Owners of a Marion, Ill., golf club late last week finally got their long-awaited sit-down with U.S. Treasury officials to ask the agency to drop its objections to the club’s sale.
But Treasury did not indicate what action it might take or give a timetable, said Fritz Archerd, head of the golf owner’s group, who attended the meeting.
"There’s reason for hope. But there’s also reason for pessimism," Archerd said.
For the past 15 months, the Treasury has blocked the sale of the Kokopelli Golf Course because of the involvement of Zimbabwean national John A. Bredenkamp. He led a group that owned the golf course from 2001 to 2006. He retained a right to future profits when the course was sold again.
The problem is that Bredenkamp was named in late 2008 by Treasury’s Office of Foreign Asset Control to a list of people targeted for economic sanctions. These specially designated nationals, which include al-Qaida terrorists and drug kingpins, are prohibited from conducting any business in the U.S.
Treasury, which has declined to comment on the proceedings, accuses Bredenkamp of "gray-market arms trading and trafficking" and other endeavors to prop up Zimbabwe’s ruling regime.
Archerd said the Kokopelli investment lost about $750,000. A purchase price expected to be about $1 million would be enough to recoup that investment and pay off debt. So no profit would head to Bredenkamp if the golf club were sold to Marion-area owners quick payday loans.
Archerd said his group could no longer afford to invest in the golf club, featuring an 18-hole championship course once voted No. 3 in Illinois by Golf Week magazine. And yet, they cannot sell the course. It’s not even clear if the bank could foreclose on the property with the Treasury’s blocking order.
The plight of this golf course was the subject of a Post-Dispatch article last Sunday.
An economic sanctions attorney not involved in the case said he was surprised Treasury did not offer a solution at the sit-down meeting.
"I don’t understand why this hasn’t moved forward," said Clif Burns with Bryan Cave in Washington.
After Archerd’s meeting, the potential buyers indicated they had lost patience. Marion-area restaurateur David Hays said in a release, "We no longer are optimistic that we will see a timely solution to this dilemma."
Time — and money — does appear to be running out for Kokopelli. Staff already has been cut from 75 to one. The lawnmowers were repossessed last week, so there is no way to maintain fairways and greens. And next week the power company plans to turn out the lights.
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Taiwan and Thailand exited recession last quarter and Malaysia probably followed, as Asian economies lead the global recovery.
Taiwanese gross domestic product rose 9.2 percent in the fourth quarter from a year earlier and the Thai economy expanded 5.8 percent, according to reports today. Malaysian figures for the three months to Dec. 31, due for release on Feb. 24, may show GDP increased 3.4 percent last quarter, according to the median estimate of 14 economists surveyed by Bloomberg News.
Asian economies are paving the way for a global recovery from the worst worldwide recession since the Great Depression after central banks in the region slashed interest rates to record lows and governments increased spending by more than $1 trillion. The strength of Asia’s rebound has seen policy makers lead the way in withdrawing stimulus.
“Asia’s recovery is at least two quarters ahead of the U.S. and monetary authorities have been contemplating exit strategies for some time,” said David Carbon, head of economic and currency research at DBS Group Holdings Ltd. in Singapore. “With higher U.S. rates on the cards, Asia’s central banks can pursue their exit strategies with less to fear on the inflow and currency front.”
Policy makers in China, India and Vietnam are tightening monetary conditions amid signs that accelerating growth is fueling inflation and may led to asset bubbles. The U.S. Federal Reserve, which increased its discount rate by a quarter point to 0.75 percent on Feb. 18, has left its benchmark policy rate unchanged for more than a year.
Rising Demand
Asian stocks jumped by the most since November on speculation Federal Reserve Chairman Ben S. Bernanke will say in a report due to be released this week that U.S. interest rates will be kept low to spur economic growth. The MSCI Asia Pacific Index gained 2.4 percent to 118.14 as of 2 p.m. in Tokyo, the biggest increase since Nov. 30.
The emergence of the world economy from the global recession is encouraging companies in Asia to boost production and hire more workers. Singapore last week raised its economic growth forecast for 2010, predicting an expansion of as much as 6.5 percent this year.
Taiwan Semiconductor Manufacturing Co. and United Microelectronics Corp., the world’s largest makers of custom chips, are boosting capital spending this year after fourth- quarter profits beat analysts’ estimates.
‘Very, Very Strong’
Demand has been “very, very strong” in the computer, automotive and consumer electronics sectors over the past few quarters, Richard Han, chief executive officer of Hana Microelectronics Pcl, said in an interview with Bloomberg Television in Bangkok today. Hana makes parts for computers and mobile phones including Apple Inc.’s iPhone.
Taiwan’s fourth-quarter economic growth was the strongest since June 2004 and Thailand’s increase in GDP was the most in seven quarters.
China’s central bank on Feb. 12 ordered lenders to set aside larger reserves, aiming to rein in credit growth after banks extended 19 percent of this year’s 7.5 trillion yuan ($1.1 trillion) lending target in January and property prices climbed the most in 21 months. Goldman Sachs Group Inc. expects the Chinese economy will expand 11.4 percent this year.
Reserve Bank of India Governor Duvvuri Subbarao on Jan. 29 increased the cash reserve ratio to 5.75 percent from 5 percent, exceeding the median forecast for a half-point move in a Bloomberg News survey of economists. India is due to release GDP data for the December quarter on Feb. 26, along with the budget for the next fiscal year.
Emerging Asia
India’s $1.2 trillion economy may grow 7.2 percent in the current fiscal year through March, accelerating for the first time since 2007, the statistics office said Feb. 8.
“We expect GDP growth in emerging Asia to stay strong in coming quarters,” said Kevin Grice, an economist at Capital Economics Ltd. in London. “The most trade-dependent economies will eventually see slower GDP growth later this year and in 2011 as the global upswing loses momentum. But Asia’s rebound will not come to a complete halt and growth, by some distance, will stay higher than in any other part of the world.”
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It is hard to tell whether the federal judge in the North Face vs. South Butt trademark infringement lawsuit is laughing.
And discerning whether that’s a smile on his face could be a clue to how the judge eventually rules.
Already, the case has been rife with humorous jabs from tiny Ladue-based South Butt LLC, which claims its clothing line is a protected parody of the popular North Face brand. In South Butt’s written response to the allegations in early January, attorney Al Watkins struck a jokey tone by including a photo of South Butt’s 18-year-old founder, Jimmy Winkelmann, and describing him — apparently for the judge’s benefit — as "a handsome cross between Mad Magazine’s Alfred E. Newman [sic] of ‘What Me Worry’ fame, and Skippy the Punk from the Midwest."
Watkins also noted how North Face’s decision to sue has resulted in a financial boon for his client. "But for the actions of North Face," he wrote, "the South Butt saga might have been relegated to local Friday fish-fry banter."
The question is whether Missouri Eastern District Judge Rodney W. Sippel finds any of this funny. An answer, of sorts, arrived Tuesday.
Sippel, 53, an appointee of President Bill Clinton, issued an order that opens with a quote from humorist Franklin P. Jones: "It’s a strange world of language in which skating on thin ice can get you into hot water." The judge then ruled against South Butt’s request that the lawsuit be dismissed. The judge also noted he did not find it "implausible" that South Butt’s logo could cause confusion or dilution of North Face’s trademark. So the case will go forward.
But at the end of his order, Sippel warned South Butt’s attorney against making requests with little merit — which also could be read as a warning to be more serious. "Although this filing may not reach the level of frivolity, it approaches the line," Sippel wrote.
That might sound like a rebuke.
But Watkins, South Butt’s attorney, did not see it that way.
"I’m very pleased that the judge has adopted a tenor and demeanor that is not inconsistent with that which we have employed in this case," Watkins told the Post-Dispatch on Wednesday no fax payday loans.
The South Butt was started in 2007 by Winkelmann as a way to spoof a status symbol that crowded the hallways of his former school, Chaminade College Prep. He began selling T-shirts, fleeces and shorts at Ladue Pharmacy, which handles the South Butt products’ marketing and manufacturing details. North Face sued Winkelmann and the pharmacy over the South Butt name in December.
South Butt has responded with humor over the dispute, both in its press releases and its legal filings.
Sandy Davidson, lawyer and professor of communications law at University of Missouri Columbia, said judges sometimes employ humor — and in a case like this, that could be good for South Butt.
Davidson pointed to the trademark case of Hormel, maker of Spam, suing over the puppet Spa’am, Miss Piggy’s guard in the "Muppet Treasure Island" movie. An appeals court sounded like it was having some fun when it shot down Hormel’s complaint.
"In a recent newspaper column," the court wrote, "it was noted that ‘In one little can, Spam contains the five major food groups: Snouts. Ears. Feet. Tails. Brains.’ … (One) might think Hormel would welcome the association with a genuine source of pork."
Davidson said she could see how Watkins might be "trying to invite the court to use banter that other courts have used."
Now, North Face and South Butt face court-ordered mediation in March, and, if that fails, will be back in Sippel’s courtroom.
But Watkins said the South Butt case was inherently humorous.
"No matter how much you try to suppress the levity of the issues," he said, "it is going to spontaneously emerge and spontaneously emerge often."
OneUnited Bank, which has skipped dividend payments on $12 million in government TARP funds, reported a 25 percent decline in deposits during 2009 as lending activity dropped off at one of the largest black-owned banks in the country.
OneUnited, which is based in downtown Boston but with major operations in Los Angeles, had $291.8 million in deposits at the end of 2009, according to a filing with the Federal Deposit Insurance Corp. That was down from $388.1 million at the end of 2008.
The bank’s net loans were $324 million at the end of 2009, down about 12 percent from the previous year. OneUnited has total assets of $540.6 million and primarily lends in city neighborhoods in Boston, Los Angeles and Miami.
The bank was not immediately available to comment for this story.
On the plus side, OneUnited turned in a full-year net profit of $3.17 million in 2009, compared with a year-ago net loss of $29.8 million when it had investment losses of nearly $60 million.
The past year has been a rough one for the bank after federal and Massachusetts bank regulators hit OneUnited with a cease and desist order. In December 2008, the regulators accused the management of OneUnited Bank of running an unsound lending operation and ordered a top-to-bottom review of executive perks that included a 2008 Porsche and a housing allowance for a beach-front home in California.
As directed by the FDIC, the bank has since sold the Porsche used by OneUnited Chief Executive Kevin Cohee.
The bank received more criticism after it received $12 million in federal bailout money, and had U.S. Rep. Barney Frank of Massachusetts, chairman of the powerful House Financial Services Committee, championing its cause. OneUnited needed the capital after investments in a poorly diversified portfolio were wiped out, leaving the bank with no capital in the third quarter of 2008.
Haitian Prime Minister Jean-Max Bellerive told an aid conference in Montreal that his country needs help with a “colossal” reconstruction from the Jan. 12 earthquake that left the nation in shambles.
“Haiti will need massive support in the medium and long term from its partners in the international community,” Bellerive said today at the conference attended by 20 governments and multi-lateral organizations. “The challenge will require that we do more, that we do better and certainly that we do differently.”
Aid groups called on those attending the meeting to cancel the Caribbean nation’s $890 million foreign debt. The meeting, to discuss long-term reconstruction and plan a full donor conference in March, is being hosted by Canadian Foreign Affairs Minister Lawrence Cannon. The U.S. is represented by Secretary of State Hillary Clinton.
Haiti was already the poorest country in the Western Hemisphere before the temblor, which killed more than 150,000 people and destroyed a third of the buildings in the capital, Port-au-Prince. The country’s infrastructure, including the water system, has collapsed and the government is unable to deliver services. Relief groups and foreign military forces are trying to reach the estimated 3 million of Haiti’s 9 million people affected by the quake.
‘Path to Development’
The donor nations’ plans must aim to “bring the country back on the path to development,” Bellerive said in a speech to the group. “Going back to the status quo ante is not an option.”
Reconstruction will have to include moving some people out of shantytowns that have overrun the capital, and fostering economic development outside Port-au-Prince, he said.
“The Haitian government is at work in precarious conditions, but it is able to provide the leadership the Haitian people expect of it in the colossal challenges on the way to development,” Bellerive said.
Most government offices and computer systems were destroyed the quake.
The U.S. has taken control of aid deliveries through Haiti’s sole international airport, and the United Nations has taken responsibility for the country’s security
Cannon said the delegates at the conference support the Haitian government’s effort to join in the reconstruction planning. Today’s meeting will help set out a “coherent” and “consistent” approach for supporting Haiti in advance of a major conference to be held in coming months.
‘Ready to Help’
“Your role is key, and your voice is clear guaranteed payday loans. We stand ready to help,” Cannon said.
Haiti’s foreign debt must be cancelled immediately, “accompanied by urgent action to support farmers and prevent a man-made food crisis exacerbating the hardship,” Oxfam Executive Director Jeremy Hobbs said in an e-mailed statement.
Cancelling debt is “indispensable to help the government of Haiti marshal the most resources possible” to rebuild the country, said Eric Faustin, president of Regroupement des Organismes Canado-Haitiens pour le Developpement, a Montreal- based non-profit aid group that focuses on Haiti.
Rescuers today wound down operations seeking survivors among the wreckage, and the UN reported that security in Port- au-Prince “remains calm but fragile, with isolated instances of looting.”
More than 150,000 bodies have been buried and 200,000 residents of Port-au-Prince have left the city, the New York Times reported Jan. 23, citing Marie-Laurence Jocelynn Lassegue, Haiti’s culture and communications minister.
Aid Groups
UN humanitarian chief John Holmes and UN development head Helen Clark are attending the Montreal meeting, along with representatives from the International Monetary Fund and the Inter-American Development Bank. Other participating nations include Japan, Mexico, Costa Rica, France and Spain.
Japan will pledge $70 million in aid at Montreal, Chief Cabinet Secretary Hirofumi Hirano told reporters today in Tokyo. The nation, which has the world’s second-biggest economy, had initially pledged $5 million, compared with the U.S. pledge of $100 million and $10 million promised by South Korea.
Japan also intends to send about 300 members of its Self- Defense Force to Haiti, serving with the UN peace-keeping troops, Hirano said.
Norway today doubled its humanitarian aid to Haiti to 200 million krone ($34 million).
Venezuela, Nicaragua and Bolivia said they will boycott the meeting to protest the U.S. military’s presence in the Caribbean, according to the German news service Deutsche Presse Agentur.
Former Cuban President Fidel Castro wrote in the official Cuban newspaper Granma that U.S. troops have “occupied” Haiti. The U.S. bolstered its presence in the country and offshore to 11,000 soldiers and sailors last week to help provide humanitarian assistance and security.
Heartland Bank sold its ownership in Heartland Payment Systems 10 years ago, but the Clayton-based bank didn’t quite escape involvement in the payment company’s massive computer security breach.
A $60 million settlement announced last week has the bank acting as a middle-man, passing settlement and fine money from the payment company to Visa, the credit card company, and other companies that issue credit cards.
A year ago, computer hackers broke into Heartland Payment’s computer system, compromising 130 million credit card accounts. Credit card issuers across the country, including Heartland Bank, replaced the compromised credit cards for customers.
Heartland Payment Systems, based in New Jersey, processes credit card payments for small and mid-sized merchants. Heartland Bank helped found the company in 1997, but sold its ownership in 2000.
However, Heartland and KeyBank of Cleveland remained as bank "sponsors" of the payment company. When Visa imposed a $780,000 fine, Heartland Bank and KeyBank paid it and collected the money from the payment company, according to a filing by the payment company with the Securities and Exchange Commission.
In the settlement, the payment company will pay up to $60 million to reimburse credit card issuers that absorbed costs because of the security breach. The payment company intends to borrow $53 million of that.
The settlement, if finalized, would let Heartland Bank, KeyBank and the payment company off the hook for any claims resulting from the hacking incident. Heartland Bank executives could not be reached for comment. The privately held bank had $967 million in assets as of September, ranking it a mid-sized player in the St. Louis banking market. It earned $1.7 million in profit in the first nine months of last year.
In a filing with the SEC in November, KeyCorp, KeyBank’s parent company, said it sponsored Heartland Payment’s participation in Visa and MasterCard. KeyBank said Heartland Payment had indemnified it against losses, but that KeyBank could face "significant" costs if the payment company can’t pay.
Burlington Coat Factory will set up shop in the former Mervyn’s store in Elk Grove in the spring, Elk Grove Economic Development Corp. officials said Friday.
The New Jersey-based chain of 414 discount department stores opened a new store last March in a former Target store at County Fair Fashion Mall in Woodland.
The Elk Grove store will be located in the Marketplace 99 shopping center at Bond Road and Highway 99 and will employ about 70 people payday loans guaranteed no fax.
Burlington Coat Factory entered this market in 2001 with a store in south Sacramento on Florin Road.
Burlington Coat Factory also has a store in Citrus Heights, located in a former Furniture World.
The U.S. dollar’s gains may end in the middle of 2010 as central banks shy away from adding greenbacks to their reserves and the Federal Reserve raises rates at a slower pace than investors expect, Barclays Plc said.
Long-term demand for dollars is set to weaken after the currency’s share of global reserves added in the third quarter slid to less than 30 percent, a decline “unprecedented in a period of U.S. dollar weakness,” Barclays said in a note to clients. The dollar stemmed 11 months of declines versus the 16 most-traded currencies in December, gaining against all but two, after investors increased bets the Fed will remove monetary stimulus next year as the economy recovers.
“We see the dollar strengthening in the first six to nine months of 2010 when the focus is on liquidity withdrawal and tightening of rates,” said Steven Englander, chief U.S. currency strategist at Barclays in New York, in a telephone interview. “Once the market gets past this initial fear of tightening, the reality will be that the Fed isn’t going to be tightening very fast and we’ll see dollar selling again.”
The Dollar Index — which measures the currency against the euro, yen, pound, Canadian dollar, Swiss franc and Swedish krona — has dropped 4.2 percent this year. It has climbed 4.1 percent in December and traded at 77.928 as of 9:28 a.m. in Tokyo. The U.S. dollar has registered its biggest declines against the Brazilian real, Australian dollar and South African rand dropping by more than 25 percent this year against each.
Global Reserves
Global reserves probably gained by about $180 billion in the third quarter with U.S. dollar-denominated reserves accounting for about $50 billion or less than 30 percent, Barclays estimated, using data from the International Monetary Fund and U.S. official reports.
The bank adjusted for changes in the value of currencies over that period to capture “actual buying and selling, rather than passive gains and losses” Englander wrote in the note.
The dollar declined against all but the yen among the 16 most-active currencies this year. That prompted China and Russia, holders of the world’s biggest and third-biggest currency reserves, to express concern about their U payday loans with no faxing.S.- denominated investments.
“Emerging market central banks are selling their local currencies and buying U.S. dollars to prevent appreciation of their currencies,” Englander said. “They’re avoiding having a bigger concentration of U.S. dollars in their portfolio by turning around and selling dollars against the euro and other currencies.”
Canadian Dollars
Canada’s Finance Minister Jim Flaherty said this week that China, may be poised to buy Canadian dollars as it seeks to shield its $2.3 trillion worth of reserves against the U.S. dollar’s decline. Russia’s central bank said last month it will add Canadian dollars to its reserves and may include more currencies to reduce its dependence on the U.S. dollar.
Declines in the greenback mostly stalled this month as traders bet on a 48 percent chance that Fed Chairman Ben S. Bernanke will increase the target rate for overnight lending between banks by June. Policy makers will end most emergency lending programs and debt purchases by March because of “improvements in the functioning of financial markets” and stabilizing labor markets, the Federal Open Market Committee said on Dec. 16.
Unemployment, Retail
Reports this month showed the U.S.’s jobless rate unexpectedly fell, retail sales beat forecasts and purchases of existing homes rose to the highest level in almost three years in November. Benchmark rates are as low as zero percent in the U.S. compared with 8.75 percent in Brazil and 3.75 percent in Australia. They are 0.1 percent in Japan and 1 percent in the Euro region.
Barclays forecasts that the Federal Reserve will begin raising rates at the end of the third quarter of next year, while the European Central Bank’s tightening cycle will begin at the start of 2011. The Fed’s target rate will reach 2 percent by the end of 2011, Englander said.
Barclays on Dec. 10 forecast the euro will fall to $1.40 in six months before rallying to $1.45 by the end of 2010. The euro traded at $1.4333 today.
WASHINGTON – House Democrats headed into the final stretch on a long-awaited Wall Street regulation bill Friday after fending off an effort to kill a proposed U.S. consumer agency that is a central feature of the legislation.
The sweeping regulatory overhaul aims to address the myriad conditions that led to last year's financial crisis.
Test votes during two days of debate indicate that Democratic support for the underlying legislation will hold in final passage.
Before the final vote Friday, House members rejected by a vote 223-208 an amendment that would have killed a proposed Consumer Financial Protection Agency. The agency would consolidate consumer lending regulations and enforcement that is now split among several banking regulators.
A bipartisan coalition had proposed keeping the consumer powers within each regulator and creating an oversight council. The U.S. Chamber of Commerce lobbied heavily to kill the agency and ran national television ads against it. Consumer groups said it was essential to the overall regulatory package.
In a separate vote Friday, Democratic leaders failed to revive legislation that would let bankruptcy judges rewrite mortgages to lower homeowners' monthly payments. The measure was rejected by a 241-188 .
The House previously passed bankruptcy-mortgage legislation, but it failed in the Senate.
Democrats hoped that by inserting the provision in the regulatory legislation they would have had another opportunity to make it law. Aiding homeowners through bankruptcy had been a key feature of President Barack Obama's foreclosure fighting proposal, but the president did not push for it.
Banks and credit unions have lobbied against the bankruptcy measure. They say it would force a flood of bankruptcy filings and ultimately drive up mortgage rates paperless payday loans.
Late Thursday, scores of Democrats voted with Republicans on amendments that eroded the reach of proposed regulations on complex derivatives trades.
Democratic attempts to toughen the legislation failed.
Though not major setbacks, the votes illustrated the difficulties facing House Financial Services Chairman Barney Frank and the Obama administration as they seek to pass the most ambitious rewrite of financial regulations since the New Deal of the 1930s.
The Chamber has been an aggressive opponent of the legislation, running television ads against the proposed consumer agency and pressuring lawmakers to vote to eliminate it and to ease the derivatives regulations.
The legislation still imposes restrictions on derivatives, aiming to prevent manipulation and bring transparency to a $600 trillion global market. An amendment by New York Democrat Scott Murphy, adopted 304-124 Thursday night, exempted businesses that trade in derivatives, not as financial speculators, but to hedge against market fluctuations such as currency rates or gasoline prices. The amendment also provided an exception for businesses that are considered too small to be a risk to the financial system.
A Democratic effort to make more companies subject to derivatives regulation failed 279-150.
For Democrats, the votes split along turf lines. All but a few of the Democrats on the House Agriculture Committee voted for the broader exception. The Agriculture Committee oversees commodities trading and had recommended less restrictive derivatives rules, but the final bill did not include them.
Campbell Soup Co. reported that its first-quarter profit rose 17 percent with the help of lower costs from increased efficiency in getting its products from its plants to store shelves, as well as lower prices for grain ingredients. Earnings were $304 million, or 87 cents per share, up from $260 million, or 70 cents per share, a year ago. But revenue fell 2 percent to $2.2 billion with dips in sales for most categories, ranging from condensed soup to Prego pasta sauce.
Hewlett-Packard said cost cutting helped its profit jump 14 percent in the fourth quarter despite an 8 percent revenue decline. H-P got higher profit from Electronic Data Systems Corp., a tech services company H-P bought for $13.9 billion last year to better compete against IBM Corp. The world’s top seller of personal computers earned $2.4 billion, or 99 cents a share, compared with $2.1 billion, or 84 cents a share, a year earlier. Revenue was $30.8 billion, down from $33.6 billion. Analysts had expected earnings of $1.13 a share, on revenue of $30.4 billion, according to a consensus survey by Thomson Reuters.
Tyson Foods Inc. said it made strides in the meat business this year and predicts more improvements next year. The world’s largest meat producer, based in Springdale, Ark., said a hefty impairment charge in its beef business left it with a loss for the fourth quarter. But all of its business units, including chicken and pork, were profitable, when excluding the $560 million noncash charge. The company lost $455 million, or $1.22 a share, compared to a profit of $48 million, or 13 cents a share, a year ago. Excluding the charge, Tyson would have earned 28 cents a share, two cents better than analysts had forecasted. Revenue inched higher to $7.21 billion, up $13 million from a year ago.
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