October 2009

Jobless claims up, leading indicator at 2-year high

WASHINGTON (Reuters) –
A bigger-than-expected rise in U.S. workers filing new claims for jobless aid last week underscored how fragile the labor market remains even as a measure of economic prospects hit a two-year high last month.

Initial claims for state jobless insurance increased 11,000 to 531,000 last week, the Labor Department said on Thursday, after falling for two consecutive weeks. Financial markets had expected new claims to be 515,000.

Separately, the Conference Board said its index of leading economic indicators rose 1.0 percent to 103.5, the highest since October 2007, but optimism over the robust increase was tempered by a report showing that home prices fell 0.3 percent in August.

"The data confirm an overall picture of a gradual economic improvement, but we are not seeing it in the commercial real estate and jobs markets," said Larry Milstein, head of government and agency trading at R.W. Pressprich & Co in New York.

Investors on Wall Street brushed aside the mixed economic data, focusing instead on solid quarterly earnings reports, including from the world's largest hamburger chain, McDonald's Corp (MCD.N), and diversified manufacturer 3M Co (MMM.N).

The blue chip Dow Jones industrial average (.DJI) ended up 131.95 points, or 1.33 percent at 10,081.31 (.N). U.S. government bond prices fell as the Treasury announced a record $123 billion worth of note sales next week.

While data and earnings reports from some companies strongly indicate the economy started growing again in the July-September period after four quarters of decline, persistently high unemployment has raised questions about the recovery's durability.

White House economic adviser Lawrence Summers told Reuters in an interview on Wednesday the economy was set for a recovery but cautioned that the pace of growth might be moderate and the job market would not revive immediately.

SIGNS OF HEALING

Analysts reckon the Federal Reserve, which is holding U.S. overnight interest rates near zero, will want to see labor markets beginning to heal before it withdraws its massive aid to the economy.

Boston Federal Reserve Bank President Eric Rosengren said on Thursday that the economy would grow reasonably in the second half of this year but added that the Fed needed to see more progress before taking some of its economic support away.

Separately, Federal Reserve Bank of Chicago President Charles Evans said the economy should grow about 3.0 percent over the next 18 months, but cautioned that unemployment posed a big challenge.

The U.S. unemployment rate rose to a 26-year high of 9.8 percent in September and is seen rising above 10 percent 2010.

Jobless claims last week were probably influenced by the October 12 Columbus Day holiday, which could have resulted in some laid off workers not filing their claims during that holiday week. Analysts say weekly jobless claims have to fall to 400,000 for payrolls show growth.

For a related graphic see: http://graphics.thomsonreuters.com/109/US_JOBLES1009.gif

Still, the pace of job losses has moderated considerably from early this year. The four-week moving average for new jobless claims fell by 750 to 532,250 last week, the lowest level since mid-January, the Labor Department said.

It was the seventh straight week of decline in the four-week average, which is considered a better gauge of underlying trends.

Among other encouraging signs, the number of people collecting long-term unemployment benefits in the week ended October 10 dropped to the lowest since March. This measure has trended lower for five straight weeks.

Analysts view this steady decline as a sign unemployment might be close to peaking but it could also reflect the fact that many jobless workers have exhausted their benefits.

The number of people receiving government-funded emergency unemployment aid rose to 3.39 million in the week ended October 3 from 3.35 million previously, the department said.

"Even as we anticipate that the economy likely grew in the third quarter, the excess slack in the system and employers' hesitance to ramp up hiring appear likely to weigh on the labor markets for some time," said Jim Baird, chief strategist at Plante Moran Financial Advisors in Kalamazoo, Michigan.

The insured unemployment rate, which measures the percentage of the insured labor force that is jobless, edged down to 4.5 percent in the week ended October 10 from 4.6 percent the prior week, the department said.

Another hopeful sign was provided by a Labor Department report that showed the number of mass layoffs, defined as job cuts involving at least 50 people from a single employer, fell by 129 to 2,561 last month.

(Additional reporting by Emily Kaiser and Tim Ahmann in Washington and Richard Leong in New York)

U.N. slams Myanmar, North Korea, Palestinian rights ills

UNITED NATIONS (Reuters) –
Human rights violations in Myanmar are alarming, North Koreans are starving and living in continual fear and Palestinians are suffering amid Middle East tensions, U.N. rights envoys said on Thursday.

Special rapporteurs appointed by the U.N. Human Rights Council in Geneva described the human rights conditions in each country to a meeting of the 192 U.N. member states.

While Myanmar rights envoy Tomas Ojea Quintana was able to visit the military-ruled Asian country twice, communist North Korea denied entry to envoy Vitit Muntarbhorn and envoy Richard Falk was stopped by Israel from entering Palestinian areas.

"The situation of human rights in Myanmar remains alarming. There is a pattern of widespread and systematic violations which in many conflict areas results result in serious abuses of civilian rights and integrity," Quintana said.

"The prevailing impunity allows for the continuation of violations," he added.

He also criticized the military junta for keeping opposition leader Aung San Suu Kyi detained. Western officials fear the government wants to keep her under house arrest during next year's election so that she is unable to run.

Myanmar's representative, who U.N. officials identified as Thaung Tun, described Quintana's report as less than objective, saying insurgents and anti-government groups had been given a "sympathetic ear" and that all the allegations made "should be taken with a grain of salt."

He said steps were being taken to organize 2010 elections in the country, which he said would be "free and fair."

Myanmar also reprimanded the United States and Britain during the meeting for referring to the country by its former name, Burma, while North Korea admonished the United States for not calling it DPRK -- Democratic People's Republic of Korea.

"PERVASIVE REPRESSION"

In North Korea, envoy Muntarbhorn said the food aid situation was desperate with the World Food Program only able to feed about one third of the people in need. He said torture is extensively practiced and described prisons as purgatory.

"Freedoms associated with human rights and democracy, such as the freedom to choose one's government, freedom of association, freedom of expression ... privacy and freedom of religion are flouted on a daily basis by the nature and practices of the regime in power," he said.

"The pervasive repression imposed by the authorities ensures the people live in continual fear and are impressed to inform on each other," he said. "The state practices extensive surveillance over its inhabitants."

North Korea's deputy U.N. ambassador Pak Tok Hun rejected the report and said the country, which has also drawn international condemnation for nuclear and missile tests, was being "singled out for sinister political purposes."

Falk's report on the Palestinian territories focused on human rights concerns related to issues including the war in December and January between Islamist militant group Hamas, which controls the Gaza Strip, as well as Israel's construction of a land barrier and disputed housing settlements.

He said an Israeli blockade of the Gaza Strip means "insufficient basic necessities are reaching the population."

Falk also spoke of the "unlawful, noncooperation" of Israel which prevented him from visiting the Palestinian territories. Israel did not respond to Falk's reports at the meeting.

(Editing by Eric Walsh)

Obama administration facing new pressure on foreclosures

WASHINGTON (Reuters) –
The Obama administration is facing stepped up pressure to provide more details about its efforts to help struggling homeowners stay in their homes.

U.S. Treasury Secretary Timothy Geithner earlier this month said about half a million American families are now participating in a home loan modification program initiated by the Obama administration to try to slow the rate of foreclosures.

"But the measure of success for the Home Affordable Mortgage Program (HAMP) is not only the number of borrowers who enter the process," said New York Bank Superintendent Richard Neiman, a member of the Congressional Oversight Panel (COP) which oversees the government's Troubled Asset Relief Program (TARP), the $700 billion bailout launched under the Bush administration.

"The real test is the number of families who complete the trial modification period and receive sustainable permanent modifications," Neiman said in a prepared statement released Thursday after Treasury Assistant Secretary for Financial Stability Herbert Allison testified Thursday before the COP.

And Rep. Maxine Waters, a California Democrat who chairs the House Financial Services Subcommittee on Housing and Community Opportunity, wants Geithner to send her detailed -- down to each congressional district - information about how many trial modifications have been converted into permanent modifications.

"Several issues continue to exist within the HAMP program, including the need for increased (loan) servicer participation and knowledge about the program and additional homeowner outreach," Waters wrote in an October 21 letter released Thursday and co-signed by Rep. Kathy Castor, a Florida Democrat. Waters wants an answer by next Wednesday.

The pressure comes just two weeks after a COP report found that government programs to fight the U.S. home foreclosure crisis look increasingly inadequate and should be reworked, expanded and supplemented with new ideas.

With a foreclosure filing occurring every 13 seconds, the United States is mired in a housing slump that is destroying billions of dollars in property values and threatening to choke off the economy's recovery from a stubborn recession.

Federal Reserve Board Chairman Ben Bernanke attended a Consumer Advisory Council Meeting Thursday at the central bank's headquarters, where consumer advocates pressed the Fed for better protections for consumers seeking mortgages and credit cards.

Bernanke made no substantive comments during his 90 minute appearance at the beginning of the three and a half hour meeting that included a discussion of credit card regulations and disclosure requirements for mortgage originators. The Fed chief left the room before the discussion turned to foreclosure issues.

It increasingly appears that HAMP, which reduces monthly mortgage payments to help borrowers who are facing foreclosure keep their homes, is not equipped to deal with the changing nature of the housing crisis, the October 9 COP report said.

The government's other effort to stem foreclosures, the Home Affordable Refinance Program, or HARP, helps homeowners who are current on their mortgages but owe more than their homes are worth, get more affordable loans.

As of September 1, the watchdog report said, HAMP had helped arrange 1,711 permanent mortgage modifications, with an additional 362,348 borrowers in a three-month trial stage. HARP has closed 95,729 mortgage refinancings, it said.

(Additional reporting by Kevin Drawbaugh)

Fortune magazine pares number of issues: report

NEW YORK (Reuters) –
Time Warner Inc.'s Fortune business magazine plans to cut the number of issues it publishes annually to 18 from 25, and make other changes that could result in more staff cuts, the Wall Street Journal said on Thursday.

It was not clear yet how many people might lose their jobs, the newspaper said.

Fortune, like many other U.S. business magazines, has struggled in the advertising downturn.

Fortune will publish two issues some months and just one issue during other months, in the new publishing schedule is part of a remodeling that is expected to result in staff cuts and a sharper focus on the long stories that have been its trademark, the Journal said.

The revamp is a prelude to broader staff cuts at Time Inc., the Time Warner Inc. magazine unit that includes Fortune, the newspaper said citing people familiar with the matter.

Although plans have not been finalized, it was expected that there will be a near replay, in terms of job losses, of the restructuring kicked off last fall, the newspaper said.

That restructuring pared more than 6 percent of Time Inc.'s work force, or more than 600 positions.

(Reporting by Dhanya Skariachan; Editing by David Gregorio)

Saints use Bush to simulate wildcat in practice

METAIRIE, La. – Reggie Bush enjoyed running a simulation of Miami's wildcat offense in practice this week — and said he even broke out a few long runs with it.
But don't expect the New Orleans Saints to change what's led to their 5-0 start this season.
That's because head coach Sean Payton is unlikely to limit prolific quarterback Drew Brees' involvement in his offense.
Even Bush, one of the Saints' most explosive and versatile running backs, saw no reason to do so, despite the fun he had with the formation. Bush received extensive work on the scout team as the Saints prepare to play Sunday against the Dolphins, the team that runs the wildcat more consistently and effectively than any other.
"I think our offense is OK," Bush said, grinning at his understatement regarding an offense that led the NFL last season and ranks No. 1 so far this year. "I don't think we need to try to fix anything."
In the wildcat formation, a running back takes a direct shotgun snap and has the option of running, handing off or even throwing, although passes are not as common. Payton spoke at length about the formation this week, discussing how it effectively helps the offense gain a blocker because there is no traditional quarterback on the field.
Bush said he rarely worked on the scout team in 2008 but was eager to take the extra work in practice this week.
"We wanted to give our defense the best look, if not try to make it harder so that they're prepared for what they're going to see," Bush said. "The Dolphins run the wildcat very well."
Knowing they would have to play Miami this season, and suspecting that more teams might give the formation a try, the Saints have been practicing defending against the wildcat since offseason workouts started last spring, defensive coordinator Gregg Williams said after Thursday's practice.
"We're trying not to get caught off guard, so every single week, every single practice schedule since I've been here, we've had a version of the wildcat," Williams said. "Are we good enough? We'll see."
Bush said he didn't see his success running out of the formation as a reason for the Saints to be alarmed at how they might do against Ronnie Brown — or former Saint Ricky Williams, who often takes the handoff from Brown.
"You want to break (big runs) now as opposed to during the game so they can see what we need to clean up," Bush said.

Bribery allegations surface against Alaska Rep. Young (McClatchy Newspapers)

WASHINGTON -- Alaska Republican Rep. Don Young refused to comment Thursday on allegations he accepted bribes from the businessman at the heart of a federal probe into corruption in Alaska politics.

"Don't bother me, don't bother me," Young said Thursday morning, with a wave of his hand, when asked by a reporter about the court filings as he entered the Alaska Federation of Natives convention in Anchorage .

The allegations surfaced Wednesday night in a confession that Bill Allen , the former chief of Veco, an Alaska oil services company, signed in 2007. The confession was made public this week as part of Allen's upcoming sentencing on charges that he bribed state lawmakers.

In the document, which outlines criminal activity Allen was involved in, the 72-year-old executive admits to 13 years of gift-giving to public officials. They include former Alaska Sen. Ted Stevens and Young, whom the document referred to as to " United States Representative A."

In the confession, Allen agreed that from 1993 to August 2006 , both he and his deputy at Veco, Rick Smith , "provided things of value to United States Representative A," a reference to Young. For example, in June 2006 , "Smith obtained a set of golf clubs, costing approximately $1,000 , that Smith gave to United States Representative A. Smith used Allen's credit card."

Young, who was obligated in 2006 to report gifts with a value of more than $335 , didn't report receiving any gifts on the personal financial disclosure form he filed with the House of Representatives for that year. From 1995 until last year, Young reported no gifts on his disclosure forms. In 2008, however, he reported receiving as gifts $77,000 in donations to his legal expense fund.

It is those same forms and his lack of disclosure on them that led the Justice Department to indict Stevens on corruption charges. Although a jury convicted Stevens, those charges were withdrawn this year by the Justice Department after defense attorneys questioned the way prosecutors and the FBI handled witnesses and evidence in Stevens' case and others.

An FBI spokesman in Anchorage , Eric Gonzalez , wouldn't comment on Young, Alaska's sole congressman since 1973, citing the agency's policy of refusing to talk about ongoing investigations.

Young's office said he had no comment on the investigation. Young's lawyer in Washington , John Dowd , didn't return a phone call or an e-mail.

Since early 2007, Young has spent more than $1.2 million on lawyers -- with money from his legal expense fund and his campaign account -- in connection with federal investigations of his fundraising and other matters.

Congress last year called on the Justice Department to look into the circumstances surrounding an earmark in the 2005 highway bill that Young oversaw as chairman of the House Transportation and Infrastructure Committee . That earmark shifted $10 million from a road-widening project in southwest Florida toward a study of an interchange that promised to benefit one of Young's campaign donors.

Until now, however, it wasn't clear whether the FBI was looking at Young as part of Allen's bribery scheme. Prosecutors wrote in a separate sentencing document filed Wednesday in Allen's case that the former Veco chief "curried favor with various state and federal legislators and awarded them with cash and other items of value so they would be favorably disposed toward voting for legislation that was of interest to Veco and the oil industry."

Allen, 72, and Smith, 64, also admitted breaking federal campaign finance laws on Young's behalf, using corporate funds to pay the expenses of a yearly fundraiser from 1993 to 2006. The illegal corporate donations, which went toward Young's annual pig roast fundraiser in Anchorage , weren't reported.

"Each year, Allen and Smith arranged for the purchase of catering expenses, liquor, equipment rentals, and other associated costs," Allen's confession said. "These expenses were paid using Veco's corporate funds, and amounted to approximately $10,000 to $15,000 each year." The total spent by Veco over the years was between $130,000 and $195,000 , according to court filings.

However, Young's campaign in 2006 decided in preparation for the 2008 campaign to take a close look at fundraising expenses from previous elections. In reviewing the 2006 campaign expenses, a spokesman for Young's campaign said last year that they discovered Veco hadn't properly billed the campaign for its annual pig roast on Young's behalf.

Campaign officials looked back several more years and determined that Veco or Allen needed to be reimbursed $37,626 . A check was sent to Allen in January 2007 , the campaign reported.

The campaign's internal audit and the reimbursement occurred months before they knew Allen was cooperating with federal investigators, Young's campaign has said. Allen and Smith pleaded guilty in May 2007 , more than eight months after they secretly began working for the FBI.

Allen never cashed the reimbursement check, and in January 2008 , Young's campaign gave the money instead to the U.S. Treasury.

( Sean Cockerham of the Anchorage Daily News contributed to this article.)

MORE FROM MCCLATCHY

Troopergate figure has Palin book coming, too

Prosecutors want ex-Veco CEO Allen to serve almost four years

Justice department won't dismiss charges against Alaska lawmakers

Alaska state lawmaker to challenge Rep. Don Young

D.C. judge OKs subpoenas for Ted Stevens prosecutors

Alaska's Young still paying legal bills from campaign funds

Alaska judge: No more delays for sentencing of Stevens witness

Alaska legislators snared in bribery probe ordered freed

Follow the latest politics news at McClatchy's Planet Washington

Francesco Molinari keeps lead at Portugal Masters

VILAMOURA, Portugal – Francesco Molinari has matched the lowest halfway total of the European Tour this season to take a one-stroke lead after the second round of the Portugal Masters.
The Italian shot a 6-under 66 on Friday, with five birdies and a bogey on the back nine. The overnight leader finished at 15-under 129.
South African Charl Schwartzel made three straight birdies from the 15th, but then finished with a bogey for a second successive 65.
Padraig Harrington, who was tied for 32nd overnight, collected 10 birdies in a 62 that moved him into third place two strokes back.
Retief Goosen and Pablo Martin were tied for fourth place, a further shot behind. Martin became the first amateur to win a title on the circuit when he won the Portuguese Open two years ago.

Gov't: Swine flu linked to 11 more child deaths

WASHINGTON – The swine flu is causing an unprecedented amount of illness for this early in the fall, with the deaths of 11 more children reported in the past week. And less vaccine than expected will be ready by month's end, federal health officials said Friday.
Of the 86 children who have died since the new swine flu arose last spring, 43 deaths have been reported in September and early October alone, the Centers for Disease Control and Prevention reported. That's a startling number because in some past winters, the CDC has counted 40 or 50 child deaths for the entire flu season — and no one knows how long this swine flu outbreak will last.
"These are very sobering statistics," said the CDC's Dr. Anne Schuchat.
Also surprising, about half of the child deaths reported since Sept. 1 have been teenagers. Until now, much of the attention has focused on younger children.
Overall, what CDC calls the 2009 H1N1 flu is causing widespread disease in 41 states, and about 6 percent of all doctor visits are for flu-like illnesses, levels not normally seen until much later in the fall.
There may be only 28 million to 30 million vaccine doses dispersed around the country by month's end, Schuchat said, short of the 40 million-plus the government had hoped. But more will continue to arrive weekly, and she urged patience as people await their turn.
As of Wednesday, states had ordered 8 million of the 11.4 million doses of swine flu vaccine the government has ready to ship.
Initial vaccine shipments were only of FluMist, the nasal spray version that can be used by only certain people — those ages 2 to 49 who aren't pregnant and have no chronic illnesses such as asthma. But swine flu shots now are shipping, too, accounting for a bit more than half of the vaccine available today, Schuchat said.

Ski Racing

Snow skiing is a group of sports using skis as primary equipment. Skis are used in conjunction with boots that connect to the ski with use of a binding. Skiing can be grouped into two general categories. Nordic skiing is the oldest and includes sport that evolved from skiing as done in Scandinavia. Nordic style bindings attach at the toes of the skier's boots but not at the heels. Alpine skiing includes sports that evolved from skiing as done in the Alps.

Alpine bindings attach at both the toe and the heel of the skier's boots. As with many disciplines, such as Telemark skiing, there is some crossover. However, binding style and history tend to dictate whether a style is considered Nordic or Alpine. Therefore, in view of its lack of a locking heel, and its roots in Telemark, Norway, Telemark is generally considered a Nordic discipline. To use common known sports as examples, since examples make the concept, cross country skiing is Nordic whereas downhill skiing is Alpine.

Ski Racing

Spain: novel on immigrant women wins major prize

MADRID – Spanish writer and journalist Angeles Caso has won the country's most lucrative literary award for a novel about the ordeals of women from poor countries who emigrate in search of a better life.
The Premio Planeta was announced late Thursday at a ceremony in Barcelona and carries a euro601,000 ($890,000) cash stipend.
Caso's novel "Contra el Viento" (Against the Wind) is about the plight of a woman from Cape Verde who emigrates first to Portugal and then settles in Spain, and how she suffers along the way.
Caso said the character is based on a woman who worked for her as a nanny and helped look after Caso's daughter.
In an acceptance speech, Caso said her book addresses "the tremendous struggle that these 21st-century heroines must wage from the time they are born, first in their countries, which are so poor and hostile, and then in a setting as complex as ours."
Caso said the sacrifices made by women such the character in her book render life easier for women like herself. "They are fundamental in our society, enabling the rest of us to get out and work, keep having children and lead dignified lives," Caso said.
The prize was founded in 1952 by Planeta, one of Spain's top publishing companies, and is open to both Spaniards and Latin Americans.
Previous winners include Mario Vargas Llosa of Peru and the late Spaniard Camilo Jose Cela, who won the Nobel prize for literature in 1989.