LITTLE ROCK — QUOTE OF THE DAY
“We don’t think some dairymen will be able to survive.They’re looking at some rough times.”
Mike Brown,
an economist at Glanbia Foods Inc.
Article, 1D
3-month T-bill rates at 15-month high
WASHINGTON - Interest rates on short-term Treasury bills rose in Monday’s auction with rates on three month bills rising to the highest level in 15 months.
The Treasury Department auctioned $29 billion in three-month bills at a discount rate of 0.175 percent, up from 0.140 percent last week. Another $28 billion in six month bills were auctioned at a discount rate of 0.210 percent, up from 0.195 percent last week.
The three-month rate was the highest since these bills averaged 0.180 percent on Aug. 17, 2009. The six-month rate was the highest since these bills averaged 0.215 percent on June 28.
The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,995.58 while a six-month bill sold for $9,989.38.
That would equal an annualized rate of 0.178 percent for the three-month bills and 0.213 percent for the six-month bills.
Separately, the Federal Reserve said Monday that the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, was unchanged at 0.27 percent last week, the same as the previous week.
Credit cards lose 8 million users
NEW YORK - More than 8 million consumers stopped using credit cards over the past year. The decline stems from a combination of consumer choices and bank actions.
An analysis by credit reporting agency TransUnion found that use of general purpose credit cards bearing MasterCard or Visa logos, or issued by Discover or American Express, fell more than 11 percent in the third quarter, compared with the July to September period last year.
About 62 million people now have an active card, compared with 70 million a year ago.
The Chicago company found that consumers in the subprime category, or those with low credit ratings, were believed to be without cards mostly because they were shut down by banks after payments fell behind or balances were written off.
Bottled-water firm closing Fiji plant
SUVA, Fiji - Global bottled water company Fiji Water said Monday that it is closing its business in Fiji because of a tax increase demanded by the country’s military government.
Fiji Water President John Cochran said in a statement issued from the company’s headquarters in Los Angeles that the shutdown was effective immediately. It is also canceling purchase orders from suppliers in Fiji and putting on hold several construction contracts in the South Pacific nation.
The statement said the government had announced last week that it was imposing a new tax rate of 15 cents per liter on companies extracting more than 920,000 gallons of water a month - up from the current one-third of one percent rate. Fiji Water is the only company extracting that much water.
“This new tax is untenable and as a consequence, Fiji Water is left with no choice but to close our facility in Fiji,” the company said in the statement.
Porsche to add small SUV to lineup Porsche AG, the maker of the 911 sports car, approved plans Monday to develop a small sport utility vehicle called the Cajun as the manufacturer aims to increase annual sales by adding models.
The supervisory board signed off on the new model, which will be smaller than the Cayenne SUV, Porsche’s best-selling vehicle, the Stuttgart, Germany-based carmaker said in an e-mailed statement.
The Cajun will be the manufacturer’s fifth model line alongside the 911, Boxster, Cayenne and Panamera series.
Porsche, which is in the process of merging with Volkswagen AG, is expand its lineup from 38 models across the four vehicle lines to almost double annual sales by 2014.
CenturyLink, Qwest deal gets state OK
MONROE, La. - Two state regulatory bodies in Arizona have approved the $10 billion acquisition of Qwest Communications International Inc. by CenturyLink Inc., the companies said Monday.
The Residential Utility Consumer Office and the staff of the Arizona Corporate Commission have found that the deal will not harm consumers or the public interest. The decision to approve the deal is still subject to review by the commission’s members, the companies said.
To help win approval, the companies said they have agreed to provide the state with regular reports on their integration and to invest at least $70 million in broadband infrastructure in Arizona over the next five years.
With the deal in place, the companies said they now have more than half of the state regulatory approvals needed to complete the acquisition.
CenturyLink, the country’s fifth-largest local phone company announced in April that it had agreed to buy Qwest, the third-largest. The combined company will have about 18 million phone lines serving customers in 37 states, with its headquarters in Monroe, La.
Consumer unit setup draws Fed worry
Federal Reserve Bank of St. Louis President James Bullard said the funding level for the Consumer Financial Protection Bureau to be housed within the Fed appears arbitrary and not necessarily suited to the agency’s needs.
“The amount of money allocated in the law is not based on any careful assessment of what the needs of the bureau will be as it attempts to fulfill the mandate of the Congress with regard to consumer protection,” Bullard said Monday at a conference at the St. Louis Fed. “Nor is there any mechanism for changing these amounts going forward.”
President Barack Obama signed into law in July a 2,300-page overhaul of financial regulation that gives the government authority to unwind failing financial firms, imposes new rules on derivatives markets and creates a consumer-protection agency in the Fed to monitor loans and services.
“The Fed’s only engagement with this independent bureau is to fund it,” Bullard said, according to a news release by the district bank. “The law requires that the equivalent of 10 percent of Federal Reserve System expenses be transferred to the CFPB in 2011, 11 percent in 2012, and 12 percent in 2013, where it will stay fixed in perpetuity.”
Business, Pages 24 on 11/30/2010