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Written By Unknown on Sabtu, 29 Juni 2013 | 22.26

BlackBerry shares dive after surprise loss

Shares of BlackBerry plunged yesterday after the company posted an unexpected quarterly loss and didn't break out the specifics of its smartphone sales.

The Canadian company reported a loss of $84 million, or 16 cents a share, on revenue of $3.1 billion. Adjusted for one-time events, BlackBerry lost $67 million, or 13 cents share.

Shaw's drops loyalty card program

Shaw's and Star Market ended their Rewards Card program yesterday that gave customers exclusive savings on weekly items. In a shift in marketing strategy, the grocer plans to instead lower prices on thousands of items across all of its 169 locations.

Honda tells Fit owners to park outside

Honda is urging the owners of more than 686,000 Fit and Jazz subcompacts worldwide to park them outside because the power window switches can catch fire.

The company said yesterday that it is recalling Fit and Jazz cars from the 2007 and 2008 model years. It's telling owners not to park them in garages until driver's side door switches can be inspected.

News Corp splits into two cos.

News Corp. formally split into two companies yesterday. One company will operate as a newspaper and book publisher and will retain the News Corp. name. The other will be an entertainment company, called Twenty-First Century Fox Inc.

Newspapers, book publishing and information services such as Dow Jones Newswires will be part of the publishing company. The 20th Century Fox movie studio, the Fox broadcast TV network and the Fox News Channel will be part of the media and entertainment company.

Puerto Rico facing economic crisis

Puerto Rico legislators yesterday rushed to try to approve a budget amid debate on how best to revive the U.S. territory's economy, which the New York Federal Reserve president warns has not yet bottomed out.

The proposed $9.8 billion operating budget proposes a flurry of new taxes while seeking to boost the island's education system and rescue a crumbling public pension system.

THE SHUFFLE

  • TD Bank has promoted Gregg P. Desmarais, left, to manager in Springfield. He is responsible for new business development, consumer and business lending, managing personnel and overseeing the day-to-day operations at the bank serving customers in Western Massachusetts.
  • Attunity Ltd., a provider of information availability software solutions, announced that Lawrence Schwartz has been appointed as the company's vice president of marketing. In this role, effective immediately, Schwartz is responsible for all aspects of marketing and sales enablement.

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Beacon pays steep markup to buy back Channel buildings

Beacon Capital Partners is back in the game at the Channel Center in South Boston's humming Fort Point Neighborhood.

The Hub real estate investment firm purchased the properties at 7-9 Channel Center for $7.8 million and 10-20 Channel Center for $62 million from Southport, Conn.-based CV Properties, according to Registry of Deeds documents filed yesterday.

The combined $69.8 million acquisition is a portion of the Channel Center holdings that Beacon had sold to CV Properties at a loss in 2007 for $21.5 million, after the area's revitalization was too slow to take hold. It originally bought 16 former Boston Wharf Co. industrial warehouse buildings in 2000 for $40.5 million, according to published reports.

"Beacon was one of the earliest companies to see the value of the Fort Point area," said Vivien Li, president of the Boston Harbor Association.

"The fact that they're now coming back to the district really says something about how the area has now evolved toward Class A office space."

Beacon declined comment, and CV Properties did not return calls.

The Channel Center consists of about a dozen former warehouse buildings off A Street that include 209 condos and 89 Midway Studios artist live/work units.

The 7-9 Channel Center buildings are vacant and yet to be renovated. Tenants at 10-20 Channel Center include members-only online shopping site Rue La La and Cengage Learning.

CV Properties is currently building One Channel Center, a $225 million, 11-story office building that's pre-leased to State Street Bank and a 970-space parking garage slated to be completed next year.


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Obama says not threatened by China focus on Africa

PRETORIA, South Africa — President Barack Obama says he doesn't feel threatened by the fact that other countries, led by China, are investing in Africa. In fact, Obama says the more countries that come to Africa, the merrier.

Obama says he's touring three African nations this week because the United States needs to increase its engagement with a continent that's showing promise and possibility.

He says such interaction is good for the U.S. regardless of what other countries do.

But he cautions that Africa must be wary of outside investment and always ask how it will benefit when other countries come seeking its natural resources or to make other investments.

Obama spoke Saturday during a news conference in South Africa with President Jacob Zuma.


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Obama: Make climate change a must for your vote

WASHINGTON — President Barack Obama is urging Americans to make climate change a political litmus test, asking them to declare they won't vote for any politicians who don't protect future generations from environmental devastation.

Obama says Americans are already paying the price for climate change, including in lost lives and hundreds of billions of dollars. He says America will be judged as a people and a nation by how it responds.

"If you agree with me, I'll need you to act," Obama says, appealing to Americans to spread the word to their family, friends and classmates. "Remind everyone who represents you, at every level of government, that there is no contradiction between a sound environment and a strong economy — and that sheltering future generations against the ravages of climate change is a prerequisite for your vote."

Obama's remarks in his weekly radio and Internet address, released Saturday but recorded at the White House prior to the start of Obama's weeklong trip to Africa, marks the start of a new phase for Obama's efforts on climate change: convincing the public to sell it for him.

Obama last week unveiled a national plan to combat climate change and prepare for its effects, bypassing Congress after years of frustrated efforts to get lawmakers to pass legislation to deal with the issue. At the core of Obama's plan are new controls on new and existing power plants that emit carbon dioxide — heat-trapping gases blamed for global warming. The program also will boost renewable energy production on federal lands, increase efficiency standards and prepare communities to deal with higher temperatures.

None of the measures in Obama's plan require Congress to act — a consideration that liberates the president but also poses risks if it's perceived as executive overreach. Republicans and some Democrats have already denounced the plan as a job-killing "war on coal," and opponents could try to undercut Obama's plan or hinder it through legal action if Americans don't seem to be on board.

"The question is not whether we need to act. The question is whether we will have the courage to act before it's too late," Obama says.

In the Republican address, Sen. Pat Roberts of Kansas says there are troubling, unanswered questions about the implementation of Obama's health care law.

"We must put an end to the fear and uncertainty," Roberts says. "Those 'bumps' and 'glitches' the president talks about? It's a train wreck, folks, and we have to get America out of the way."


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Verbal exchange between Doc Rivers, ESPN personality adds spice to NBA draft telecast

The actual NBA Draft proved dramatic enough Thursday night with General Manager Chris Grant and the Cavaliers making a mockery of most mock drafts throughout the country with their selection of power forward Anthony Bennett out of UNLV, but there was another unscripted moment that has gained national attention.

It came as the draft was headed for the doldrums, but that changed quickly.

ESPN's Shelley Smith interviewed new Los Angeles Clippers coach, Doc Rivers, who left the Boston Celtics earlier this week, to ask him about his new team's draft choice.

Bill Simmons, an NBA television analyst, popular writer for the ESPN-affiliated site Grantland.com and unabashed Boston Celtics fan, was working as part of the channel's draft team. He has been openly critical of Rivers in recent weeks, suggesting that the coach who led the Celtics to a championship, quit on the team. Topping it off, Simmons' devotion to the Celtics took another hit when their GM, Danny Ainge, continued to dismantle the team by trading Kevin Garnett and Paul Pierce to the Brooklyn Nets.

It capped an unusually bad week in Boston sports given the Bruins' loss in the Stanley Cup finals, the loss of Rivers and the arrest of New England Patriots tight end Aaron Hernandez for murder.

Wily journalist that Smith is, she also asked Rivers about the trade.

He promptly delivered this terse zinger: "I would like to call him (Simmons) an idiot, but I'm too classy for that."

Simmons, noticeably unhappy, replied on the air: "The truth keeps changing. He's giving different quotes about this. He did know, he didn't know, he kind of knew. He wanted the trade to happen, he was coming back, he needed a year off. When he sticks to a story, I'll believe the truth."

It made for great, honest television on Rivers' part. But I had to wonder if Simmons crossed an invisible line that few sports journalists cross.

Yes, we all have favorite teams in favorite sports, but for the most part, we don't allow it to affect our jobs and observations. Simmons has written sonnets expressing his love for all things Boston Celtics and for a while he allowed his inner fan boy to come out after news of that trade broke.

Good television it was, but I suspect it might be a moment Simmons eventually regrets. But I could be wrong. More and more, it seems that sports fans love to engage in groupthink and appreciate talented writers such as Simmons who can put into words his attachment to the Celtics with sincerity normally reserved for loved ones.

There's no doubt he possesses sharp wit, accounting for one of the show's funniest moments. At one point during the draft, he referenced the blaxploitation film classic Cooley High, the TV show The White Shadow and former Indians outfielder Oscar Gamble in a 30-second span when talking about Celtics draft choice Lucas Nogueira and his life-of-its-own afro.

---

©2013 Akron Beacon Journal (Akron, Ohio)

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Microsoft wants to disclose data on FISA orders

Written By Unknown on Jumat, 28 Juni 2013 | 22.27

WASHINGTON — Microsoft is asking a court to let it disclose data on national security orders the company has received under the Foreign Intelligence Surveillance Act.

Microsoft made the request in a motion with the secretive Foreign Intelligence Surveillance Court. The motion was dated June 19 but wasn't unsealed until this week.

The company's motion comes after Google filed a similar motion asking that it be allowed to disclose the number of data requests that come from secret orders approved by the court.

Google and Microsoft were among several U.S. Internet companies identified as giving the National Security Agency access to data on its customers under the program known as PRISM. Microsoft says it wants to correct misimpressions about what it provides to the government.


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Former New York, LA top cop Bill Bratton to NBC

NEW YORK — NBC News has hired former New York police commissioner and Los Angeles top cop Bill Bratton as a news analyst.

Bratton, who also ran Boston's police department in a busy law enforcement career, will specialize in criminal justice policy, domestic intelligence gathering and the role of law enforcement in counterterrorism. NBC said Thursday that Bratton will also appear on MSNBC.

He joins a protege in the media. John Miller, who worked for Bratton in New York and Los Angeles, is a busy analyst and reporter at CBS News.


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Jeep owners worry about safety after recall deal

DETROIT — A deal between the government and Chrysler over Jeeps linked to deadly fires isn't sitting well with many Jeep owners and auto safety advocates.

In early June, after a nearly three-year investigation, the National Highway Traffic and Safety Administration recommended that Chrysler recall 2.7 million older Jeep SUVs because the fuel tanks could rupture, leak and cause fires in rear-end crashes.

But last week, after talks between outgoing Transportation Secretary Ray LaHood and Chrysler CEO Sergio Marchionne, the agency compromised, letting Chrysler limit the recall to about 1.5 million vehicles.

The agreement removed about 1.2 million Jeep Grand Cherokees, model years 1999 to 2004, from the recall, leaving some owners confused about the safety of their vehicles. Chrysler argued that those Jeeps have a different design than the ones it agreed to recall and are as safe as comparable models from other automakers.

The about-face has confused people like Els Sipkes, a photographer from near Charleston, S.C. Her 2000 Grand Cherokee isn't being recalled, although the government initially said it should be.

She says that every time she stops quickly, she checks her rear-view mirror. "It's in my mind that if a car crashes into the back of me, that I've got to be on my toes and I've got to get out," she said.

Chrysler won't comment on the recall, beyond the documents it filed with NHTSA outlining its case.

Sean Kane, a frequent critic of NHTSA who heads a safety research company in Massachusetts, said the number of vehicles cut from the Jeep recall is unusual. But the agency frequently negotiates the size of recalls with car companies, he said. For example, in the early 2000s, Ford negotiated a series of smaller recalls that held off a big one for vehicles with cruise control switches that caused fires, he said. But the company eventually recalled more than 10 million vehicles.

David Kelly, former NHTSA chief of staff and acting administrator under President George W. Bush, said Chrysler probably presented data justifying the smaller recall. "I am positive that the agency would never negotiate vehicles out of a recall if they felt they were unsafe," he said.

Yet critics say all the Jeeps should be recalled. And they question whether Chrysler's solution of adding a trailer hitch as an extra buffer in the back is enough to prevent deadly fires.

Under the recall Chrysler will, free of charge, install hitches on any Grand Cherokees from 1993-1998 and Libertys from 2002-2007 that don't already have them from the factory. About 65 percent of Jeeps from that era were sold without factory hitches, according to Ward's Automotive. Chrysler will inspect those with hitches purchased elsewhere and replace them if they have sharp edges that could puncture the gas tank.

The 1999-2004 Grand Cherokees are part of a "customer service campaign." Here, a Chrysler dealer will inspect a trailer hitch installed after the car was purchased and replace it if necessary. But Chrysler won't install a hitch on any vehicle that doesn't already have one.

Chrysler Group LLC, which is majority owned by Fiat SpA of Italy, hasn't disclosed how much the recall could cost, although hitches sell for about $200 each on websites.

On June 3, the government sent Chrysler a 13-page letter requesting a recall of all 2.7 million Grand Cherokees and Libertys in question. The letter included detailed statistics on crashes involving fuel tank fires in SUVs from model years 1993 to 2007. The agency said the data showed the Jeeps were more prone to fuel tank fires than similar models. The Jeeps have gas tanks behind the rear axle, a design that was fairly common when they were built but isn't used much anymore. NHTSA had evidence of 37 Jeep accidents that killed 51 people.

Chrysler argued that the vehicles were safe. The company said its data show the Jeeps are no more prone to fatal crashes than comparable vehicles such as the Ford Explorer, Chevrolet Blazer and Toyota 4Runner. But it agreed to the smaller recall, it says, to improve the Jeeps' safety.

When asked about the government's change of position, spokeswoman Karen Aldana said in an emailed statement that NHTSA let Chrysler remove the 1999-2004 Grand Cherokees from the recall because the design change made them safer than the older models. The agency's full analysis will be published when the investigation is completed, she said.

But NHTSA knew about the change to the Grand Cherokee's design long before it asked for the recall. Documents on NHTSA's website examined by The Associated Press show that Chrysler detailed the change in a November 2010 letter to the agency.

The recall deal came after outgoing Transportation Secretary Ray LaHood and NHTSA Administrator David Strickland met with Chrysler CEO Sergio Marchionne on June 9, and it was sealed in a June 18 telephone call, a Transportation Department spokesman confirmed.

Clarence Ditlow, director of the Center for Auto Safety, an activist group founded by Ralph Nader, said those events show the deal was made by political appointees and not by engineers. Ditlow's 2009 inquiry prompted NHTSA to investigate the Jeeps.

Ditlow is urging NHTSA to test the trailer hitches to see if they offer added safety. Ditlow said a hitch failed to protect 4-year-old Cassidy Jarmon of Cleburne, Texas, who died in a fire after her family's 1993 Grand Cherokee was rear-ended by a car in 2006. The hitch punctured the gas tank, he said. According to news reports, police estimated the Jeep was hit by a car traveling 52 mph.

NHTSA's abrupt position change even worries people who own a Jeep with a trailer hitch.

Soham Vaishnav, a pediatrician from Chicago who uses a wheelchair, had a hitch installed by U-Haul on his 2004 Grand Cherokee. But he's still not convinced it's safe to carry his children, ages 1 and 4. So Vaishnav and his wife are thinking of buying a new car.

"There's just not enough time after a fire starts," he said.

Some owners also fear the controversy will hurt resale values.

"It kind of depreciates the car's value because people would be wary of buying them," said Charles Mangan, a recent college graduate from South Carolina who is moving to New York City. Mangan hopes to sell the 2004 Grand Cherokee he bought used four years ago. His SUV isn't part of the recall, but he's thinking of paying to get a trailer hitch installed.

Newer Grand Cherokees and Libertys aren't as risky as the old ones. Chrysler moved the fuel tank in front of the axle in a 2005 redesign, which helped meet stricter government rear-crash safety requirements imposed that year. The change also brought easier back-seat access and more storage space. The Liberty's tank was moved forward in the 2008 model year.


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Online pharmacy crackdown shutters 1,677 websites

U.S. and international regulators have seized more than $41 million in illegal medicines worldwide and shut down 1,677 websites as part of their ongoing fight against counterfeit drugs sold over the Internet.

The U.S. Food and Drug Administration said Thursday it used federal court warrants to seize website domain names and post messages letting visitors know that people who traffic in counterfeit drugs may face severe penalties under federal law. The message also offers a link to a site — www.fda.gov/BeSafeRx — that explains the risks of fake online pharmacies.

Experts say the Internet is filled with illegitimate, professional-looking sites that peddle drugs. The FDA launched a campaign last fall to warn consumers that the vast majority of online pharmacies do not follow laws or pharmacy industry standards and their products could harm or even kill.

The moves the agency announced Thursday took place as part of Operation Pangea VI, a weeklong crackdown organized by the international police agency Interpol that ended Sunday.

Investigators visited the websites and used undercover IDs to order the drugs. They received counterfeit drugs that were not approved by the FDA. Some arrived with no directions for use and in strengths and quantities not available in the United States. Some also had different ingredients than the real drugs, which can be very dangerous to the patients taking them.

"You essentially have no idea what it is that you would be buying and what you would be taking," said John Roth, director of the FDA's Office of Criminal Investigation.

Illegal medicines found online include the diabetes treatment Avandaryl. They also include versions of the impotence drugs Levitra and Viagra called "Levitra Super Force" and "Viagra Super Force" that are not approved by the FDA.

Online sales of those erectile dysfunction treatments can be especially enticing to patients who may be too embarrassed to visit a drugstore to buy the drug in person.

Roth said consumers should watch for red flags that indicate an online pharmaceutical website may not be legitimate. They include sites that offer steep discounts from a drug's regular price, those that don't require a prescription to fill your order or ones that contact you through a spam email.

"This is a constant struggle for us, but one of the most important things we can do is educate the consumers about what a legitimate website looks like," he said.

A January study by the National Association of Boards of Pharmacy, which accredits online pharmacies, found that only 257 of 10,275 online pharmacy sites it examined appeared legitimate.

Last year, Operation Pangea V resulted in the arrests of about 80 people and the seizure of $10.5 million in medicines. In addition more than 18,000 illegal pharmacy websites were shuttered.

Roth said there were no arrests in the latest operation, but the investigation is continuing.


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Boston Scientific spends $275M on CR Bard business

NATICK — Boston Scientific Corp. plans to spend $275 million to buy the electrophysiology business of fellow medical device maker C.R. Bard Inc. and strengthen its stake in a $2.5 billion global market.

Boston Scientific, which is based in Natick, Mass., said the deal supports its push to offer a "robust portfolio" of tools to diagnose and treat conditions in which the heart beats abnormally.

Murray Hill, N.J.-based C.R. Bard's electrophysiology business employs about 180 people and makes advanced therapeutic and diagnostic catheters, electrophysiology recording systems and other devices. It generated $111 million in revenue last year.

Boston Scientific expects the deal to close later this year.

Shares of Boston Scientific rose 13 cents to $9.35 in morning trading Friday while C.R. Bard rose 94 cents to $109.49. Meanwhile, the Standard & Poor's 500 index fell less than 1 percent.


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PayPal looks to conquer space (payments)

Written By Unknown on Kamis, 27 Juni 2013 | 22.27

NEW YORK — PayPal wants to explore space — or at least begin to figure out how payments and commerce will work beyond Earth's realm once space travel and tourism take off.

PayPal, which is eBay Inc.'s payments business, says it is launching an initiative called PayPal Galactic with the help of the nonprofit SETI Institute in Mountain View, Calif., and the Space Tourism Society, an industry group focused on space travel. Its goal, PayPal says, is to work out how commerce will work in space.

Questions to be answered include how commerce will be regulated and what currency will be used. PayPal's president, David Marcus, said the company is very serious about the idea. He says that while space tourism was once the stuff of science fiction, it's now becoming a reality.

"There are lots of important questions that the industry needs to answer," he said. There are regulatory and technical issues, along with safety and even what cross-border trade will look like when there are not a lot of borders.

"We feel that it's important for us to start the conversation and find answers," Marcus added. "We don't have that much time."

PayPal is no stranger to outer space. One of its founders, Elon Musk, heads the privately held space company Space Exploration Technologies Corp., better known as SpaceX. And James Doohan, best known for his role as "Scotty" on "Star Trek," was PayPal's first official spokesman when it launched in 1999.

PayPal said it plans to hold an event announcing the venture at the SETI Institute in Mountain View on Thursday.


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Samsung puts curve in OLED televisions

SEOUL, South Korea — After delays, Samsung Electronics Co. rolled out Thursday a curved TV that uses an advanced display called OLED.

The 55-inch TV will sell for 15 million won ($13,000) in South Korea, more than five times the cost of LCD televisions of the same size.

But Kim Hyunsuk, the executive vice president of Samsung's TV division, said the company is optimistic about demand for the high-end TV.

"OLED is about picture quality," Kim told reporters. "We are sure that we realized the perfect picture quality."

It remains to be seen if consumers will be willing to pay a premium for enhanced imagery. The TV industry has been struggling to excite interest with its latest technologies. In recent years, attempts to boost sales by introducing 3-D TVs and TVs that are connected to the Internet have failed to end the downturn in the TV industry.

Samsung is not the first to introduce a curved TV using OLED. In May, its rival LG Electronics Inc., the second-biggest TV maker, launched a 55-inch curved TV in South Korea.

LG's model, which also sells for 15 million won, is not sold outside South Korea.

LG spokesman Kenneth Hong said the company will ship curved OLED TVs to other countries in the near future.

Samsung will ship its curved OLED TVs to overseas markets starting July, Kim said. The company does not plan to manufacture flat OLED TVs this year, he said.

The concave display gives viewers a sense of being immersed in the images, according to Samsung.

Samsung and LG, which are the only TV makers in the world to begin commercial sales of OLED TVs, had promised to launch them in 2012 but delayed the launch to this year.

The two South Korean TV giants tout OLED, short for organic light-emitting diode, as the next-generation display technology that will eventually replace older displays. But mass producing OLED displays still faces many challenges, leading to high prices.

In addition to curved OLED TVs, Samsung launched two ultra-HD TVs, with about four times the resolution of regular high-definition TVs.


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Salem State University to purchase historic diner

SALEM — A diner that's listed on the National Register of Historic Places and was a former haunt of Red Sox legend Johnny Pesky will soon be owned by Salem State University.

The school announced on Wednesday that it's reached an agreement to purchase Salem Diner for $600,000.

The Salem News reports that the real estate closing is expected in the next few weeks.

Salem State president Patricia Meservey said the purchase was a chance to enhance the South Salem neighborhood and preserve a piece of local history.

Plans for the diner are uncertain, though a school spokeswoman said it could continue to be a restaurant.

The diner was built in Merrimac in 1941. It became known a few years ago as a regular breakfast spot for Pesky.


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US unemployment benefit applications fall to 346K

WASHINGTON — The number of Americans seeking unemployment benefits fell 9,000 to a seasonally adjusted 346,000 last week, evidence that the job market is still improving modestly, despite signs of slower growth.

The four-week average, a less volatile figure, declined 2,750 to 345,750, the Labor Department said Thursday. That's near the five-year low of 338,000 that the average touched last month.

Applications are a proxy for layoffs. Since March, they have fluctuated between 340,000 and 360,000, a level consistent with steady hiring. Employers added 175,000 jobs in May, almost matching the average monthly gain for the past year. The unemployment rate was 7.6 percent, down from 8.2 percent a year earlier.

Steady job gains could help the economy expand later this year. Growth was only 1.8 percent at an annual rate in the first quarter, the government said Wednesday, down from a previous estimate of 2.4 percent.

The main reason for the lower estimate was consumers spent less than previously thought.

A separate report Thursday showed that consumer spending rose 0.3 percent in May, after falling by the same amount in April. Incomes rose 0.5 percent, the most in three months, the Commerce Department said.

Still, the report revised spending lower in several months earlier this year, causing some economists to lower their forecasts for the April-June quarter.

Nearly 4.6 million people received unemployment benefits in the week ended June 8, the latest data available. That's about 23,000 more than in the previous week.

Slower growth could mean the Federal Reserve may delay its plans to slow its monthly bond purchases, economists said. Those purchases are intended to keep long-term interest rates low.

Chairman Ben Bernanke rattled financial markets last week when he said the Fed would slow its purchases if the economy continued to strengthen. But the Fed may not be able to follow through until growth accelerates from the first quarter's pace. Some economists think that may not happen until the final three months of the year.

Some economic reports this week have been encouraging. U.S. factories are fielding more orders. Higher home sales and prices are signaling a steady housing recovery.

Spending at retail businesses rose in May, a sign that solid job growth has encouraged Americans to open their wallets. And the improving job market has lifted consumer confidence to its highest point in 5½ years.


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Investigator: No sign progressives mistreated

WASHINGTON — The Treasury Department watchdog who detailed Internal Revenue Service mistreatment of tea party groups seeking tax-exempt status says he has no evidence the IRS also mishandled progressive groups' applications.

In a letter to Congress, the inspector general for tax administration, J. Russell George, acknowledged that the term "Progressives" appeared on a list of terms used by IRS screeners from 2010 to 2012 to look for applicants with potential problems that would merit close scrutiny. But he said there was no evidence the IRS set aside progressive groups' applications because they appeared on that list, which was aimed at finding groups that may have engaged in political activity — which could affect whether they were granted tax-exempt status.

George said his investigators have "multiple sources of information corroborating," including interviews with IRS employees, emails and other documents, that tea party groups' applications were set aside for close examinations. But he added, "We found no indication in any of these other materials that "Progressives" was a term used to refer cases for scrutiny for political campaign intervention."

George's explanation did not satisfy Rep. Sander Levin of Michigan, top Democrat on the House Ways and Means Committee.

At a hearing of that panel Thursday at which IRS chief Danny Werfel was testifying, Levin said he wanted that committee to have George testify at a future session. Levin and other Democrats say George's report last month revealing IRS mistreatment of tea party groups unfairly focused on conservatives and omitted mention of progressives.

"Our committee, in its oversight role, has an obligation to fully understand the manner in which the inspector general conducted his audit, and at what direction," Levin said.

The congressman, to whom George sent his letter, said that applications from progressive groups were sent to a different group of screeners within the IRS and that George failed to investigate that.

Under questioning from Ways and Means Chairman Dave Camp, R-Mich., Werfel said his own investigation of his agency's behavior had produced no evidence to contradict George's finding that progressive groups' applications were not set aside so their political activities could be examined. But he later said there was "a diversity of political labels" among the groups whose applications were set aside for further review.

Some progressive groups seeking tax-exempt status have complained about facing lengthy delays and detailed questions from the IRS.

It is unclear whether progressive groups faced the same extent of mistreatment as conservative organizations. Dozens of them ran into delays exceeding a year, and many received scores of detailed questions that officials have since said were overly intrusive, including demands for information about their donors.

The back-and-forth came as Werfel answered questions from Congress for the first time since revelations that progressives joined the tea party on a list of groups whose applications for tax-exempt status drew extra scrutiny.

Camp criticized a report that Werfel issued this Monday, six weeks after President Barack Obama named him to head the troubled agency.

Werfel wrote that he found mismanagement but no purposeful wrongdoing at the IRS in a report that also pointed to the officials who have been replaced and other changes he has made. Camp said that conclusion was "incomplete" because Werfel did not interview several former top IRS officials, including former commissioner Douglas Shulman.

Democrats seem determined to shift the focus to this week's disclosure that the term "Progressive" was also on the agency's watch lists.

IRS regulations allow tax-exempt social welfare organizations to engage in some political activity but it cannot be their primary mission. The agency must decide whether each applicant's activities meet those vague guidelines.

The IRS has been under withering fire since May 10, when an agency official acknowledged that it had targeted conservative groups seeking tax-exempt designations for tough examinations. Until then, IRS officials had insisted that conservatives had not been singled out for such treatment.

Some Republicans have suggested that the focus on conservative groups came from the White House or other Obama allies.

There has been no evidence of that so far. Instead, according to investigators and testimony from IRS workers to congressional committees, workers in the agency's Cincinnati office that handled tax-exempt applications developed the lists to help them find groups that merited additional scrutiny.

Obama and members of both parties in Congress have said such targeting is inexcusable. At least five top officials, including former acting Commissioner Steven Miller, have been removed.


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Barnes & Noble's loss more than doubles

Written By Unknown on Rabu, 26 Juni 2013 | 22.27

NEW YORK — Sales plummeted at Barnes & Noble bookstores in the latest quarter and its Nook e-book devices failed to keep up with competitors, pushing the company to a net loss that more than doubled from a year ago.

The largest traditional U.S. bookseller said Tuesday that it will stop making its own Nook color touchscreen tablets as a result, a move intended to stem the losses it's suffering from its digital unit.

It said it will continue to make its more basic, black-and-white e-readers but farm out the tablet manufacturing to a third-party.

"We know this is a sizable change from our existing strategy," CEO William Lynch said in a call with analysts. He declined to give specifics on how the tablet partnership would work because the company is in discussions with "a lot of interested parties."

The about-face troubled investors, who sent Barnes & Noble's stock price down more than 17 percent Tuesday to close at $15.61.

Barnes & Noble Inc. had been pouring money into developing its Nook devices to keep up with changing reading habits and beat back competition from retailers such as Amazon, which makes the popular Kindle readers.

It hasn't worked. According to research firm IDC, Barnes & Noble's tablet shipments fell to 1 million in the fourth quarter, down from 1.4 million a year earlier. At the same time, sales of Kindle e-readers have kept growing.

Michael Norris, senior analyst in the trade books group at Simba Information, said Barnes & Noble didn't differentiate its product aggressively enough.

At an analyst presentation, for example, he noted that Barnes & Noble had Kindle devices on hand to demonstrate how much lighter its Nooks were. But it failed to do that in stores for customers, he said. The company also didn't have as much money to spend on advertising as its rivals.

"It's kind of unfortunate," Norris said of the decision to outsource tablets but continue making its e-readers. "They're getting out of the hardware business that has the most potential and hanging onto the business that has the least."

Whether the change will help Barnes & Noble remains to be seen, but Norris warned that it could be going down a dangerous path.

"That's where Borders got it so wrong," he said. "They had a bunch of devices lined up like Formula One race cars. You'd ask an associate about it, and they wouldn't have a clue about them."

There were signs that Barnes & Noble was seeking to exit the hardware business. This month, the company slashed prices on its Nook readers, leading some to suggest that it was clearing out its stock of tablets.

On Tuesday, the company said it planned to sell its remaining inventory at the reduced prices. Some have speculated that Microsoft, which has a 6.8 percent stake in the Nook unit, could offer to buy it outright.

For the quarter, the company booked inventory and impairment charges for its Nook unit. It said it sold fewer devices and that sales of digital content for the readers also fell 9 percent. It blamed the decline of e-book sales partly on the tough comparison from a year ago, when "The Hunger Games" and "Fifty Shades of Grey" trilogies boosted results.

In the broader e-book market from the largest publishers, Barnes & Noble has said it has about 25 percent of content sales. But it admitted that figure has been under pressure from Apple Inc. and Amazon lately.

"We're holding our own, but it's declined slightly," said Michael Huseby, chief financial officer.

The company declined to say how its device sales split between tablets and dedicated e-readers. But it said its "biggest readers" use e-readers, which drive a majority of its content sales.

Meanwhile, its bookstores also saw sales decline. Revenue at stores open at least a year, a key metric, fell 8.8 percent during the period. It also warned it expects that figure to decline in the "high-single digits" for its fiscal 2014, partly as a result of tough comparisons with last year.

Overall retail sales, which include Barnes & Noble bookstores and online sales, declined 10 percent, in part because of store closings.

Barnes & Noble declined to provide an update on the possibility of taking the retail business private. Leonard Riggio, the founder of Barnes & Noble, has offered to buy the company's physical bookstores and website, but not the Nook unit.

The company also said it's reviewing previous financial statements that may result in a revision.

For the February-to-April quarter, Barnes & Noble Inc. said its net loss totaled $118.6 million, or $2.11 per share. That compares with a loss of $56.9 million, or $1.06 per share, last year.

Revenue fell 7 percent to $1.28 billion.

Analysts expected a loss of 97 cents per share on revenue of $1.33 billion.


22.27 | 0 komentar | Read More

US economy grows at slower 1.8 pct. rate in Q1

WASHINGTON — The U.S. economy grew at an annual rate of 1.8 percent in the first three months of the year, significantly slower than first thought. The steep revision occurred mostly because consumers spent less than previously estimated, a sign that higher taxes could be dampening growth.

The Commerce Department revised its estimate of economic growth for the January-March quarter down from a 2.4 percent annual rate. The revised rate was still faster than the 0.4 percent rate in the October-December quarter.

Economists had thought growth in the April-June quarter would be 2 percent or less. Analysts had also expected growth to strengthen in the second half of this year. The downgrade for the January-March quarter will likely change those estimates.

It might also affect the timing of the Federal Reserve's plan to scale back its bond-buying program. Chairman Ben Bernanke said last week that the Fed would likely start to slow its bond purchases later this year and end them next year if the economy continues to strengthen. The Fed's bond purchases have helped keep long-term interest rates low.

Jennifer Lee, senior economist at BMO Capital Markets, noted that the economy barely grew in the final quarter of last year. If the April-June quarter proves as weak as some analysts expect, the Fed will be looking at three quarters of subpar growth.

"The Fed won't taper under these conditions," Lee said. "They need convincing signs of a pickup."

Stocks surged Wednesday for the second straight day, a sign that some investors believe the economy may be too weak for the Fed to begin scaling back its stimulus later this year. The Dow Jones industrial average rose 108 points in early trading.

Most of the revision to last quarter's growth was due to a drop in consumer spending to an annual rate of 2.6 percent. That's sharply lower than the 3.4 percent rate estimated last month. Consumer spending accounts for 70 percent of economic activity.

Much of the change reflected a lower estimate for spending on services such travel, legal services, health care and utilities.

Export growth was also trimmed, reflecting slower global growth. And business investment spending was much weaker than initially estimated. That was largely due to an even larger drop in spending on buildings than previously thought, a particularly volatile category.

An increase in Social Security taxes on Jan. 1 has reduced take-home pay for most Americans. A person earning $50,000 a year has roughly $1,000 less to spend, while a high-earning couple has $4,500 less.

Many economists had thought that the tax increase, along with steep government spending cuts, would start to affect consumers in the second quarter, which ends this week. But the revision suggests the tax increase may have hampered consumer spending a little earlier than thought.

The economy continued to be slowed by weakness in government spending. It fell during the first quarter at an annual rate of 4.8 percent. That shaved 0.9 percentage points from growth — the biggest negative factor. And it followed an even steeper decline in government spending during the fourth quarter.

Economists had predicted that economic growth would rebound to a rate of around 2.5 percent in the July-September quarter and to more than a 3 percent rate in the final three months of the year.

The Fed's latest economic projections are for growth of 2.3 percent to 2.6 percent this year. And it predicts that growth will accelerate next year to as much as 3.5 percent.

The latest reports have been encouraging. U.S. factories are fielding more orders. Home sales and prices are rising, signaling a stronger housing recovery. Spending at retail businesses rose in May. And employers added 175,000 jobs last month, which almost exactly matched the average increase of the previous 12 months.

Steady job growth has gradually reduced the unemployment rate to 7.6 percent from a peak of 10 percent in 2009. And it has lifted Americans' confidence in the economy to its highest point in 5½ years.

Consumers' confidence in the economy is watched closely because their spending accounts for about 70 percent of U.S. economic activity.


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Obama's climate plan takes aim at coal plants

NEW YORK — America is slowly moving toward cleaner sources of energy and using less of it overall. President Barack Obama's plan to fight climate change will accelerate those trends.

The plan aims to reduce power-plant emissions of carbon dioxide, increase America's reliance on natural gas and renewables and make trucks, homes and businesses more efficient.

Some parts of the plan will take months to work out and years to go into full effect. The most ambitious part of the plan seeks to rein in one of the biggest sources of carbon dioxide emissions: coal-fired power plants. Obama will direct the Environmental Protection Agency to create the first-ever federal limits on these emissions, which trap heat in the earth's atmosphere.

Obama also seeks to increase funding for clean energy research by 30 percent to $7.9 billion and make $8 billion in federal loan guarantees available to projects that could help capture and bury the carbon dioxide produced at power plants.

Here's how the plan will likely affect companies and consumers:

— UTILITIES AND COAL PRODUCERS

Power plants account for 40 percent of the nation's carbon dioxide emissions, and most of those emissions come from burning coal. To reduce these emissions, power companies will have to run coal plants less often, install equipment that captures carbon dioxide or shut down plants that become too expensive to operate.

The cost to make these changes are likely so great that utilities would instead generate more power with natural gas, nuclear, wind and solar power, which will become comparatively less expensive and more profitable.

Very few, if any, new coal-fired plants will be built. A shift toward natural gas power plants is already underway thanks to a boom in natural gas production that has caused the price of the fuel to plummet; Obama's plan will magnify this trend, analysts say.

The stock prices of the nation's biggest coal miners, including Peabody Energy Corp., Alpha Natural Resources, Inc. and Arch Coal, Inc., have fallen more than 10 percent over the past two days as details of Obama's plan trickled out.

The financial effect on utilities that rely heavily on coal, such as NRG Energy and First Energy, is unclear. While coal-fired power will become more costly, that will be offset by higher electricity prices.

Obama's plan offers clear benefits to natural gas producers such as Exxon Mobil and Chesapeake Energy and to utilities such as Exelon, Entergy and Calpine, which generate large amounts of electricity using low-carbon sources like nuclear power and natural gas.

— RENEWABLE ENERGY COMPANIES

By directing the Department of Interior to accelerate permits to clean energy developers who want to use public land, Obama will make it less expensive for companies to build wind, solar and geothermal energy projects.

This will help companies that provide equipment for, build and finance large wind and solar farms, such as First Solar, SunPower, General Electric and Siemens.

Wind, solar, and other non-hydroelectric renewable power sources generated 4.8 percent of the nation's electricity last year, double what those sources contributed to the nation's energy mix five years ago. Over that same period, total electricity consumption fell by one percent as the economy slowed and appliances and buildings have become more efficient.

Experts predict that U.S. electricity consumption will grow very slowly, if at all, in the years to come.

— ENERGY EFFICIENCY

Companies that install windows, insulation and heating and cooling systems stand to benefit from the Obama plan, which will give homeowners and businesses incentives to invest in energy-efficiency improvements. While the upfront costs can be high, the long-term savings can be significant.

Obama also wants the EPA to develop new fuel efficiency standards for heavy trucks, which are the second-largest source of greenhouse gas emissions in the transportation sector after cars. Obama has already implemented new fuel economy standards for cars through 2025.

Tighter fuel efficiency standards and higher gasoline and diesel prices over the last several years have cut sharply into U.S. oil consumption. Last year total U.S. consumption of petroleum products fell to 18.6 million barrels per day, the lowest level since 1997. Consumption is expected to fall further as newer fuel economy standards take effect.

The new standards for trucks would go into effect for vehicles made in 2018 and beyond. Engine-makers and parts suppliers that succeed in developing fuel-efficient technologies could benefit. While trucking companies may face higher equipment costs at first, their fuel bills will decline.

— ELECTRIC CUSTOMERS

Homeowners and businesses will likely pay more for electricity because the nation will be relying less on coal, which has historically been the cheapest way to produce electricity.

But more efficient homes and appliances are helping reduce energy consumption, which will likely offset at least some of the higher electricity cost.

Hugh Wynne, an analyst at Bernstein Research, estimates that a 20 percent nationwide reduction in carbon dioxide emissions would increase retail power prices by about 1 cent per kilowatt hour, or 9 percent. At current rates of electricity use, that would add $9 or so to an average American's monthly bill. Obama's plan seeks to reduce carbon dioxide emissions by 17 percent from their 2005 level by 2020.

Nick Akins, CEO of American Electric Power, one of the nation's largest utilities, said in an interview Tuesday that as long as utilities like his are given enough time to transition to a cleaner fleet of power plants, Obama's plan can be carried out "without a major impact to customers or the economy."

___

Follow Jonathan Fahey on Twitter at http://twitter.com/JonathanFahey .


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Luxoft surges in 1st day of trading on the NYSE

NEW YORK — Shares of Luxoft, which develops and maintains software for businesses and other enterprises, surged in their first day of trading on the New York Stock Exchange.

The stock gained $3.65, or 21.5 percent, to $20.65 Wednesday morning.

Luxoft Holding Inc., based in the British Virgin Islands, said that the offering of about 4.1 million shares was priced at $17 per share, the midpoint of the expected range of $16 to $18 per share.

It raised almost $69.7 million from the offering. Both Luxoft and its parent company, IBS Group Holding Ltd., are offering the same amount of stock in the IPO. IBS is a software development and information technology services provider in Eastern Europe.

Luxoft won't receive any proceeds from the shares sold by IBS.

Luxoft said in a regulatory filing that it anticipates net proceeds of about $31.1 million, based on the IPO pricing at $17 per share.

The underwriters are being given a 30-day option to buy up to an additional 613,810 shares to cover any excess demand. Luxoft anticipates net proceeds of approximately $35.9 million if the underwriters fully exercise their option.

Luxoft said that it plans to use its proceeds after expenses related to the offering for working capital and other general corporate purposes.

For the year ended March 31, Luxoft had net income of $37.5 million on revenue of $314.6 million.

The stock is trading under the "LXFT" ticker symbol.

The offering is expected to close on July 1.


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Watchdog: IRS fought oversight in tea party cases

WASHINGTON — The Internal Revenue Service long has resisted efforts by an internal watchdog to help groups seeking tax-exempt status, creating a culture that enabled agents to improperly target such organizations for additional scrutiny, the National Taxpayer Advocate reported Wednesday.

Nina E. Olson, who runs the independent office within the IRS, said in her annual report to Congress that culture continues today, despite the scandal that has rocked the tax agency for more than a month.

She said her office first approached the IRS about a backlog of applications for tax-exempt status in 2007. Olson has the authority to intervene in cases in which IRS actions are causing a "significant hardship" for taxpayers.

But the report said the agency's Exempt Organizations division resisted Olson's efforts, contending that she had no authority to intervene in such cases.

"The attitude that (Exempt Organizations) does not have to be responsive to (the taxpayer advocate) permeated the organization and persists to this day, with one EO employee recently complaining about being 'so tired of you calling,'" the report said.

The IRS has been under siege since the agency revealed last month that agents had improperly targeted tea party and other conservative groups for additional, often burdensome scrutiny when they applied for tax-exempt status during the 2010 and 2012 elections.

This week, the IRS released documents showing that progressive and liberal groups may have been improperly singled out as well.

The taxpayer advocate does not have the authority to investigate the IRS, so the new report doesn't shed any light on who ordered agents to target the groups.

The report does, however, provide more details about an IRS division that shunned outside scrutiny even as agents engaged in conduct that has been condemned by the president, members of Congress and the public.

The IRS' acting commissioner, Danny Werfel, promised to work with Olson's office "to improve education inside and outside the IRS about taxpayer rights."

Werfel, who took over the agency last month, added, "We also agree on other areas, including the need to do a better job of reducing the backlog of (tax-exempt) applications."

The IRS was screening the groups' applications because agents were trying to determine their level of political activity. IRS regulations say tax-exempt social welfare organizations may engage in some political activity but the activity may not be their primary mission.

The additional scrutiny caused hundreds of applications for tax-exempt status to languish for more than a year, with some waiting more than three years for a decision.

The report said IRS agents are supposed to report taxpayer inquiries to the taxpayer advocate's office if a case has been delayed more than 30 days beyond the normal processing time. Despite the directive, the Exempt Organizations division did not refer any cases to the taxpayer advocate, even though nearly 300 applications were delayed much longer than 30 days, the report said.

From 2010 to 2013, the taxpayer advocate's office said it received 19 referrals about cases that may have involved groups that were targeted for additional scrutiny, the report said. Most of the referrals came from congressional offices.

The office didn't recognize a pattern because of the volume of cases it handles. During the same period, the taxpayer advocate's office received a total of 915,000 referrals, according to the report.

___

Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap


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Halle Berry to testify on Calif. paparazzi bill

Written By Unknown on Selasa, 25 Juni 2013 | 22.26

SACRAMENTO, Calif. — Actress Halle Berry is scheduled to testify on Tuesday in favor of California legislation that would limit the ability of paparazzi to photograph the children of celebrities.

The hearing before the Assembly Committee on Public Safety is set for midmorning, although it's not clear exactly when Berry is expected to speak.

Berry has tangled with paparazzi. In April, she shouted and cursed at photographers at Los Angeles International Airport, telling them to get away from her young daughter, the Los Angeles Times reported (http://lat.ms/14mCKMV ).

The bill by state Sen. Kevin de Leon, D-Los Angeles, would change the definition of harassment to include photographing or recording a child without the permission of a legal guardian, by following the child or guardian's activities or by lying in wait.

It also increases the penalties for people convicted of such behavior. The first conviction would require imprisonment of at least 10 days, up from the current five days.

The goal is also to protect the children of public officials, including judges and law enforcement, said Greg Hayes, a spokesman for the senator.

Opponents, including The Motion Picture Association of America, said it infringes on free speech.

Jim Ewert, general counsel for the California Newspaper Publishers Association, told the Times the bill could criminalize legitimate news gathering.

"It's what journalists do," he said. "They take pictures."


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US consumer confidence at five-year high in June

WASHINGTON — Americans' confidence in the economy rose to its highest level in more than five years, bolstered by a more optimistic outlook for hiring.

The Conference Board, a New York-based private research group, said Tuesday that its consumer confidence index jumped to 81.4 in June. That's the best reading since January 2008. And it is up from May's reading of 74.3, which was revised slightly downward from 76.2.

Consumers' confidence in the economy is watched closely because their spending accounts for about 70 percent of U.S. economic activity.

The report shows consumers are more positive about current economic conditions and have a more optimistic view of the economy and job market in the next six months.

Lynn Franco, director of economic indicators at the Conference Board, said that "suggests the pace of growth is unlikely to slow in the short-term, and may even moderately pick up."

Employers added 175,000 jobs in May, nearly matching the average monthly gain for the past year. That's enough to slowly lower the unemployment rate. The rate ticked up to 7.6 percent last month but has fallen 0.6 percentage points in the past year.

More Americans see signs of hiring taking place. Nearly 12 percent describe the number of jobs available as "plentiful," the most since September 2008.

And nearly 20 percent of consumers expect there will be more jobs in six months, while only 16.1 percent expect fewer jobs. That's the first time those expecting more jobs have outnumbered those expecting fewer since February 2012.

Rising home prices are also likely making Americans feel wealthier and more confident about spending. Home prices jumped 12.1 percent in April compared with a year ago, according to the Standard & Poor's/Case-Shiller home price index, also released Tuesday.

Slightly more consumers said they planned to buy a car in the next six months. The percentage saying they planned to buy a home also ticked up.

Americans have been resilient this year, despite tax increases and steep government spending cuts. Consumer spending rose at the fastest pace in two years in the first three months of the year. That helped the overall economy grow at a 2.4 percent annual pace during the January-March quarter.

Economists forecast that overall economic growth is slowing to a 2 percent annual pace in the April-June quarter, in part because they expect consumers have eased up on spending from the robust first-quarter pace.

Despite the recent gains, the confidence index remains well below the 90 reading that indicates a healthy economy — a level it hasn't reached since the Great Recession began in December 2007.

So far, reports on consumer spending for the second quarter have been mixed. In April, consumer spending fell as income was unchanged. But spending appears to have rebounded in May, based on a preliminary report on retail sales. Americans spent more on cars, home improvements and sporting goods, boosting retail sales 0.6 percent.

The Commerce Department will release a more complete report on May consumer spending and income on Thursday.

The Conference Board survey is conducted in the first half of the month. So the June report didn't capture the impact of Federal Reserve Chairman Ben Bernanke's comments last week after the Fed's policy meeting.

Bernanke said the Fed could begin to slow its bond purchases by the end of the year. Since then, stocks have plunged and interest rates have spiked.


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AP Survey: Bernanke comments surprised investors

WASHINGTON — Stock and bond prices are sinking because investors were caught off guard and alarmed by the Federal Reserve's signal that long-term interest rates are headed higher.

That's the view that emerges from an Associated Press survey of economists late last week. A majority of the more than two dozen economists polled support the Fed's plan to start slowing its bond purchases later this year if the U.S. economy continues to strengthen. Higher long-term rates will likely result.

But in the short run, traders fear that higher rates could slow growth and that the Fed might be moving too fast to slow its stimulus, according to many of the economists. Some also think investors perceived a shift in the Fed's timetable for curtailing its low-rate policies.

The Fed has been buying $85 billion a month in bonds to try to push down long-term borrowing rates to spur spending. On Wednesday, Chairman Ben Bernanke said the Fed will likely slow its bond-buying program later this year and end it next year because the economy is improving. That signal came earlier than some expected.

The Fed has also said it plans to keep its benchmark short-term rate near zero at least until the unemployment rate reaches 6.5 percent. It's now 7.6 percent. On Wednesday, it forecast that unemployment could reach 6.5 percent as early as the end of next year — sooner than previously forecast — and that the economy will grow faster than they thought three months ago.

Bernanke has cautioned that 6.5 percent unemployment is a threshold, not a trigger, for any short-term rate increase. Still, some investors now fear the short-term rate could rise by late next year or in early 2015, sooner than many had assumed.

"It was a big change in tone and messaging," said Mark Zandi, an economist at Moody's Analytics. "Judging by investors' reaction, it was too big a change. The lesson for (the Fed) is to move more incrementally with regard to their communications."

On Monday, one Fed member agreed that the Fed could be clearer about its efforts to help the economy. Narayana Kocherlakota, president of the Federal Reserve Bank of Minneapolis, said he thought the Fed should clarify that it will continue to provide stimulus even as the economy moves closer to healthy levels.

Kocherlakota said in a statement that he thinks the Fed should continue to buy long-term bonds at least until unemployment falls below 7 percent. And he thinks it should keep its short-term rate near zero at least until unemployment reaches 5.5 percent, rather than the Fed's 6.5 percent threshold.

Kocherlakota is not a voting member of the Fed's policy committee this year.

Despite the plunge in financial markets, most economists surveyed by the AP think the Fed got the overall policy right: That the economy should soon be healthy enough to manage without ultra-low long-term rates. The economy has grown at a consistent, if modest, annual pace of about 2 percent the past three years. Employers have added an average of about 180,000 jobs a month over that time, enough to slowly reduce unemployment.

That suggests that the extraordinary support the Fed has provided since the depths of the recession began may soon no longer be necessary, economists said. At the same time, Bernanke has stressed that if the economy weakens, the Fed won't hesitate to step up its bond purchases again.

"The rise in interest rates signals a strengthening economy," said Jerry Webman, chief economist at OppenheimerFunds, said. "If it stays on track ... there would be no reason to maintain an aggressive policy that was designed to deal with a substantially weaker economy."

Some economists argued that continuing the $85-billion-a-month in bond purchases much longer risked inflating dangerous bubbles in stocks, real estate or other assets. As rates have sunk and bond yields have dwindled, many investors have moved money into riskier assets in search of higher returns.

Some said they also feared that maintaining the Fed's pace of bond purchases would trigger higher inflation later. That's because the Fed creates money to pay for its bond-buying program. Too much money pouring into the economy can inflate prices.

"It is important to act sooner rather than later to head off financial excess and the risk of future inflation," said John Ryding, an economist at RDQ Economics.

Still, Michael Hanson, U.S. economist at Bank of America Merrill Lynch, noted that Bernanke hasn't signaled he's alarmed about possible high inflation or asset bubbles. Rather, Bernanke stressed at a news conference Wednesday that the risks of an economic slowdown have declined since fall. He said the economic fundamentals "look a little better."

"I'm skeptical that they would tell us that they're more optimistic while in reality they're actually more worried about bubbles," Hanson said.

The inflation gauge the Fed monitors most closely has risen only 1 percent in the past 12 months. That's well below the Fed's target rate of 2 percent. When inflation falls too low, the Fed normally keeps rates low to try to boost prices.

As a result, some economists surveyed by the AP faulted Bernanke for signaling a likely end to ultra-low rates.

"There is no evidence of inflation anywhere," said Dean Baker, co-director at the Center for Economic Policy and Research. "It is actually falling, not rising. ... This is definitely a wrong-headed move by the Fed."


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Carnival sees fewer bookings, replaces its CEO

NEW YORK — Passengers remain hesitant to book cruises, despite deep discounts. But that didn't stop Carnival Corp. from eking out a $41 million second-quarter profit thanks to lower fuel costs and the timing of some administrative expenses.

The Miami-based company also announced Tuesday that Micky Arison, who has been CEO since 1979 and is the son of Carnival co-founder Ted Arison, is being replaced by Arnold W. Donald, who has served on the company's board for the past 12 years. Arison will continue to serve as chairman of the board.

The profit was nearly triple the $14 million the world's largest cruise company earned during same period last year, a quarter which it suffered from steep losses on fuel prices bets known as derivatives.

Earnings totaled of 5 cents per share this quarter, up from 2 cents a share last year at this time. Revenue fell 1.7 percent to $3.48 billion.

Excluding one-time items, Carnival's earnings were 9 cents per share. Analysts polled by FactSet had expected earnings of 6 cents per share on revenue of $3.56 billion.

Shares of Carnival rose $1.11, or 3 percent, to $34.33 in morning trading.

Arison led the company through an aggressive expansion that included the acquisition of several brands, including Holland America, Costa Cruises, Cunard and Seabourn. In 2003, he oversaw a merger between Carnival Corp. and P&O Princess Cruises. Today, Carnival runs cruises under 10 brands.

However, Arison came under fire during Carnival's bad publicity earlier in the year when a string of its cruise ships suffered through mechanical problems and fires. The most dramatic of them was the Carnival Triumph where passengers were stranded at sea for five days as toilets backed up and air conditioners failed. There were media reports of raw sewage seeping through walls and carpets.

Arison, who also owns the Miami Heat basketball team, took some heat of his own for attending a game while the crisis was ongoing.

Donald founded and led Merisant, a company whose products include sweetener brands Equal and Canderel. He also held multiple senior management roles at Monsanto over the course of 20-plus years, including president of the company's consumer and nutrition sector and president of its agricultural sector.

The Triumph nightmare was followed up with problems on three other Carnival ships: The Elation, Dream and Legend — all which made big headlines.

None of that helped restore confidence in vacationers who are still wary after the January 2012 sinking of the Costa Concordia, also owned by Carnival.

In its earnings release Tuesday, Carnival said that advance bookings for the rest of 2013 are running behind last year's levels, even at lower prices. Bookings on its namesake Carnival line are particularly weak.

Arison said in a statement that Carnival is working to market the "truly exceptional vacation values" that cruises offer through travel agents and other industry partners.

"We believe these initiatives, combined with slower supply growth, will lead to increased yields," he said. "In addition, we remain focused on reducing our fuel dependence. By year end, we will achieve a 23 percent cumulative reduction in fuel consumption since 2005 and expect our research and development efforts in fuel saving technologies to continue to bear fruit."

Those fuel-savings efforts seem to be paying off. In the quarter that ended May 31, the company saw a 14-percent drop in its fuel bill. The company spent $555 million on fuel, down from $645 million during the same quarter last year. Cruise companies, airlines and other large consumers of fuel typically make bets, called derivatives, on the price of oil to hedge again any sudden spikes. Last year, Carnival lost $145 million in the second quarter on such bets. This year, that loss was narrowed to $31 million.

During the second quarter, the company took delivery of Princess Cruises' 3,560-passenger Royal Princess, the first of a new class of ships for Princess. Additionally, Carnival Sunshine entered service in May following a $155 million modernization.

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Scott Mayerowitz can be reached at http://twitter.com/GlobeTrotScott.


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Mass. company gets tax break for 1,900 jobs

BOSTON — A company that's leading efforts to computerize health care records nationwide is promising to add 1,900 jobs in Massachusetts in an exchange for a state tax break.

The agreement with athenahealth Inc. is the biggest economic development deal reached with Massachusetts in years, The Boston Globe reported Tuesday.

Athenahealth already has 1,100 employees at its Watertown headquarters, where it plans to add the new jobs.

The director of the Massachusetts Office of Business Development, James Ermilio, said the deal is important because of the new jobs it offers and because it can anchor a key growth sector in the Massachusetts economy. The state's unemployment rate rose to 6.6 percent last month.

"To find a company like athenahealth that is willing to grow here is a great story," Ermilio said.

Under the tentative agreement, athenahealth's workforce in Watertown will nearly triple by 2022 in exchange for $9.5 million in state tax credits. To make room for the new employees, athenahealth recently agreed to buy a Watertown office complex from Harvard University for nearly $169 million.

The tax break works out to about $5,000 per job, which is less than other incentives the state has awarded. For instance, in 2010, the state and the City of Boston combined to offer insurance giant Liberty Mutual $46.5 million in tax breaks, or $77,500 per job, to help it build a skyscraper.

The athenahealth deal includes some of the highest job creation numbers promised under any deal done under the state's two decades old incentive program. But the companies haven't always delivered the jobs envisioned, and Greg LeRoy of Good Jobs First, a Washington group that tracks development incentives, questioned whether the tax incentives are truly needed to attract jobs.

"This sounds like a case where a company is getting paid for what it was doing anyway," he told the Globe.


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