Actual finance blog

For the second week in a row, the Chinese aren’t coming.

China Cargo has canceled its scheduled Monday freight flight to Lambert-St. Louis International Airport, airport officials said Friday, a move that raises serious concerns about the viability of Lambert’s fledgling cargo hub project.

Last month the airline landed its first Shanghai-to-St. Louis cargo flight to great fanfare, then ran a second on Oct. 19. But now it has canceled the regularly scheduled Monday flight for the second consecutive week.

Lambert officials said they have not been told exactly why, but suspect there are two reasons: one local, one global.

Both cancellations have come since the collapse of the so-called Aerotropolis tax credits, a $60 million program to subsidize air exports from Missouri. It was intended to make cargo flights from Lambert cheaper than from competing cargo hubs like Chicago-O’Hare, but it died in the Legislature last week.

“We believe there is some correlation” between the tax credit demise and the canceled flights, said airport director Rhonda Hamm-Niebruegge.

But perhaps a bigger factor is the global economy.

Demand for air cargo has been weaker than expected this year, and while there’s typically a fall rush ahead of the holidays, this fall it isn’t panning out. International freight flown by Asian-based carriers was down 6.5 percent in September compared with last year, according to the Association of Asia Pacific Airlines quick payday loan. And Chinese aviation officials this week slashed their cargo forecast for the rest of 2011.

“It’s not isolated to St. Louis,” Hamm-Niebruegge said. “The air cargo market out of China is softer than expected and the impact is being felt across the world.”

Still, the timing is tough for St. Louis.

Lambert and local business leaders have been talking with the Chinese for four years and call the hub project a potential game-changer for the region’s economy. They had hoped to start with three flights a week but said they would build from one after the Aerotropolis bill fell apart. Meanwhile, Gov. Jay Nixon spent the week in China on a long-planned trade trip and was set to meet with aviation officials there.

It’s unclear how that meeting went. Nixon canceled a conference call Wednesday with reporters because of scheduling conflicts, and his spokesman hasn’t answered questions about the aviation meeting.

Nor is it clear what happens next. China Cargo has a two-year lease on a building and ramp space at Lambert, at a cost of $14,549 a month, but that doesn’t mean they have to fly planes. As of Friday, Lambert had gotten no word on when the next flight would land.

“It’s going to be a week-to-week thing at this point,” said airport spokesman Jeff Lea.

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The threat that floodwaters will inundate Thailand’s capital could ease by early November as record-high levels in the river carrying torrents of water downstream from the country’s north begin to decline, authorities said Sunday.

Bangkok’s immediate prospects remain uncertain, however, as the front lines in battling the flood from north, east and west of the city draw closer daily.

The relatively rosy longer term projection from the Flood Relief Operations Center came just a day after reports that Bangkok’s main Chao Phraya river was overflowing its banks and at its highest levels in seven years.

People should not be too concerned because the spillover could be drained, said the center’s chief, Justice Minister Pracha Promnok, in a televised news conference. He also said water in an overflowing main canal in Bangkok was receding, and drainage efforts east and west of the city were working well.

The situation was dire in many respects in the capital’s northern outskirts and Thailand’s central provinces, which suffered the worst of the flooding after heavy monsoon rains since July.

Off a highway heading north of the city, Associated Press reporters found people scrambling for safety in flooded streets.

The Thai military used boats to help rescue stranded residents near a domestic airport in northern outer Bangkok that has been the flood-operations headquarters and a shelter for evacuees.

Mothers walked in hip-high water with children strapped to their backs, while other people waded through the murky water holding belongings in plastic bags atop their heads.

There are concerns the Don Muang airport itself may be vulnerable, and the European Union canceled an aid-handover ceremony scheduled there Monday due to “unforeseen circumstances.”

In Nonthaburi province, just north of Bangkok, a 7-foot (2-meter) crocodile was captured while resting on dry land outside a restaurant, presumably after pulling itself out of the surrounding floodwaters. Thai television showed the beast, which had reportedly escaped from a farm, with its snout taped shut and its scaly body covering most of a boat that was carrying it away.

An Associated Press photographer saw two crocodiles that had been killed in Nonthaburi, and unconfirmed recent reports have claimed up to 100 crocodiles may have escaped from farms in the region.

Prime Minister Yingluck Shinawatra has said the waters may take up to six weeks to recede to manageable proportions around Bangkok payday loans guaranteed no fax. The government has cautioned that rumors have been quick to circulate and people should check all information, advice that follows strong criticism of the government for missteps and confusion since the crisis began.

Residents of Bangkok and its suburbs have settled into a routine of waiting and worrying.

Many are hoarding supplies, and supermarket shelves have emptied faster than they can be restocked. Bottled water, batteries and canned food were among the first items to go.

At a supermarket in central Bangkok’s business district _ which is not under immediate threat _ sandbags lined both entrances Sunday, forcing shoppers to step over to go inside. Many of the shelves were bare, with the handful of shoppers inside grabbing the few snacks that were left. Cat food and toilet paper were gone.

While larger stores in Bangkok have kept their prices fixed, smaller merchants were raising theirs in the flooded zones north of the city. A Rangsit resident, Taweetit Hongsang, complained that the price of a papaya, 10 baht (33 cents) a week ago, had shot up to 30 baht ($1).

The desperate battle to route the water away from the city has led to several conflicts in which people have used force to try to protect their own neighborhoods by removing flood barriers.

Bangkok Governor Sukhumbhand Paribatra said Sunday one crew of city workers was unable to carry out reinforcement of one barrier because of “a group of people opposing the mission and harassing” them. He said it was necessary to withdraw them “since they are not trained to deal with unruly and armed outsiders.”

In evident response, Prime Minister Yingluck Shinawatra said she had delegated high-ranking police officers to protect workers carrying out anti-flood duties.

The flooding that began in August has killed 356 people in Thailand and the $6 billion cost estimate could double if Bangkok is badly hit.

The flooding is the worst to hit Thailand since 1942 and is proving a major test for Yingluck’s nascent government, which took power in July after heated elections and has come under fire for not acting quickly or decisively enough to prevent major towns north of the capital from being ravaged by floodwaters.

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China has given the go-ahead for several local authorities to sell bonds as it moves to bridge financing shortfalls and prevent debt defaults by overextended provinces.

The Ministry of Finance said in a notice Thursday that Shanghai, Zhejiang and Guangdong provinces and Shenzhen, a special economic zone bordering Hong Kong, would be allowed to issue three-year and five-year bonds on a trial basis, subject to quotas.

China normally prohibits local governments from issuing bonds directly or from taking bank loans, confining such bonds to those issued by the central government on their behalf.

Local governments owe about 10.7 trillion yuan ($1.7 trillion) in debt through financing vehicles set up to support construction projects. Issuing bonds would help them to honor those obligations.

Instructions outlined by the ministry suggests plans for strict central government oversight of the program.

Bond quotas set for one year cannot be carried over to another, it says.

Funds raised by local government bond sales will be kept in a special account of the finance ministry which will oversee payment of interest and principal.

The ministry said the local governments also should provide timely information to the public regarding local economic and financial conditions.

With highway and railway projects running short of cash, Zhejiang province, west of Shanghai, plans to issue 8 billion yuan ($1.3 billion) worth of bonds to fund infrastructure projects this year, the official Xinhua News Agency reported earlier.

It characterized the plan as the beginning of a shift in how local government projects are financed.

Much of the money is also expected to be earmarked for so-called “affordable housing” projects.

Cities have been ordered to speed up construction of such housing, but many already debt-encumbered localities reportedly lack the financial wherewithal to follow through.

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Asian stock markets advanced Monday, bolstered by improved U.S. retail sales and Europe’s renewed efforts to contain its debt crisis.

Japan’s Nikkei 225 stock average rose 1.5 percent to 8,881.42, hitting a six-week intraday high at one point.

Hong Kong’s Hang Seng jumped 1.7 percent to 18,824.07, South Korea’s Kospi was up 1.2 percent at 18,824.07 and Australia’s S&P/ASX 200 climbed 1.8 percent to 4,282.30.

Sentiment brightened after stronger retail sales data in the U.S., leading to gains on Wall Street before the weekend. The Dow Jones Industrials rose 1.4 percent to close at 11,644.49 on Friday.

Retail sales, which are a key barometer of consumer spending, recorded the biggest gain in seven months in September and double what economists were expecting. The data added to signs that the world’s biggest economy may avoid another recession.

Worries about Europe’s debt problems also eased following a meeting of Group of 20 finance chiefs over the weekend in Paris.

The group opened the door for the International Monetary Fund to play a bigger role in fighting the escalating debt troubles among countries that use the euro common currency. It also said eurozone ministers will “decisively address the current challenges through a comprehensive plan” to be unveiled on Oct paydayloans. 23.

In currencies, the dollar edged up to 77.24 yen from 77.22 late Friday. The euro fell to $1.3851 from $1.3875.

With the dollar holding above the 77-yen line, investors sent Japanese exporters higher. Sony Corp. surged 4.6 percent, while Toyota Motor Corp. 2.4 percent.

Missing out on the rally was camera and precision instruments maker Olympus Corp., which plunged after firing its British CEO on Friday after just six months.

The issue tumbled more than 22 percent, following a double-digit slide before the weekend. Several ratings agencies issued downgrades, while media reports said Michael Woodford was dismissed after questioning Olympus executives about improper corporate governance and several acquisitions before he arrived.

Benchmark oil for November delivery was up 35 cents at $87.15 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $2.57 to settle at $86.80 in New York on Friday.

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Several thousand Occupy Wall Street protesters have marched to New York City’s Washington Square Park for a peaceful general assembly.

Demonstrators marched Saturday from Manhattan’s Zuccotti Park, the group’s unofficial headquarters where protesters have been camped out for the last 22 days. The trek was peaceful and orderly.

On Wednesday, dozens were arrested when thousands marched on Wall Street in their biggest show of support yet. Last Saturday, 700 people were arrested after they spilled onto the roadway while crossing the Brooklyn Bridge.

Protesters are speaking out against corporate greed and the gap between the rich and poor. They say they have no leaders and are making decisions by consensus.

Supporters have donated food, clothing and medical supplies. Some drop off their offerings, while others have mailed them.

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Lawyers say interior designer Kelly Hoppen has accepted 60,000 pounds ($93,000) in damages for phone hacking from the publisher of the News of the World.

Hoppen, former stepmother of actress Sienna Miller, is one of scores of people accusing the tabloid of eavesdropping on cell phone voicemails. Her case was due to go to court in January.

Her lawyer, Mark Thomson, told a hearing Friday that the paper’s publisher had agreed to pay Hoppen damages and legal costs low fee payday loans.

He said that between 2004 and 2006, Hoppen was the subject of numerous articles in the paper “which contained intrusive and private information.”

More than 60 people have filed court papers alleging their phones were hacked by the News of the World, which was shut down by owner Rupert Murdoch in July.

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The St. Louis region is not only getting its second Nordstrom department store this week — it will also soon have a second Nordstrom Rack.

A 35,000 square foot Nordstrom Rack, the retailer’s smaller off-price store, is scheduled to open in fall 2012 in Manchester. The store will be located on Manchester Road next to a Weekends Only Furniture Outlet. It is just east of the Manchester Highlands where there is a Costco, Walmart, Best Buy and more.

It will be about three miles from West County Center, where Nordstrom opened its first full-line department store in the region back in 2002.

On Friday, Nordstrom will open its second full-line department store at the St. Louis Galleria, just down the street from the Nordstrom Rack it opened last year.

“We find that our Racks do well when they’re located near full-line department stores,” said Brooke White, a Nordstrom spokeswoman. “That’s something that’s worked well for us.”

So I guess this must mean that the first Rack here has done well?

“Yes, we’re happy with our business at our store in Brentwood,” White said. “That’s really what helps us decide that we should move ahead.”

Nordstrom announced the new location in St. Louis today after the Post-Dispatch inquired about it on Monday.

Construction of the store is to begin immediately, according to Pace Properties, which will develop and own the building.

Nordstrom has been on a expansion boom with its Rack stores in recent years, especially as customers have gravitated toward more discount offerings in this economy. It opened about 17 Rack stores last year and plans to open 18 this year. The Manchester store is one of six stores planned for next year, White said.

Nordstrom Rack carries merchandise that is 50 to 60 percent off Nordstrom department store prices. About 20 percent of it comes from full-line Nordstrom stores. The rest is specially-purchased from the same brands, but will often be the previous year’s designs and will often have fewer bells and whistles.

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LONDON — World stocks and the euro fell sharply on Monday as investors feared a messy Greek default within weeks unless Athens implements the austerity measures demanded by its international lenders.

International lenders told Greece on Monday that it must shrink its public sector and improve tax collection to secure a vital 8 billion euro rescue payment next month.

After a rare four-day rally in world stocks last week, markets fear the crisis is worsening again after Greece’s prime minister cancelled a U.S. trip to chair an emergency cabinet meeting at home and German Chancellor Angela Merkel suffered a regional election loss.

EU finance ministers also failed to make progress on the debt crisis at the weekend, and the focus is now shifting to a conference call between Greece and its international lenders at 1600 GMT to see how Greece plans to make up its budget shortfall and avoid a disorderly default.

With the gloom so widespread, investors took little comfort from expectations that the Federal Reserve would introduce new measures to stimulate the U.S. economy later this week.

“It’s no more a link between markets and economics, but a link between markets and politics. The politicians should have seen the crisis coming and done more, but the problem is they are not proactive,” said Koen De Leus, strategist at KBC Securities, in Brussels.

“We are just going from one crisis to another. It’s a nightmare for the markets.”

The MSCI world equity index fell 1.1 per cent on the day, after posting its biggest weekly gain since early July last week in buying largely driven by short-term players.

Long-term asset managers have been either staying on the sidelines, or steadily cutting back on exposure to risky assets. The MSCI index is around 5 per cent above its one-year low hit earlier in September.

European stocks lost nearly 2 per cent, led by sharp losses on the banking sector, while emerging stocks dropped nearly 2.2 per cent. U.S. stock futures pointed to a weaker open on Wall Street later.

The euro fell more than 1 per cent to $1.3632.

POLICY RISKS

Events this week promise a heavy dose of policy action.

Finance ministers of the BRIC emerging economies — Brazil, Russia, India and China — meet later this week to discuss steps to offer support to the euro zone.

Market sentiment may change if they buy euro-denominated bonds, as suggested in preliminary talks, after the European Central Bank’s 70 billion euro bond-buying spree over the last five weeks or so failed to stop the crisis from spreading to Spain and Italy.

Investors will also be watching U.S. President Barack Obama’s deficit-reduction plan on Monday aimed at covering the cost of his recent jobs bill.

U.S. crude oil was down 1.4 per cent to $86.76 a barrel.

Bund futures rose 78 ticks.

The dollar gained 0.7 per cent against a basket of major currencies, supported by expectations that new Fed measures would be focused on the maturities of the debt it buys rather than on expanding its already swollen balance sheet.

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President Barack Obama is keeping up his appeal for public support of his $447 billion proposal to boost jobs and consumer spending by urging Americans to press Congress to pass the legislation. “No more division or delay,” he said.

In his weekly radio and Internet address Saturday, he focused on a message that has become central to a presidency struggling to address stubbornly high unemployment numbers and dipping approval of his handling of the economy.

The president announced his jobs legislation to a joint session of Congress last week and has since gone outside Washington to build a case for its passage. He has been to Virginia, Ohio and North Carolina.

“The No. 1 issue for the people I meet is how we can get back to a place where we’re creating good, middle-class jobs that pay well and offer some security,” he said.

His address Saturday came in the face of sobering public opinion ratings for the president.

A New York Times/CBS News poll released Friday showed nearly half of those surveyed worried the economy was headed for another recession and nearly three out of four said they believe the country is on the wrong track.

Obama’s proposal would reduce payroll taxes on workers, cut them in half for most businesses and offer incentives for employers to hire. It would spend tens of billions of dollars on new public works projects, extend unemployment benefits for long-term jobless and help states and localities avoid layoffs of teachers and emergency workers.

On Monday, Obama plans to spell out a long-term debt stabilizing plan that aims to cut the deficit by about $2 trillion over 10 years. Obama is making his proposal to a special congressional committee that has been charged with lowering deficit by $1.2 trillion to $1.5 trillion.

“But right now, we’ve got to get Congress to pass this jobs bill,” Obama said.

Obama’s jobs plan has received a tepid reception from Republicans, who are willing to consider some of his tax relief proposals, but not his spending plans. His proposal to pay for the plan with limits on tax deductions and closing corporate tax loopholes is facing stiff GOP resistance and even Democrats have pushed back on some of those provisions in the past.

In an interview with MSNBC that aired Saturday, House Minority Leader Nancy Pelosi, D-Calif., said simply approving tax cuts without including spending on public works and local and state government assistance would not do enough to spur the economy.

“To take one piece or another, it doesn’t create the dynamism we need,” she said.

Still, despite his demand for quick passage, Obama is not likely to get immediate action even in the Democratic-led Senate, where Majority Leader Harry Reid has said there are some other issues that need to be dealt with first, including transportation money.

In the Republican address, Rep. Peter Roskam of Illinois called on Obama to reduce regulations on businesses, saying government agency rules were choking off hiring. “Washington has become a red tape factory,” he said.

He acknowledged Obama’s decision to scrub a clean-air regulation that aimed to reduce health-threatening smog. “He can cancel more,” Roskam said.

He pressed Obama to push the Democratic-controlled Senate to adopt House Republican initiatives, including legislation that would give Congress veto power over certain high-cost regulations.

“Job creators should be able to focus on their work - not on Washington’s busy-work,” he said.

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Ameren Missouri Vice President Mark C. Birk went to considerable lengths in a Post-Dispatch guest column last week to explain why the utility’s leaking coal ash pond at the Labadie power plant doesn’t pose a risk to groundwater — an argument that members of the Labadie Environmental Organization still don’t accept.

So it was surprising to see on Ameren’s website Wednesday afternoon a statement that the utility planned to place monitoring wells around all of its Missouri coal ash ponds.

Specifically, Ameren’s website said:

We have also volunteered to implement the Utility Solid Waste Activities Group’s (USWAG) Action Plan. USWAG is a consortium of more than 80 utility operating companies that generate more than 70% of the electricity used in the United States. Compliance with the USWAG Action Plan will result in the placement of monitoring wells around our Missouri ash ponds and other surface impoundments.

The mention of a groundwater monitoring plan (you can see a cached version of the web page on the left) prompted several questions, such as: When would monitoring wells be installed? When did Ameren commit to the USWAG plan? How often would sampling be done? What pollutants would be tested for?

On Thursday, after a Post-Dispatch inquiry, the company deleted the paragraph. Utility spokeswoman Rita Holmes-Bobo explained that the web page was out of date payday loan companies. Ameren has no plans to monitor groundwater at existing Labadie ash ponds.

Holmes-Bobo said that Ameren put the monitoring plan on hold when the Environmental Protection Agency began developing rules for coal ash disposal.

Mike Menne, an Ameren vice president, told the Post-Dispatch last month that the utility was part of an industry group, presumably USWAG, that was working with the EPA to voluntarily implement groundwater monitoring before the 2008 Kingston, Tenn., ash spill.

It was that disaster that renewed the debate over coal waste and prompted the EPA to propose the first national rules for coal ash disposal. Two coal ash disposal rules were issued in May 2010, but implementation of a final rule has been delayed.

Meanwhile, the utility does plan to fix the leaks, or “seeps,” as it calls them.

And discussion over a proposed coal waste landfill at Labadie continues. A draft of proposed land use regulations to accommodate utility waste landfills was supposed to be complete by July 19. But the Franklin County counselor went on medical leave for a month before the draft was complete. There’s no word yet on when the draft will be complete.

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