministers also put the pressure on Greece to reach a manageable debt level by bolstering its reform and austerity measures.

“Greece and the banks have to do more in order to reach a sustainable debt level,” Dutch Finance Minister Jan Kees de Jager told reporters as he arrived for a second day of meetings with his European counterparts. “We have to await the discussions about that because a sustainable debt level is absolutely a precondition for the next (rescue) program.”

Schaeuble also insisted that firm support for new austerity measures from all major Greek parties _ including after elections expected in April _ was a precondition for a new bailout.

__

Pan Pylas in Zurich and Nicholas Paphitis in Athens, Greece, contributed to this story.

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Foreign direct investment in China fell for the second straight month in December as global financial turmoil dimmed companies

China is expecting foreign trade growth to slow this year to around 10 percent amid a grim outlook for exports, a state news agency reported Saturday.

The world’s second-largest economy’s foreign trade will be hurt by weak external demand, increasing trade competition, a stronger Chinese currency and other factors, the official Xinhua News Agency cited an official from the country’s top economic planning agency as saying.

“We expect more difficulties in foreign trade and the export situation will be grim in 2012, especially in the first half of the year,” said Zhang Xiaoqiang, deputy director of the National Development and Reform Commission, according to Xinhua.

Last year, China’s foreign trade grew 22.5 percent to $3.6 trillion, according to data from the official General Administration of Customs released earlier in the week.

The data also showed that exports in December rose 13.4 percent, down slightly from November’s growth rate. In a new that sign the economy is slowing, import growth showed an unexpectedly sharp drop, falling to 11.8 percent, barely above half the previous month’s gain payday loans.

On Saturday, Zhang told a forum in Beijing that improving tax and insurance policies and providing financial support for small trading companies could help stabilize export growth, Xinhua said.

China’s relatively robust growth has been a rare bright spot for a struggling global economy. But growth has slowed in recent months after Beijing tightened lending and investment curbs to prevent overheating.

A slump in demand for Chinese goods abroad has prompted the government to reverse course and promise to help struggling exporters and shore up growth with more bank lending and other measures. It is unclear what impact the measures will have.

Chinese export growth has fallen steadily since August as Europe’s debt crisis and high U.S. unemployment hurt demand. But it has stayed in double digits, showing the competitive strength of Chinese exporters in global markets.

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So the U.S. economy added hundreds of thousands of jobs last month and everything is fantastic, right?

Well, not exactly. More than 40,000 of those jobs were couriers and messengers, which were in demand during the holidays because of the increased focus on online shopping rather than retail. But these jobs tend to be temporary seasonal hires and not permanent additions.

"People are happy to get those jobs for the time they have them, but come January, they’re out looking for jobs again," said Dean Baker, co-director of the Center for Economic and Policy Research.

The U.S. Labor Department reported that the economy added 200,000 jobs, which was stronger than economists expected, and the unemployment rate dipped to 8.5%.

Obama proposes pay hike

But spokeswomen for FedEx (, Fortune 500) and UPS (, Fortune 500) confirmed that they increased temporary hiring during the 2011 holiday season even more than the year before. However, many of those jobs have already evaporated.

"The hiring boost this holiday season was greater than the prior holiday season," said Kara Ross of UPS, noting that her company hired 55,000 temporary workers for the 2011 holiday season, an increase of 5,000 from the year before credit reports free.

Ross said that many of those new hires were drivers, driver helpers, loaders and unloaders. Many of them won’t remain on the payrolls after the holiday season, she said, though the level of attrition is yet to be determined.

"It just depends on our volume loads," she said. "Some of them we might keep on; some of them we might not."

Carla Boyd of FedEx said her company hired 20,000 temporary seasonal workers from October to December, an increase of 17,000 from the prior holiday season.

Unemployment rate, state by state

"There’s an incredible holiday surge," said Boyd. "We had our busiest day in history on Dec. 12."

On that day, FedEx had 17 million shipments, compared to the year-ago holiday peak of 15.6 million. But the annual average is 8.5 million, so FedEx doesn’t need that many workers year-round.

"The problem is that you have a lot of reporters touting this as a really strong report, and if that creates a view among policy makers that the economy is on the mend, then that undermines the need to do anything," said Baker. 

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%3Cp%3EU.S.+stock+futures+rose+Monday%2C+even+as+news+of+North+Korea+ruler+Kim+Jong+Il%27s+death+rattled+Asia+and+European+markets.%3C%2Fp%3E+%09%3Cp%3EEuropean+markets+fell%2C+but+then+rebounded+as+investors+weighed+the+potential+consequences+of+Kim%27s+death.+Asian+indexes+closed+lower.+Analysts+warn+Kim%27s+death+could+cause+an+uncertain+power+transition+and+put+the+brakes+on+talks+aimed+at+getting+the+secretive+communist+state+to+give+up+its+nuclear+weapons.%3C%2Fp%3E+%09%3Cp%3EKim+Jong+Un%2C+the+supreme+leader%27s+untested+third+son+and+heir-apparent%2C+is+expected+to+want+to+consolidate+his+power+and+dispel+any+notions+of+weakness.%3C%2Fp%3E+%09%3Cp%3EDow+Jones+industrial+average+futures+are+up+51%2C+or+0.4+percent+at+11%2C829.+The+broader+Standard+%26amp%3B+Poor%27s+500+index+futures+are+up+7%2C+or+0.6+percent%2C+at+1%2C218.+Nasdaq+100+futures+are+up+13.25%2C+or+0.6+percent%2C+to+2246.%3C%2Fp%3E+%09%3Cp%3E%22The+most+likely+scenario+for+regime+collapse+has+been+the+sudden+death+of+Kim+%28Jong+Il%29.+We+are+now+in+that+scenario%2C%22+said+Victor+Cha%2C+a+former+U.S.+National+Security+Council+director+for+Asian+affairs.%3C%2Fp%3E+%09%3Cp%3EBut+after+Asian+indexes+closed+lower%2C+European+stocks+recovered.+Germany%27s+DAX+rose+0.7+percent+to+5%2C741+and+Paris%27+CAC+40+index+rose+0.2+percent+to+2%2C979.+Britain%27s+FTSE+gained+0.3+percent+to+5%2C405.40.%3C%2Fp%3E+%09%3Cp%3EOvernight+South+Korea%27s+Kospi+index+dived+nearly+5+percent+but+later+recouped+some+losses+to+close+3.4+percent+lower+at+1%2C776.93.+The+Korean+won+also+fell%2C+losing+1.6+percent+against+the+U.S.+dollar%2C+a+traditional+haven+in+times+of+uncertainty.+The+Japanese+yen+and+other+regional+currencies+also+weakened+against+the+dollar.%3C%2Fp%3E+%09%3Cp%3EThe+euro+was+flat+around+%241.3030.%3C%2Fp%3E+%09%3Cp%3EKim%27s+death+overshadowed+what+already+was+a+gloomy+start+to+the+week+after+Fitch+warned+after+the+market+close+on+Friday+that+it+may+downgrade+the+credit+ratings+of+Italy+and+Spain%2C+as+well+as+Belgium%2C+Cyprus%2C+Ireland+and+Slovenia.%3C%2Fp%3E+%09%3Cp%3EEU+finance+ministers+will+later+Monday+discuss+how+much+money+their+countries+will+lend+to+the+International+Monetary+Fund+in+a+conference+call.%3C%2Fp%3E+%09%3Cp%3EThe+ministers+will+seek+to+decide+how+to+split+up+the+euro200+billion+%28%24261+billion%29+EU+leaders+promised+to+send+to+the+IMF+at+a+summit+10+days+ago.+The+money+is+meant+to+boost+the+eurozone%27s+firewall+against+the+escalating+debt+crisis.There+were+some+doubts+whether+the+EU+would+reach+the+euro200+billion+after+several+non-eurozone+countries+balked+at+having+to+support+the+currency+union.+The+ministers+will+also+discuss+in+their+conference+call+a+new+treaty+to+tighten+fiscal+discipline%2C+a+spokesman+for+the+Polish+delegation+to+the+European+said.%3C%2Fp%3E+%09%3Cp%3EOver+the+coming+days%2C+investors+will+remain+alert+to+developments+in+North+Korea%27s+power+transition.%3C%2Fp%3E+%09%3Cp%3EKim+Jong+Il%27s+death%2C+announced+Monday+by+North+Korean+state+television%2C+raises+the+specter+of+more+instability+on+the+divided+Korean+peninsula.%3C%2Fp%3E+%09%3Cp%3EThose+worries+are+most+acute+in+South+Korea+and+Japan%2C+which+have+often+been+the+targets+of+North+Korea%27s+mercurial+military+and+diplomatic+actions.%3C%2Fp%3E+%09%3Cp%3E%22We%27re+seeing+deeper+negative+sentiment+in+some+markets%2C%22+said+Dariusz+Kowalczyk%2C+strategist+at+Credit+Agricole+CIB%2C+in+Hong+Kong.+%22Basically+this+is+because+risk+aversion+on+the+geopolitical+front+has+increased+given+that+there%27s+a+transition+of+power+in+a+relatively+unstable+country.+So+we%27re+seeing+an+impact+on+equities%2C+currencies.%22%3C%2Fp%3E+%09%3Cp%3ESouth+Korea%27s+military+and+police+went+on+alert+and+President+Lee+Myung-bak%2C+convened+a+national+security+council+meeting.+Japanese+leaders+said+they+were+watching+markets+closely+and+in+contact+with+the+U.S.%2C+Kyodo+News+Agency+reported.%3C%2Fp%3E+%09%3Cp%3EKim+was+ailing+after+suffering+what+is+thought+to+have+been+a+stroke+in+2008+and+died+at+age+69+on+Saturday.%3C%2Fp%3E+%09%3Cp%3ENorth+Korea%27s+official+Korean+Central+News+Agency+identified+his+third+son%2C+the+twenty-something+Kim+Jong+Un%2C+as+the+%22great+successor%22+to+the+man+known+officially+as+the+%22Dear+Leader.%22%3C%2Fp%3E+%09%3Cp%3EBut+even+with+the+younger+Kim+designated+as+his+father%27s+successor%2C+and+already+filling+high-ranking+posts%2C+some+experts+fear+a+behind-the-scenes+power+struggle+or+nuclear+instability.%3C%2Fp%3E+%09%3Cp%3EFitch+Ratings+said+it+did+not+view+Kim%27s+death+%22as+a+trigger+for+negative+action+on+South+Korea%27s+sovereign+ratings+in+itself.%22%3C%2Fp%3E+%09%3Cp%3E%22For+now%2C+it%27s+much+too+early+to+say+risks+have+materially+increased%2C+but+clearly+we+will+keep+the+situation+under+close+review%2C%22+said+Andrew+Colquhoun%2C+head+of+Fitch%27s+Asia-Pacific+sovereigns.%3C%2Fp%3E+%09%3Cp%3EMarkets+in+Taiwan%2C+Singapore%2C+Australia%2C+New+Zealand+and+Indonesia+also+sank+on+Monday.%3C%2Fp%3E+%09%3Cp%3EStill%2C+barring+unexpected+developments+in+Pyongyang+the+impact+of+Kim%27s+death+on+markets+is+likely+to+be+passing%2C+analysts+said.%3C%2Fp%3E+%09%3Cp%3E%22In+the+short+term+there+will+be+some+psychological+uncertainty+but+I+think+things+will+go+back+to+the+fundamentals%2C%22+said+Steven+Leung%2C+director+of+institutional+sales+at+UOB-Kay+Hian+Ltd.+in+Hong+Kong.%3C%2Fp%3E+%09%3Cp%3EBenchmark+oil+for+January+delivery+was+up+51+cents+at+%2494.04+a+barrel+in+electronic+trading+on+the+New+York+Mercantile+Exchange.%3C%2Fp%3E+%3Cp%3E%3Ca+href%3D%27http%3A%2F%2Fwww.stltoday.com%2Fbusiness%2Fnational-and-international%2Fus-stocks-edge-higher-after-n-korean-leader-death%2Farticle_e55e0b52-5b48-5395-8e2e-959dfe5f3526.html%27+rel%3D%27nofollow%27%3ESource%3C%2Fa%3E%3C%2Fp%3E+

Bangkok authorities are telling more residents to leave as floodwaters threaten southwestern neighborhoods in the Thai capital.

Governor Sukhumbhand Paribatra said people should evacuate three neighborhoods due to surging water levels. He said Sunday pumps were operating around the clock and more pumps were being added to help drain the water.

Still, floodwaters are receding elsewhere. Prime Minister Yingluck Shinawatra said previously the city center would have light flooding if the water penetrated that far but western areas of Bangkok were threatened with inundation savings account payday advance.

The national death toll from floods since late July has reached 536. More than 13.1 million people _ one in five Thais _ are affected.

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A ballot battle in Ohio that pits the union rights of public workers against Republican efforts to shrink government and limit organized labor’s reach culminates Tuesday in a vote with political consequences from statehouses to Pennsylvania Avenue.

A question called Issue 2 asks voters to accept or reject a voluminous rewrite of Ohio’s collective bargaining law that GOP Gov. John Kasich signed in March, less than three months after his party regained power in the closely divided swing state.

Thousands descended the Statehouse in protest of the legislation known as Senate Bill 5, prompting state officials at one point to lock the doors out of concern for lawmakers’ safety.

The legislation affects more than 350,000 police, firefighters, teachers, nurses and other government workers. It sets mandatory health care and pension minimums for unionized government employees, bans public worker strikes, scraps binding arbitration and prohibits basing promotions solely on seniority.

By including police and firefighters, Ohio’s bill went further than Wisconsin’s, which was the first in a series of union-limiting measures plugged by Republican governors this year as they faced deep budget holes and a tea party movement fed up with government excess. Democratic governors, including New York’s Andrew Cuomo and Connecticut’s Dannel Malloy, have also faced down their public employee unions in attempts to rein in costs.

That’s why labor badly needs a win in Ohio, said Lee Adler, who teaches labor issues at Cornell University’s New York State School of Industrial and Labor Relations.

“If the governor of Ohio is able to hold the line on the legislation that was passed, then it would be a very significant setback for public sector workers and public sector unions in the U.S.,” he said. “Likewise, if the other result happens, then it would certainly provide a considerable amount of hope that, with the proper kind of mobilization and the proper kind of targeting, some of the retrenchment that has been directed at public sector workers can be combated.”

Victory could also galvanize support and build energy within the Democratic-leaning labor movement ahead of the 2012 presidential election, a potential boon for President Barack Obama’s re-election effort.

We Are Ohio, the labor-backed coalition fighting the law, had raised more than $24 million as of mid-October _ more than Obama, John McCain and 18 other presidential contenders raised in combined Ohio contributions during the 2008 presidential election, according to Federal Election Commission data.

Building a Better Ohio, the business-fueled proponent campaign, has raised $8 million. Outside groups including FreedomWorks, Americans for Prosperity and the Virginia-based Alliance for America’s Future are also rallying support for the law. Their spending hasn’t been documented.

“This will eclipse any statewide candidate election in the history of the state, in terms of spending,” said Jason Mauk, a spokesman for Building a Better Ohio. “It’s an unprecedented campaign.”

Ohio voters favored repeal 57 percent to 32 percent, an Oct. 25 Quinnipiac University poll showed. But Mauk said the law’s backers are still cautiously optimistic they can win, and will continue through the weekend to carry the bill’s tea party-friendly message to voters.

“People are tired of government spending more than it makes, more than it collects, and they’re frustrated by the debt and deficit problem in Washington,” he said. “Voters clearly sent a message of concern (in 2010) and they’re demanding that government get its house in order, and that’s the platform John Kasich ran on. This is an effort to try to eliminate government excess and get spending under control.”

Kasich is ranked among America’s least popular governors, thanks in part to his fight against the unions. The former congressman, investment banker and Fox News commentator has traveled the state to rally voters to keep the law and appeared in pro-Issue 2 commercials paid for by Make Ohio Great, a project of the Republican Governors Association.

Voters are eager to help defeat the law because they felt disenfranchised by the process, said Melissa Fazekas, a spokeswoman for the opposition.

The bill was introduced, debated in the Legislature, passed and signed by Kasich in two months. GOP legislative leaders say they heard dozens of hours of testimony and Democrats proposed no amendments to the bill during deliberations.

After it passed, the law’s opponents easily gathered 1.3 million signatures for their ballot effort and now boast a legion of more than 17,000 volunteers of all political stripes.

“I’ve never been involved in something quite like this,” Fazekas said. “I’ve just never seen people so engaged and enthusiastic. I’ve seen situations before where people were willing to sign petitions, but on this issue people were literally grabbing petition booklets out of our hands and taking them out and circulating them.”

Adler said public schools and the post office are the last two big government entities not controlled by corporations, and so are primary targets of union-limiting efforts.

He said “everybody A to Z” will be watching the vote’s outcome because of the state’s long history as a political bellwether: “Ohio tells a story about America every time it votes.”

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When the market falls as rapidly as it has lately, you’ll inevitably hear analysts proclaiming that stocks are now bargains.

At one level, they’re stating the obvious: Like shirts on the department store’s bargain rack, companies are suddenly 5, 10 or 20 percent cheaper than they were a few months ago. The current crop of bargain-hunters, though, think they’ve found something more significant than a quick markdown.

By some traditional measures, stocks are as cheap as they have been in decades. The stocks in the Standard & Poor’s 500 index, for example, sell for about 12 times the profit they earned in the past year. That’s called the price-earnings ratio, and its long-term average is around 16.

The S&P 500 companies also are trading at less than twice their book value, which is the accounting measure of their worth. Historically, a typical number would be more like 3 times book. The last time the price-to-book measure got this low was in March 2009, which in hindsight turned out to be a terrific buying opportunity.

Some money managers see a similar opportunity today. “We really think the market is pretty darned cheap,” says David Rolfe, chief investment officer at Wedgewood Partners in Ladue. “There’s this fear of what may happen in Europe, but if you get just a whiff of relief, a whiff that maybe we’ve priced in the worst of Greece, the U.S. stock market is like a coiled spring.”

In other words, he’s buying and waiting for a bounce. With short-term interest rates at near zero, Rolfe adds, stocks have never been more attractive in comparison to Treasury bills and other cashlike investments.

When someone talks about ratios, though, it’s important to look at both numerator and denominator. A plunging stock price might make the price-earnings ratio look attractive, but how reliable are the earnings?

After all, stocks didn’t look overpriced in 2007, but then a severe recession turned profits into losses and the market lost half its value.

Perhaps, then, we should put a little less faith in analysts’ estimates of what a company might earn next year. If earnings are volatile, maybe the classic P/E ratio can’t tell us whether stocks are cheap or expensive.

Robert Shiller, a finance professor at Yale University, tackled this problem by constructing a cyclically adjusted price-earnings ratio. It compares today’s stock price to a 10-year average of company profits. By his measure, today’s stock market isn’t cheap. In fact, the so-called Shiller P/E stands at almost precisely its 50-year average.

The Shiller concept is a good tool for assessing today’s market, says Mark Keller, chief investment officer at Confluence Investment Management in Webster Groves.

“Earnings are so volatile in recent years,” he explained. “You could argue that today’s profit margins are not sustainable.”

As a percentage of the U.S. gross domestic product, corporate profits are already at a record level. “Maybe we’ll go to a new all-time high, but we find it hard to believe things could get much better,” Keller said.

Perhaps, then, we’ve hit the profit peak for this cycle. If profits can only grow as fast as GDP

Greece’s finance minister has started new talks with international debt inspectors on reforms the debt-crippled country must implement to keep receiving rescue loans.

The finance ministry says the teleconference between Evangelos Venizelos and officials from the European Commission, International Monetary Fund and European Central Bank _ collectively known as the troika _ started late Tuesday.

Venizelos, who held a first call with the troika officials Monday, has to convince them that Greece’s delayed reform and cutback program is viable.

If so, the country will receive the next euro8 billion ($11 billion) installment of the bailout that has been keeping it solvent since May 2010. Otherwise, Greece’s cash reserves will run out around mid-October, forcing a chaotic bankruptcy.

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

ATHENS, Greece (AP) _ Greek authorities, in a bid to prevent a potentially disastrous default, will try to convince international creditors on Tuesday that their debt-ridden country will meet the strict budget targets required to keep getting rescue loans.

Markets are fairly hopeful that Greece will receive the next euro8 billion ($10.9 billion) installment of its bailout, without which the country would go bankrupt next month, plunging Europe’s banking system into turmoil.

The talks will be held by teleconference between Finance Minister Evangelos Venizelos and officials from the European Commission, International Monetary Fund and European Central Bank, collectively known as the troika.

Though stocks were up on expectations some deal would be struck, most analysts think the country will have to restructure its debts at some point, especially if the economy remains mired in recession. Fitch Ratings said in a report Tuesday that it expected Greece to eventually default, but to do so while remaining in the eurozone.

Some experts believe the country will have to drop out of the 17-nation euro, a notion Venizelos dismissed.

“Greece’s participation in the eurozone and the euro is an irrevocable and fundamental national choice that the Greek population is making sacrifices to safeguard, in full knowledge of how priceless it is,” Venizelos told journalists, rejecting a Greek newspaper report that the government was considering a referendum on the issue.

German Chancellor Angela Merkel has likewise had to quell fears of a euro break-up, a scenario elected officials in her own government speculated about last week, roiling financial markets.

Prime Minister George Papandreou plans to meet Merkel next week during a visit to Berlin, a German government official said. The official, who spoke on condition of anonymity because the meeting hasn’t yet been announced officially, said the two would talk on the sidelines of the Federation of German Industries’ annual meeting on Sept. 27.

Since May 2010, Greece has been dependent on a euro110 billion ($150 billion) bailout from other eurozone countries and the IMF to continue servicing its debt and to pay salaries and pensions. Without the next installment, the country only has enough funds to see it through mid-October.

The funds had been expected in September, but the country’s creditors have said a decision on whether to disburse the funds will not be made until early October.

A first teleconference between Venizelos and the troika Monday night was “productive and substantive,” the Finance Ministry said.

Inspectors from the IMF, ECB and Commission suspended their quarterly review of the country’s progress earlier this month, amid talk of missed targets and delayed implementation of reforms.

The Socialist government has already taken a series of austerity measures, cutting public sector pay and pensions and hiking taxes. Unions have responded with strikes and demonstrations.

Hundreds of civil servants demonstrated peacefully in central Athens, while about 250 high school students marched in a separate protest against shortages in schoolbooks and other supplies at state-run schools. Public transport workers have called for a daylong strike Thursday, while air traffic controllers have declared a 24-hour strike Sunday and a four-hour work stoppage on Sept. 28.

Efforts so far have proved to be not enough to tackle the country’s severe debt crisis. In July, European countries agreed to extend a second bailout, worth euro109 billion, to Greece. However, the details of the second rescue package, which includes voluntary bond rollovers, have still to be worked out.

On Monday, the IMF representative in Greece, Bob Traa, said Greece needed to speed up its reforms in tax collection and reduce the size of the overmanned public sector.

Ahead of Tuesday’s teleconference, Venizelos was attending a parliamentary committee meeting, at which the director of Greece’s Statistical Authority has been summoned to testify after a member of the outgoing agency’s board claimed budget deficit figures in 2009 were miscalculated, inflating the annual figure. A judicial investigation has been launched into the claims.

“As a result of our actions in the past year, the agency has experienced a strong recovery in confidence regarding its international reputation,” Andreas Georgiou, director of the Greek Statistical Authority, said at the committee hearing.

The European Commission’s representative office in Athens issued a statement saying the EU’s statistics agency, Eurostat, had published the reviewed Greek 2009 deficit figures “without reservations” last November.

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Geir Moulson in Berlin, David McHugh in Frankfurt and Derek Gatopoulos in Athens contributed.

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