Business and Finance

European financial chiefs are trying to soothe global CEOs and political leaders, insisting they have a handle on the eurozone’s troubles.

Germany’s Finance Minister Wolfgang Schaeuble says he’s “quite optimistic” about a Greek debt restructuring deal, despite recent strains in the complex talks. He says he doesn’t expect Greece to default.

He stressed that recent developments in markets have been “positive” for Italy and Spain.

France’s Finance Minister Francois Baroin welcomed actions by the European Central Bank that he says have helped “reduce tensions in the European banking system payday loans.”

Both spoke Friday at the World Economic Forum in the Swiss ski resort of Davos, where many business and political VIPs fear that Europe’s debt crisis will drag the global economy into a new recession.

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The Czech Republic should sell Eurobonds this year at better terms than other eastern European Union states because of government plans to trim the budget deficit, Deputy Finance Minister Jan Gregor said.

The Finance Ministry will be ready to sell between 1 billion euros ($1.3 billion) and 2 billion euros of debt from the start of February after the ministry updates its macroeconomic forecasts, Gregor said yesterday in an interview in Prague. The ministry may sell a bond on foreign markets denominated in other currencies if terms for a Eurobond issue aren

In a Dec. 30 story about iceberg lettuce being removed from grocery stores after salmonella was found in an Arizona field adjacent to the grower’s property, The Associated Press, relying on information from Kroger and its affiliated Smith’s Food and Drug, erroneously reported the lettuce had been removed from stores in North Carolina, among at least six other states. Kroger said Saturday the product never made it to its North Carolina stores.

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A judge on Monday used unusually harsh language to strike down a $285 million settlement between Citigroup and the Securities and Exchange Commission over toxic mortgage securities, saying he couldn’t tell whether the deal was fair and criticizing regulators for hiding the details of the firm’s wrongdoing from the public.

U.S. District Judge Jed Rakoff said the public has a right to know what happens in cases that touch on “the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives.” In such cases, the SEC has a responsibility to ensure that the truth emerges, he wrote.

Rakoff said he had spent hours trying to assess the settlement but concluded that he had not been given “any proven or admitted facts upon which to exercise even a modest degree of independent judgment.”

The SEC replied in a statement issued by enforcement director Robert Khuzami, saying the deal “reasonably reflects the scope of relief that would be obtained after a successful trial.”

The SEC had accused the bank of betting against a complex mortgage investment in 2007

Industry analysts and anxious travelers expressed fears Tuesday for the survival of Britain’s venerable tour operator Thomas Cook, after the company, which took more than 22 million people on holidays in the latest year, revealed its financial problems had worsened.

Shares in Europe’s second-largest tour operator lost three-fourths of their already depressed value after the company said it was seeking new agreements with its main creditors, barely a month after announcing it had negotiated new funding arrangements to carry it through the slow winter months.

The company insisted flights would leave as usual and that it was taking new bookings, but Britons who have bought holidays through the firm were worried.

Jamila Juma-Ware, 27, who has booked a holiday at Spain’s Tenerife island in the next three weeks for herself and her mother, said she was “praying it’s going to be all right … but I’m not confident.”

Several small British travel firms have gone under since the global economic crisis hit in 2008, but Thomas Cook is an industry giant and a fixture of Britain’s main streets.

“There are a lot of small independent travel agents around here, but I said I’d rather just book it through someone like Thomas Cook because they’re big and there’s more of a guarantee they won’t go bust,” Juma-Ware said. “And then this week this happens.”

Thomas Cook is, like many airlines and tour operators, suffering from weak consumer demand as Europe’s financial crisis has people worried about their jobs.

Unrest in Egypt and in Tunisia _ normally the top winter destination for French travelers _ flooding in Bangkok and disappointing sales in Russia have all added to the pressure on the company.

Analysts said the financial troubles could scare away customers, darkening the company’s prospects.

“Legitimate questions will be asked as to whether Thomas Cook can survive long-term,” said James Hollins, analyst at Evolution Securities. He added that he believes the company could pull through on the strength of businesses outside Britain, but “a more flexible financial structure and massive turnaround are required.”

Thomas Cook Group PLC shares were down almost 75 percent at 10.41 pence in afternoon trading in London. On July 1, shares had closed at 134.5 pence.

Thomas Cook was due to report annual earnings for 2010-11 on Thursday, but it has put that off indefinitely “as a result of deterioration of trading in some areas of the business, and of its cash and liquidity position since its year end.”

Sam Weihagen, Thomas Cook’s interim chief executive, insisted it was business as usual: “Flights are leaving on schedule, shops are open and we’re taking bookings.”

Weihagen said people who book package holidays will be protected by the Air Travel Organizers’ Licensing insurance program which is funded by contributions from travel companies. However, those who book only flights are advised to buy their own travel insurance.

The group has previously announced plans to reduce its fleet of 41 aircraft to 35, and it hopes to raise 200 million pounds ($312 million) by selling assets, including its stake in Britain’s part-privatized air traffic control service.

Wyn Ellis, analyst at Numis Securities, said Thomas Cook’s announcement could frighten new customers and alarm suppliers. The company, he said, “faces a difficult near-term future which could lead to significant loss of market share.”

The news of the company’s problems upset some prospective travelers near its shop in the St. James neighborhood of London on Tuesday.

Tony Wright, 64, said he’s had “nothing but good experiences” with the brand and would not hesitate to use Thomas Cook again. “We were devastated to hear the news this morning and we hope it’s not as bad as it sounds,” he said.

Others were disappointed the airfares had not dropped.

On Tuesday, Simon Ash visited the branch hopeful that the combination of the company’s financial woes and a lack of tourist interest in Egypt because of rioting there could help him find a cheap ticket to Cairo _ but he could not find one. “The prices they’re giving me are not as good as the ones I’m finding on the Internet,” he said.

Thomas Cook takes its name from the cabinetmaker Thomas Cook, who had a flash of inspiration while walking to a temperance meeting in 1841 to use the railways to help promote abstinence from alcohol. Cook’s first venture was to charter a train which carried about 500 passengers in open coaches on a 12-mile round trip.

“Thus was struck the keynote of my excursions, and the social idea grew up on me,” Cook later recorded.

He organized more trips for temperance societies and Sunday schools. He took his business a step further in 1845 by arranging a trip to Liverpool, which included a 60-page booklet in the price of the ticket.

The International Exhibition in Paris in 1855 inspired Cook to organize a trip to the continent. Ten years later, he was organizing railway tours in North America.

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The latest evidence that the economy is making steady gains emerged Friday from a gauge of future economic activity, which rose in October at the fastest pace in eight months.

A string of better-than-expected economic reports this month has led some analysts to revise up their forecasts for growth. Still, they caution that their brighter outlook remains under threat from Europe’s financial crisis.

“Things are looking better than we thought they would _ not great, but better,” said David Wyss, former chief economist at Standard & Poor’s.

The most recent sign was Friday’s report by the Conference Board that its index of leading economic indicators surged 0.9 percent last month. It was the index’s best showing since February. And it was far faster than the increases of 0.1 percent September and 0.3 percent in August.

The index is designed to predict economic activity. The October figure marked the sixth straight increase.

The jump reflected gains in nine of the index’s 10 components. Leading the way: a surge in permits for home construction; a narrower gap between short- and long-term interest rates that suggested less concern about inflation; a recovery in stock prices; and growth in the U.S. money supply.

A longer average workweek and fewer applications for unemployment benefits also contributed to the rise in the index.

All told, the components of the index signaled that the economy is steadily, if still slowly, strengthening.

On Thursday, the government reported further improvement in the number of people seeking unemployment benefits for the first time. The number fell to 388,000, the fewest since April.

In October, the economy added a net total of 80,000 jobs. It was the 13th straight month of gains. Still, the additional jobs were fewer than the roughly 125,000 that are needed each month just to keep up with population growth.

Many economists said the October gain in the leading indicators offered further assurance that the economy is in no imminent danger of slipping back into a recession, so long as Europe doesn’t fall into a severe downturn.

“This was a very positive reading for the leading indicators,” said Mark Zandi, chief economist at Moody’s Analytics. “The economy seems to be holding its own.”

Steven Wood, chief economist at Insight Economics, said the string of positive readings suggests “the economy should continue to experience at least moderate growth over the next six to nine months.”

In the first six months of the year, the economy grew at an annual rate of just 0.9 percent. Growth expanded to a 2.5 percent rate in the July-September quarter.

Before this month, many economists had estimated that growth in the current October-December quarter would roughly match the 2.5 percent pace of the July-September period. But in recent days, based on the healthier economic news, some analysts have boosted their forecasts.

This week, the government said retail sales in October and factory production were picking up. U.S. builders started slightly fewer homes in October. But building permits, a gauge of future construction, surged nearly 11 percent. That gain was led by a 30 percent increase in apartment permits, to their highest level in three years.

Wyss said he expected the annual growth rate in the current quarter to amount to about 3 percent, up from his earlier expectation of 2.5 percent. Economists at JPMorgan Chase & Co. are also expecting a 3 percent growth rate for the October-December period.

Wyss said one reason for his increased optimism is that he thinks a modest rebound in consumer spending will trigger companies to restock depleted shelves.

Even so, an economy growing at a 3 percent rate would still fall shy of the 4 percent to 5 percent pace that economists say is needed to significantly reduce the unemployment rate, which remains stuck at 9 percent.

And without stronger job gains, analysts say consumer spending, which accounts for about 70 percent of economic activity, will remain constrained.

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The press likes to cast itself as society’s guardian. On Monday, the judge leading the investigation into Britain’s deepening phone hacking scandal vowed to find an answer to the question: Who guards the guardians?

For years, the British media’s answer has been that it mainly looks after itself. But following explosive allegations of pervasive criminality at Rupert Murdoch’s News of the World tabloid, Lord Justice Brian Leveson suggested it was time for a change.

“Guarding the guardians is not an optional add-on,” he said.

Britain’s phone hacking inquiry was set up by Prime Minister David Cameron shortly after the scandal boiled over in July, pulling the lid off illegal spying at the nation’s best-selling Sunday newspaper and exposing police corruption.

It’s one of several investigations spurred by public anger over unethical practices at the now defunct paper. The long-running scandal has threatened Murdoch’s global media empire, which includes the Wall Street Journal and dozens of other properties.

Parallel inquiries launched by police, prosecutors and parliamentarians have called Murdoch to Britain for dramatic testimony before lawmakers, led to more than a dozen arrests and the resignation of several top-ranking Murdoch executives, including News International CEO Rebekah Brooks and The Wall Street Journal publisher Les Hinton.

The first part of Leveson’s inquiry seeks to go beyond assigning blame to individual journalists or newspapers to evaluate the media’s wider role: Is the press above the law? Is it too close to police and politicians? Does society’s guardian need a powerful guardian of its own? These are some of the questions on his agenda.

Although the News of the World has few defenders, editors and broadcast bosses have publicly voiced concern that recommendations from any inquiry could leave Britain’s press less aggressive _ and less free. Few if any want more government regulation _ especially since Britain’s press already labors under strict libel laws and contentious new privacy rules.

While inquiry counsel Robert Jay said that the importance of a free press was “almost self-evident,” he warned that the media may not necessarily like the solutions the inquiry finds for tricky ethical issues.

“These solutions will not necessarily have been the solutions which the press themselves would have devised,” he said.

Leveson said he hoped to have the first part of his inquiry wrapped up by the end of 2012.

He’s expected to recommend either scrapping or radically reforming the Press Complaints Commission, the self-regulatory body whose failure to get to grips with the hacking scandal has been roundly criticized. The scope of his inquiry’s recommendations will hinge in part on whether illegal behavior is found to have been limited largely to the News of the World or whether it was practiced more widely.

There seemed to be plenty of evidence that shady practices were widespread at Monday’s hearing.

Jay told the inquiry _ whose proceedings were broadcast live over the Internet _ that it appeared that illegal interception of voicemails went beyond the News of the World. He said that the inquiry had seen the names of no fewer than 28 News International employees in the notes kept by Glenn Mulcaire, the private investigator which the News of the World paid to illegally eavesdrop on its victims.

The words “The Sun” _ a possible reference to the News of the World’s sister-title _ also cropped up in Mulcaire’s notes, Jay said. So, too, did a name linked to the Daily Mirror, the Sun’s left-wing rival.

Jay said that the evidence on phone hacking pointed to what he described as “at the very least, a thriving cottage industry.”

The inquiry was briefly disrupted when David Sherborne, a lawyer for phone hacking victims, said that a Trojan, or data-stealing virus, had been found on his computer _ raising the possibly that he was being hacked.

The otherwise cool and clinical Leveson briefly seemed speechless.

“I’m not often thrown, but Mr. Sherborne has managed to do that,” he said. Sherborne later said the problem was being dealt with.

Sherborne was one of several dozen lawyers and journalists packed into a room at London’s neo-gothic Royal Courts of Justice, with more in a spillover tent pitched into a nearby courtyard.

A handful of members of the public came to watch the proceedings as well _ among them Bob Dowler, whose daughter Milly had her phone hacked by the News of the World at the height of the media frenzy over her disappearance in 2002.

Dowler’s case was the first to arouse broad public anger when it was reported by the Guardian newspaper in July, though several celebrities had earlier won settlements from News International. Among the people who will be legally represented at the hearings are “Harry Potter” author J.K. Rowling, singer Charlotte Church, actor Hugh Grant and actress Sienna Miller.

Katriona Ormiston, a 21-year-old journalism student, said she was there to see media history being made.

“Obviously it’s got quite a big impact on the future,” she said.

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The complex network of flood defenses erected to shield Thailand’s capital from the country’s worst floods in nearly 60 years was put to the test early Saturday as coastal high tides hit their peak. No major breaches were immediately reported.

Fear gripped Bangkok early in the day as tides along the Gulf of Thailand crested at about 9 a.m. and pushed the city’s main waterway, the Chao Phraya river, to its brink. Overflows so far have lightly inundated riverside streets from Chinatown to the famed Temple of the Emerald Buddha.

But the white-walled royal Grand Palace was dry, less than 24 hours after being ringed by ankle-deep water, and the landmark remained open to tourists. Many visitors carried parasols to protect themselves from the blistering sunshine.

Prime Minister Yingluck Shinawatra said in her weekly radio address that floodwaters that had wreaked havoc to provinces north of Bangkok in the last several weeks had started to recede, and she urged citizens to let the crisis take its course.

“We have the good news that the situation in the central region has improved as runoff water gradually decreased,” she said. “I thank people and urge them to be more patient in case this weekend is significant because of the high tide.”

She also said that the government had implemented a plan to accelerate the drainage rate and that water in the greater Bangkok area should recede by the first week of November.

Meanwhile, the streets of downtown Bangkok _ the country’s financial heart _ were bone-dry and bustling with taxis, restaurant-goers and tourists snapping pictures. But the city remained in peril, as high tides along the gulf were expected to crest again late in the day, threatening to obstruct the flood runoff from the north. The government also is worried major barriers and dikes could break.

Also on Saturday, the government’s Flood Relief Operations Center was forced to move its headquarters from its base at Don Muang airport, which is used mostly for domestic flights, to a government building nearby after a power transformer malfunctioned. Authorities were forced to shut down the airport this week after floodwaters rushed in.

On Friday, saffron-robed monks and soldiers piled sandbags outside the capital’s most treasured temples and palaces as the Chao Phraya swelled precariously beyond its banks. Most of the water receded at low tide, but worried Bangkokians were buying up bright orange lifejackets and inflatable boats, fearing the worst is yet to come.

“You have to prepare,” said Fon Kanokporn, a banker who bought a rubber boat from a store that had several hanging from trees out front as advertisements.

Employees at the shop said they had sold well over 3,000 boats in the last week. The brisk business is a measure of the fear gripping Bangkok and a reflection of the tragedy of neighboring provinces that have been submerged for weeks. Several buyers said they needed boats because their submerged homes outside the capital were no longer accessible by road.

Three months of relentless monsoon rains have caused the worst flooding in Thailand in more than half a century, triggering a national crisis that has overwhelmed Yingluck’s government online payday loans.

The water has crept from the central plains south toward the Gulf of Thailand for weeks, engulfing a third of the country and killing nearly 400 people and displacing 110,000 more. Now, Bangkok is in the way _ surrounded by behemoth pools of water flowing around and through the city via a complex network of canals and rivers.

On Friday, army trucks dumped thousands of sandbags outside the riverside Siriraj Hospital, where Thailand’s ailing and revered King Bhumibol Adulyadej has stayed since 2009.

Elsewhere along the Chao Phraya, dozens of monks at the 200-year-old Temple of the Dawn stacked hundreds more along a secondary barrier to protect against river overflows.

“It’s likely going to get higher, but I don’t think its going to get high enough to cause chaos,” said Phramaha Abhin, a 42-year-old monk. Still, he said, “we cannot neglect the risk to this temple. It’s one of the country’s landmarks, one of the things Thailand is known for. We have to protect it.”

The State Railway of Thailand said all train services from Bangkok to southern Thailand were suspended after the tracks in Bangkok’s suburbs were submerged by floodwaters.

Thais and expatriates alike continued to leave Bangkok as foreign governments urged their citizens to avoid the threatened city, citing transportation difficulties and shortages of certain food items.

Seven of Bangkok’s 50 districts _ all in the northern outskirts _ are heavily flooded, and residents have fled aboard bamboo rafts and army trucks and by wading through waist-deep water. Eight other districts have seen less serious flooding.

New flooding was reported Friday in the city’s southeast when a canal overflowed in a neighborhood on the outer parts of Sukhumvit Road. And high tides briefly touched riverside areas closer to the city’s central business districts of Silom and Sathorn. But the day passed without major incident.

“It is clear that although the high tides haven’t reached 2.5 meters (8.2 feet), it was high enough to prolong the suffering of those living outside of the flood walls and to threaten those living behind deteriorating walls,” Bangkok Gov. Sukhumbhand Paribatra said.

The flood walls protecting much of the inner city are 8.2 feet high, and Saturday’s high tide was expected to reach 8.5 feet (2.6 meters).

International charity Save the Children said it was concerned that crocodiles and snakes were lurking in stagnant floodwaters it said are growing filthier by the day.

“Every day we see children playing in the water, bathing or wading through it trying to make their way to dry ground,” said Annie Bodmer-Roy, the group’s spokeswoman in Thailand.

The aid group said many families have been left without access to running water or clean toilets.

“There is a very real risk of waterborne or communicable diseases such as diarrhea and skin infections taking hold if families can’t maintain basic standards of hygiene,” Bodmer-Roy said. “It is essential that the risks facing children in this crisis are understood and steps taken to keep them safe.”

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MetLife Inc. says its net income increased tenfold in the third quarter, boosted largely by its acquisition of Alico last year.

The nation’s biggest life insurer says it earned $3.55 billion, or $3.33 per share, in the three months ended Sept. 30. That’s compared with $286 million, or 32 cents per share, in the year-ago period.

Excluding one-time items, the company earned $1.11 per share. Analysts had forecast a profit of $1.05 per share, according to FactSet.

The New York company said total international sales more than doubled as a result of its acquisition of American Life Insurance, or Alico, from American International Group Inc. last year.

Alico operates in more than 50 countries and was expected to help MetLife expand in Japan, Europe and Latin America.

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Swiss bank UBS says its chief executive has resigned over a $2.3 billion rogue trading loss.

The bank says its Europe chief Sergio P. Ermotti will take over as interim chief executive until Gruebel’s replacement is appointed.

UBS board president Kaspar Villiger said in a statement Saturday that Oswald had considered it his duty to take responsibility for the massive loss caused by unauthorized trading at its London-based investment banking unit.

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