Actual finance blog

International air cargo traffic fell 22.1% in February compared with the same month a year ago, but the decline in freight may have found its floor, the airline industry body IATA said on Thursday.

Freight demand is considered a key barometer for the health of global trade, which has weakened considerably in response to the world’s economic downturn and credit crisis.

The February decline was the third consecutive month with cross-border cargo volumes far below the previous-year levels, following a 23.2% year-on-year drop in January and a 22.6% decline in December.

"We may have found a bottom to the freight decline, but the magnitude of the drop means that it will take time to recover," IATA Director-General Giovanni Bisignani said in a statement.

Freight demand in Asia, the region most affected by the decline in shipments, fell 24.7% year-on-year in February, the Geneva-based group said. Japanese exports have almost halved from February 2008, it said payday loans.

Air passenger traffic also declined last month, but less sharply than cross-border cargo.

Overall passenger volumes fell 10.1% below February 2008 levels, following a 5.6% year-on-year fall in January, IATA said.

Asia-Pacific carriers saw a 12.8% drop, North American airlines carried 12% fewer passengers and Europe’s recorded traffic down 10.1%, matching the global average. Latin American passenger traffic was slightly stronger, with only a 3.8% drop, and in the Middle East it was up 0.4%.

IATA, which represents 230 airlines including British Airways, Cathay Pacific, United Airlines (UAUA, Fortune 500) and Emirates, said earlier this week that airlines would lose $4.7 billion this year as a result of the economic downturn that has kept people and cargo from flying.

Its traffic data excludes domestic flights. 

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Langa Air Inc. has opened a flight training and aircraft maintenance facility at Spirit of St. Louis Airport. The company has a similar operation at St. Louis Regional Airport in Bethalto. Scott Langa, the company’s president, said Langa Air moved into Spirit on March 1. Langa Air offers flight training and aircraft rental. The company will begin performing general aircraft maintenance beginning in April at Spirit, in the Chesterfield Valley payday advance. Langa employs 34 people at St. Louis Regional and 12 at Spirit airport, and intends to hire five to 10 people in the coming months. (Ken Leiser) =”clear:both”>

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U.S. consumer spending probably slowed in February as business investment and housing tumbled, underscoring the urgency of government efforts to thwart a deeper recession, economists said before reports this week.

Purchases rose 0.2 percent after gaining 0.6 percent in January, according to the median estimate in a Bloomberg News survey ahead of Commerce Department figures due March 27. Combined sales of new and existing homes likely dropped to the lowest level in at least a decade and orders for durable goods fell for a seventh straight month, other reports may show.

Mounting job losses and shrinking wealth are squeezing the consumer spending that makes up about 70 percent of the economy as Americans forego expensive items such as cars and homes. The economy may keep shrinking until Obama administration and Federal Reserve initiatives to calm credit markets take hold.

“Consumers will be more inclined to put off bigger-ticket purchases until they start to see a deceleration in job losses,” said Maxwell Clarke, chief U.S. economist at IDEAglobal in New York. Clarke said the first half of this year is “mostly about getting our legs back under us,” and that a recovery won’t happen until later this year.

Commerce’s spending report may also show incomes fell for the third time in the past four months, economists said.

Purchases of existing homes fell 0.9 percent last month to an annual pace of 4.45 million, according to the median estimate of economists surveyed. The National Association of Realtors’ report is due tomorrow.

Durable Goods

Sales of new homes, due from Commerce on March 25, probably fell 2.9 percent in February to an annual pace of 300,000, the survey median shows. That would bring the combined sales rate to 4.75 million, the lowest since comparable figures began in January 1999.

Also on March 25, Commerce figures may show bookings for goods meant to last several years fell 2.4 percent in February, according to the survey. Durable-goods orders excluding transportation also probably dropped.

The economy has lost 4.4 million jobs since the recession began in December 2007, and the unemployment rate in February jumped to 8.1 percent, the highest level since December 1983. The U.S. Postal Service last week said it will close offices, cut jobs and offer early retirement to about 150,000 workers.

The Standard & Poor’s 500 Index is already down 15 percent this year following a 38 percent slide in 2008, its worst year since the Great Depression online payday loans.

Policy Moves

Fed figures showed household wealth fell by a record $5.1 trillion in the final quarter of 2008, as stock portfolios and home values plummet. The housing slump may extend well into its fourth year as rising foreclosures return more properties to the market and demand stays depressed.

President Barack Obama’s $787 billion stimulus package, enacted last month, was designed to create or save millions of jobs and jolt the economy out of recession through infrastructure spending and tax cuts. A separate plan is aimed at stemming foreclosures and helping struggling homeowners manage their mortgage bills.

Treasury Secretary Timothy Geithner also is working on a plan to tackle the bad assets clogging banks’ balance sheets so they’ll resume normal lending to consumers and businesses.

The Fed, meanwhile, last week said it will buy as much as $300 billion of Treasuries and an additional $750 billion of agency mortgage-backed securities, and that the central bank will keep the benchmark interest rate near zero for an extended time.

Growth Data

Sales at U.S. retailers last month fell less than forecast and January’s gain was almost double the previous estimate, indicating the biggest part of the economy may be starting to stabilize. Still, a sustained recovery in purchases is unlikely while consumers worry about losing their paychecks.

The downturn is hurting companies from home builder Hovnanian Enterprises Inc. and Caterpillar Inc., the world’s largest maker of construction equipment, to automakers General Motors Corp. and Chrysler LLC, now dependent on government loans.

Commerce releases the last of three economic growth estimates on March 26, which may show the economy shrank at a 6.6 percent annual pace in the fourth quarter as consumer spending plunged, according to the survey. The contraction in gross domestic product would be deeper than the government’s prior projection and the worst since 1980.

FedEx Corp., a bellwether for the economy as the second- biggest American package deliverer, last week reported its first sales drop in at least a decade. The economy “will definitely be weak” for all of 2009, Chief Executive Officer Fred Smith said, though he doesn’t anticipate a “further significant decline.”

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As loan servicers scramble to implement President Obama’s foreclosure prevention plan, the administration on Thursday unveiled a Web site to assist homeowners in determining whether they are eligible for help.

Obama rolled out his $75 billion foreclosure prevention program on Feb. 18, saying it would begin two weeks later when financial institutions received the guidelines.

The two-part Obama plan calls for servicers to reduce monthly payments to no more than 31% of eligible borrowers’ pre-tax income or to refinance eligible mortgages even if the homeowner has little or no equity. It also provides thousands of dollars in incentives for servicers and borrowers to participate.

Servicers, however, are still updating their systems to process modification and refinancing applications. And they are waiting for clarification on a few points of the president’s plan.

It could be weeks before borrowers learn whether they qualify for either program. Many have complained about being turned away by their servicers.

Administration officials reiterated the need for borrowers to be patient as the servicers work to implement the program. The nation’s four major servicers — Citigroup (C, Fortune 500), Bank of America (BAC, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and Wells Fargo (WFC, Fortune 500) — have said they would participate.

"They are moving as fast as humanly possible," a senior administration official said Wednesday in a discussion about the government’s new Web site.

The site can be found at makinghomeaffordable.gov.

Contact your servicer

Some financial institutions, while still not processing applications, are encouraging borrowers to contact them and submit their paperwork. That way homeowners can learn whether they qualify soon after the systems are in place.

Bank of America, for instance, is collecting borrowers’ information. If it’s clear they aren’t eligible for the Obama plan, the bank looks to help them through one of the other loan modification programs already underway. If they might qualify for the president’s program, Bank of America is compiling taking down names for future follow-up.

"As soon as we’re ready, we’ll make calls to the people who’ve already contacted us," said Rick Simon, a Bank of America spokesman.

Citigroup, meanwhile, is already modifying mortgage payments to no more than 31% of borrowers’ monthly income, as part of its November bailout from the federal government fast cash online.

"We anticipate that the modifications we are making will qualify under the Obama plan once the details are finalized," said Mark Rodgers, a Citigroup spokesman.

Servicers are encouraging borrowers to collect the financial information needed to determine eligibility.

"We’re also asking our customers to gather the necessary documents so that when our systems are up and running, we can begin quickly to help those who will likely qualify," said a Wells Fargo spokeswoman.

Determining eligibility

The administration’s new Web site helps homeowners determine whether they might qualify for either a loan modification or refinancing. It also provides links to finding government-approved housing counselors and warns people to avoid foreclosure rescue scams.

Borrowers can answer a set of questions to learn whether they could benefit from either the Obama modification or refinancing programs. The loan modification interactive tool, for instance, asks whether the borrower lives in the home, has a mortgage of less than $729,500 that was originated before Jan. 1 and is having trouble making payments.

The site also helps homeowners determine whether their monthly payments are more than 31% of their pre-tax income. And it gives an estimate of how low their new payment might go under the plan. For example, if you earn $4,000 a month and pay $1,400 a month, you could see your payments drop to $1,240 under the modification plan.

The refinancing tool, meanwhile, provides links to Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500) that let borrowers determine whether they have loans held by either mortgage finance company, a key eligibility criteria.

Borrowers will also find a checklist of financial documents — including pay stubs, tax returns and credit card statements — that they will need to present when applying for the program.

The administration estimates that its foreclosure prevention fix will help up to nine million homeowners.

"We want to encourage as many eligible borrowers as possible to take advantage of our program," said a senior administration official. "This site encourages borrowers to investigate if they are eligible for one or both programs." 

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The state’s non-farm payroll lost only 6,400 jobs last month, the Missouri Department of Economic Development reported Tuesday. From November through January the state averaged a monthly loss of 11,500 positions.

Even so, the department estimates that 250,000 Missourians were out of work in February. Over the past year, Kansas City (13,500 jobs lost) and St. Louis (31,500) have been hit the hardest.

The state said the bulk of the February job losses came in the business services and manufacturing sectors faxless payday loans. Construction, retail, health care and social assistance fared slightly better. Employers in private educational services, leisure, government and hospitality sectors were hiring.

— STEVE GIEGERICH

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St. Patrick's Day carries extra importance in Boston, Mass., the U.S. metropolitan area with the highest percentage of people who claim Irish ancestry.

Almost 19 percent of the people in Boston and its suburbs consider themselves to be of Irish descent, according to 2007 data from the U.S. Census Bureau.

Only eight other metros — including Buffalo — are at least 10 percent Irish. Buffalo ranks eighth nationally at 11.2 percent, with 126,660 residents of Erie and Niagara counties listing Irish as their primary ancestry.

Irish-Americans constitute the second-largest ancestral group in the United States. A total of 22.6 million Americans claim Irish as their primary ancestry, equaling 7.5 percent of the 2007 national population of 301.6 million.

German-Americans, at 11.8 percent, form the only ancestral group that is larger.

The Census Bureau has generated ancestry data for 46 metropolitan areas. They’re ranked below, based on the percentage of residents who listed Irish as their primary ancestral group in 2007:

• 1. Boston, 18.87 percent
• 2. Albany, 15.92 percent
• 3. Philadelphia, 14.60 percent
• 4. Providence, 12.23 percent
• 5. Bridgeport-Stamford, Conn., 11.69 percent
• 6. New Haven, Conn., 11.56 percent
• 7. Hartford, 11.45 percent
• 8. Buffalo, 11.23 percent
• 9. Pittsburgh, 10.74 percent
• 10. Rochester, N.Y., 9.86 percent
• 11. Kansas City, 9.66 percent
• 12. Tampa-St. Petersburg, 9.65 percent
• 13 free credit score online. Cleveland, 9.43 percent
• 14. Baltimore, 9.14 percent
• 15. Cincinnati, 9.05 percent
• 16. St. Louis, 8.73 percent
• 17. Indianapolis, 8.61 percent
• 18. Columbus, 8.59 percent
• 19. Jacksonville, 8.50 percent
• 20. Chicago, 8.19 percent
• 21. Nashville, 8.04 percent
• 22. Portland, Ore., 7.67 percent
• 23. New York City, 7.64 percent
• 24. Denver, 7.41 percent
• 25. Seattle, 7.41 percent
• 26. Minneapolis-St. Paul, 7.14 percent
• 27. Washington, 6.84 percent
• 28. Sacramento, 6.74 percent
• 29. Detroit, 6.70 percent
• 30. Richmond, 6.51 percent
• 31. Virginia Beach-Norfolk, 6.37 percent
• 32. Phoenix, 6.28 percent
• 33. Charlotte, 6.26 percent
• 34. Orlando, 6.22 percent
• 35. Austin, 6.02 percent
• 36. San Diego, 5.97 percent
• 37. Las Vegas, 5.87 percent
• 38. Milwaukee, 5.84 percent
• 39. Atlanta, 5.60 percent
• 40. Dallas-Fort Worth, 5.49 percent
• 41. San Francisco-Oakland, 5.42 percent
• 42. Riverside-San Bernardino, Calif., 4.53 percent
• 43. Houston, 4.20 percent
• 44. Miami-Fort Lauderdale, 3.93 percent
• 45. San Jose, 3.39 percent
• 46. Los Angeles, 3.27 percent

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Rather than being merely an unpleasant memory, your 2008 tax return should be the template for your 2009 financial game plan.

The return’s vital information about your situation can tell you line by line what you’ve done right and wrong. In one of the most trying economic periods in our nation’s history, repeating mistakes is asking for trouble.

"The purpose of looking at your 2008 tax return is to anticipate changes for 2009," said Molly Balunek, certified financial planner and vice president with Spero-Smith Investment Advisers in Beachwood, Ohio.

"For example, it is important that you ask yourself how your sources of income may change from 2008 to 2009 so that you can plan accordingly."
Here are some things to keep in mind.

— The drop in investment values should alter strategies: "In every economic season there is an opportunity, and the biggest one with these market declines is estate planning in terms of giving gifts," said Mackey McNeill, CPA and president of Mackey Advisors, Cincinnati. "You can transfer $12,000 per person annually free of gift tax, so if stock or real estate assets are severely depressed, you can give them away while they’re ‘on sale’ to your kids or your grandkids."

— It’s time to re-examine the relevance of your current investment mix: "Individuals who are out of work and without income, but who still have a mortgage and property taxes, should not be in tax-free investments," said Joel Isaacson, president of Joel Isaacson & Co. Inc. in New York. "They belong in taxable investments because if, for example, they have $20,000 of mortgage interest and $10,000 in real estate taxes, they can take in $30,000 of income free of tax."

— Declines in investments can be used to your advantage: "This may be a good time to harvest capital losses, since you can deduct up to $3,000 in realized losses against ordinary income and carry forward the remaining portion into future years," said Maureen McGetrick, tax partner with BDO Seidman LLC in New York. "You can also offset a gain."

Many investors aren’t aware they can offset capital gains against losses to the extent that they have them, not just by $3,000, said Mark Balasa, co-president of Balasa Dinverno Foltz LLC wealth management firm in Itasca, Ill.

"If you had portfolio losses carried over from your 2008 taxes, you can use them to offset gains and can still use an additional $3,000 against ordinary income," Balasa said. "So pay close attention to how your 2008 realized losses will be handled in 2009 guaranteed payday loans."

Whether you decide to take some losses also depends on your expectations for the future of tax rates.

McNeill says that if she "was a betting person," she’d bet tax rates are going to be higher in the future.

If you have an asset that has dropped in value, even though you have to pay tax on it, sell it now because this might be the least amount of tax you’re ever going to pay, she said.

— There could be other reasons to sell: With Procter & Gamble based in McNeill’s area, many of its shareholders live nearby. They loaded up their portfolios on Procter shares at low prices and never sold, fearing taxes on gains. Now that those shares are down, they can be sold with less tax consequences and proceeds deployed to other assets, McNeill said. That is an opportunity available to many investors holding too much of one firm’s shares.

In other instances it is better to hang tight, especially if you’re a retiree counting on the market’s reviving eventually.

"When the stock market is down by half, the last thing many people want to do is sell assets, so for 2009 Congress changed the rules for IRA distributions for folks 70

Chicago’s landmark Sears Tower, the tallest building in the Western Hemisphere, will be renamed Willis Tower after insurance broker Willis Group Holdings, the company announced Thursday.

"Willis Tower will make us a household name among our clients, prospective clients and in the larger business community," said Don Bailey, chairman and chief executive of Willis HRH, the company’s North American business.

The London, England-based company said it will rent 140,000 square feet of the building at a cost of $14.50 per square foot. The move, which involves 500 employees and consolidating five area offices, is expected to be completed by late summer.

"We found a great opportunity, a great deal, in the Sears Tower," Joseph Plumeri, chairman and chief executive of the Willis Group, told CNN.

Willis Group Holdings (WSH) provides insurance, risk management, financial and human resource consulting to corporations and public institutions around the world.

"This key new tenant underscores the importance of the building as a destination for successful businesses," said John Huston, of American Landmark Properties, Ltd., one of the investors that owns the tower, in a written statement.

Rita Athas, executive director of World Business Chicago, a not-for-profit economic development corporation, said the move demonstrates the Willis Group’s commitment to the city and could boost the labor market there bad credit payday advance.

"Their decision speaks to the quality of Chicago’s workforce, and our vibrant and supportive business community," Athas said in a written statement.

While the company expects to rechristen the building sometime this summer, it’s not clear whether the new name will stick with native Chicagoans.

"The Sears Tower has been an icon here for the last quarter of a century," said John Russick, senior curator at the Chicago Historical Society. "For the generation that grew up calling it the Sears Tower, it’ll be hard for people to shift and start calling it something else," he said.

Indeed, many long-time Chicago residents still refer to the Standard Oil Building, now know as the Aon Center, as "Big Stan" Russick said. That building’s name has been changed twice since it was built in 1973.

The Sears Tower was opened in 1973 and is 1,729 feet tall, including its antenna. It was originally named for retailer Sears, Roebuck & Co., which moved its headquarters to Hoffman Estates, Ill. in 1992.

–CNN’s Rachael Shackelford contributed to this report.  

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A St. Louis-based company that makes stem cell research products could benefit from President Barack Obama’s decision this week to broaden what stem cells qualify for federal funding.

Fine chemicals maker Sigma-Aldrich Corp. develops and sells general scientific kits that can be used by researchers and about 580 products specifically for stem cell research.

These products are a small portion of Sigma-Aldrich’s overall business. But the company is strengthening marketing efforts as stem cell research expands.

Obama signed an executive order Monday to lift federal funding restrictions on certain types of human embryonic stem cells. The action reversed a 2001 policy by President George W. Bush. Bush allowed federal funding only for human embryonic stem cells created before August 9, 2001.

The policy change doesn’t necessarily mean any extra federal research money. But it does expand the scope of funding.

The research opportunities look promising. Embryonic stem cells created after 2001, which now will qualify for federal funds, have been produced with better technology and can better meet what’s needed to treat human diseases, said Dr. Mary Ellen McAsey, an associate professor at Southern Illinois University School of Medicine in Springfield. She received part of a $1.1 million grant from the Illinois Regenerative Medicine Institute for research using adult stem cells.

Dr. David Smoller, president of the Sigma-Aldrich’s Research Biotech business unit, said it was difficult to quantify how much the company would benefit from the expanded federal guidelines.

An increase in orders could happen if scientists need more research products and tool kits as they continue their stem cell studies with federal money easy payday loans.

The company is well-positioned to take advantage of this potential increase, but it would have only a small effect on overall earnings, said Daniel Ortwerth, a materials analyst for Edward Jones in Des Peres who tracks the company.

Sigma-Aldrich is "very deliberately a well-diversified company," Ortwerth said, so any one product carries little impact.

Smoller sees a stronger potential boost from the stimulus package, which includes more than $10 billion in additional funding for the National Institutes of Health.

"I think life science companies will benefit for sure," Smoller said.

The stimulus package specifies some NIH money for induced pluripotent stem cells, which are adult cells reprogrammed to mimic human embryonic cells, said Dr. John Kessler, director of Northwestern University’s Stem Cell Institute. So an increase in some stem cell research funding is on the way.

That could trickle down to more orders for Sigma-Aldrich.

To market its product portfolio, the company announced Wednesday that it had launched a one-stop shop online for researchers to quickly find and order stem cell research products. The launching and Obama’s action are "total coincidence," Smoller said.

atablac@post-dispatch.com | 314-340-8140

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Bernard Madoff’s defense attorney Ira Lee Sorkin tells CNN he has received death threats and virulently anti-Semitic hate mail.

One e-mail Sorkin received last week states, "I deeply regret that the Sorkin family did not perish in the Nazi death camps." The sender wrote "As one Jew to another." CNN sent an email to the originating electronic address but received no reply.

Other e-mails to Sorkin call the defense attorney a "No good f……ing bastard Jew" and ask why he is representing a thief and someone who should rot in hell.

"These people need to take Civics 101," Sorkin told CNN. "It is extremely disappointing that people who should know better have no understanding of the role defense lawyers play in preserving our system of justice."

The senders display a "lack of understanding of the constitution and bill of rights and how it applies to everyone," Sorkin added. "As for the remarks I can only have sympathy for these people who treat this representation as some religious quest."

Sorkin, a lawyer with the firm Dickstein Shapiro is among New York’s high-profile defense attorneys specializing in securities law. He is a former chief of the Securities and Exchange Commission’s New York office.

Madoff is charged with operating a massive investment fraud in which he allegedly used new funds from investors to pay redemptions to other investors, a so-called Ponzi Scheme that may have cost clients $50 billion by Madoff’s estimate instant payday loan.

At a hearing scheduled for Thursday at U.S. District Court in Manhattan, Madoff is expected to plead guilty. The criminal complaint charges him with one count of securities fraud, which carries a maximum term of 20-years in prison. Sorkin would not comment on Madoff’s plans for Thursday, saying only, "You’ll hear it in court."

Madoff and Sorkin are also scheduled to appear in court Tuesday afternoon for a hearing involving a potential conflict of interest for the defense attorney.

Sorkin told the Government he invested $18,860 with Madoff in the early 1990s through a retirement account that had been set up with his former law firm that was later transferred to another brokerage firm in 1995. Also, Sorkin’s late father held an account with Madoff, the proceeds of which were eventually distributed to trust accounts for Sorkin’s two sons.

Sorkin also has represented a Florida accounting firm, Avellino & Bienes, which invested with Madoff. Madoff is expected to waive the potential conflicts and tell the Court he is satisfied Sorkin is appropriately representing his interests. 

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