Global finance blog - news, jokes, life…

Extending the light rail through Central Mesa is a step closer now that the Federal Transit Administration has approved Metro light rail’s request to enter the project development phase.

This means that Metro can start the engineering process of the 3.1-mile extension that runs along Main Street from the current end-of-line at Sycamore on the west side of town through downtown Mesa and on to Mesa Drive.

This is the first step in receiving $75 million from the federal government. The engineering contract is for $12.5 million and has been awarded to Jacobs Engineering, headquartered in Pasadena, Calif.

Preliminary and final engineering will take about two years and the Central Mesa extension is scheduled to be completed in 2016.

“Central Mesa is a solid project,” said Steve Banta, Metro CEO, in a news release. “While the FTA process is competitive, our project received a favorable rating and should fare well in its application for federal grant money.”

The total project cost is estimated at $200 million and will be paid for using a mix of regional and federal funds. The regional funding sources were approved by the voters in 2004 as part of Proposition 400, according to John Farry, spokesperson for Metro.

Source

Cash advance loans and online payday loans available today. Apply now and receive up to $1500 no teletrack cash advance in as little as 1 hour, direct lenders.

Loose internal controls and a reliance on real estate development loans sunk The Buckhead Community Bank, the lender in Atlanta’s tony enclave founded by Aaron’s Inc. founder Charlie Loudermilk, according to a post-mortem of the bank’s collapse.

Buckhead Community, famously founded by Loudermilk, an Atlanta business legend, after a poor customer service experience at another bank, bet heavily on residential and commercial development loans in metro Atlanta.

The failure of the $896 million-in-assets Buckhead Community cost the government's deposit insurance fund $240 million.

Like many other Georgia banks, the sweet profits found in lending to developers soured with the fallout of the real estate market, and Buckhead Community burned through its capital as losses mounted, according to a report Friday by the Office of the Inspector General of the Federal Deposit Insurance Corp.

“(The bank) failed because the bank’s Board and management did not implement adequate controls to identify, measure, monitor, and control the risks associated with the bank’s significant (land acquisition and development loan) concentration,” the report stated. “Further, Buckhead relied on potentially volatile non-core liabilities such as higher-priced certificates of deposit, including brokered deposits, to fund loan growth.”

It’s a familiar story in Georgia, a state which leads the nation in bank failures with 38 since 2008, including eight this year.

Buckhead Community failed Dec. 4, 2009, along with two other banks. It and First Security National Bank were bundled and sold to State Bank & Trust Co. in a deal assisted by the FDIC.

Buckhead Community was founded in 1998 with $34 million in assets by investors, including Loudermilk, and featured some of the city’s business elite on its board, including and real estate developers David Allman, owner of Regent Partners LLC, and Julian LeCraw.

The bank tripled in size every three years from 1998 to 2007, propelled in part by an ultimately crippling decision in 2007 to acquire Allied Bancshares Inc., the parent company of First National Bank of Forsyth County.

In a December 2008 interview with Atlanta Business Chronicle, Loudermilk, Buckhead Community’s chairman, said he regretted the decision to acquire Allied at the height of the market.

The purchase contributed to soaring loan losses at the bank, with eight branches across the north metro.

“We wouldn’t buy that group again,” he said at the time. “It was a good thing at the time, but if we were presented with it today we’d pass.”

First National was also besieged by real estate loan problems when Buckhead Community acquired it for $53.8 million in stock and cash, capital that could have been used to protect against real estate losses.

Buckhead Community lost $59.8 million through the first three quarters of 2009, following a $35.8 million loss in 2008.

The bank was bullish with its loan growth from 2004 to 2007, ignoring declines in the housing market, the FDIC said.

“Weaknesses in the bank’s loan underwriting and credit administration practices, exacerbated by the precipitous economic decline in the Atlanta metropolitan real estate market that began in 2007, led to ADC loan losses that eroded the bank’s earnings and capital,” the Inspector General’s report said.

In 2008, Buckhead Community had nearly five times its total capital in real estate loans.

Soured loans began to mount in the second half of 2008. Problem loans—those delinquent, in default or in foreclosure—climbed to 9.8 percent in third quarter 2008 and more than tripled to 28.66 percent by the end of the first quarter of this year.

By the third quarter, 36.98 percent of its $648 million loan portfolio was in some form of trouble. A total of $173 million in loans were listed as non-accrual or foreclosed.

In December 2008, the held $277.7 million in wholesale deposits, volatile funding sources when a bank encounters trouble because the deposits are not from local core customers.

In its 2009 annual report, Buckhead Community’s auditors said they had doubts about the bank's ability to survive, and the bank was also subject to regulatory enforcement orders requiring the bank to raise capital and improve its balance sheet.

By January 2008, regulators reached an informal memorandum of understanding to correct problems. More restrictive enforcement action followed in August 2009, when the FDIC slapped the bank with a cease and desist order, directing the bank to make changes to its operations.

Bank insiders tried to save the bank, pursuing options to raise capital. It issued $10 million in subordinated notes in March 2008, and submitted an application in October 2008 for funding under the U.S. Treasury’s Troubled Asset Relief Program. That application was withdrawn several months later.

Source

If you would like to learn more about the convenience of payday loans or how to apply for one, simply visit our site.

RehabCare Group Inc. said Kevin Gross, senior vice president of hospital operations, plans to resign effective June 4.

Gross has accepted the position of president of the Oklahoma division of Ardent Health Services, a role he held prior to his tenures at Universal Health Services and RehabCare.

He has led RehabCare’s hospital division since July 2008.

Brock Hardaway, president and chief operating officer of Triumph HealthCare, which RehabCare recently bought for $570 million, has been promoted to RehabCare executive vice president, assuming leadership of the hospital division and reporting directly to RehabCare President and Chief Executive John Short.

Hardaway joined Triumph in 2005 and was appointed to manage the combined company’s long-term acute care hospital portfolio following RehabCare’s acquisition of Triumph in November 2009. He will oversee division operations from Triumph headquarters in Houston.

St. Louis-based RehabCare (NYSE: RHB) is the fourth-largest, post-acute hospital operator and the third-largest, long-term acute care hospital provider in the nation, with 28 long-term acute care hospitals and six inpatient rehabilitation facilities in 13 states. The company has more than 18,000 employees and reported $869.4 million in 2009 operating revenue.

Source

So now what do we do? How do we create a more entrepreneurial climate in St. Louis, and ensure the companies of the future grow here?

The short answer, the easy answer, is money, in the form of bank loans, seed funds, venture capital. But money is tight these days, and it has a tendency to follow results, not fertilize new ground. So here are a few other ideas — most already in play on a small scale — that St. Louis can build on to make its economic garden bloom.

Lower the barriers to entry — Most startups operate on a drum-tight budget. And any hurdle to opening the doors makes that budget even tighter.

Yet many entrepreneurs say they face a maze of paperwork, inspections, licenses and approvals. This takes precious time and money.

"Business assistance centers," like the one run by the city of St. Louis, try to help smooth the road for would-be business owners. More publicity for programs like these, and less paperwork in general, would be big step in the right direction.

Pull in the same direction — St. Louis has scads of people working on this problem. There are incubators and counseling programs and angel networks and mentor teams. Most do good work. But sometimes, they do the same work.

"It’s difficult sometimes for business support organizations to work together," said Eddie Davis, director of the Center for the Advancement of African-American Roundtable. "This impedes our growth."

And despite all these efforts, everyone has stories of small-business owners who don’t know the resources available to them. A more streamlined effort to steer people in the best direction would make the most of all of this.

Maybe it’s a regional clearinghouse. Maybe it’s (horrors!) a committee. Maybe it’s as simple as stronger informal networks among the many groups working on this. But more cooperation would go a long way.

Cash on the barrel — Yes, the kind of money needed to fuel lots of startups is probably too much to hope for. But small, well-targeted loan funds can make a difference. Like St. Louis County’s new Boost loan program.

Funded with a $5 million line of credit from PNC Bank, the Boost program is designed to help small businesses struggling to get bank loans, by offering funds with lower eligibility requirements, and county backing payday loans. Since January, the county has received more than 30 serious applications and will soon issue its first loans.

Small partnerships like this could augment bank lending and provide more support to startups at a relatively low cost.

Leverage our universities — Two years ago, a group of investors launched the Billiken Angel Network, a fund designed to provide seed capital to entrepreneurs with a tie to St. Louis University — students, alumni, faculty. They leverage their own money, plus $1 million in funding from SLU, to help fund startups, many of them here in St. Louis.

This region has a lot of universities. And they create a lot of ideas. Pooling investors around their ties to other local institutions, from Columbia to Rolla to Edwardsville, is a low-cost way to spark more companies that are born, and will stay, in St. Louis.

Pool Midwestern venture capital — Most of the Midwest — not just St. Louis — lags when it comes to creating high-powered, innovative startups. This is despite research universities that are among the nation’s best, and that win more than their share of federal grants, R&D funding and patents.

"But it’s not getting translated into new businesses," said John Austin, who heads the Great Lakes Economic Initiative at the Brookings Institution.

He co-authored a recent report detailing how the Midwest ships much of its venture capital to the coasts. Investing closer to home, he contends, would be profitable for all involved. More Midwest-specific funds, like the Clayton-based Mid America Healthcare Investors Network, would provide opportunity, and profit, in the region.

"We need more entrepreneurial investors," said Frank Samuel, the study’s other author.

The big steps — more state seed funding, a flood of venture capital — will help, if and when they arrive. But small steps now can help prepare the ground for entrepreneurship to bloom.

Source

Foreclosure notices on commercial properties in the Dallas-Fort Worth area jumped 58 percent in the first six months of 2010, Addison-based Foreclosure Listing Service Inc. said Thursday.

During that period, including foreclosures already set for June, 1,659 notices were filed on retail properties, retail buildings, office buildings, industrial spaces, apartment complexes, and commercial lands in the D-FW area. Property owners still have time to respond and avoid foreclosure.

While it’s nothing compared to the 8,000 foreclosure filings reported in one year during the late 1980s, the jump over last year has made an impact, according to Foreclosure Listing Service, which compiles foreclosure data for the region.

There are still more foreclosure postings on residential properties, said George Roddy president of Foreclosure Listing Service, but he added, “posting activity has climbed at a much steeper pace on commercial properties than on residential.”

During the first six months of 2010, foreclosure filings on buildings classified as "miscellaneous commercial properties" jumped 126 percent to 683 postings. There were in 302 last year. Meanwhile, foreclosure notices filed on commercial land jumped 72 percent, hitting 381, up from 222 postings.

Meanwhile, apartment communities saw the number of foreclosure notices filed increase 46 percent over last year. Foreclosures on office buildings increased 18 percent, while foreclosures on retail centers and buildings dropped 16 percent.

Source

Emergency state legislation that will help Maryland health care leaders figure out how to put their share of $5 billion in federal money to use in a high-risk insurance pool has passed committees in both the House and Senate.

The bill, introduced last week after President Barack Obama signed the national health care reform bill, first paves the way for the Maryland Health Insurance Plan to continue operating as the state’s insurance pool for individuals with chronic and other costly health conditions who cannot afford to purchase coverage from a commercial carrier.

Money from the federal government — perhaps 1 percent to 2 percent of the $5 billion — would then enable MHIP to lower its premiums for coverage and eliminate a policy that denies coverage or makes it more expensive for individuals with pre-existing health conditions such as diabetes who previously were not covered by a private health plan.

The legislation — filed at House Bill 1564 and Senate Bill 1125 — passed the House Health and Government Operations Committee on March 27. It was approved by the Senate Finance Committee on March 25.

If the measure is passed by both sides of the state legislature and signed into law as expected, the benefits could take effect as soon as June, said Richard Popper, MHIP’s executive director.

“We could cut our premiums within 60 days,” he said bad credit pay day loans. “The national health care reform gives states the money to make it happen.”

Under the national health care reform, about 32 million more individuals will be required to have health insurance by 2014. In the meantime, the federal bill calls for the creation of a temporary national high-risk insurance pool that would lower the cost of coverage for millions of uninsured individuals.

Still, details regarding how Maryland’s 7-year-old high-risk insurance program will mesh with the new federal one need to be ironed out. Popper said eligibility requirements for the federal program may differ slightly from those imposed by MHIP.

As many as 70,000 uninsured Marylanders could benefit from the expansion of MHIP’s coverage, according to testimony Popper presented to members of the Senate Finance Committee on March 25.

MHIP already covers more than 17,000 Marylanders. Its enrollment grew about 15 percent in recession-soaked 2009, as more individuals joined the program after losing their job or their employer cut benefits.

Baltimore-based CareFirst BlueCross BlueShield, the region’s largest health insurer, administers claims for MHIP, which replaced the state’s Substantial, Available and Affordable Coverage plan in July 2003.

Source

Orlando-area hotel occupancy was 67.3 percent for the week of Feb. 28-March 6, up 11.1 percent from 60.6 percent the year prior, said Smith Travel Research.

Average daily room rates for that period were $101.54, up 0.8 percent from $100.77 last year.

In addition, revenue per available room — a barometer of the hotel industry’s health — was $68.32, up 12 percent from $61.02 a year ago.

Source

Companies will begin slowly adding to their payrolls in 2010, according to an annual White House review of the economy.

The White House Council of Economic Advisers, which on Thursday released a 462-page analysis of the president’s economic initiatives, said that the unemployment rate will be at 10% during 2010. It is now at 9.7%.

"With millions of Americans still unemployed, much work remains to restore the American economy to health," the report said. "It will take a prolonged and robust GDP expansion to eliminate the large jobs deficit that has opened up over the course of the recession."

On a call Wednesday with reporters, Council Chairwoman Christina Romer said she expects an average of 95,000 jobs a month to be created this year, and that the nation’s GDP will expand at a 2.5% rate.

The report, which is delivered to Congress, looks at the actions President Obama took to deal with the recession over the past year. It also discusses the economic challenges that lie ahead for the nation, but offers little insight that’s new.

Overall, the analysis enthusiastically supports the administration’s handling of the economic crisis and its proposals to strengthen the country’s fiscal standing in the future.

Romer called the report "a page-turner" and noted that it’s available for download to Kindle and other e-readers.

Placing blame

The report places blame on the Bush administration for running up debts and cutting taxes.

Romer blogged about the study on WhiteHouse.gov. "Largely because of two tax cuts, two wars, and a major new Medicare drug benefit that were not paid for, the budget surpluses of the 1990s had been replaced by substantial actual and projected future deficits long before the recession began at the end of 2007," she wrote.

She also took another whack at Obama’s favorite new target: Wall Street.

"Much of the economic growth that the United States experienced in the past decade was fueled by consumers and the government running up large debts, aided by a financial system better at making short-term profits than managing long-term risks," she wrote business cards.

Republicans were quick to react the report, calling it fluff and noting that the report says that unemployment won’t fall back to its 2008 level for another seven years.

"The Obama Administration’s report is full of blame for the policies of years past, praise for its own failed policies of the past year, and promises about their ideological agenda to grow government, said Rep. Eric Cantor, R-Va., the House GOP whip. "Instead of praising themselves and blaming others, a greater focus on small businesses and smart solutions to reduce uncertainty and create jobs would be welcomed and is long overdue."

Praising policies

The report has kind words for the $862 billion American Recovery and Reinvestment Act, the centerpiece of Obama’s economic policy in his first year. Calling the program the "great unsung hero of the past year," Romer reiterated that the program has funded up to 2 million jobs and helped turn the economy around.

Going forward, the report highlights several areas of financial concerns. These include health care, the deficit, living standards, business investment and trade, climate change and financial regulation. As consumers spend less, the government must foster an atmosphere which allows companies to ramp up their investments and exports.

The report lays out the administration’s proposals to address these issues.

Obama has made job creation his central focus in his second year in office. He has recently traveled the country promoting tax credits for small businesses, the source of many new hires. And on Tuesday, he brought together congressional leaders to push for a bipartisan agreement on legislation to boost hiring. 

Source

Federal Reserve Chairman Ben Bernanke, just days ahead of his confirmation hearing, is warning Congress that actions limiting the central bank’s independence could prove detrimental to the causes of financial reform and economic recovery.

In an op-ed piece to be published in Sunday’s Washington Post, Bernanke criticizes two moves aimed at limiting the Fed — a proposal in the Senate to strip the central bank of its bank regulatory powers and a House Financial Services Committee vote to audit monetary policy deliberations and actions.

"These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States," Bernanke wrote.

Bernanke says the congressional moves are a byproduct of the public frustration over the financial crisis and the government’s response, especially the bailout of large banks. (Fed rage boils on Capitol Hill)

"The government’s actions to avoid financial collapse last fall — as distasteful and unfair as some undoubtedly were — were unfortunately necessary to prevent a global economic catastrophe that could have rivaled the Great Depression in length and severity, with profound consequences for our economy and society," he wrote.

But the Fed chairman says that, while reforms are needed, "we should be seeking to preserve, not degrade, the institution’s ability to foster financial stability and to promote economic recovery without inflation."

Among the ideas he supports is development of a special bankruptcy procedure for firms "whose disorderly failure would threaten the integrity of the financial system — to ensure that ad hoc interventions of the type we were forced to use last fall never happen again."

Bernanke’s column comes ahead of a Senate Banking Committee hearing, scheduled for Thursday, considering his nomination for a second term as Fed chairman. President Obama announced the nomination in August.

The last sentence of his commentary is likely to be the theme he and his supporters will stress during the hearing.

"Now more than ever, America needs a strong, nonpolitical and independent central bank with the tools to promote financial stability and to help steer our economy to recovery without inflation," Bernanke wrote. 

Source

Confidence among U.S. consumers rose more than forecast in September as the pace of job losses slowed and the economy showed signs of pulling out of the recession.

The Reuters/University of Michigan preliminary index of consumer sentiment increased to 70.2 this month from 65.7 in August. The index was forecast to rise to 67.5, according to a Bloomberg survey of economists. A government report today showed inventories at U.S. wholesalers fell in July as higher sales helped distributors reduce excess supply.

Americans are starting to grow more upbeat after suffering the biggest destruction of wealth on record from a slump in stocks and home prices and companies are ramping up production to replenish stockpiles. Consumers may still be wary of increasing the spending that makes up 70 percent of the economy as they focus on building savings and paying down debt.

“We can be encouraged that consumer sentiment is healing,” said Jonathan Basile, an economist at Credit Suisse Holdings USA Inc. in New York, which at 70 had the closest forecast in the Bloomberg survey. “Good news continues to come through, bad news continues to diminish. It’s better, but it’s not good yet.”

The University of Michigan measure of current conditions, which reflects Americans’ perceptions of their financial situation and whether it is a good time to buy big-ticket items like cars and homes, rose to 71.8 from 66.6.

The index of consumer expectations for six months from now, which more closely projects the direction of consumer spending, increased to 69.2 from 65 in August.

Stocks Fell

Stocks fell after the reports. The Standard & Poor’s 500 Index closed down 0.1 percent from yesterday at 1,042.73 in New York. Earlier, the index had gained as much as 0.4 percent.

Gap Inc., Limited Brands Inc. and American Eagle Outfitters Inc. on Sept. 3 reported smaller August sales declines than analysts had forecast. San Francisco-based Gap, which also operates Old Navy and Banana Republic stores, said sales at outlets open at least a year fell 3 percent. Limited said its sales dropped 4 percent and American Eagle reported a 7 percent decline.

Starbucks Corp., the world’s largest coffee shop operator, said Sept. 9 it is removing 30 U.S. stores from a list of locations it planned to close after sales and profits improved. The Seattle-based company had planned to shutter about 800 U.S. stores and about 160 international cafes.

Wholesale Inventories

A Commerce Department report showed wholesalers’ stockpiles fell by a greater-than-forecast 1.4 percent in July, after a revised 2 free credit reports.1 percent drop in June. Wholesale inventories have had the longest series of declines since records began in 1987. Sales rose 0.5 percent, the third straight gain.

Investment in new equipment and other orders for long- lasting items may help boost U.S. gross domestic product and lead the economy out of the recession, President Barack Obama’s chief economist said today.

“I’m very encouraged by what we’re seeing, for example, in those advanced durable goods orders,” Christina Romer, chairman Christina Romer, chairman of the White House’s Council of Economic Advisers, said in an interview on Bloomberg Television. “Eventually, firms are going to say we need workers to produce these things.”

A Labor Department report today showed prices of goods imported into the U.S. rose in August for the fifth time in six months, led by petroleum costs. Prices excluding fuels rose 0.4 percent. Export prices rose 0.7 percent, indicating overseas demand is also starting to recover.

Growth Forecasts

The U.S. this quarter will emerge from the worst recession since the 1930s, economists say. The economy will grow at a 2.9 percent annual rate from July through September, according to the median of 61 estimates in a monthly Bloomberg News survey.

A Labor Department report last week showed the pace of job losses slowed in August, even as the unemployment rate rose to a 26-year high of 9.7 percent. Companies cut payrolls by 216,000 workers, after a 276,000 drop in July.

The number of Americans filing first-time claims for jobless benefits dropped last week to the lowest level since July, the Labor Department said yesterday. Applications fell by 26,000 to 550,000 in the week ended Sept. 5.

The economic recovery will probably be “lackluster,” hobbled by strains in financial markets and weak consumer spending, Federal Reserve Bank of Atlanta President Dennis Lockhart said yesterday.

The Federal Reserve said Sept. 9 that 11 of its 12 regional banks reported signs of a stable or improving economy in July and August. Five districts, including San Francisco, home to the biggest regional economy, “mentioned signs of improvement,” the Fed said in its Beige Book business survey.

Even so, “consumer spending remained soft in most districts,” according to the Fed report. “Loan demand was described as weak, and many districts reported that credit standards remained tight.”

Source