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Showing posts from January 18, 2014

In wake of JPMorgan settlement, big banks add to defense funds

Several large U.S. banks have set aside extra money to pay for potential legal costs in part because of JPMorgan Chase & Co's massive $13 billion settlement with U.S. authorities over bad mortgages, according to two sources familiar with the situation. The size of the JPMorgan settlement, which the government called the largest in U.S. history, led many banks to realize that the cost of resolving some of their own legal problems was likely to be higher than they had initially believed, the sources said. Justice Department officials have said in public statements they want to use the JPMorgan settlement as a template for deals with other banks. Bank of America, Citigroup, Goldman Sachs and Morgan Stanley all added hundreds of millions of dollars to funds they have set aside to pay for the cost of litigation, including legal fees, fines and settlements. All four banks are facing mortgage-related investigations by federal prosecutors located in different parts of the country.

Exclusive: NY AG won't ask Bank of America for damages but Merrill case goes on

New York Attorney General Eric Schneiderman has abandoned his effort to obtain damages from Bank of America Corp over its purchase of Merrill Lynch & Co, but plans to press on with the case, his lawyers said in court on Friday. Schneiderman will seek to bar the bank's former chief executive, Kenneth Lewis, and former chief financial officer, Joe Price, from the securities industry and from serving on boards of public companies, according to his office. It was not clear what sanctions he would seek from the bank. The 2010 lawsuit filed in New York state court by Schneiderman's predecessor, Andrew Cuomo, accused Bank of America of misleading shareholders about Merrill's losses and bonus largesse prior to a December 2008 vote on the merger. Merrill posted a $15.84 billion loss in the fourth quarter of that year, even as it paid out $3.62 billion in bonuses. The merger closed in January 2009. Last April, a federal judge approved a $2.43 billion class-action settlement

Wall St. Week Ahead: Stocks may be vulnerable in earnings blitz

The initial reads on earnings have been mixed, and yet U.S. stocks are hovering near all-time highs. Next week, investors will see whether the first companies out of the gate were a harbinger of what's to come. More than 60 S&P 500 companies are scheduled to release results next week, including more than half a dozen Dow components. The reports will give the fullest picture yet of how corporations are faring and whether the market can advance further as Fed stimulus begins to recede. "Given that equities are fully valued and arguably overvalued, we need earnings and revenue to come through to support the gains we've already made," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago. "There's a reasonable chance we could see a 10 percent correction in the event we get some high-profile disappointments." Earnings for S&P 500 companies are seen rising 7 percent in the quarter, down from the 7.6 percent rate that had been

China home price rises show signs of easing in December

China's home prices continued to surge in December, though the pace of gains overall did not exceed the previous month's and rises eased in some major cities, suggesting that government tightening measures may be starting to bite. _0"> Home prices in many Chinese cities have continued to set records in the past year despite a four-year long government campaign to cool the market, adding to the threat of a price bubble and forcing some local governments into a fresh round of curbs in November. Average new home prices in 70 major Chinese cities climbed 0.4 percent in December on the month, easing from November's 0.5 percent and the fourth straight slowdown since August's 0.8 percent gain, according to Reuters calculations from data released by the National Bureau of Statistics (NBS) on Saturday. "The slower home price gains in December showed recent curbs unveiled by local governments in tier-1 and some tier-2 cities have started to stabilize market expe

Analysis: Morgan Stanley bets on smaller bond unit, defying skeptics

In early 2011, Morgan Stanley Chief Executive James Gorman thought he had finally figured out how to rebuild the bank's depleted bond trading business without taking too much risk. He hired traders from rivals in areas where the bank was relatively weak, such as trading government debt, and exhorted his sales staff to gain new clients and win more trades from existing customers. On Friday, after three years of spotty results, Gorman flipped the script, announcing a new strategy for fixing the operation: shrinking and taking less risk. It is at least the fourth time the bank has tried to retool the business since the financial crisis. Rivals and some analysts are skeptical that Gorman has it right this time. "Whether banks can really compete and be profitable on a smaller scale - that's the million dollar question," said Lisa Kwasnowski, an analyst at the bond ratings firm DBRS who is supportive of Gorman's plan. Bond trading - including fixed income, curren

Fukushima's operator says spin-off an option only for the future

Spinning off the clean-up project at Japan's wrecked Fukushima nuclear plant from the rest of operator Tokyo Electric Power's business could be an option in the future if the decommissioning runs smoothly, the company's president said. Nearly three years after a devastating earthquake and tsunami hit the plant, Tokyo Electric (Tepco) is still struggling to contain radioactive water at the site and turn around its battered finances. "Paying compensation (to evacuees), decontamination, and the work at the Fukushima plant; there is a lot of work to be done ... We have to continue doing this, while maintaining the workers' safety, their sense of responsibility, duty and keeping up their morale," said Naomi Hirose in an interview with Reuters on Saturday. Hirose said if working conditions improve significantly at Fukushima and worker shortages become no longer a problem, the utility could consider hiving off the Fukushima decommissioning from the rest of the b

Insight: Europe's utilities squeezed by creeping nationalization

Vattenfall unplugged! With flyers, posters and an animated film of a bear disconnecting the Swedish utility that operates the Berlin electricity grid, campaigners tried to convince voters to put power distribution back in public hands. The November referendum in Berlin failed, but in September, citizens of Hamburg, Germany's second-biggest city, voted to return their power grid, also run by Vattenfall, to public ownership. The votes were organized by citizens' groups who want municipalities to buy back electricity distribution networks from private utilities, because they say local authorities can provide a cheaper and better service. The German movement is part of a Europe-wide reversal of the trends towards liberalization and privatization that have driven energy policy in the past decade. While ostensibly backing free energy markets, many European governments squeeze utilities by intervening in power generation while also capping energy prices. This creeping renational

Paris auction opens closet of Schiaparelli, doyenne of 1930s fashion

Elsa Schiaparelli, doyenne of 1930s Paris fashion, may be long gone - buried in her favorite hue of shocking pink - but nearly 200 pieces from her closet, along with her fine art and furniture, may enjoy a second life after an auction next week. In the heady, pre-war Paris of the 1930s, Italian-born Schiaparelli exerted her sense of subversive, outlandish whimsy on couture from her design studio on the Place Vendome, creating conversation pieces that flouted convention. Devotees of the trailblazer who dared women to be bold can choose between a silk violet blouse from the "Astrology" collection, a series of Man Ray photographs of the designer, a multi-colored feather boa or a delicately painted bird cage - up for the highest bidder at the January 23 auction in Paris. "She had this incredible side of her that loved to have fun, that was very original, that dared to do anything, that was provocative but always chic," said Schiaparelli's granddaughter, Marisa

In letters, J.D. Salinger bemoans trappings of fame

In a letter to his college friend, a young J.D. Salinger writes about yearning for fame. In ensuing correspondence to the same woman and her son over the next four decades, the American author describes how much he loathes his status as a celebrity. In the letters from Salinger to Ruth Smith Maier, a woman he met while attending Ursinus College in Pennsylvania in 1938, the two share stories about parenthood, working as a writer and general banter about popular culture. The letters, which experts say humanize the notoriously reclusive author as he experiences a range of life-changing events, were acquired by the Harry Ransom Center, a humanities research library at the University of Texas, and made available to researchers this week. In the earliest correspondence from January 1941, a confident 22-year-old Jerry Salinger writes to Ruthie that he intends to leave his mark as an author. "Oh, but I'm good," he says in the single-spaced, typewritten letter. "It will

Roy Keane teams up with author Roddy Doyle for memoir

Booker Prize-winning author Roddy Doyle, creator of some of Ireland's most renowned characters, will tackle one the country's best known when he teams up with Roy Keane to write the former footballer's memoir. _0"> Former Manchester United captain Keane and Doyle, author of books such as 'The Commitments', will collaborate on 'The Second Half', the fiery midfielder's autobiography set to be published later this year, the Orion Publishing Group said on Friday. Keane, who wrote his first autobiography in 2002, shortly after walking out on the Irish national team during that year's World Cup, enjoyed a hugely successful playing career that was equally filled with controversy. The ex- Ireland captain, who became assistant manager of the national team last year, won seven league titles with United and helped them to a first European title in over 30 years in 1999 before famously falling out with manager Alex Ferguson. His World Cup walk out

Camera glitch triggers marathon Russian spacewalk

Spacewalking Russian cosmonauts on Friday spent over eight hours installing two cameras outside the International Space Station for a Canadian streaming-video business and then retrieving the gear due to connectivity problems. Station commander Oleg Kotov and flight engineer Sergey Ryazanskiy left the station's Pirs airlock at 8 a.m. EST (1300 GMT) as the complex sailed 260 miles over Australia , mission commentator Rob Navias said during a NASA Television broadcast of the spacewalk. It was the third spacewalk this week by members of the station's six-man crew. NASA astronauts Rich Mastracchio and Mike Hopkins made spacewalks on Saturday and Tuesday to replace a failed cooling pump. During the first part of Friday's planned seven-hour outing, the Russian cosmonauts set up a high-definition video camera on a swiveling platform and a medium-resolution still imager for Vancouver-based UrtheCast Corp. The Russian space agency, Roscosmos, agreed to host the cameras on the

Russia launches new Soyuz rocket

Russia successfully launched an upgraded version of its Soviet-design Soyuz rocket on Saturday, the Defence Ministry said, giving a boost to the country's troubled space program. _0"> The launch of the Soyuz 2.1v rocket, which features a new engine and digital guidance system, had originally been planned for the beginning of 2012 but was postponed due to an accident during testing which caused engine damage, Interfax reported. It was then scheduled to be launched earlier this week but was delayed again, Interfax reported. The lightweight launch vehicle blasted off Saturday afternoon from Russia's Plesetsk launch pad in the northwest Arkhangelsk region. A spokesman said it was a debut launch for the rocket to place a scientific earth-monitoring satellite into orbit. The Soyuz 2.1v is the latest addition to Russia's Soyuz family of rockets, which has become the world's most frequently used booster since its first launch in 1966. In 1961, a prototype of the

Relapse of 'cured' HIV patients spurs AIDS science on

Scientists seeking a cure for AIDS say they have been inspired, not crushed, by a major setback in which two HIV positive patients believed to have been cured found the virus re-invading their bodies once more. True, the news hit hard last month that the so-called "Boston patients" - two men who received bone marrow transplants that appeared to rid them completely of the AIDS-causing virus - had relapsed and gone back onto antiretroviral treatment. But experts say the disappointment could lay the basis for important leaps forward in the search for a cure. "It's a setback for the patients, of course, but an advance for the field because the field has now gained a lot more knowledge," said Steven Deeks, a professor and HIV expert at the University of California, San Francisco. He and other experts say the primary practical message is that current tests designed to detect even very low levels of HIV present in the body are simply not sensitive enough. As wel

Over a thousand candidates shortlisted for life on Mars

A mission to put humans on Mars that drew 200,000 applicants has selected more than a thousand candidates who will now be tested to come up with a final list of 24 would-be Mars-dwellers. _0"> Mars One was set up in 2011 by two Dutch men with the goal of establishing permanent human life on Mars in 2025. They hope the project will be funded by investors and the rights from the documentary-cum-reality TV broadcasting of the tests, training and final selection. The 1,058 candidates who got through to the first round come from all over the world. By far the largest number - 297 - are American, followed by 75 Canadians and 62 Indians. They must now undergo rigorous tests, including simulations of life on Mars and coping with isolation, co-founder Bas Lansdorp said. "The challenge with 200,000 applicants is separating those who we feel are physically and mentally adept to become human ambassadors on Mars from those who are obviously taking the mission much less seriously,

SpaceX Falcon rocket lifts off with Thaicom digital TV satellite

A Space Exploration Technologies' Falcon 9 rocket blasted off from Cape Canaveral Air Force Station in Florida on Monday to put a commercial communications spacecraft into orbit for Thai satellite operator Thaicom. The 224-foot-tall rocket lifted off its seaside launch pad at 5:06 p.m. (2206 GMT), soaring through overcast skies as it headed toward the satellite's drop-off point more than 55,000 miles above Earth, or about one-quarter of the way to the moon. From that position, the 6,649-pound (3,016 kg) Thaicom 6 satellite is expected to lower itself to about 22,300 miles above Earth and shift the angle of its orbit so that it can be permanently stationed to beam high-definition and digital television services to customers in Thailand and surrounding areas. The satellite, built by Virginia-based Orbital Sciences Corp, also is equipped to provide other communications services for customers in Southeast Asia and Africa, including Madagascar, Thaicom's website shows. In

Obama agrees to 4-year extension for International Space Station

The Obama administration wants to keep the International Space Station, a $100 billion orbital research outpost that is a project of 15 nations, flying until at least 2024, four years beyond a previous target, NASA said on Wednesday. The extension will give the U.S. space agency more time to develop the technologies needed for eventual human missions to Mars, the long-term goal of NASA's human space program. Keeping the station in orbit beyond 2020 also opens a window for commercial companies and researchers to benefit from hefty U.S. investment in the outpost. NASA's costs for operating the station, which flies about 250 miles above Earth, run about $3 billion a year. About half that sum is spent on transporting crew and cargo. "Ten years from today is a pretty far-reaching, pretty strategic-looking vision," NASA Associate Administrator Bill Gerstenmaier told reporters on a conference call. "This extension… opens up a large avenue of research onboard stat

Orbital Sciences' cargo ship blasts off for space station

An unmanned Orbital Sciences Corp. Antares rocket blasted off on Thursday to deliver the first of eight cargo ships to the International Space Station for NASA. The 13-story rocket lifted off its seaside launch pad on Wallops Island, Virginia, at 1:07 p.m. EST/1807 GMT, putting the Cygnus freighter on track for an early Sunday rendezvous with the station. "We're in good shape," Orbital Sciences Executive Vice President Frank Culbertson told reporters after launch. The launch, which was broadcast live on NASA Television, was delayed twice this week, first by cold weather and then by high space radiation due to a massive solar flare on Tuesday. Both conditions could have affected critical rocket systems. Orbital Sciences is one of two firms hired by the National Aeronautics and Space Administration to fly cargo to the station, a $100 billion project of 15 nations, following the retirement of the space shuttles in 2011. Privately owned Space Exploration Technologies,

Virgin Galactic spaceship makes third powered test flight

Virgin Galactic's SpaceShipTwo, a six-passenger, two-pilot spacecraft aiming to make the world's first commercial suborbital spaceflights later this year, conducted its third rocket-powered test flight on Friday. With Virgin Galactic chief pilot David Mackay and co-pilot Mark Stucky at the controls, SpaceShipTwo soared to an altitude 71,000 feet above ground - about twice as high as commercial jetliners, Virgin Galactic said on Twitter. The 20-second rocket burn, over California's Mojave desert, propelled the ship to 1.4 times faster than the speed of sound, the company said. It was the third powered test flight for SpaceShipTwo, which was designed and built by Mojave, Calif.-based Scaled Composites, a subsidiary of Northrop Grumman Corp. "She flew brilliantly," Mackay said in a statement from Virgin Galactic after landing. "To be behind the controls and fly it as the rocket ignited is something I will never forget," Mackay added. The spacecraft,

Space-faring nations lay groundwork for human, robotic exploration

Officials from 32 of the world's space-faring nations concluded a trio of summits on Friday to tackle expanding participation in the International Space Station and planning for eventual human expeditions to Mars. Fifteen nations collaborated to build the space station, a permanently staffed research complex that flies about 250 miles above Earth. On Wednesday, the Obama Administration announced its intent to extend station operations to at least 2024, four years beyond when it was slated to be removed from orbit. "We're very happy to hear about extension," Xu Dazhe, administrator of the China National Space Administration, said Friday at the International Academy of Astronautics conference, one of three global space summits hosted in Washington this week. "It means that by the time our space station is being built, we would have a companion up there," Xu said, speaking through a translator. China has a prototype station in orbit and plans to launch t

U.S., Canada sign agreement to share data on space debris

The United States and Canada have signed an agreement to share data on orbiting space debris, asteroids and other hazards to space flight, the U.S. military said on Friday. _0"> The agreement, signed on December 26 with Canada's Department of National Defence, permits an advanced exchange of data, the U.S. Strategic Command, which oversees the American military's space operations, said in a statement. "We were pleased to finalize this data-sharing agreement with Canada, one of our closest allies. These agreements are mutually beneficial, provide for greater space flight safety and increase our national security," Admiral Cecil Haney, commander of U.S. Strategic Command, said. The agreement streamlines the process for Canada to request specific information gathered by U.S. Strategic Command's Joint Space Operations Center at Vandenberg Air Force Base in California, the statement said. The information is crucial for space launches, satellite maneuverin

Orbital Sciences cargo ship arrives at space station

Orbital Sciences Corp, one of two companies hired by U.S. space agency NASA to make supply runs to the International Space Station, delivered its first cargo ship on Sunday, a NASA TV broadcast showed. Space station flight engineer Mike Hopkins used the outpost's 60-foot-long (18 meter) robotic arm to pluck a Cygnus freighter capsule from orbit at 6:08 a.m. EST as the two ships sailed 264 miles over the Indian Ocean, northeast of Madagascar. "A big sigh of relief for Orbital," said astronaut and NASA TV commentator Catherine "Cady" Coleman from Mission Control in Houston. About two hours later, Hopkins latched the capsule, which is about the size of a small bus, to a docking port on the space station's Harmony module. The capsule is loaded with 3,221 pounds (1,461 kg) of food, equipment, science experiments and supplies for the station, including computers and replacement parts for NASA's spacesuits. Several commercial payloads also are aboard the

Australian scientists microchip bees to map movements, halt diseases

Australian scientists are gluing tiny sensors onto thousands of honey bees to track their movements in a trial aimed at halting the spread of diseases that have wiped out populations in the northern hemisphere. Scientists at the Commonwealth Scientific and Industrial Research Organisation (CSIRO), Australia's national science agency, said the microchips could help tackle so-called colony collapse disorder, a situation where bees mysteriously disappear from hives, and the encroachment of the parasitic varroa mite. Scientists will use tweezers to glue on the sensors, weighing about 5 milligrams and measuring 2.5 millimeters (a little more than 1/16 of an inch) square, after soothing the bees to sleep by refrigeration. Some young bees, which tend to be hairier than older bees, need to be shaved before the sensor can be glued on. Scientists will examine the effectiveness of pesticides in protecting the bees from colony collapse disorder and varroa mite. The study will also enabl

China confirms hypersonic missile carrier test

China has flight-tested a hypersonic missile delivery vehicle in a move that was scientific in nature and not targeted at any country, the Defence Ministry said on Wednesday. _0"> A Chinese military build-up has raised regional jitters. Many countries in Asia have welcomed a stated U.S. intention to shift more attention and military assets back to the region. They are beefing up military spending and ties with Washington. "Our planned scientific research tests conducted in our territory are normal," the Beijing Defence Ministry said in a faxed response to Reuters. "These tests are not targeted at any country and at any specific goals." The statement confirmed a report by the online Washington Free Beacon newspaper that the hypersonic glide vehicle (HGV) was detected flying at 10 times the speed of sound over China last week. A spokesman for the Pentagon said it was aware of the test. "We routinely monitor foreign defence activities and we are aw

Obama unveils manufacturing hub on North Carolina trip

President Barack Obama on Wednesday announced a new public-private manufacturing hub in North Carolina during his visit to the state, seeking to bolster an industry that he considers essential to raising middle class incomes. The manufacturing hub in Raleigh is a consortium of 18 businesses and six universities that will be led by North Carolina State University and will lead an institute to develop high-power electronic chips. Obama had called for three such hubs in his State of the Union speech a year ago. The other two have yet to be selected. Backed by $70 million in federal funding, the hub would connect manufacturers with emerging research on energy-efficient chips that would help make electronic devices smaller and faster. Companies involved include ABB, APEI, Avogy, Cree, Delphi, Delta Products, DfR Solutions, Gridbridge, and Hesse Mechantronics, among others. Eager to press economic themes in an election year after struggling with the rollout of his healthcare plan, Obama

House approves $1.1 trillion measure to fund government through Sept 30

The U.S. House of Representatives overwhelmingly approved a $1.1 trillion spending bill on Wednesday that quashes the threat of a government shutdown through September 30 and offers lawmakers a chance to end four years of chaotic, crisis-driven budgeting. The 359-67 vote, reflecting strong bipartisan support in the Republican-controlled chamber, sends the measure to the Democratic-controlled U.S. Senate for approval by Saturday. The Senate gave itself three more days to consider the measure by approving an extension of current funding that was due to expire at midnight on Wednesday. The massive "omnibus" spending bill, which funds programs from missile systems to Amtrak rail services, passed with strong majorities of both House Republicans and Democrats. It boosts fiscal 2014 spending on military and domestic discretionary programs by $45 billion over levels that had been scheduled under automatic, "sequester" spending cuts. The measure fleshes out a budget de

Obama picks Latina banker to lead small business agency

U.S. President Barack Obama nominated Maria Contreras-Sweet on Wednesday to lead the Small Business Administration, an agency that provides loans and helps small businesses get government contracts. _0"> "She understands the needs of small business owners like herself. She knows how they can lift entire communities, and ultimately how they lift our country," Obama said in making the announcement at the White House. She is the second Hispanic nominated to Obama's second-term cabinet after Labor Secretary Tom Perez. Contreras-Sweet founded ProAmerica Bank, a Latino-owned community bank in Los Angeles, which focuses on lending to small- and medium-sized Latino businesses. "Maria knows how hard it is to get started on a business, the grueling hours, the stress, the occasional self-doubt - although I have not yet seen self-doubt out of Maria," Obama said. The Mexican-born Contreras-Sweet was California's secretary of business, transportation and h

No earmarks in U.S. spending bill, but plenty of money for folks back home

Earmarks may be a thing of the past for Congress, but lawmakers still tout their ability to deliver the bacon through a $1.1 trillion federal spending bill that won passage in the House of Representatives on Wednesday. The 1,582-page bill is officially free of the spending for pet projects that spurred public outrage and were banned in 2010 after Republicans won control of the House of Representatives. But with November congressional elections looming, lawmakers from both parties are promoting their roles in shaping the legislation in ways that will improve life back home. The bill, which funds wide swaths of the U.S. government, is expected to pass the Senate by the end of the week. Republican Sen. Jerry Moran of Kansas said in a press release that he helped win $404 million for a home-state facility to study foreign animal disease outbreaks. He also noted that the bill would create jobs by funding an Air Force base expansion in the state. Republican Rep. Mike Simpson highlighte