Friday, December 25, 2009

“Business briefs - Dubuque Telegraph Herald” plus 4 more

“Business briefs - Dubuque Telegraph Herald” plus 4 more

Business briefs - Dubuque Telegraph Herald

Posted: 25 Dec 2009 07:57 AM PST

Jobless claims, goods orders signal rebound

WASHINGTON -- A fitful economic recovery is drawing strength from a stabilizing job market and signs that manufacturing will contribute to the rebound.

The Labor Department said the number of newly laid-off workers filing claims for unemployment aid fell more than expected last week. The four-week average for claims, which smooths out fluctuations, fell for the 16th straight week, to its lowest point since September 2008, when the financial crisis hit with full force.

Further evidence of a gradually healing economy was a Commerce Department report that orders to U.S. factories for big-ticket durable goods rose in November.

Treasury removes cap for Fannie, Freddie aid

NEW YORK -- The government has handed its ATM card to beleaguered mortgage giants Fannie Mae and Freddie Mac.

The Treasury Department said Thursday it removed the $400 billion financial cap on the money it will provide to keep the companies afloat. Already, taxpayers have shelled out $111 billion to the pair, and most analysts hadn't expected the companies to hit the limit.

Treasury Department officials said it will now use a flexible formula to ensure the two agencies can stand behind the billions of dollars in mortgage-backed securities they sell to investors. The formula will provide the companies with a sufficient cushion based on projected losses over the next three years.

Energy futures rise on storms, supply

Energy prices are ending the year on an upswing with large storms, falling supplies, a weak dollar and a slightly better employment picture sending futures higher.

Crude futures closed above $78 per barrel for the first time in more than a month Thursday in shortened holiday trading as the government reported that unemployment benefit claims from newly laid-off workers fell for the 16th straight week.

Yet there are few signs that demand has increased, meaning that any price hikes felt by consumers might be temporary.

Oil prices climbed 6 percent on the week, though the stabilizing economy hasn't seriously dented huge stores of crude, natural gas and gasoline.

Mortgage rates inch above 5 percent

McLEAN, Va. -- The average fixed-rate for a 30-year mortgage climbed above 5 percent for the first time in two months, leading to a decline in mortgage applications.

The average fixed rate on a 30-year mortgage was 5.05 percent this week, up from 4.94 percent last week, Freddie Mac said Thursday. The last time rates were above 5 percent was the week ending Oct. 29, when they were 5.03 percent.

Mortgage rates have risen since they hit a record low of 4.71 percent the week of Dec. 3. They are closely tied to yields on long-term government debt, which have gone up since then.

Congress raises debt limit to $12.4 trillion

WASHINGTON -- The Senate voted Thursday to raise the ceiling on the government debt to $12.4 trillion, a massive increase over the current limit and a political problem that President Barack Obama has promised to address next year.

The Senate's rare Christmas Eve vote, 60-39, follows House passage last week and raises the debt ceiling by $290 billion. The vote split mainly down party lines, with Democrats voting to raise the limit and Republicans voting against doing so. There was one defection on each side, by senators whose seats will be on the ballot next year: GOP Sen. George Voinovich, of Ohio, and Democratic Sen. Evan Bayh, of Indiana.

Apple's stock hits high as buzz builds

NEW YORK -- Apple Inc. shares hit an all-time high Thursday after a published report suggested the intensely scrutinized yet secretive company may be getting ready for a major product announcement.

Citing unnamed people familiar with the preparations, the Financial Times reported on its Web site Wednesday that Apple has rented space for several days in late January at an arts center in San Francisco.

The company is famed for its highly staged launches. CEO Steve Jobs has used past events to introduce groundbreaking -- and lucrative -- gadgets such as the iPod and the iPhone.

Apple shares hit an all-time high of $209.35 at one point on Thursday, topping the previous record of $208.71, set Oct. 21. The stock was up $6.94, or 3.4 percent, to $209.04 in afternoon trading.

Stocks end session at new highs for 2009

NEW YORK -- Stocks ended a holiday-shortened session Thursday at new highs for the year.

The Dow Jones industrial average rose 53.66, or 0.5 percent, to 10,520.10. The Standard & Poor's 500 index rose 5.89, or 0.5 percent, to 1,126.48, while the Nasdaq composite index rose 16.05, or 0.7 percent, to 2,285.69.

Rising shares outnumbered decliners by about 3 to 1 on the New York Stock Exchange, where consolidated volume came to 1.2 billion shares.

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The 11 Secrets of Business Rules Success - IT Business Edge

Posted: 25 Dec 2009 06:46 AM PST

FICO

FICO™ (NYSE:FIC) is the leader in decision management, transforming business by making every decision count. FICO™ uses predictive analytics to help businesses automate, improve and connect decisions across organizational silos and customer lifecycles. Clients in 80 countries work with FICO to increase customer loyalty and profitability, cut fraud losses, manage credit risk, meet regulatory and competitive demands, and rapidly build market share. Most leading banks and credit card issuers rely on FICO solutions, as do insurers, retailers, healthcare organizations and other companies.

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ALL BUSINESS: No consequences for lying borrowers - YAHOO!

Posted: 25 Dec 2009 08:26 AM PST

NEW YORK – The government shouldn't reward liars. But that's the effect of changes to the Obama administration's failing program to help homeowners modify their mortgages.

Until recently the rules were clear: if you grossly understated your income to qualify for the program, you had to restart the loan modification process. It made sense. After all, we got into this housing mess partly because too many people were dishonest about how much they made.

Fast forward to today. The federally funded Home Affordable Modification Program was aimed at getting banks to rework mortgages for homeowners in order to slow the pace of foreclosures. The government set a goal of modifying up to 4 million mortgages over the next three years.

The program isn't working like it's supposed to. Since March, just 31,000 homeowners have won permanent relief. One big reason why is that lenders are doing what they should have been doing all along — requiring things like proof of income.

How's the government responding? By letting homeowners who fudge their income numbers off the hook with little more than a wink and a nod.

"This isn't the kind of person the government should want to help," said Dean Baker, co-director of the Center for Economic and Policy Research, a left-leaning Washington think tank.

Under the $75 billion program, lenders are paid by the government to alter mortgages in hopes that cheaper loans will lead to fewer defaults. In most cases, modifications lower interest rates on home loans. Lenders also offer grace periods, longer repayment schedules or lower loan balances.

Borrowers say lenders are permitting trial modifications, but few are being made permanent. Lenders say borrowers aren't providing all the necessary paperwork to get loans permanently altered. Many lenders don't require documentation of income upfront. First, they'll make a verbal agreement with a borrower for a modification, and then verify the income once the trial period starts.

The government needs this program to work — and fast. That's the only way to explain the Treasury Department's waiver of a requirement punishing borrowers who understate their income by 25 percent or more when trying to get a modification.

That means a borrower who had told a lender he made $75,000 but was found to make $100,000 doesn't have to restart the modification process. Under the waiver announced Dec. 16, that person now gets to continue the trial period instead of being rejected immediately.

"During the housing boom, borrowers had every incentive to overstate their income to get a bigger mortgage," said Larry Doyle, who spent more than 20 years working in the mortgage business on Wall Street and now writes the financial blog Sense on Cents. "Now, they have every incentive to understate their income to get a bigger modification."

Treasury Department spokeswoman Meg Reilly says that discrepancies could be the result of mistakes or changes in someone's job or income during the trial phase. She also noted none of the eligibility, documentation and verification requirements for a permanent modification change under the new waiver.

Still, a difference in income of 25 percent or more is not a rounding error. The government should err on the side of caution with these people, not give them a free pass.

Doyle thinks that allowing dishonest borrowers to stay in the program sets a bad precedent. It also shows that lessons from the housing bust haven't been learned.

The housing market's collapse wasn't just caused by lenders issuing risky loans to borrowers who couldn't afford them. More than a third, or 4.3 million, of the home loans issued from 2004 through 2007 were for borrowers who provided no or little documentation of their income, according to real-estate data company First American CoreLogic.

When housing prices were rising, homeowners who couldn't afford their mortgages for whatever reason — lost jobs, wage cuts or a pileup of medical bills — could often sell their homes for a profit to get out of trouble.

It's a much different story today. About one in four homeowners are considered underwater, meaning their mortgage exceeds their home value.

That has led to a dramatic rise in foreclosures. About 2.2 million homes since July 2006 have completed foreclosure, according to foreclosure listing service RealtyTrac Inc.

The government knows that reducing foreclosures could go a long way toward stabilizing property values, which would help reverse the housing slump and ultimately aid the broader economic recovery.

Dishonesty fed the housing bust. Let's not let it ruin the chances for its repair.

___

Rachel Beck is the national business columnist for The Associated Press. Write to her at rbeck(at)ap.org

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Business and the Way of Democracy - New York Times

Posted: 25 Dec 2009 06:03 AM PST

Much like transitions to democracy over the past four decades transformed governments from mostly authoritarian to mostly democratic, we are currently witnessing a transformation of global corporations from a more or less opaque shareholder-centric model to a more transparent multi-stakeholder model.

The 1970s witnessed the beginning of a global trend toward the democratization of authoritarian and totalitarian regimes. This first appeared in Greece with a coup that led to democracy, continued in Portugal and culminated in Spain with a paradigmatic transition from Franco to democratic government. To this day all three countries continue to be thriving democracies.

The trend continued into the next three decades. Starting with the Polish Solidarity movement and epitomized by the fall of the Berlin Wall in 1989, democratization swept through the former Soviet bloc. Likewise, today most of Latin America can claim the democratic mantle. Successful transitions occurred in such diverse places as South Africa, the Philippines, Indonesia, Mongolia and even Iraq.

The yearning for greater political transparency and accountability continues sometimes tragically, as Iran currently exemplifies. The case of China remains a unique experiment in the liberalization of economics but not politics. Despite some business-related legal reforms, China may remain the exception that proves the rule.

As to global companies, increased government pressure and stakeholder demands for accountability (from employees, investors, customers, non-governmental organizations and others) are creating a similarly catalytic turning point that is beginning to yield a more transparent business model.

Will greater corporate transparency evolve from this turning point in a manner similar to the democratization that began in the early 1970s? We think so.

Governments are lending a hand. Global anti-corruption efforts provide a clear example. In the past month alone, governments around the world have stepped up the pressure. Dec. 9 was International Anti-Corruption Day; among other activities, the 38 signatory nations of the Organization for Economic Cooperation and Development Anti-Bribery Convention reaffirmed their commitment to expanded enforcement efforts around the world. In November, the Obama administration provided business with additional carrots and sticks. In a major speech, Lanny Breuer, chief of the Criminal Division of the Department of Justice, promised to deliver on an aggressive Foreign Corrupt Practices Act enforcement agenda "in the months and years ahead," noting that the Justice Department "will be intensely focused on rooting out foreign bribery." He emphasized that the department will focus on the investigation and prosecution of executives, stating that "culpable individuals must be prosecuted and go to jail." Mr. Breuer counseled businesses to have a "rigorous F.C.P.A. compliance policy that is faithfully enforced," to "seriously consider voluntarily disclosing" discovered violations, and to remediate the source of any violations. He noted that smart companies already have these measures in place.

The anti-corruption example shows how strong government incentives, good governance and corporate citizenship can be mutually reinforcing factors and how they are playing a key role in shaping important issues in the growth of corporate transparency.

There are other critical global business issues — human rights, anti-fraud, environmental compliance — that all point in the same direction: For their own good and that of their multiple stakeholders, companies are trending in the inevitable direction of adopting greater transparency and integrity programs.

Whether they do so voluntarily or by regulatory mandate, companies are beginning to embrace the new transparency imperative in five key ways:

Adopting better governance with stronger shareholder rights, board rules, director accountability and pay for performance.

Integrating corporate integrity programs into business strategy and leadership development.

Pursuing dialogue with multiple and increasingly vocal stakeholders.

Engaging proactively with regulators intent on trans-border cooperation and enforcement (especially regarding anti-corruption, anti-money laundering, antitrust and anti-fraud).

Catering to two critical constituents — employees and customers — who have shown greater willingness, and ability, to "vote with their feet."

Over 2000 years ago, Aristotle, in his seminal work the Nicomachean Ethics, nailed it: the pursuit of virtue and happiness is the essence of the human condition. "Ethos" and "demos." Are these two words that apply a similar principle to two different contexts? Is ethics to business what democracy is to politics? Is the role that transparency and integrity play in the private sector similar to the role that democracy plays in the public sector? We think so.

Enlightened companies are recognizing the value of integrity and transparency in business in the same way that political actors and constituents discovered the value of democracy in government over the past half century. Less enlightened entities will come along under the pressure of increasingly proactive stakeholders and regulators. And the irreversible Internet revolution that now "outs" what previously could be hidden will only further the irreversible progress to greater transparency that is already underway.

Andrea Bonime-Blanc is general counsel and chief compliance officer of Daylight Forensic & Advisory and author of "Spain's Transition to Democracy: The Politics of Constitution-making." Mark Brzezinski is a partner at McGuire Woods and author of "The Struggle for Constitutionalism in Poland."

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Big business? Just us dogs here - Boston Globe

Posted: 25 Dec 2009 08:26 AM PST

I invested my nest egg to create a dog care business that Boston needs. I followed the permitting process as instructed by the city, received my permit, and the city realized it made an internal mistake upon receiving a complaint. We reapplied and will appear before the Board of Appeals. The properties proposed are in a M-1 Restricted Manufacturing zone. Within a block radius is a factory, a 24/7 power plant, an MBTA bus repair station, and bars. We are aware of abutter residences and have environmentally sound solutions to mitigate rational concerns. We are very proud of Fenway Bark and look forward to providing jobs and being an exemplary neighbor.

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