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Monthly Archives: October 2012

$GLW Announces a 20% Dividend Increase

“The Board of Directors at Corning Inc. (NYSE:GLW) announced a 20 percent increase in the company’s quarterly common stock dividend today.  The move allows Corning to repay a portion of cash flow to its investors and improve their total shareholder return, something Chief Executive and President Wendell P. Weeks called a priority.

“Corning continues to generate strong cash flow from all our businesses and we have done so for some time now,” Weeks said. “We believe our operating cash flow generation will continue, and combined with lower capital spending, give the company more financial flexibility.”

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$MMM Cancels Their Planned Buyout of $AVY Division

3M Co. (MMM)’s retreat from a $550 million office-products purchase amid regulatory pressure will let it focus on an even bigger acquisition while forcing deal partner Avery Dennison Corp. (AVY) to put the unit back on the block.

Avery fell as much as 7.8 percent in after-hours trading in New York yesterday following the announcement. Investors may be concerned that Avery will struggle to get another offer and a price that comes close to 3M’s, said Ghansham Panjabi, an analyst at Robert W. Baird & Co. in New York.

“When one of the national bidders is out of the process now, then by definition there are fewer bidders for the asset,” Panjabi said. “The likelihood of the sale is pretty high. The question is, ‘At what price does it get done?’”

3M terminated the Jan. 3 sale accord to buy Avery’s office- products business amid U.S. Justice Department opposition because of overlap between the companies. The move reversed 3M’s pledge last month to keep pursuing federal approval and came after Chief Executive Officer Inge Thulin agreed Oct. 1 to pay $860 million for ceramics maker Ceradyne Inc. (CRDN)

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$FB Hits 1 Billion Monthly Users

“(Reuters) – Social media company Facebook Inc said on Thursday it reached the 1 billion active monthly users threshold last month, and is up by 45 million users since June.

Facebook, based in Menlo Park, California, hit the 1 billion milestone on September 14 at 12:45 p.m. Pacific time, the company said on its website. It added that it had 600 million mobile users, according to a fact sheet posted on its website

The 1 billion user count is up from the end of June, when it had 955 million active monthly users. The company also said it has seen 1.13 trillion “likes,” or endorsements by users, since the company launched the feature in February 2009. Many of the ad campaigns that companies conduct on Facebook are designed to garner likes.

It said 219 billion photos were uploaded as of September. Excluding deleted photos, about 265 billion photos have been uploaded since 2005.

About 17 billion location-tagged posts were made on the website, Facebook said, and 62.6 million songs have been played 22 billion times since September 2011.”

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Challenger: Planned Layoffs Uptick Slightly in September

 

“NEW YORK (Reuters) – The number of planned layoffs at U.S. firms in September rose 4.9 percent after hitting a 20-month low in August, a report on Thursday showed.

Employers announced planned job cuts of 33,816 last month, up from 32,239 in August, according to the report from consultants Challenger, Gray & Christmas, Inc.

Despite this relative increase, the latest data marks a 15-year low in planned job cuts announced for the month of September.

Last month’s planned cuts were 71 percent lower than they were this time last year, when 115,730 expected job cuts were announced. Employers have announced 386,001 j o b cuts so far in 2012, down 19 percent from the 479,064 jobs cut during the first nine months of 2011.

“Layoffs are definitely at pre-recession levels. Unfortunately, hiring has not returned to those levels. A combination of factors, including the upcoming election, ongoing instability in Europe, growing signs of weakness in Asia and a host of other issues, are keeping companies from making any major expansion or hiring moves,” John Challenger, chief executive officer of Challenger, Gray & Christmas, said in a statement.”

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Fitch: Biggest Risk to Spain is Recession

 

“LONDON (Reuters) – The biggest threat to Spain’s investment grade status is its intensifying recession, Fitch’s head of sovereign ratingssaid on Thursday, although proposed support measures such asECB bond buying could help turn the situation around.

Spain, which continues to resist making a formal request for aid, is expected to see its economy shrink substantially over the next two years as the combination of high unemployment, painful spending cuts and an Exodus of capital bites.

The head of the country’s central bank admitted on Thursday that next year’s decline was likely to be closer to the 1.5 percent drop estimated by bank analysts than the 0.5 p0ercent forecast by the Spanish government last week.

“The biggest threat from our perspective to Spain’s investment grade status is actually that the recession there intensifies and that spills into greater concerns about bank asset quality as well as the solvency of the Spanish state,” David Riley said in an interview with Reuters Insider Television. (To watch click http://link.reuters.com/neb23t)”

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Rumor: ECB Considering Bond Insurance for Spain

“MADRID/PARIS (Reuters) – The euro zone is considering aiding Spain by providing insurance for investors who buy government bonds in a move designed to maintain Spanish access to capital markets and minimize the cost to European taxpayers, European sources said.
One senior European source said the plan could cost about 50 billion euros ($64.5 billion) for a year. It would enable Spain to cover its full funding needs and trigger European Central bank buying of Spanish bonds in the secondary market.
If the gamble succeeds, it would achieve two important aims. Spain would be rescued without draining Europe’s entire bailout fund and there would be no contagion to Italy.
Under the scheme, which officials say is under consideration in Madrid, Paris, Berlin and Rome, the euro zone’s new permanent rescue fund (ESM) would guarantee the first 20 to 30 percent of each new bond issued by Spain.”

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The BoE Votes to Continue Stimulus and QE Measures

Bank of England officials voted to complete their latest round of stimulus amid intensifying dissent on inflation risks that threatens to cause a rift on future aid for the economy.

Governor Mervyn King’s nine-member Monetary Policy Committee left the bond-purchase targetat 375 billion pounds ($604 billion), as forecast by all 40 economists in a Bloomberg News survey. By next month’s meeting, they’ll have finished spending the 50 billion-pound round they started in July, forcing a decision on whether more stimulus is needed.”

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The EBA Requests Euro Banks to Hold Up to $258 Billion in Fresh Capital to Meet Global Protection Standards

“The European Union’s top banking regulator told the bloc’s lenders to hold on to more than 200 billion euros ($258 billion) in capital raised to pave the way for tougher global standards.

The 27 banks that were required by the European Banking Authority to submit plans for their capital raising attained a total of 116 billion euros, the London-based EBA said yesterday. Including aid to Greek and Spanish banks, European lenders increased their capital reserves by more than 200 billion euros since 2011, according to an EBA report published on its website.”

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The Euro Continues to Show Strength Against Most Major Currencies

“The euro rose for a sixth day against the yen, the longest run of gains since March, on speculation European Central Bank President Mario Draghi will today provide more detail of the bond-purchase program announced last month.

The single currency gained versus all but two of its 16 major counterparts after the ECB kept its benchmark interest rate at a record-low 0.75 percent after a policy meeting today. The yen fell to a two-week low versus the dollar as the Bank of Japan started a two-day meeting. A measure of volatility among major currencies fell to the lowest level in almost five years.”

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The ECB Keeps Rates on Hold as They Wait For Spain to Decide if They Need a Bailout

“The European Central Bank kept interest rates on hold today as President Mario Draghi waits for Spain to decide if it needs his help.

Policy makers meeting in Ljubljana, Slovenia, left the benchmark rate at a historic low of 0.75 percent, as predicted by 48 of 52 economists in a Bloomberg News survey. Four forecast a cut to 0.5 percent. Draghi will brief reporters on the decision, taken at one of the ECB’s twice-yearly meetings outside Frankfurt, at 2:30 p.m.”

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Central Bank Fun: Poland Signals November Cut After Holding Borrowing Costs

Poland’s central bank signaled it may cut borrowing costs next month if the economy slows further after unexpectedly leaving them at the highest level since 2009 for a fourth meeting.

The Narodowy Bank Polski kept the benchmark seven-day interest rate at 4.75 percent yesterday. Eight economists in a Bloomberg survey predicted no change, while 27 expected a 25 basis-point reduction that would have reversed a rate increase in May, the only one by a central bank in the European Union this year. The NBP last lowered the benchmark in June, 2009.”

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World Food Prices Hit Six Month Highs, Crisis “Just Not There”

World food prices rose in September to the highest in six months as dairy and meat producers passed on higher feed costs to consumers, the United Nations’ Food & Agriculture Organization said.

An index of 55 food items tracked by the FAO rose to 215.8 points from a restated 212.8 points in August, the Rome-based agency reported on its website today. Dairy costs jumped the most in more than two years.

Livestock breeders and dairy farmers are passing on the higher cost of feed, after grain prices jumped in June and July, according to Abdolreza Abbassian, an economist at the FAO in the Italian capital. Higher prices don’t mean a food crisis is imminent, he said today by phone.

“Despite a very difficult market, the fundamentals that suggest a food crisis are just not there,” Abbassian said. “Market sentiment is now accepting high prices more as a rule than as an exception.”

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Black Gold Bounces on Mid East Tensions and Hopes From the ECB Meeting

“Oil rebounded in New York after dropping the most in more than three months as tensions between Syria and Turkey fanned concern exports from the Middle East may be reduced.

Futures advanced as much as 0.8 percent as Turkey fired into Syrian territory for a second day and called for United Nations intervention. The euro gained against the dollar before a European Central Bank meeting, boosting the appeal of commodities. Oil plunged 4.1 percent yesterday after the Energy Department reported that U.S. crude production climbed to the highest level in more than 15 years while fuel usage decreased.

“Turkey-Syria jitters are adding to general concerns in the Middle East,” said Andrey Kryuchenkov, an analyst at VTB Capital in London, who correctly predicted crude would fail to advance last month. “There’s some buying on the lows after losses yesterday, and the greenback is also a touch lower.”

Crude for November delivery gained as much as 68 cents to $88.82 a barrel on the New York Mercantile Exchange and was at $88.78 at 11:43 a.m. London time. Futures dropped to $88.14 yesterday, the lowest settlement since Aug. 2. Prices are down 10 percent this year.

Brent oil for November settlement advanced $1.23 to $109.40 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $20.58 to WTI, up from $20.03 yesterday.”

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HURT: Obama the Debater: Making Jimmy Carter look Awesome

Party like it’s 1980!

Bewildered and lost without his teleprompter, President Obama flailed all around the debate stage last night. He was stuttering, nervous and petulant. It was like he had been called in front of the principal after goofing around for four years and blowing off all his homework.

Not since Jimmy Carter faced Ronald Reagan has the U.S. presidency been so embarrassingly represented in public. Actually, that’s an insult to Jimmy Carter.

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Sullivan: This was a Disaster for the President

10.31 pm. Look: you know how much I love the guy, and you know how much of a high information viewer I am, and I can see the logic of some of Obama’s meandering, weak, professorial arguments. But this was a disaster for the president for the key people he needs to reach, and his effete, wonkish lectures may have jolted a lot of independents into giving Romney a second look.

Obama looked tired, even bored; he kept looking down; he had no crisp statements of passion or argument; he wasn’t there. He was entirely defensive, which may have been the strategy. But it was the wrong strategy. At the wrong moment.

The person with authority on that stage was Romney – offered it by one of the lamest moderators ever, and seized with relish. This was Romney the salesman. And my gut tells me he sold a few voters on a change tonight. It’s beyond depressing. But it’s true.

There are two more debates left. I have experienced many times the feeling that Obama just isn’t in it, that he’s on the ropes and not fighting back, and then he pulls it out. He got a little better over time tonight. But he pulled every punch. Maybe the next two will undo some of the damage. But I have to say I think it was extensive.

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