Actual finance blog

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 Utility spokeswoman Rita Holmes-Bobo explained that the web page was out of date payday loan companies.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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The United Auto Workers union extended its contracts with General Motors Co. and Chrysler Group LLC early Thursday after failing to meet a deadline to reach a new agreement.

GM broke off talks after midnight and said they would resume at 8 a.m. EDT Thursday. Chrysler didn’t say when its talks would resume.

The decision has little impact on the 71,000 U.S. factory workers covered by the GM and Chrysler contracts. In the past, workers might have gone on strike if the UAW hadn’t extended their contracts. But as part of their 2009 government bailouts, GM and Chrysler workers had to agree not to strike over wages.

“We should continue to do the things we do until we receive official notification otherwise,” a UAW local official at a GM factory in Lordstown, Ohio, wrote Wednesday in a message posted on the local’s website.

The UAW extended its contract with Ford Motor Co. last week, as talks have progressed more slowly with that automaker. The Ford contract covers around 40,000 workers.

Up until the deadline, the negotiations that began over the summer appeared to be proceeding without the acrimony that plagued them in the past. But just before the 11:59 p.m. EDT Wednesday deadline, the CEO of Chrysler fired off a letter to UAW President Bob King saying an agreement likely wouldn’t be reached because King didn’t come to the table Wednesday night to finish the deal.

“I know we are the smallest of the three automakers here in Detroit, but that does not make us less relevant,” Chrysler CEO Sergio Marchionne said in the letter, which was obtained by The Associated Press.

Marchionne said he planned to travel out of the country for business and will return next week. He said he would agree to a weeklong extension of Chrysler workers’ current contract. The UAW didn’t set a new deadline to reach agreements.

UAW President Bob King wouldn’t comment on Marchionne’s letter when he was reached by phone early Thursday.

The UAW extended its contract with Ford Motor Co. last week, as talks have progressed more slowly with that automaker.

Marchionne said he and King met a week ago and agreed to finish work on the new contract before the deadline. He said not meeting the deadline hurts Chrysler’s workers.

“You and I failed them today,” he wrote. “We did not accomplish what leaders who have been tasked with the turning of a new page for this industry should have done.”

Things appeared to be progressing more smoothly at GM. Joe Ashton, the UAW’s vice president in charge of the GM negotiations, told local union officials Tuesday night in a note that bargainers have made “much progress” in talks with the company. GM has taken the lead on the negotiations and its agreement may be used to set the pattern for the other two companies.

The contract talks will determine wages and benefits for 111,000 union workers at the auto makers, and they also set the bar for wages at auto parts companies, U.S. factories run by foreign automakers and other manufacturers, which employ hundreds of thousands more. The contract talks are the first since GM and Chrysler needed government aid to make it through bankruptcy protection in 2009.

GM nearly ran out of cash and needed $49.5 billion from the government to survive, but it’s been making billions in the last two years because its debt and costs were lowered in bankruptcy and its new products have been selling well.

Ashton wrote that “difficult restrictions” have been placed on the union and company as a result of the bailout. To get the government funding, the union had to agree not to strike over wages at GM and Chrysler. Also, unresolved issues can be taken to binding arbitration, and the union’s new contracts must keep the companies’ labor costs competitive with Asian automakers such as Toyota Motor Corp. and Honda Motor Co.

“As you know, several difficult conditions were agreed to in order to obtain financing during the bankruptcy,” Ashton wrote in the note to local union officials. “We are confident that we can reach an agreement that will meet many of the goals we set at the beginning of negotiations.”

The union has been seeking bigger profit-sharing checks instead of pay raises, higher pay for entry level workers who make $14 to $16 per hour, signing bonuses and guarantees of new jobs as auto sales recover. Ford and GM want to cut their labor costs to get them closer to Honda and Toyota, while Chrysler wants to hold its costs steady. Health care costs are also an issue.

Once the contract agreements are reached, workers will vote on them.

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Egypt’s benchmark stock index fell slightly on Sunday, weighed down by investor unease after the storming of Israel’s embassy and protests in Cairo over the weekend. Inflation, meanwhile, eased in August to 8.5 percent on a slower increase in food prices.

The Egyptian Exchange’s EGX30 index closed almost 1.2 weaker, at 4,698 points the first day of the trading week. The index’s year-to-date losses are at about 34 percent.

“To be honest, we were expecting a lot worse than this _ maybe a fall of 3 to 4 percent,” said Khaled Naga, a senior broker with Mega Investments. “Even so, I’m not recommending anyone buy at this time. … There could still be a lot of problems cropping up this week.”

But in a measure of good news, the government’s statistical arm announced Saturday that annual urban inflation had dropped to 8.5 percent in August, from 10.4 percent in July. The decline came as food inflation, which accounts for over 40 percent of the consumer price index, increased at a slower pace in the month _ 12.2 percent compared with 16.7 percent the prior month.

Food inflation, in particular, was seen as one of the factors that fueled Egyptians’ frustrations ahead of the Jan. 25 revolution, and a decline in that key figure could help ease some of the economic pressure the country’s more than 80 million citizens feel daily.

In addition, Suez Canal revenues, a key source of foreign income for the government, climbed to $472.9 million in August, gaining 7.9 percent on the same month in 2010 and hitting a roughly three-year high, government figures showed.

Analysts warned that Egypt still faced major pressures in trying to retrench and rebuild its economy, which recorded GDP growth of 1.8 percent in the 2010-2011 fiscal year. Before the Jan. 25 uprising, economic growth had been projected at nearly 6 percent.

London-based Capital Economics, which is forecasting that GDP will contract by 1 percent in the current fiscal year, said in a recent research note that given the current global economic climate, “it is too early to expect a rapid recovery.”

In a reflection of the difficulty Egyptian officials have faced, the country’s net international reserves have slipped to slightly more than $25 billion, roughly $11 billion below their December 2010 levels. The slide, in part, is linked to efforts to support the Egyptian currency.

The storming of the Israeli Embassy over the weekend was the most serious challenge to relations between the two countries since the signing of their peace treaty in 1979. An angry mob, for hours, laid siege to the embassy, trapping six Israeli guards in a safe room before they were rescued by Egyptian commandoes.

The incident at the Israeli Embassy spoke not only to the anger over the shooting death of six Egyptian soldiers along the country’s border with Israel last month, but also the hostility toward the Jewish state many feel in the country despite the peace agreement. The soldiers were killed as Israeli troops pursued militants who had launched an attack inside Israel that killed eight Israelis.

It also reflected the pressures and challenges confronting Egypt’s military rulers, who are balancing often opposing ends of placating an irate Egyptian populace after Mubarak’s ouster and pushing the country toward an elected civilian leadership.

The 18-day uprising that began in late January opened the floodgates to decades of pent up resentment over a widening income disparity, shoddy salaries, poor social and educational systems and the general sense in the Arab world’s most populous country that opportunities were something that came through nepotism and cronyism versus skills and perseverance.

The continuing mass protests have battered Egypt’s economy, undercutting vital tourism revenue and crimping foreign direct investment.

In a reversal of an earlier decision that would likely have done little to spur tourism, the government froze a ruling requiring tourists and other visitors to apply for visas before arrival in the country, the official MENA news agency reported, citing the deputy tourism minister.

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Congress has given the U.S. patent system its first major overhaul since the age of the transistor radio by passing legislation designed to spur innovation and provide a sorely needed boost to the job market.

Senate passage Thursday of the America Invents Act, which sends it to President Barack Obama for his signature, is the first significant change in patent law since 1952. It took years to accomplish, with the final vote coming a little more than an hour before Obama appeared before a joint session of Congress to pitch his plan for promoting jobs growth.

“Today you passed reform that will speed up the outdated patent process so that entrepreneurs can turn a new idea into a new business as quickly as possible,” Obama said in his speech. “That’s the kind of action we need.”

The vote was 89-9, a rare example recently of Democrats and Republicans, and the House and Senate, working together for a common cause. Despite the emphasis from both parties this year on finding work for the unemployed, political divisions have resulted in almost no concrete jobs legislation.

The bill, said Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., “is an opportunity to show the American people that Democrats and Republicans can come together to enact meaningful legislation for the American people.”

Leahy’s partner on the bill, House Judiciary Committee Chairman Lamar Smith, R-Texas, said it was the most important change to patent law since the Patent Act of 1836 and hailed it as “one of the most significant jobs creation bills enacted by Congress this year.”

The legislation is aimed at streamlining the patent process, reducing costly legal battles and giving the U.S. Patent and Trademark Office the money it needs to process patent applications in a timely fashion.

It wasn’t easy. Congress has debated a patent bill every year over the past six years and, before final passage, the Senate had to defeat three proposed amendments that would have forced the bill to return to the House, with increased prospects of another deadlock. The Senate was voting on a version already passed by the House.

The measure would switch the United States from the “first-to-invent” system to the “first-inventor-to-file” system for patent applications. That change would put the U.S. in line with other industrialized countries.

The proposal has met resistance from some small-scale and independent inventors who say it will put them at a disadvantage with big corporations. Their concerns were voiced by Sen. Maria Cantwell, D-Wash., who said, “This is not a patent reform bill. This is a big corporation patent giveaway that tramples on the rights of small inventors.”

Supporters say it will add certainty to a system now riddled by costly lawsuits. With rivals having to rely on their own secret documents to prove they were the first inventor, it becomes difficult to “gain a clear picture of whether a patent is valid without years of litigation” and millions of dollars of discovery and other legal costs, said Sen. Jon Kyl, R-Ariz.

The bill ensures that the patent office has the money to expedite the application process. It now takes an average of three years to get a patent approved. The agency has a backlog of 1.2 million pending patents. More than 700,000 have yet to be reviewed.

Since 1992, the agency has lost nearly $1 billion because what it receives from Congress is less than what it collects in fees.

The bill gives assurance the agency will have access to more money but maintains congressional controls. Senators defeated an amendment by Sen. Tom Coburn, R-Okla., that would have given the agency more leeway to set fees and keep all the fees it collects.

The legislation also takes steps to reduce harassing litigation, and improve patent quality by enabling third parties to submit information that may be relevant to the granting of a patent.

It encourages U.S. manufacturing by allowing producers to continue to use a manufacturing process in this country even if another inventor later patents the idea.

While small-scale inventors are divided on the legislation, it has the backing of associations representing corporations such as Caterpillar Inc. and General Electric, as well as high-tech companies including Apple and Google, along with the U.S. Chamber of Commerce and the Association of American Universities.

IBM Senior Vice President Robert C. Weber, in a statement, praised “our elected officials for producing a bipartisan, common-sense bill that will significantly improve the U.S. patent system.”

IBM has been the top U.S. patent recipient for the past 18 years.

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World Bank President Robert Zoellick says the U.S. economy will likely limp along with slow growth and high unemployment but avoid a recession.

Zoellick told reporters Tuesday in Singapore that Europe’s debt crisis threatens to undermine the confidence of consumers and investors.

Zoellick said the challenges facing Europe are more “imminent” than those in the U.S.

He said European countries may need to deepen fiscal integration _ implying governments should sacrifice some control over their budgets so spending policies can be coordinated among countries using the euro.

Singapore Finance Minister Tharman Shanmugaratnam told reporters that weak economic growth in the U.S. and Europe was making them “extremely vulnerable to each new shock.”

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Japan’s new prime minister chose fresh faces and political unifiers for his Cabinet Friday, promising to steer the troubled nation through disaster recovery, a nuclear crisis and a lengthy economic slump.

Yoshihiko Noda tapped relatively unknown lawmakers as part of his 18-member Cabinet, including 49-year-old Jun Azumi as finance minister and 47-year-old Koichiro Gemba as foreign minister.

Both are young in a Japanese political world normally dominated by elder statesmen. And both are closely allied with Noda, who, at 54, is the third youngest prime minister in post-World War II Japan.

“They will work like loaches mired in mud and sweating to get the job done,” Chief Cabinet Secretary Osamu Fujimura, another Noda ally, said when announcing the lineup. Loaches, a type of bottom-dwelling, eel-like fish, have become a bit of an odd buzzword after Noda described himself as one in what has largely been interpreted as a self-deprecating remark.

Noda’s effectiveness will in large part depend on whether he can contain intraparty bickering that has increasingly plagued the ruling Democrats. In a nod to rival faction leader Ichiro Ozawa, Noda appointed lawmakers close to the veteran powerbroker as defense minister and the chairman of the National Public Safety Commission, which runs the police force.

Noda struck a confident tone in comments shortly after his full Cabinet was approved by the emperor. He pledged to do his utmost to improve disaster relief efforts following the March 11 earthquake and tsunami that have left more than 20,000 people dead or missing, destroyed much of Japan’s northeast coast and is expected to be the most expensive natural disaster in history.

He also pledged to bring under control the nuclear crisis at the Fukushima Dai-ichi plant, where workers continue to try to cool temperatures and stop radiation leaks.

“We need to speed up and revitalize our restoration efforts,” he said. “Without the rebirth of Fukushima, there is no rebirth of Japan.”

He also said he and his Cabinet would work to jump-start an economy battered by the surging yen. A strong yen hurts Japan’s top exporters like Toyota Motor Corp. and Sony Corp. by reducing the value of their overseas earnings.

Noda, who was finance minister in the previous Cabinet, said more needed to be done to prop up the U.S. dollar, acknowledging that he was worried about a hollowing out of Japanese industry if companies move their operations abroad because of the high yen.

He noted that Japanese companies should take advantage of a strong yen by buying up foreign businesses.

Noda’s biggest surprise of the day was his unconventional pick for the powerful role of finance minister. A former television journalist from tsunami-devastated Miyagi prefecture, Azumi has little experience in economics and finance and has made few comments on key issues like foreign exchange.

Financial markets on Friday did not and could not react to the relatively unknown Azumi, said Masayuki Kichikawa, chief Japan economist at Bank of America Merrill Lynch.

Analysts had expected more of a political heavyweight for such a key position.

Kichikawa suspects Azumi got the job because he shares Noda’s concerns about Japan’s fiscal health and controlling the country’s massive public debt, now twice the size of gross domestic product.

The appointment represents a “continuity of a relatively fiscal conservative stance,” he said.

Azumi will have little time to settle into his new office. He travels to France next week to represent Japan at a Group of Seven meeting of finance ministers and central bank governors. He must then find money for a third supplemental budget needed to fund disaster recovery.

Noda, Japan’s sixth new prime minister in five years, is keeping around some ministers from the previous Cabinet. He’s retaining Goshi Hosono as the minister in charge of dealing with the nuclear crisis and Agriculture Minister Michihiko Kano, who ran against Noda for the party leadership and is considered well connected to veteran legislators.

The Cabinet also includes two women: Yoko Komiyama as Health, Labor and Welfare Minister and Renho, who goes by a singular name, as Government Revitalization Minister, charged with reforming government and cutting waste.

Koichi Nakano, political science professor at Sophia University, said the picks were balanced enough that he felt optimistic the Cabinet would last at least a year _ a solid achievement given the records of recent prime ministers.

“The neo-liberal reformists who tend to be young and in their 40s are placed in eye-catching ministries,” Nakano said of several new ministers, including Azumi and Gemba. “Those youthful, new leaders of Japan are placed in high-visibility positions.”

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When I last checked in with the fellows at Aisle411, they had just launched their first smartphone application that helps users to locate products

Greece’s finance minister says the crisis-afflicted economy will shrink more than expected this year, putting pressure on the country’s deficit-cutting effort.

Evangelos Venizelos said Monday that the ministry forecasts the economy to shrink between 4.5 percent and 5.3 percent in 2011 _ considerably worse than initially estimated.

Venizelos told a press conference he will discuss the matter with representatives of Greece’s international creditors during talks in Athens this week no fax payday loans.

He said that, provided all austerity measures are fully implemented, the government should meet its target of cutting budget overspending from 10.5 percent of GDP to 7.5 percent this year.

Greece is surviving on rescue loans worth euro220 billion ($317 billion) from its European partners and the International Monetary Fund.

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CHARLOTTE, N.C.,

The Toronto stock market fell back Wednesday as fresh worries about the European debt crisis helped stop a short-lived rally in its tracks.

The S&P/TSX composite index dropped 77.3 points 12,032 and the junior TSX Venture Exchange gained 8.69 points to 1,719.92.