Lenon’s main business news

Italian business confidence unexpectedly fell in September on concern that a lack of consumer spending means Europe’s fourth-biggest economy will depend on foreign demand to emerge from the worst recession since World War II.

The Isae Institute’s manufacturing sentiment index fell to 74 from a revised 74.4 in August, the Rome-based research center said today. The September reading was lower than the median forecast of 75.8 in a Bloomberg News survey of 19 economists.

“Signs of improvement are visible mostly from foreign demand, while domestic demand remains weak,” said Marco Valli, an economist at UniCredit MIB in Milan. That’s “not unusual at the early stages of a recovery.”

Industrial production rose in July as the $2.1 trillion economy benefited from demand from France and Germany, its two biggest trading partners, which emerged from recession in the second quarter. Italy’s economy contracted for a fifth quarter in the three months through June as unemployment reached a 3 1/2-year high and consumer spending remained weak.

Manufacturers’ pessimism has been reflected in earnings forecasts. Clothesmaker Mariella Burani Fashion Group SpA expects second-half sales to fall 16 percent as demand for luxury apparel falters, Chief Executive Officer Gabriele Fontanesi said yesterday in an interview.

“In the first half, we saw a decline of 16 percent,” Fontanesi said. “In the second half, I don’t think it will move from that trend.”

Unemployment Grows

The number of Italians employed fell by 1.6 percent in the second quarter, the biggest drop since 1994, while the jobless rate rose to 7.4 percent, the highest since 2005. The rate may exceed 10 percent in 2010 should the recovery remain weak, the Organization for Economic Cooperation and Development said in a Sept. 16 report.

Italian businesses “see further job losses,” today’s report also said. A sub-index measuring expectations on employment fell to minus 19 in September from minus 16.

With Germany and France expanding, Europe’s slump is probably coming to an end, according to an index co-produced by the Bank of Italy and the Center for Economic Policy Research. The Eurocoin index measuring economic activity in the 16-nation euro region rose in September, the first positive reading in 15 months.

Signs of Improvement

On Sept. 22 the Italian government raised its forecast for this year’s economic contraction to 4.8 percent from 5.2 percent previously. The Finance Ministry said it expects the economy to expand 0.7 percent in 2010. While the economy will exit the recession by the end of this year, the recovery may not last throughout next year, Valli said.

Italian consumers were more optimistic about the economic outlook. Consumer confidence climbed this month to the highest in more than seven years as expectations of a return to economic growth after five quarterly contractions more than offset concern that unemployment will rise further.

Isae conducted its latest survey of 4,000 companies between Sept. 1 and Sept. 17.

Source

It helped Elizabeth Poelker buy her house.

It probably helped Paul Medler sell his.

But is the $8,000 tax credit for first-time homebuyers really helping the economy all that much? Enough to warrant extending it for another year, at an estimated cost of $15 billion? Enough to maybe even expand it to $15,000 apiece, for everyone?

That’s a question Congress is wrestling with these days, as the program starts to near its Nov. 30 closing date, and the real estate industry ramps up a full-throated campaign to keep the credits flowing. It’s unclear at this point what will be decided.

Nearly everyone agrees that the credits have helped keep the housing market afloat during a tough time. After they were enacted as part of the $787 billion federal stimulus Congress passed in February, existing home sales rose for four straight months, before dipping in August. The rate of sales is up 12 percent since March, according to the National Association of Realtors.

About 1.4 million people have already claimed the credit on their taxes, according to the IRS, with probably more awaiting paperwork or delaying until they file in the spring.

And, along with low prices and historically low interest rates, real estate agents say the credits are sparking interest in home-buying.

"There’s no question it’s had a positive impact on our business," said Jim Dohr, president of Coldwell Banker Gundaker, which has 25 offices in the St. Louis region. That’s especially true at lower price points. Coldwell’s business is up 23 percent from last year on homes sold for less than $100,000 and 16 percent for homes sold for $150,000 or less.

"Much of the action in our business is at the lower end, and it’s really being fueled by the first-time tax credit," Dohr said.

What is less clear is how many of those sales would have happened anyway.

Prices and interest rates are low, after all. And people still need a place to live.

Out of a projected 1.8 million sales that will use the tax credit this year, economists estimate that between 350,000 and 400,000 would not have happened without it. And a recent survey commissioned by real estate tracking firm Zillow found that, if the credit is extended another year, it would be a major deciding factor for 18 percent of first-time homebuyers — spurring an additional 334,000 sales in all.

That’s nothing to sneeze at, said Zillow chief economist Stan Humphries. But at $15 billion, it works out to almost $45,000 for every sale generated.

"It’s an expensive program," he said. "For every five homes, four were going to get purchased anyway."

But there’s still that other one — people such as Poelker.

She’s 25 and works at an accounting firm. Her lease in Maryland Heights was coming up this summer, and she had grown tired of renting but didn’t think she could afford a down payment. When the tax credit passed, she started looking.

Soon, she found a nice townhouse in Manchester, put in an offer, and closed in June.

"It really helped me make it work," said Poelker, who noted that her brother and a friend had also used the tax credit to buy houses. "I probably would have purchased in the next couple of years, but it helped me do it sooner."

Still, that raises another question about the tax credit. Is it just borrowing sales from the future?

Skeptics point to Cash for Clunkers, the government-funded program to help spur auto sales. After a surge of car-buying in July and August, September is expected to be car dealers’ worst month of the year, according to a recent report from JD Power. The same thing, critics say, could easily happen whenever the homebuyer credit expires.

But supporters say that’s all the more reason to prolong it, at least for a few months. The economy is still shaky. Any housing recovery is fragile at best. Winter is typically a slow season in real estate. The timing, said Scott Dettmer, general manager of Dettmer Homes in Cottleville, is bad all around.

"You’re taking the single biggest impetus for home sales in at least three years, and you’re going to expire it at what is normally a bad time anyway?" he said. "I’d like to see it extended at least through the spring, to give a bridge over what are normally a tough few months."

At least 20 bills have been proposed in Congress to extend the plan, including one co-sponsored by Sen. Majority Leader Harry Reid that would push it into June. Another bill — to extend the credit and make it $15,000 for all homebuyers — reportedly has 15 co-sponsors.

But that measure was stripped from the stimulus bill in February, and there seems to be a limited appetite for it now, as Congress wrestles with health care reform and other pricey legislation. Many observers don’t expect a resolution until the Nov. 30 deadline draws nearer.

And that will probably keep Paul Medler waiting.

He sold his home in Kirkwood in June to a first-time buyer who used the tax credit. It probably helped make the deal happen, Medler said. Now he’s renting, and waiting to find a good deal to buy, but prices in the neighborhoods where he’s looking still seem too high for this market.

Medler’s hoping the credit either gets extended to everybody — so he can use it — or ends in November as planned.

"After this stops I feel like we might have another dive in housing prices," he said.

And, at least in his case, that would be a good thing.

Source

Federal Reserve General Counsel Scott Alvarez said audits of monetary policy by the U.S. Congress could lead to higher interest rates and reduced confidence in central bank policy.

Congressional audits of monetary policy could “cause the markets and the public to lose confidence in the independence of the judgments of the Federal Reserve,” Alvarez told the House Financial Services Committee today in response to a question from Representative Dennis Moore, a Kansas Democrat. Alvarez said in his prepared remarks the audits would probably “chill” the central bank’s discussions on interest rates.

Fed Chairman Ben S. Bernanke and his colleagues are trying to persuade lawmakers not to pass legislation sponsored by Representative Ron Paul of Texas that would repeal the central bank’s immunity to audits of monetary policy. Fed officials used emergency powers to protect creditors of Bear Stearns Cos. and American International Group Inc. during the financial crisis, prompting congressional scrutiny.

“We don’t want to give the rest of the world or, more important, domestic investors the impression that we are somehow in a formal way injecting Congress into the setting of monetary policy,” said Representative Barney Frank, a Massachusetts Democrat and chairman of the committee. “That could have a very destabilizing effect.”

Frank added that “a lot needs to be done” on Fed transparency and said that Congress can accomplish that without interfering with the independence of monetary policy decisions.

Remove Exemptions

Paul’s legislation would remove Fed exemptions from audits in four areas: transactions with foreign central banks; deliberations on monetary policy matters, including discount- window operations; transactions made under the direction of the Federal Open Market Committee; and communications and discussions between the Board, the reserve banks and staff.

Frank said he supports a delay in making some Fed information public, such as the securities it buys and sells, so it doesn’t have a “direct market effect.” Alvarez told Frank that the Fed is “giving serious consideration” to that idea and would be “happy to work with you on it fast payday loan no faxing.”

In an interview after the hearing, Paul said the audit powers in the bill may be altered to delay by three to six months releasing information on FOMC actions. The legislation is likely to be included in a broader Democratic package of financial-regulation changes in the House, he said.

‘Gentleman’s Agreement’

“It’s a gentleman’s agreement” with Frank, Paul said, adding that Frank fulfilled an earlier agreement to hold a hearing. “That doesn’t mean it will happen in the Senate,” even as prospects in the upper chamber are improving, Paul said.

In the hearing, Paul told Alvarez that the Fed had “failed” to stabilize interest rates, prices and employment, according to its mandate. “What we need is more oversight and more transparency rather than more authority to the Federal Reserve,” Paul said.

Alvarez said GAO audits of discount-window lending could reduce the effectiveness of “these facilities in promoting financial stability, maximum employment, and price stability.” The legislation could also “disrupt” the Fed’s relationships with foreign central banks, he said.

“Monetary policy independence prevents governments from succumbing to the temptation to use the central bank to fund budget deficits,” Alvarez said in his prepared testimony. “Financial markets likely would see the grant of audit authority to the GAO with respect to monetary policy as undermining the Federal Reserve’s independence.”

The legislation has 295 sponsors in the House, including every Republican member, Rachel Mills, a spokeswoman for Paul, said in an e-mail yesterday.

The Fed is facing other challenges by Congress, including a proposal to strip the central bank of its rule-writing power on some consumer financial products.

Source

Lithuania’s recession, the deepest in the European Union, is close to bottoming out and the economy may start growing next year if trade demand continues to gain strength, central bank Governor Reinoldijus Sarkinas said.

“Under positive external conditions, a recovery, even if at very low growth rates, may begin next year,” Sarkinas said in an interview in Vilnius yesterday.

The government of Prime Minister Andrius Kubilius expects the economy to contract 4.3 percent next year as the Baltic state adapts to tough austerity measures needed to comply with euro adoption terms. Lithuania, like neighboring Latvia and Estonia, pegs its currency to the euro inside the exchange rate mechanism, obliging the government to deflate the economy to stay competitive instead of relying on a weak litas.

The Baltic nation’s top monetary policy official called on the government to cut spending to a level “it can afford.”

Government spending cuts and tax increases contributed to a 20.2 percent economic contraction last quarter. The Cabinet yesterday proposed savings including cuts on social spending to stop next year’s deficit from widening beyond the 8 percent of gross domestic product estimated for this year.

“The deficit needs to start narrowing next year,” Sarkinas said. “We shouldn’t borrow just for consumption. One must live within one’s means.”

A swelling budget gap doesn’t mean the country will need outside help with its finances, he said. Lithuania has “no need at the moment” to ask for money from international lenders, “but there’s nothing frightful if such a need occurs,” he said.

IMF

Latvia, which is suffering the second-deepest recession in the EU after Lithuania, is relying on a 7.5 billion euro ($11 billion) loan from the International Monetary Fund and the European Commission to stay afloat.

Latvia’s economic difficulties “can’t be comforting to anyone, neither to us, nor to Latvians, nor to other countries,” Sarkinas said. “We’d benefit if the situation there would be solved as soon as possible and would begin improving.”

The government can avoid a bailout if it raises funds on the domestic bond market or abroad. “The Baltic region is three separate countries with different situations, and one shouldn’t put an ‘equals’ mark,” Sarkinas said.

Borrowing opportunities in foreign markets “have significantly improved since the start of the year,” he said, and the government is likely to borrow at a cheaper rate than earlier this year, when it sold euro-denominated bonds.

The Baltic economic crisis has had repercussions outside the region, with western European lenders suffering depleted loan portfolios as a growing number of Baltic borrowers were unable to service their debt.

‘Most Serious Risk’

The recession in the Baltic region poses the “most serious risk” to Sweden’s economy and budget, Swedish Finance Minister Anders Borg said on Sept. 21. Stockholm-based Swedbank AB and SEB AB are the biggest lenders in the region.

Sarkinas said Swedish lenders are operating “completely fine” in Lithuania, while adding an improvement in the banking industry’s loan quality may take longer. “It’s a difficult time for banks,” he said.

Loan provisions average 3.28 percent of total lending, compared with 0.8 percent a year ago, and “will continue increasing.” Even so, lenders are “well-prepared” and “have accumulated sufficient capital to absorb future losses,” Sarkinas said.

Capital adequacy ratios average more than 13 percent, compared with the 8 percent ratio required by the central bank, Sarkinas said.

Credit portfolios, which shrank about 7 percent from the start of the year, are showing the first signs of stabilizing and may start growing in coming months, Sarkinas said. Loans to households and businesses were almost unchanged in August after shrinking in each of the first seven months.

Source

Sales of existing U.S. homes probably climbed in August to the highest level in two years, another sign the real-estate collapse that triggered the global recession is abating, economists said before a report today.

Purchases rose 2.1 percent to a 5.35 million annual rate, according to the median forecast of 74 economists in a Bloomberg News survey. It would be the fifth consecutive gain, capping the longest stretch of increases since 2004.

Government tax credits for first-time buyers and foreclosure-induced price declines are helping the housing market recover from the worst slump since the Great Depression. Federal Reserve policy makers yesterday committed to keeping interest rates low to ensure the pickup in growth is sustained.

“The housing recovery is under way,” said Michelle Meyer, an economist at Barclays Capital Inc. in New York. “While the first-time homebuyer tax credit likely boosted sales, there has been a fundamental shift in home buying due to greater affordability and confidence.”

The National Association of Realtors’ report is due at 10 a.m. in Washington. Bloomberg survey estimates ranged from 5.1 million to 5.55 million after a 5.24 million rate in July. Resales reached a 4.49 million pace in January, their lowest level since comparable records began in 1999.

A report at 8:30 a.m. from the Labor Department is projected to show the number of Americans seeking jobless benefits rose last week to 550,000 from 545,000 a week earlier.

Leading Indicator

Purchases of existing homes, which make up more than 90 percent of the market, are tabulated when sales close and therefore reflect contracts signed a month or two earlier. Sales of newly built residences, which make up the rest, are considered a more leading indicator because they are counted when a contract is signed.

The Commerce Department may report tomorrow that purchases of new houses rose in August to the highest level in 12 months, according to a Bloomberg survey.

Fed policy makers yesterday maintained they will keep the benchmark lending rate near zero “for an extended period,” while noting that the economy and housing had strengthened. They also said they will slow central bank purchases of mortgage debt securities in order to extend the $1.45 trillion program through the first quarter of 2010 rather than completing it by the end of this year.

They extended the period to allow more time “to work out of the housing problems,” John Silvia, chief economist at Wells Fargo Securities LLC in Charlotte, North, Carolina, said in a report to clients yesterday.

First-Time Buyers

The Obama administration’s $8,000 tax credit for first- time home buyers, which is due to expire at the end of November, combined with the plunge in prices as foreclosures climbed, have helped lift sales this year. The Realtors’ group and the National Association of Home Builders have lobbied to extend the credit on concern demand will wane after it lapses.

Treasury Secretary Timothy Geithner told reporters on Sept. 17 that the administration would take a “careful look” at extending the credit and called signs of stabilization in the U.S. housing market “very encouraging.”

Growing demand has prompted builders such as KB Home to get back to work. Housing starts rose to a nine-month high in August, the Commerce Department reported last week, indicating residential construction may soon add to growth after subtracting from gross domestic product since 2006.

Builder Shares

The Standard & Poor’s Homebuilder Supercomposite Index is up 32 percent so far this year, compared with a 17 percent gain for the broader S&P 500.

Prices, which most economists forecast would be the last component of the market to turn, have begun to improve. The Federal Housing Finance Agency’s home-price index for purchases was up 1.1 percent in the three months through July, the best performance since early 2006.

The recent increases may also be contributing to the rise in sales as buyers who had been waiting for prices to turn jump back into the market, economists said.

“We’re seeing a firming of prices in a number of markets, not all,” Eli Broad, founder of Los Angeles-based KB Home, said yesterday in an interview with Bloomberg Television. “I think we have bottomed out in many markets.”

KB Home on Sept. 16 announced it was resuming its building operations in the mid-Atlantic region, including the Washington, D.C., area.

Still, with unemployment forecast to reach 10 percent by the end of the year and record foreclosures adding to the 4.4 million houses on the market, any rebound in sales, construction or prices will take time to strengthen.

Source

Five U.S. states that were among the hardest hit by job losses and the construction slump also had declines in household incomes during the first year of the recession, according to a government report.

Arizona, California, Florida, Indiana and Michigan all saw median household incomes drop in 2008, the Census Bureau said yesterday in an annual report. Only one state had a decline the previous year.

The figures highlight concern that consumer spending may hamper a recovery from the worst recession since the 1930s. Falling home values and stock prices have fueled an $11.1 trillion loss in household wealth in the U.S. since the third quarter of 2007, before the recession began.

“Business profits are down considerably, so companies can’t pay the kind of wages that they did” earlier this decade, said Brad Kemp, director of regional economics at Beacon Economics in Los Angeles. “Incomes are going to continue to be affected and be a drag on consumer spending.”

The census report also showed the foreign-born population in the U.S. last year dropped for the first time since 1970, to 37.9 million from 38 million. That same group represented 12.5 percent of the overall population, down from 12.6 percent in 2007. The number of non-citizens also fell, to 21.6 million in 2008 from 21.9 million the previous year.

Nationally, median household income last year fell 3.6 percent to $50,303, snapping three years of increases, the Census Bureau said this month in a separate report.

Maryland had the highest median household income, at $70,545, for the third consecutive year, followed by New Jersey and Connecticut, yesterday’s report showed. Mississippi had the lowest, at $37,790.

Five States Gain

Kansas, Louisiana, New Jersey, New York and Texas had increases in median household income last year compared with 2007. In the previous year, 33 states saw an increase.

Real per capita income for the U.S. as a whole declined by 3.1 percent last year to $26,964, according to an earlier census report.

Workers from the financial services industry to home construction lost their jobs as the recession took a toll. Since the slump began in December 2007, the U.S. has lost 6.9 million jobs. Payroll cuts peaked at 741,000 in January and have since subsided, with 216,000 job losses in August, according to the Labor Department.

California lost 462,000 jobs last year, the most of any state, according to the Labor Department. Florida was next with 375,000 cuts from payrolls, followed by Michigan with 204,000.

Engine of Growth

“The recession hit Florida harder than most states,” said Stan Smith, director of the University of Florida’s Bureau of Economic and Business Research. “Housing was a major engine of growth. The decline in the housing market is a big reason incomes have dropped so much.”

Construction jobs accounted for 29 percent of all job losses in California and Florida, the Labor Department said.

“This has been a very difficult environment,” said Gary Aubuchon, president of Aubuchon Homes in Cape Coral, Florida. Home permits in the Fort Myers area were off as much as 98 percent last year from their peak, he said.

Aubuchon started selling a line of homes for under $200,000 on Labor Day, compared with its prior target of “primarily $400,000 and up,” he said.

In Michigan, declines in manufacturing payrolls contributed 31 percent of all job cuts. Manufacturing accounted for 57 percent of payroll declines in Indiana last year.

Whirlpool Cuts

Whirlpool Corp., the world’s largest appliance maker, is among those companies still eliminating positions. The Benton Harbor, Michigan-based company said Aug. 28 it will close its Evansville, Indiana, manufacturing plant, resulting in the elimination of 1,100 jobs.

Home prices declined 18 percent in 2008, according to the S&P/Case-Shiller home-price index. So far this year, property values have dropped only 4.7 percent.

President Barack Obama in February signed into law a $787 billion stimulus package aimed at stabilizing the economy and creating or saving about 3.5 million jobs. So far, the bill has created or saved as many as 1.1 million jobs, the White House said this month.

A new topic in the American Community Survey by the Census Bureau measured the percentage of state residents who lacked health insurance. In Texas, 24.1 percent went without health care in 2008, while only 4.1 percent in Massachusetts were uninsured, the report showed.

The number of people without health insurance coverage rose to 46.3 million last year from 45.7 million in 2007, the census said this month. The uninsured still accounted for 15.4 percent of the population, the same as in 2007, according to the Census figures.

Insurance Tax Proposal

In order to cut costs and make health care accessible to all Americans, Obama and Democratic lawmakers have proposed taxing private insurers, trimming spending in the federal Medicare program for the elderly and disabled and creating a more affordable public plan to expand coverage.

Data from the census report is used to help determine the annual distribution of more than $400 billion in federal and state funds, the Census Bureau said.

Source

Senate Banking Committee Chairman Christopher Dodd’s plan for a single bank regulator may set up a fight with House colleague Barney Frank and the Obama administration and might slow the overhaul of financial rules.

Dodd, leading efforts to rewrite regulations, will suggest combining the Federal Reserve, the Federal Deposit Insurance Corp., the Office of Thrift Supervision and the Office of the Comptroller of the Currency into one agency, the senator’s office said yesterday.

“Establishing a single regulator is a very bad idea,” Camden Fine, president of the Independent Community Bankers of America, a Washington-based trade group with 5,000 members, said yesterday in an e-mail. “When you have a cyclopic regulatory system, it only takes one stick in the eye to blind it.”

Dodd’s proposal goes further than recommendations by President Barack Obama that are backed by Frank, chairman of House Financial Services Committee that resumes hearings on the issue this week. Dodd’s plan embraces ideas of Democratic Senators Charles Schumer of New York and Mark Warner of Virginia and has elements from measures introduced by House Republicans. Any differences must be resolved before the rules become law.

Obama in June recommended combining OCC, regulator of national banks including New York-based Citigroup Inc., and OTS, which regulates savings and loans including Paramus, New Jersey- based Hudson City Bancorp Inc.. His proposal leaves intact oversight powers of the Fed and FDIC.

The multiple-agency system has produced “some real costs ranging from inefficiencies and redundancies to the lack of accountability and regulatory laxity,” Dodd said at an Aug. 4 Senate Banking Committee hearing to consider the issue. “We are now paying a very high price for those shortcomings.”

No Panacea

FDIC Chairman Sheila Bair and Comptroller of the Currency John Dugan support Obama’s proposal.

Bair said merging the four agencies is “no panacea” for effective oversight, according to Banking committee testimony Aug. 4. “One of the advantages of multiple regulators is that it permits a diversity of viewpoints to be heard,” she said.

Fed officials including Chairman Ben S insurance quotes. Bernanke and Governor Daniel Tarullo, who is leading efforts to overhaul the Fed’s bank supervision, have testified that the central bank should retain its authority over U.S. banks.

The administration recognizes “many ideas” will be offered and will “work with the leadership” in the House and Senate committees “to get a bill done” this year, White House spokeswoman Jennifer Psaki said yesterday in a statement.

‘Big Mistake’

Frank, the Massachusetts Democrat leading his chamber’s efforts, supports Obama’s merger. Stripping the Fed and FDIC of their oversight powers would be “a big mistake,” Frank said.

Representative Spencer Bachus of Alabama, top Republican on the Financial Services panel, has proposed consolidation as a step to reduce duplication and avoid the separate Consumer Financial Protection Agency proposed by Obama.

“If structured like the House Republican plan, streamlining and consolidating the functions of the four bank regulatory agencies will address consumer protection without the need for a new and costly government bureaucracy,” Bachus said in a statement. “It will create smarter regulation, and will benefit both taxpayers and consumers.”

Schumer and Warner, along with Republicans on Frank’s committee, support a single regulator.

“It does not make sense for up to four different federal regulatory bodies to retain oversight over the safety and soundness of banks,” Schumer wrote in June to Treasury Secretary Timothy Geithner. This system “preserves the regulatory arbitrage that allows institutions to pick the oversight scheme that benefits them the most.”

Warner told Bloomberg News July 1 that the Fed and FDIC should cede their bank oversight role to an “end-to-end” supervisor.

Jonathan Graffeo, a spokesman for Senator Richard Shelby, top Republican on Dodd’s committee, in an e-mail yesterday said “we continue to review” Dodd’s proposal.

Source

Soft drink maker Pepsico Inc said on Saturday that Michael White, vice chairman and PepsiCo International chief executive, would retire later this year after nearly 20 years with the company.

White will also leave his seat on the PepsiCo board of directors when he retires, which is the company’s practice.

The component businesses of PepsiCo International will be managed by Zein Abdalla, who becomes CEO of PepsiCo Europe, and Saad Abdul-Latif, who becomes CEO of PepsiCo Asia, Middle East, Africa. Both will report to PepsiCo CEO Indra Nooyi.

“Close to a year ago, Mike shared with me his interest in eventually moving on to ‘the next chapter’ of his life,” Nooyi said in a statement fast payday loan.

“It would be difficult to overstate Mike’s contribution to PepsiCo over two decades,” Nooyi said.

White joined the company in 1990 and has held several senior positions, including CFO of Frito-Lay North America. (Reporting by Kyle Peterson; Editing by Peter Cooney)

Read more

Iceland expects to get its first International Monetary Fund review this month as an accord with the U.K. and the Netherlands on depositor claims reaches completion, allowing the island to tap its bailout funds.

“We are still optimistic and it’s technically possible that the first review of the IMF program will take place in September, although we’re cutting it pretty tight,” Finance Minister Steingrimur Sigfusson said in an interview in the capital Reykjavik yesterday.

Iceland’s dispute with the U.K. and the Netherlands has threatened to stall the continued disbursement of its IMF-led bailout. The failure of Landsbanki Islands hf last year left thousands of British and Dutch depositors wondering whether they’d lost their life savings and even prompted the U.K. to deploy anti-terror laws to freeze Icelandic assets until the country agreed to cover the so-called Icesave claims.

The island’s lawmakers have since demanded changes to the government’s accord with the U.K. and Dutch authorities. Iceland yesterday received its first response from the two countries, which showed they don’t accept a clause requesting renegotiation if the loan isn’t repaid by 2024, broadcaster RUV said.

The Atlantic island is relying on the $5.1 billion international loan, including $2.5 billion from the Nordic states of Sweden, Finland, Norway and Denmark, to avert default and a second collapse, Sigfusson has said. To date, Iceland has received $827 million in IMF funds.

Not OK With Delay

“This delay is clearly not something that we are OK with or the fact that the review is connected to the Icesave matter,” Sigfusson said. “However, the official position of the IMF is that as the Nordic loans are contingent on the resolution of the Icesave agreement, the board wants to wait until all the parts of the financing are in place, before the review takes place.”

If the IMF review, which was originally scheduled for February, doesn’t take place by Sept. 25, it will be delayed again until the second week of October, Sigfusson said. It will be clear today “or this weekend whether or not the fund’s board will be able to carry out the review before it’s last meeting in this month.”

The coalition government on June 6 agreed to take a 2.35 billion-pound ($3.83 billion) loan from the U.K. and 1.2 billion euros ($1.76 billion) from the Netherlands to cover the deposit guarantees. However, the government needed parliamentary ratification for a state guarantee, linked to the loans. After three debates in parliament the bill was approved with conditions, including linking payments to economic growth.

Krona Slump

The failure of Iceland’s biggest banks last year forced the government to impose capital restrictions to prevent a sell-off of the krona after the currency lost as much as 80 percent of its value against the euro on the offshore market. The controls have failed to prevent a 7.5 percent decline in the krona against the euro this year, making it the third-worst performer of the 26 emerging market currencies tracked by Bloomberg.

“I believe that the fundamentals of the economy justify a stronger krona than what we see now.” Sigfusson said. “We would like to see the krona’s value increase as we think it’s currently undervalued. I’m not saying that it should gain a lot of strength, but at least reach a realistic long-term value.”

The country’s central bank, which shares Europe’s highest benchmark interest rate with Serbia, on Aug. 13 left the key rate at 12 percent.

At Odds

The bank said last month it won’t lower rates further adding it can’t rule out higher rates if the krona comes under pressure as capital restrictions are scaled back. That policy is at odds with Sigfusson’s view. He says he wants lower borrowing costs to boost the domestic economy.

“It’s important to continue on the path of rate cuts and bringing down inflation,” he said. “The primary objective is to bring about stability. Even though the rate of the krona is low, it is stable.”

Sigfusson, chairman of the junior coalition partner, the Left Green Party, became finance minister at the beginning of this year after the island’s economic collapse led to the ousting of the government former Prime Minister Geir Haarde. His party rules together with Prime Minister Johanna Sigurdardottir’s Social Democrats.

Source

Former U.S. President Bill Clinton said the Obama administration’s best hope to reduce the budget deficit is to focus on reviving the economy while maintaining discipline in budgeting.

“The most important thing is to have honest accounting and real discipline in the way you spend or cut taxes,” Clinton, 63, said in an interview today with Bloomberg Radio. “If you’re going to expend revenues or reduce them coming in, you have to replace them.”

Clinton endorsed Obama’s call for “pay-as-you-go” budget rules that would require that future spending increases or tax cuts be paid for with revenue increases. Still, he said progress on the budget deficit would mostly turn on the success of Obama’s economic strategy.

“The better the economy is, the quicker you’ll balance the budget,” Clinton said. “But anyone that says that they know how quickly they can do it with precision is not being entirely candid because part of it depends on factors beyond your control.”

The federal budget deficit will total $1.6 trillion this year as revenue falls and the government spends at the fastest pace in 57 years, the nonpartisan Congressional Budget Office said last month guaranteed unsecured personal loan.

The gap will be equal to 11.2 percent of the economy, the biggest since World War II. The shortfall is largely attributable to the financial crisis, which has reduced tax revenue even as the government increased spending on stimulus programs and bailouts for financial companies and automakers, the CBO said.

Dollar Weakness

Investor concern about the deficit, which has grown from $455 billion in 2008, has contributed to the weakness of the dollar. The trade-weighted dollar index has fallen 12 percent since Obama’s inauguration in January. The index measures the currency’s performance against the euro, yen, pound, Canadian dollar, Swiss franc and Swedish krona.

Under Clinton, the budget balance swung to a surplus of $236 billion in 2000, his last full year in office, from a deficit of $290 billion deficit in 1992 during the final year of the George H.W. Bush presidency. The dollar index rose 21 percent in the Clinton years.

Source