Lenon’s main business news

The drug-data provider Epocrates Inc. has filed with the SEC to sell up to an estimated $75 million in an initial public offering.

The company plans to trade on the Nasdaq Global Market with the symbol EPOC.

Epocrates, a leading provider of mobile drug reference tools and interactive services, said it will use the proceeds to pay dividends due to the holders of its Class B preferred stock and for general corporate purposes, including working capital, research and development, sales and marketing, and capital expenditures.

J.P. Morgan Securities Inc. and Piper Jaffray & Co. will serve as joint book-running managers no fax pay day loan. William Blair & Co. LLC. and JMP Securities LLC will act as co-managers.

The company has yet to determine the number of shares to be sold and their price range.

Epocrates has more than 1 million users, including more than 40 percent of U.S. physicians, the company said. Its products are used on popular hand-held devices including the iPhone, iTouch and Blackberry, and Palm, Android and Windows devices.

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Nova Engineering, a unit of L-3 Communications, landed a contract worth up to $53.8 million to provide and maintain a remote sensor system for the Department of Defense.

According to a DOD news release, Cincinnati-based Nova will provide the department with equipment, upgrades and repairs, and program management for its Tactical Remote Sensor System payday loans. The technology allows for all-weather remote monitoring of specific areas.

The work will be performed at Nova’s Cincinnati operations and is expected to be completed by July 2015.

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Lending through Small Business Administration programs has plummeted since the end of May, when the SBA ran out of money for breaks that made those loans less risky for lenders and more affordable for borrowers.

The drop in SBA lending has occurred even as Congress explores new ways to expand small businesses’ access to credit.

The economic-stimulus bill increased the government guarantee on the SBA’s flagship 7(a) loans to 90 percent from the typical 75 percent. The legislation also reduced or waived fees on those loans as well as 504 loans, which are used primarily for real estate. As a result of those breaks, SBA lending rebounded after cratering during the credit crisis of late 2008.

Through June 25, the SBA had approved $10.5 billion in 7(a) loans this fiscal year, which began Oct. 1. That’s up 80 percent from the same period a year ago.

However, lending slowed dramatically in June due to the loss of the higher guarantee and fee waivers. In May, SBA lenders made about $272 million in 7(a) loans per week. That’s not counting the $732 million in 7(a) loans made during the final week of May, as lenders rushed to get their loans approved before the loan breaks expired. In the first four weeks of June, average weekly loan volume dropped to $86 million.

President Barack Obama has called for reviving and extending the higher loan guarantee and fee waivers through the end of the year, and the proposal has bipartisan support. But Congress left town for its weeklong Fourth of July break without acting on it. That lack of urgency frustrates SBA lenders.

Tony Wilkinson, president and chief executive of the National Association of Government Guaranteed Lenders, criticizes Congress for letting “the one stimulus program that was probably working the best” expire.

“Shame on them,” says Eddie Tuvin, vice president of SBA and commercial lending at Capital Bank in Rockville, Md. “Why isn’t it a priority?”

Restoring the 90 percent guarantee “would do as much to really juice the recovery as anything,” says Charles Green, a former SBA lender in Atlanta who now advises businesses on financial issues.

Tuvin says 7(a) loans “breezed through” his bank’s approval process when the 90 percent guarantee was in place. “It was a major factor in the decision of our loan committee to approve several loans that wouldn’t have been made without it low rates payday advance.”

Now it’s much a harder to get a 7(a) loan approved, he says.

Plus, many borrowers and lenders simply are holding off on SBA loans.

“We have borrowers waiting right now who are willing to create and retain jobs,” Wilkinson says.

The Senate is expected to vote soon on legislation that would restore those SBA loan breaks, as well as establish a $30 billion fund that community banks could tap for small-business lending. Chances for the Small Business Jobs Act are good; it cleared a procedural hurdle by a 66-33 vote before the Fourth of July recess.

But that doesn’t mean the SBA loan breaks will be restored right away. The Senate bill differs in many respects from the House’s version of the Small Business Jobs Act. That means the Senate and House would have to hash out their differences before sending the legislation to the president for his signature. That could take weeks, or even months.

Even though the Senate bill increases the size limits on SBA loans — something lenders have long pushed for — Wilkinson would rather see Congress first pass a simple extension of the higher guarantee and fee waivers, and then work out a more ambitious bill.

Financial regulatory reform also awaits a final vote in the Senate when Congress returns. The legislation aims to end “too big to fail” bank bailouts by imposing new capital and leverage requirements, and creating an orderly system to liquidate large financial firms that fail. It also regulates over-the-counter derivatives and creates a new consumer watchdog for financial products.

Critics fear the bill could hurt the availability of credit to small businesses. Tuvin expects banks may cut back their lending as a result of the additional costs and regulations they would face as a result of the legislation. Green fears the bill could lead to more bank consolidation, because it would make it harder for smaller banks to be profitable.

However, Green thinks small businesses could benefit from the bill’s new consumer protections, since many business owners rely on credit cards and revolving lines of credit.

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Bermuda Run Country Club is out from under control of a court-appointed receiver after businessman Don Angell reached an agreement with the club’s lender.

Members of the club received a letter dated July 1 notifying them of the agreement with Rhode Island-based Textron Financial, which filed suit earlier this year claiming that Angell put the club up as collateral for a more than $8 million loan that the club’s operating company, WFBRCC LLC, took out in 2004.

The letter did not outline details of the agreement.

“Unfortunately, the speed and depth of the worst recession in eighty years caught us completely off guard,” Angell’s letter said. “As a result, we had to enter into some difficult dealings with Textron Financial, our lender, including a possible foreclosure of the club low fee payday loans.”

Georgia-based Affiniti Golf Partners came in to manage the club under the court-appointed receiver and will continue to run the club. Affiniti, along with club staff, “have worked hard to right the ship and put it back on a healthy course once again,” Angell wrote.

Several of Angell’s other companies have faced financial difficulties including tax liens over the past few months. But Angell wrote that “Bermuda Run CC is one of our proudest accomplishments. We love the club, all the people involved, and cherish the memories we have created together over all these years. Its recent troubles were very painful for us.”

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Los Alamos National Laboratory and its employees donated a combined $113,000 to the United Way of Santa Fe’s 2009-2010 giving campaign, making LANL the top donor for the ninth consecutive year.

LANL and its management company, Los Alamos National Security LLC (LANS), will receive the 2010 Top Workplace Contributor Award, along with the lab’s Community Programs Office. In addition, Debbi Wersonick – who coordinates community-giving programs for LANL – will receive a Community Ambassador plaque cashadvance.

LANL employees raised more than $2 million in its most recent giving campaign for the United Way of Santa Fe County and United Way of Northern New Mexico. The total included a dollar-for-dollar match from LANS.

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California’s high-speed rail officials said Monday they will compete for a share of an additional $2.3 billion in federal funds for such train projects nationwide.

Federal Railroad Administration officials announced they will start accepting applicants to disseminate $2.1 billion in grants for high-speed intercity passenger rail projects. The agency will also make available $245 million for individual construction projects within a high-speed rail corridor.

This will be in addition to the $8 billion in federal stimulus funds that were awarded to high-speed rail projects last fall. California was able to secure $2.2 billion of that amount to help kick-start its proposed 800-mile, $45 billion statewide high-speed rail network connecting Southern California with the Bay Area and Sacramento payday loans.

“The High-Speed Rail Authority and California will compete aggressively for our share of these funds to supplement the federal stimulus funds we have already been awarded and the state funds committed to the project by the people of California," said Curt Pringle, chairman of the rail authority’s board of directors, in a statement. "We will continue to move forward with building the nation’s first high-speed rail system because we know it will create jobs, economic opportunity for Californians and improved mobility for our state.”

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Congressman Zach Wamp, R-Chattanooga, has scored the second business celebrity endorsement this week in Tennessee’s gubernatorial race, winning the support of Nashville-based financial guru Dave Ramsey.

Wamp is in a three-way race with Knoxville Mayor Bill Haslam and Lt. Gov. Ron Ramsey of Blountville for the Republican nomination to face Democrat Mike McWherter in the governor’s race. Party primaries are Aug. 5. Dave Ramsey will host a fundraising event for Wamp at his Franklin home on July 1.

“We the people are looking for freedom from government control over our personal lives and our wallets,” Ramsey said in a statement. “Taxes are out of control because government spending is out of control.”

Ramsey’s Brentwood-based The Lampo Group employs 285 people and provides financial planning resources and classes based on Ramsey’s debt-free principles.

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are widely regarded as being in much better position than the top banks in the U.S..

"The recession was milder since Canada’s banking system is fairly healthy," said Paul Ashworth, senior economist with Capital Economics, a research firm based in Toronto. "Canada never had a housing downturn that was anything like what happened in the U.S."

Some Canadian companies have even tried to capitalize on this image of financial strength in their ad campaigns. Toronto-based insurer Sun Life Financial (SLF), which has a big presence in the U.S. and even has the naming rights for the Miami stadium where the Dolphins and Marlins play, boasts in commercials that it didn’t take any government bailout money.

That’s all well and good. But will Canada keep attracting strong investor interest or is the fact that Canada isn’t the U.S. already priced into their currency, stocks and bonds?

Ashworth said that the rise in gold, which is partly a fear trade, has certainly helped Canada. So if gold prices cool, that could hurt the Canadian dollar.

But he said that if gold falls on hopes that the global economy is going to avoid another major meltdown, the trade-off would probably be higher oil prices. That could offset any weakness in gold.

"The bottom line is that the loonie is still a petro currency," he said.

So as long as the Canadian economy holds up, there is a good chance that Canadian assets could continue to perform well. After all, Canada’s central bank took the first step towards bringing interest rates back to normal earlier this month.

The Bank of Canada boosted rates by a quarter-of-a-point to 0.5%. That makes Canada the first of the so-called G-7 group of industrial nations to raise rates since the onset of the global financial crisis in 2008.

Stefane Marion, chief economist and strategist with National Bank Financial Group in Montreal, points out that the Bank of Canada is likely to raise rates again next month. And that’s lifting bond rates in Canada.

The difference between the yield on 2-year Canadian bonds and the 2-year U.S. note is about a full percentage point. In other words, investors believe they’ll be able to get a better rate of return in Canada because the economic fundamentals look stronger.

"Gone are the days when foreign investors thought of North America as only the U.S.," Marion said. "People are discriminating between Canada and the U.S. There’s probably limited downside for the Canadian dollar and other assets unless there’s a major global economic relapse."

Reader comment of the week. To quote Hannibal from "The A-Team" (and did they really need to make a movie of the TV show?), I love it when a plan comes together. This week’s best reader retort fits perfectly with the theme of today’s column.

I wrote on Monday about how Brazilian oil company Petrobras could benefit from the BP fiasco in the Gulf of Mexico. Paul Dupuis took issue with that.

"Why would you suggest Brazil when there is over a trillion barrels in oil reserves in Alberta??? No drilling in water here and we are already are the largest supplier of oil to the U.S.," he wrote.

Well said.

- The opinions expressed in this commentary are solely those of Paul R. La Monica.  

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A private equity group has paid $5.4 million to Union Credit Bank for nearly an acre of land in the heart of Miami’s financial district, the site of a planned 42-story condominium tower.

The June 11 sale pegged the purchase price of the 36,000-square-foot property at $150 a square foot.

Union Credit Bank repossessed the site, at 1100 S. Miami Ave., from development company Brickell Village Partners and principal J. Kevin Reilly. Reilly planned to build Pointe at Brickell Village on the property.

At the time of the foreclosure, the bank was owed $7.6 million in principal, plus $1.2 million in interest, fees, and court costs, according to the final judgment of foreclosure signed by Miami-Dade County Circuit Court Judge Gerald D. Hubbart on Jan. 22.

Peter Zalewski, managing principal of Bal Harbour-based real estate consultancy Condo Vultures, said the deal is a sign that investors are looking beyond condo management and resales as revenue models – another sign of the local market’s recovery.

"Nearly 10 high-rise condo development sites in greater downtown Miami have been sold in the last two years, and several more are for sale," he said. "Private equity groups have been buying up deeply discounted condos in greater downtown Miami with great velocity for the last 18 months. As the oversupply of new condos is whittled down, buyers are increasingly broadening their criteria. Land is starting to become acceptable at the right price once again."

Adam Greenberg, managing director of Miami-based BayBridge Real Estate Group, which handles real estate sales and financing, agrees that the deal is another sign that the market is turning.

“Investors are buying up strategic sites so they can build on the next go around,” he said.

But, Jack McCabe, of McCabe Research & Consulting in Deerfield Beach, said there are variables on the horizon, including Amendment 4, which could create obstacles to future investment.

On the November ballot, Amendment 4 would require the public to vote on large development projects that would need changes to government master plans. He also noted that there is still significant unsold inventory, financing challenges and another wave of foreclosures that will likely tamp down demand for new construction for five to seven more years.

“Miami will come back strong. It’s only a matter of time,” he said. “But, I think some developers are overly optimistic about how fast the turnaround will be.”

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Forget the worries about China’s economy cooling off. Overheating might be the greater concern.

China reported Thursday that its exports grew nearly 50%. Property prices in the biggest cities shot up 12% compared to a year earlier, the second biggest jump on record. Industrial production is up nearly 19% so far this year.

While a robust Chinese economy could benefit the U.S., it’s also a concern since further strength may lead China to take more steps to rein in growth.

There are other signs that the Chinese economy is once again white hot, despite recent worries about a slowdown in demand for its products in Europe and the United States.

The Chinese government reported Friday that consumer prices jumped 3.1% in May compared to a year ago, and that spending on consumer soared 19% on that basis.

But one of the most significant is a series of strikes and labor agreements in recent days granting large pay increases to Chinese workers.

After labor stoppages shut down some of the operations of Honda Motor (HMC) in China, workers got wage increases of between 24% and 32%. Foxconn Technology, which makes products for Apple (AAPL, Fortune 500), Dell (DELL, Fortune 500), Hewlett Packard (HPQ, Fortune 500) and Sony (SNE) on a contract basis, has doubled the wages of its estimated 800,000 workers in China.

Wage increases are spreading beyond these plants. Some provincial governments are raising minimum wages by as much as 16% in order to attract skilled workers.

Nicholas Lardy, economist and China specialist at the Peterson Institute for International Economics, said the increases are nothing new. Wages have been rising at least 15% a year for the last decade in China, although off a very low base.

But Lardy predicted more wage increases ahead. For Chinese exporters, especially manufacturers of electronics, labor costs are only a small part of their costs bad credit payday loans. So they can afford to raise wages without losing production to even lower-wage countries like Vietnam.

If wages continue to go up, that could eventually cause higher prices for some Chinese exports, as well as create inflation pressures in China. That could lead to additional wage hikes, creating an inflationary cycle that could have an impact on the price of goods across the globe.

Treasury Secretary Tim Geithner testified before a Senate committee Thursday that the U.S. believes rising Chinese wages will be a plus for U.S. jobs, however.

"China has to be a key part of any strategy to increase U.S. exports and jobs," Geithner said. "Over time Chinese households will be able to earn more and buy more, including American goods and services."

But Lardy said U.S. exports to China still make up a relatively small percentage of consumer purchases there. Most U.S. multinational corporations trying to reach Chinese consumers are producing the goods in China. Chinese imports are still dominated mostly by capital goods or industrial commodities.

In addition to spending more, better-paid Chinese workers are likely to invest more as well, which could feed into asset bubbles there.

Rates on savings accounts in China are well below 1%. That has driven many people to invest in real estate to try to get better returns on those savings.

John Makin, a China expert and principal at Caxton Associates, a hedge fund, said the overall Chinese economy isn’t in danger of overheating even with the large wage hikes, but that the housing market is at risk.

"I think the overheating pressure has been concentrated in the real estate sector. They’re making people very nervous," he said. 

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