Business and Finance

World stock markets took a beating on Monday after a report showed U.S. companies stopped hiring in August, reviving fears that the world’s largest economy is heading back into recession.

The lack of hiring in the U.S. last month surprised economists, who were expecting about 93,000 jobs to be added. Previously reported hiring figures for June and July were revised lower. The unemployment rate held steady at 9.1 percent _ it has been above 9 percent in all but two months since May 2009.

The jobs crisis has led President Barack Obama to schedule a major speech Thursday night to propose steps to stimulate hiring.

Traders waited for signs that the U.S. Federal Reserve might take action at its September meeting to support the economy _ perhaps a third round of bond purchases, dubbed quantitative easing III or QE3, analysts said.

“Right now the possibility has increased,” said Linus Yip, a strategist at First Shanghai Securities in Hong Kong. “I think they have to do something. The markets are expecting QE3.”

Amid the uncertainty, traders pulled out of any risky investments _ such as stocks, particularly financial ones, the euro and emerging market currencies _ to pile into safe havens: U.S. Treasuries, the dollar, the Japanese yen and gold.

European shares opened sharply lower and closed with even heavier losses. Britain’s FTSE 100 shed 3.6 percent to 5,102.58. Germany’s DAX slumped a massive 5.3 percent to 5,246.18, and France’s CAC-40 tumbled 4.7 percent to 2,999.54.

Markets in the U.S. were closed for the Labor Day holiday.

Banking stocks were among the hardest hit after the U.S. government on Friday sued 17 financial firms for selling Fannie Mae and Freddie Mac billions of dollars worth of mortgage-backed securities that turned toxic when the housing market collapsed.

Among those targeted by the lawsuits were Bank of America Corp., Citigroup Inc., JP Morgan Chase & Co., and Goldman Sachs Group Inc. Large European banks including The Royal Bank of Scotland, Barclays Bank and Credit Suisse were also sued.

Renewed jitters over the eurozone debt crisis also contributed to the slump in financial stocks amid concerns they would need to raise new capital. Deutsche bank closed down 8.9 percent in Frankfurt while Societe Generale in Paris shed 8.6 percent.

An international debt inspectors’ review of Greece’s finances was interrupted on Friday amid disagreements over the country’s deficit figures. The review will be resumed in about 10 days and must be completed in order for the country to receive its bailout loans at the end of the month payday loans in 1 hour.

Signs that the Italian government’s commitment to its austerity program is wavering have also shaken investors. Prime Minister Silvio Berlusconi’s government has backtracked on some deficit-cutting measures, prompting EU economic officials to urge it to stick to its promised plan.

The yields in so-called peripheral eurozone countries, such as Greece, Italy and Spain, rose sharply while those of Germany _ whose bonds are widely considered a safe haven _ fell.

The economic indicators, meanwhile, were mostly downbeat. Although retail sales in the eurozone rose unexpectedly in July, a survey of the services sector showed a slowdown across the continent for the fifth consecutive month.

The purchasing managers’ index for the eurozone showed the services sector was still growing _ unlike the manufacturing sector _ but only barely. That will add pressure on the European Central Bank to keep interest rates on hold when it meets this week.

“Indeed, the latest data and surveys suggest that the ECB’s eventual next move could actually be to trim interest rates, although it is likely to need sustained eurozone economic weakness and possibly even GDP contraction to get the ECB to perform a U-turn on interest rates,” said Howard Archer, economist at IHS Global Insight.

In Asia, indexes closed sharply lower. Japan’s Nikkei 225 stock average sank 1.9 percent to close at 8,784.46, with sentiment also undermined by the persistent strength of the yen, which hurts exporters.

Australia’s S&P/ASX 200 fell 2.4 percent and South Korea’s Kospi slid 4.4 percent. Hong Kong’s Hang Seng slid 3 percent. Benchmarks in Singapore, Taiwan, New Zealand and the Philippines also were down.

Shanghai’s benchmark Composite Index down 2 percent to 2,478.74, its lowest close in 13 months. The Shenzhen Composite Index lost 2.4 percent.

In currencies, the euro weakened to $1.4100 from $1.4187 in New York late Friday. The dollar was roughly flat at 76.87 yen. Last month, the dollar fell under 76 yen, which was a new post-World War II high for the Japanese currency.

Benchmark oil for October delivery was down $2.12 to $84.33 a barrel in electronic trading on the New York Mercantile Exchange. Crude fell $2.48 to settle at $86.45 on Friday.

In London, Brent crude for October delivery was down $1.63 at $110.70 on the ICE Futures exchange.

Source

A proposed combination of two Canadian patent licensing companies will make it easier to extract lucrative licensing deals from technology giants, would-be buyer WiLan said on Thursday.

WiLan, which makes money by developing and licensing intellectual property for the communications and consumer electronics markets, has offered $38 a share for smaller rival Mosaid just as tech majors pay heavily for patents to use as weapons in litigation and cross-licensing.

ask the expert

Nick Lombardi, manager, risk services practice Brown Smith Wallace LLC

314-983-1323

nlombardi@bswllc.com

Are solar panels a good investment for a business in the St. Louis area?

The answer today is a resounding “Maybe.”

Not long ago, the response would have been a hushed, “Not really, but you might pursue them to be seen as ‘green.’”

The combination of higher tax incentives, lower installation costs, greater efficiency and rising utility rates are boosting the advantages of solar electricity. Around the world, there is a massive upsurge in solar panel manufacturing capability and installations. The industry is now well established and truly competitive.

So how to assess an investment in solar panels?

They tend to hold their value, have a long life of more than 20 years and provide a monthly cash stream with almost no maintenance cost.

Unlike most other business investments, they are a long-term and low-risk investment. While it is fair to expect a reasonable return on a solar energy investment, it is not fair to expect the return demanded of higher-risk projects.

Solar electric projects should be evaluated using a discounted cash flow analysis covering at least 10 years. The analysis should consider the initial installation cost, energy revenue, capacity revenue, tax incentives, rebates, depreciation, maintenance cost, marginal tax rate and internal cost of capital. A great source to help with the incentives and rebates is www.dsireusa.org.

The installing contractor should provide an estimate of monthly revenue along with guarantees of minimum performance. A business that lacks the expertise to validate such information might seek outside help to verify it and help with paperwork and tax issues.

An independent verification of system performance is also a good idea should a business decide to install a solar energy system.

Source

The Toronto stock market tumbled almost 500 points Monday after an unprecedented credit rating downgrade of U.S. government debt by Standard and Poor’s helped give added momentum to a four-week-old selloff.

Rupert Murdoch has arrived at the offices of his U.K. newspaper division amid the phone hacking scandal engulfing the News of the World tabloid, which has been shut down and published its last edition.

TV footage showed the News Corp. CEO being driven into the east London offices of News International on Sunday. He was seated in the front passenger seat with a copy of the last issue of the News of the World in his hands.

Allegations the paper’s journalists paid police for information and hacked into the voicemails of young murder victims and the grieving families of dead soldiers prompted Murdoch’s News International to shut down the paper.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

LONDON (AP) _ Rupert Murdoch has arrived at the offices of his U.K. newspaper division amid the phone hacking scandal engulfing the News of the World tabloid, which has been shut down and published its last edition.

TV footage showed the News Corp. CEO being driven into the east London offices of News International on Sunday. He was seated in the front passenger seat with a copy of the last issue of the News of the World in his hands.

Allegations the paper’s journalists paid police for information and hacked into the voicemails of young murder victims and the grieving families of dead soldiers prompted Murdoch’s News International to shut down the paper.

Source

Italian opposition parties and the media claimed Tuesday that a measure buried in Italy’s euro47 billion ($68 billion) austerity package would allow Premier Silvio Berlusconi’s family investment company to avoid a heavy fine, at least temporarily.

Opposition politicians and magistrates expressed outrage at the measure that would suspend any payments until appeals process is exhausted.

Fininvest, the holding company for Berlusconi’s family assets, was ordered two years ago to pay euro750 million ($1.09 billion), to a rival for alleged corruption in the takeover of publishing house Mondadori in the 1990s. A decision on the appeal in the Mondadori case is expected later this week. Italian media say Fininvest has not yet paid any part of the fine.

Italian newspapers said the measure only came to light during a review of the austerity package by the Italian president’s office.

The Finance Ministry had no immediate comment, though it canceled a presentation of the austerity plan on Tuesday, while President Giorgio Napolitano told reporters that he would not comment on the package until the review was complete.

Meanwhile, Berlusconi ally Foreign Minister Franco Frattini, said the measure was general and not aimed at protecting anyone in particular. “If I understand correctly, it is a general measure,” Frattini was quoted by the news agency LaPresse as saying, adding that it didn’t receive much attention in the Cabinet.

The government approved the austerity measures last week to show financial markets and the European Union that it is serious about balancing its budget. It must be approved by Parliament.

The three-year-plan aims to bring the government’s budget deficit of 3.9 percent this year to near-balance by 2014. It includes new taxes on financial transactions, tax breaks for young entrepreneurs, extending a public sector hiring freeze and cutting ministries’ budgets, as well as measures to fight tax evasion.

Opposition politicians said the measure benefiting Berlusconi’s family violated the wishes of voters, who demonstrated in last month’s referendum that they think the premier does not deserve special treatment. Voters overwhelmingly killed a law that partially shielded Berlusconi and other top officials from prosecution while in office.

“If this is confirmed, it will be proof that the austerity measures will be a problem for all Italians and a solution for Premier Berlusconi,” Pierluigi Bersani, leader of the main center-left party, was quoted as saying by il Sole 24 Ore financial daily.

Shares of Berlusconi’s Mediaset media company, controlled by Fininvest, were down 1.6 percent to euro3.25 in Milan.

Source

SAN FRANCISCO—Google Inc, frustrated by a string of failed attempts to crack social networking, is taking another stab at fending off Facebook and other hot social sites with a new service called Google Plus.

Google designed the service, unveiled Tuesday, to tie together all of its online properties, laying the foundation for a full-fledged social network. It is the company’s biggest foray into social networking since co-founder Larry Page took over as chief executive in April.

Page has made social networking a top priority at the world’s No 1 Internet search engine, whose position as the main gateway to online information could be at risk as people spend more time on sites like Facebook and Twitter.

To set its service apart from Facebook, which has more than 500 million users, Google is betting on what it says is a better approach to privacy, a hot-button issue that has burned Facebook, as well as Google, in the past.

Central to Google Plus are so-called “circles” of friends and acquaintances. Users can organize contacts into different customized circles — family members, co-workers or college friends, say — and share photos, videos or other information only within those smaller groups.

“In the online world there’s this ’share box’ and you type into it and you have no idea who is going to get that, or where it’s going to land, or how it’s going to embarrass you six months from now,” said Google Vice President of Product Management Bradley Horowitz.

“For us, privacy isn’t buried six panels deep,” he added.

Facebook, which has been criticized for confusing privacy controls, introduced a feature last year that lets users create smaller groups of friends. Google, without mentioning Facebook by name, said other social networking services’ attempts to create groups were “bolt-on” efforts that do not work as well.

Google Plus will be rolled out to a limited number of users in what the company is calling a field trial. Only those invited to join will initially be able to use the service. Google did not say when it would be more widely available.

Google’s stock has been pressured by concerns about rising spending within the company and increasing regulatory scrutiny — not to mention its struggles with social networking. The Federal Trade Commission, among others, is currently reviewing its business practices.

Its shares are down almost 20 per cent this year after underperforming the market in 2010.

To create Google Plus, the company went back to the drawing board in the wake of several notable failures, including Google Wave and Google Buzz, a microblogging service whose launch was marred by privacy snafus.

“We learned a lot in Buzz, and one of the things we learned is that there’s a real market opportunity for a product that addresses people’s concerns around privacy and how their information is shared,” said Horowitz.

Google, with $29 billion in revenue last year, drew more than 1 billion visitors worldwide to its websites in May, more than any other company, according to Web analytics firm comScore. But people are spending more time on Facebook: The average U.S. visitor spent 375 minutes on Facebook in May, compared with 231 minutes for Google.

Google Plus seems designed to make its online properties a pervasive part of the daily online experience, rather than being spots where Web surfers occasionally check in to search for a website or check email.

As with Facebook’s service, Google Plus has a central Web page that displays an ever-updating stream of the comments, photos and links being shared by friends and contacts.

A toolbar across the top of most of Google’s sites — such as its main search page, its Gmail site and its Maps site — allows users to access their personalized data feed. They can then contribute their own information to the stream.

Google Plus will also offer a special video chat feature, in which up to 10 people can jump on a conference call. And Google will automatically store photos taken on cell phones on its Internet servers, allowing a Google Plus user to access the photos from any computer and share them.

When asked if he expected people to switch from Facebook to Google Plus, Google Senior Vice President of Engineering Vic Gundotra said people may decide to use both.

“People today use multiple tools. I think what we’re offering here offers some very distinct advantages around some basic needs,” he said.

Source

Inflation in Germany, Europe’s largest economy, accelerated more than initially estimated in April after energy costs surged.

The inflation rate, calculated using a harmonized European Union method, jumped to 2.7 percent from 2.3 percent in March, the Federal Statistics Office in Wiesbaden said today. That’s an upward revision from the first estimate of 2.6 percent on April 27. From March, consumer prices rose 0.3 percent, more than the 0.2 percent initially reported.

The price of crude oil rose above $113 a barrel in April, helping to drive euro-area inflation to 2.8 percent. The European Central Bank, which aims to keep inflation just below 2 percent, last month raised its benchmark interest rate for the first time in almost three years. With economic growth gathering speed, the ECB is concerned workers will demand compensation for higher food and energy costs, entrenching faster inflation.

“All the signs are that inflation risks are increasing,” Joerg Kraemer, chief economist at Commerzbank AG in Frankfurt, told Bloomberg Television. “It’s a clear signal for the ECB to deliver a series of rate hikes.”

Wholesale prices rose 0.2 percent in April from March and 9.2 percent from a year earlier, the statistics office said in a separate release. Energy costs were the main driver of consumer- price inflation, with light heating oil up 26.7 percent in the year and fuel 12 percent more expensive.

Source

COLUMBIA, Mo.

Some day, America’s shrunken job market is going to boom again. When that happens, expect a “tsunami of résumés” hitting HR offices around the country, along with a thunderous pounding of feet as dissatisfied employees head out their employers’ door for good.

So says Dr. Ronald Leopold, vice president of U.S. Business for MetLife.

The insurance firm surveyed 1,400 employees and 1,500 business executives last fall on their work attitudes. The American worker, they found, is ticked off and hoping to bail out.

“This year’s findings reveal a workforce that has grown more dissatisfied and disloyal, to the point where a startling one in three employees hopes to be working elsewhere in the next 12 months,” the study said.

That’s not surprising after three years of recession, layoffs, wage cuts and benefit reductions. Some companies treat employees like light bulbs. Burn them out; throw them away.

“Employees aren’t feeling the love,” says Leopold. Instead, they’re feeling the whip. According to the study, 40 percent of us worked harder last year, while 25 percent felt less secure in their jobs.

“These burnt-out employees are the most likely to say that they hope to be working elsewhere in 2011,” the study said.

For the moment, employers can ignore this. There aren’t many jobs to flee to.

Workers “hold on like little barnacles to the side of the ship when things are bad. As soon as things loosen up, they’ll go,” says Rose Jonas, who bills her Clayton career coaching business as the Job Doctor.

Employers are still concentrating on cutting costs (you and I are costs), and not worrying much about how they’ll retain workers when the boom resumes.

That might be a mistake. “When people leave an organization, the top achievers leave first,” notes David Hults, a Sunset Hills career coach.

Unemployment is coming down