Yahoo and eBay seal online deal BBC News
Internet search engine Yahoo and auctioneer eBay have teamed up in an exclusive online alliance. Under the deal, Yahoo, the largest internet media firm, will be the exclusive provider of branded advertising on eBay's site. In exchange, Yahoo will use eBay's payment system PayPal, to permit its customers to pay for Yahoo services. The deal comes as both firms face stiff competition from rival Google, and are seeking new ways to gain market share. "It's a very positive for both, since eBay gets to monetize its traffic with advertising," said Marianne Wolk, an analyst with Susquehanna. Monetization denotes a way to create revenue from a property or an asset, in this case by increasing advertising on an internet page. "Clearly Google and Microsoft, I assume, would have liked this business, but Yahoo has more assets to leverage in a partnership with e eBay," said Mark May, an analyst with Needham & Co. The joint initiative will start later this year.

Nintendo sets price limit on Wii BBC News
Japanese games giant Nintendo has confirmed that the price of its new Wii console will be much lower than its rivals. The Wii will cost 25,000 yen or lower in Japan and $250 (£133) or less in the US, said Nintendo as it revealed its financial results. The company added it aims to sell six million machines by March 2007. The Wii is due out towards the end of the year, competing with Sony's PlayStation 3 and Microsoft's Xbox 360. The three companies are battling for a share of a video games industry worth some $30bn (£16bn).

Cheaper machine
Nintendo unveiled its Wii console at the E3 games expo in Los Angeles earlier this year. At the time, it did not reveal the cost of the machine, but analysts had expected it to be lower than its competitors. At a news conference in Osaka, Nintendo senior managing director Yoshihiro Mori confirmed what many wanted to hear. The price range set by Nintendo contrasts with the cost of Sony's new PlayStation 3, which is due to hit the shops in November. A basic version of the console will cost $499 (£266), while a premium model will sell for $599 (£320). The exact price in the UK has not been announced. Prices for Microsoft's Xbox 360, which went on sale last November, start at $299 (£209 in the UK).

Wii hopes
The Wii console is key to Nintendo's future success. The company has just posted a 19% drop in annual profits, warning that results for its current financial year will be weaker than previously expected. It is looking to the launch of the Wii to help its bottom line. Nintendo plans to ship six million consoles by March next year and aims to sell 17 million games for it. The console has a one-handed controller that looks like a TV remote control. It uses motion-detection sensors that allow players to control the game by moving the controller in the air.

Enron's Lay and Skilling guilty BBC News
Former Enron bosses Ken Lay and Jeffrey Skilling have both been found guilty on fraud, conspiracy and other charges. The two presided over the spectacular collapse of the energy giant in 2001 and were also accused of lying to investors about its financial problems. The two former chief executives faced 34 counts relating to Enron's collapse. The energy trading firm went from being the US's seventh largest company to bankruptcy, amid allegations of accounting irregularities. "I'm glad it's over, it's put closure to it," said former Enron worker Deborah Defforge. "I feel sorry for the families, but at the same time the reality was that we suffered the most when we were let go." "I think that contrary to what the defendants were saying I think everybody recognised there were severe problems at Enron," added Philip Hilder, lawyer for Enron whistleblower Sherron Watkins. A spokesman for President George W Bush said the verdict should be seen as a warning to other corporate criminals. "The administration has been pretty clear there is no tolerance for corporate corruption," said White House spokesman Tony Snow. "The Justice Department has been going aggressively after those who are involved in corporate corruption."

The way it works
The Enron saga has been both messy and confusing since October 2001, when the company announced huge losses as its shares dived. Two months later, it filed for bankruptcy as allegations began to emerge that it had used off-the-books offshore firms to hide losses. The firm's auditor, Arthur Andersen, was forced out of business following the collapse of Enron, as it was seen as having colluded in the accounting practices. In a separate case, Lay has also been found guilty by a District Court judge of four charges of bank fraud totalling $75m (£40m). The two plan to appeal their convictions. "We fought the good fight," Skilling told reporters outside the court after the verdict. "Some things work, some things don't. Obviously I am disappointed but that's the way the system works."

USA Inc in the dock
The Enron case is the culmination of a string of high-profile cases involving corporate misbehaviour.Among them was the conviction of Worldcom chief executive Bernie Ebbers for fraud and conspiracy, and homecare queen Martha Stewart for insider trading. Andrew Fastow, Enron's former chief finance officer, pleaded guilty to his part in the scandal in 2004 having agreed to testify against his former bosses. He paid fines totalling $23m and received a sentence of 10 years in jail. Numerous other Enron executives have been convicted - many after pleading guilty - in court cases across the US.

Blockbuster trial
The trial of Lay and Skilling in Houston follows four years of investigation by the Department of Justice's Enron Task Force. It lasted for 15 weeks, with 54 witness called by the two sides. The verdict came on the jury's sixth day of deliberations. In all, Skilling has been found guilty on 19 of the 28 counts he faced - with the "not guilty" verdicts coming on some of the charges of insider trading. He could face as much as 185 years in jail. Lay, however, has been found guilty of all six fraud and conspiracy charges that he faced. He could face as much as 45 years behind bars.

Skilling and Lay convicted of Enron conspiracy MSN Money
Former Enron executives Kenneth Lay and Jeffrey Skilling were convicted on Thursday of fraud and conspiracy for their role in the energy trader's collapse, bringing a dramatic conclusion to a case that changed the face of US business. The verdict provided the federal government with its most important victory in a five-year crackdown, which followed a white-collar crime wave that rattled investor confidence, wiped out thousands of jobs and destroyed billions of dollars in wealth. Some of the jurors said they saw themselves as part of a bigger battle against corporate excess, an effort that prompted US lawmakers to pass Sarbanes-Oxley, which requires increased accountability from corporate executives and directors. "This is undoubtedly the most challenging and heart-rending experience I've ever had," one of the jurors, Kathy Harrison, an elementary school teacher, said at a news conference. "I've fought on this battleground for American justice." After five days of deliberations on the case, which involved the use of off-the-book partnerships to disguise debt, Mr Lay, former chairman, was found guilty on all six counts of wire fraud, securities fraud and conspiracy. In addition, Judge Sim Lake said he had found Mr Lay guilty of four counts of bank fraud in a separate case that was argued last week without a jury. The tabular content relating to this article is not available to view. Apologies in advance for the inconvenience caused. Mr Skilling, the former chief executive, was found guilty on 19 counts of conspiracy, securities fraud, insider trading and making false statements. Mr Skilling was acquitted on nine of 10 counts of insider trading. It is possible the two men could spend the rest of their lives in prison. Mr Lay, 64, faces up to 45 years. Mr Skilling, 52, faces up to 185 years. They are to be sentenced on September 11. As the verdicts were read, Mr Lay's face turned grey. His wife and daughter covered their faces and sobbed. All five of his children huddled around him. Mr Skilling, whose wife was not at court, kept his face blank. Daniel Petrocelli, his lawyer, promised a "vigorous" appeal. Legal experts said the verdicts showed jurors rejected defence arguments that there was no accounting fraud at the world's biggest energy trader, and that the collapse was sparked by a collapse in confidence caused by heightened scrutiny from regulators, analysts and the media. Henry Hu, business and law professor at the University of Texas, said: "Symbolically, this is the end of the morality play. Enron has become a word that you can use to scare children. Average investors might not have followed some of the other cases, such as WorldCom and Tyco, but they followed this one. They knew who these guys were." Jurors said their verdict was not reached because of one particular witness or piece of evidence, and confessed to changing their minds from day to day. "You felt like a ping-pong ball,'' said Doug Baggett, a juror who manages a legal department, in a news conference. Judge Lake said Mr Skilling's $5m bond was sufficient to release him until sentencing but told Mr Lay to surrender his passport and have his five children post their homes to back up his $5m bond. Meanwhile, a consortium of US and European hedge funds had agreed to buy the international assets of Enron for $2.1bn in cash.
Undoing of Enron OCRegister
Enron execs convicted The Herald
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Enron's Lay, Skilling avow innocence despite guilty verdict Yahoo! News
Enron founder Kenneth Lay and former chief executive office Jeffrey Skilling avowed their innocence despite a jury's guilty verdict in their fraud and conspiracy trial. "I firmly believe I'm innocent of the charges against me as I have said from day one," Lay told reporters after he surrendered his passport and paid a 5 million dollar bond which was co-signed by his children. "Certainly we're surprised. I think probably more appropriately to say we're shocked." Lay, who is currently facing a maximum of 165 years in jail, said he still considers himself "a very blessed man" because he has the love of his wife and family and faith in God. "Obviously as time goes on we'll have more things to say," Lay concluded. Skilling's defense attorney said a vigorous appeal would be mounted. "Obviously I am disappointed ... that's the way the system works," Skilling said after leaving the court. But when asked by a reporter whether he would ever be able to admit to himself that he had committed crimes, Skilling said "No." When asked why not, he responded "I didn't." "I would like to thank my family for sticking by me," Skilling told said. "We fought a good fight and we didn't get the verdict we wanted." Prosecutors said these avowals of innocence will impact sentencing. "Personal acceptance and personal responsibility plays a very important role in sentencing," said lead prosecutor Sean Berkowitz, who declined to comment on what length of sentence he would be asking for. "We're going to calmly and objectively look at all of the sentencing factors and work to bring a just sentence that reflects what the victims have lost and things that have happened to the community as well as what justice should be done in the individual case," he said. Prosecutor John Hueston said he was not worried about losing the case on appeal. "We're not worried about the appeals because of the good work the judge did in this case," he said. Skilling, 52, was found guilty of 19 of 28 counts of fraud and conspiracy and faces a maximum penalty of 185 years in jail. Enron founder and longtime chairman Lay, 64, was found guilty of all six fraud and conspiracy charges and also of federal bank fraud charges in a separate trial.

http://www.humaneventsonline.com/article.p...nt=yes&id=15183



39,000 Days Later, Telephone Tax Expires

by Robert B. Bluey
Posted May 26, 2006

For all the bad things Republicans did today—the Senate’s amnesty bill being one of the biggest flops of President Bush’s presidency—they’re at least still able to do some good when it comes to cutting taxes, even when it’s unintended.

Last week the President signed into law an extension of his tax cuts—handing the GOP some good news at a time when it’s hard to come by. Today, Republicans on Capitol Hill celebrated the Treasury Department’s decision to concede a court case involving the Long-Distance Telephone Excise Tax.

Explains House Majority Whip Roy Blunt (R.-Mo.): "Levied to help fund the Spanish American War in 1898, the telephone excise tax has outlasted two world wars, the Great Depression, and the start of two new centuries, but the federal government continued to needlessly tax basic telephone services. The war lasted only 220 days, yet this tax on talking has finally expired after over 39,000 days."

Senate Majority Leader Bill Frist (R.-Tenn.), who disappointed me and most conservatives with his embrace of the amnesty bill today, offers some key points following Treasury’s announcement:

No immediate action is required by taxpayers.


Refunds will be a part of 2006 tax returns (filed in 2007).


Refund claims will cover all excise tax paid on long-distance service over the last three years, from July 1, 2003, through June 30, 2006 (time allowed given statute of limitations). Interest will be paid on refunds.


The IRS is working on a simplified method for individuals to use to claim a refund on their 2006 tax returns.


Refunds will not include tax paid on local telephone service, which was not involved in the litigation.


Originally established in 1898 as a “luxury” tax on wealthy Americans who owned telephones, the federal excise tax on telephone calls is not compatible with today’s modern information-age society.
Perhaps not coincidentally, Frist and Sen. Sam Brownback (R.-Kan.)—both considered contenders for the GOP nod in ’08—put out statements this afternoon around the same time they were voting for an amnesty for illegal immigrants. It has me wondering: Were they trying to placate conservatives angry about their immigration vote?

Here’s what Brownback had to say:

“The longevity of the phone surcharge tax, which was instituted over a hundred years ago as a temporary measure to help finance the Spanish American War, goes to show how hard it is for the federal government to wean itself from so-called ‘temporary’ taxes and programs. I applaud the Treasury Department and the Bush Administration for ending the phone tax and for pursuing a pro-growth tax relief strategy. The deficit is going down because of the strong economic growth stimulated by the Administration’s tax relief policy.”

And Frist added this:

“Today marks the long-overdue end of an obsolete tax that’s incompatible with modern society. The long-distance telephone excise tax has morphed from a targeted luxury tax into a burden facing nearly every American with a phone. I’m confident the refunds issued by Treasury will reap benefits throughout the economy, for Tennesseans and taxpayers everywhere. I support Secretary Snow’s call on Congress to repeal the remaining outdated excise tax on local telephone service.”

http://www.boston.com/news/nation/washingt...losures?mode=PF



Bush OKs companies forgoing disclosures
May 24, 2006

WASHINGTON --President Bush has delegated to the government's intelligence chief, John Negroponte, the authority to exempt private companies from certain federal disclosure requirements on grounds of national security.

Bush signed an official memorandum to Negroponte on May 5 giving him the authority to excuse companies with government contracts for secret projects from having to disclose them in required periodic filings with the Securities and Exchange Commission. The memo, published in the Federal Register on May 12, was first reported Tuesday by BusinessWeek Online.

Administration officials said it was the first time a president has ever delegated that authority to someone not in his executive office, according to BusinessWeek. It wasn't clear whether any U.S. company has received a waiver under the national-security provision.

"There was no expansion of the authority (to exempt companies), and nothing specific that led to the memo," White House spokeswoman Dana Perino said Wednesday in response to questions. She was referring to the idea that the legal basis for granting exemptions hadn't changed.

Carl Kropf, a spokesman for Negroponte, said, "The ability to protect the confidentiality of some of these relationships (with companies) is important." He declined further comment.

SEC spokesman John Nester declined to comment.

BusinessWeek noted the timing of Bush's memo, which came the same day that Porter Goss resigned as CIA director, ending a turmoil-filled 18 months as the agency struggled to get its footing in an era of intelligence blunders and government overhauls. Six days later, on May 11, USA Today reported that the National Security Agency was trying to analyze the telephone call records of millions of Americans and that it had obtained records provided by three major U.S. phone companies.

Negroponte, appointed by Bush last year as the first director of all U.S. intelligence activities, oversees both the CIA and the NSA.

FCC Looks at Stations' Use of PR Videos

WASHINGTON-The corporate releases aired on news programs without
disclosure, a nonprofit group says. By Jim Puzzanghera.
http://email.latimes.com/cgi-bin1/DM/y/e3J...Io30G2B0HZLz0E8

Eisner Has Much to Say to Successor

On his cable show, the former Disney chief talks to Bob Iger about
Steve Jobs, Pixar and his underwear. By Claire Hoffman.
http://email.latimes.com/cgi-bin1/DM/y/e3J...Io30G2B0HZL10Eu

Yahoo to Sell Ads on EBay Websites

SAN FRANCISCO-The broad alliance lifts the Net giants' stocks, as
Google pays to put its software on Dell PCs. By Chris Gaither and
Terril Yue Jones.
http://email.latimes.com/cgi-bin1/DM/y/e3J...Io30G2B0HZL20Ev

Enron verdict divides former employees Yahoo! News
After hearing Thursday that Enron Corp. founder Kenneth Lay and former Chief Executive Jeffrey Skilling had just been convicted of conspiracy to commit securities and wire fraud, former employees' reactions ranged from elation to satisfaction to indifference. Sherri Saunders got the call at her desk and squealed "Yes!" Brian Cruver turned on the television, saw news of the verdicts and kept on working. "Ken Lay has been coming out of the courthouse every day saying the case is in the hands of the jury, judge and God. To me, God has spoken to him with this verdict," said Saunders, 59, who lost her job and $1 million in retirement savings when the high-profile energy trader went bankrupt in 2001. "I guess it gives me a little comfort, but it doesn't put back my retirement money." Lay, convicted on all six counts — as well as four counts of bank fraud and making false statements to banks in a separate, non-jury trial related to his personal banking — now faces a maximum penalty of 165 years in federal prison. Skilling, convicted on 19 of the 28 counts, faces up to 185 years in federal prison. The judge can order them to serve some or all of the counts concurrently, and the advisory sentencing guidelines would drop the penalty far below the maximum. Saunders and Cruver were among some 4,000 employees who, the day after Enron filed for bankruptcy in December 2001, were told they no longer had jobs. They were given only 30 minutes to pack their belongings and leave the building in downtown Houston. Cruver, a trader at Enron for just nine months, said he was indifferent upon hearing the verdicts because he has moved on. But he said he would have reacted strongly if the men had been acquitted. "I was always satisfied with the punishment they were already getting, having their lives for decades tied up in courts and legal fees, but these verdicts make perfect sense," said Cruver, 34, who now lives in Austin. "They're getting what they deserve and what Enron employees wanted." Cruver wrote "Anatomy of Greed: The Unshredded Truth from an Enron Insider," which was the basis for a CBS television movie about Enron. He then founded Giveline, an online retail company where a purchase generates a contribution to a charity — a venture he calls the "anti-Enron." Richard Evans, who worked on broadband development for Enron, said he had taken his layoff in stride and still felt lucky to have worked there. He said justice was served but that the verdicts had no impact on him. He said for other former employees, "this is almost like the Astros winning the World Series" and that they were "just extremely elated." Saunders, now an executive secretary at a Houston hospital, said she hopes 52-year-old Skilling and 64-year-old Lay get stiff sentences because they have never taken responsibility or showed remorse. "If Ken Lay gets 20 years, he'll probably die in jail," Saunders said. "So 20 years would be good."
By ANGELA K. BROWN, Associated Press Writer

Earthlink to build New Orleans Wi-Fi network Yahoo! News
Earthlink Inc., the Internet service provider, said on Friday it has won approval from the New Orleans City Council to build a wireless high-speed Internet network in the city. The company said the wireless network will provide Internet access for residents, businesses and visitors in New Orleans. It will offer a free service for a limited time during the city's rebuilding efforts and a faster paid-for tier service.

Google, Dell in deal on PC software package Yahoo! News
Google Inc. and Dell Inc. said on Thursday that the No. 1 personal computer maker will install Google software on its systems, potentially dealing a blow to Microsoft Corp.. Google will incorporate on Dell computers its desktop software, which integrates a number of personal computing applications, a Google tool bar and a co-branded Internet home page, officials from both companies said on Thursday. "There's probably more to come" in the Google-Dell partnership, Google chief executive Eric Schmidt told investors at a Goldman Sachs & Co. Internet conference. "This is the first" of several agreements. The companies will share revenue from the tie-up, but Schmidt and Dell spokesman Jess Blackburn declined to give details. "We're doing this because we feel the tools will help the customers search and organize digital information quickly and easily right out of the box," Blackburn said. Dell will start selling Google-equipped PCs to consumers and small and mid-sized businesses by the end of this month, Blackburn said. The systems will also be offered to some large corporate customers. Google of Mountain View, California, and Dell of Round Rock, Texas, in February said they had begun to test incorporating Google's software package, which would allow PC customers to search both the public Web and information stored on their computers. At the time, Dell and Google were reported to be in talks to install the software on as many as 100 million new Dell PCs, following a bidding process in which Google edged out Microsoft, the world's biggest software maker, and after Web search rival Yahoo Inc. (Nasdaq:YHOO - news) withdrew. A large-scale agreement with the world's No. 1 PC maker would be a major coup for Google. A decade ago, Microsoft used its leverage over PC makers to control which software came installed in new computers, betting that customers rarely bothered to replace many of those programs. Dell, whose growth has slowed for the past year as competitors reduced prices, stands to benefit by aligning itself with the Internet's most popular search engine. The company last week announced it would equip some high-end corporate server computers with microchips from Advanced Micro Devices Inc. AMD.N>, whose advanced processors have been gaining in popularity at the expense of industry leader Intel Corp., previously Dell's sole chip supplier. Dell, led by Chief Executive Kevin Rollins, has been trying to enhance its image by buying and selling more consumer electronics such as wide-screen televisions, buying Alienware Inc., a seller of high-powered gaming PCs, and opening two storefront outlets to showcase its products.

Michelin director dies boating BBC News
Edouard Michelin, a joint managing director of France's tyre-maker Michelin, has died on a boating trip. Mr Michelin, 43, was on a fishing trip off Ile de Sein island in Brittany when he died, a company spokesperson said. The cause of his death was not clear. Joint managing director Michel Rollier will "assure the continuity of the company's management," the firm said. France's Interior Minister Nicolas Sarkozy said France's business world had lost one of its "rising stars".

Passion for business
Mr Michelin was part of the family that founded the Michelin company in 1889, and now employs 130,000 people worldwide. He worked for different parts of the firm including production and sales, before succeeding his father Francois as the firm's head in 1999. Apart from a one-year stint in the navy in 1987, he spent nearly 20 years at the company. Edouard Michelin took the decision to axe 7,500 jobs in 1999, and reorganise the firm's North American operations, to boost profitability and be able to compete with rivals. At the time, then Prime Minister Lionel Jospin urged workers and politicians to protest at the decision. Mr Sarkozy paid a tribute to Mr Michelin, saying he was one of France's best businessmen. "He had a passion for his business and he knew how to make other people experience that passion."

Lions Gate Growth Bodes Well for Icahn

Could Hollywood's last remaining independent studio become
billionaire investor Carl Icahn's next prey? By Lorenza Munoz.
http://email.latimes.com/cgi-bin1/DM/y/e3L...Io30G2B0HZVl0EI

Ex-Money Manager Gets 30 Years

Orange County money manager James P. Lewis Jr. was sentenced to 30
years in prison for swindling 1,600 investors of $156 million in a
Ponzi scheme so calculated and long-running that the judge called
it a "crime against humanity." By E. Scott Reckard.
http://email.latimes.com/cgi-bin1/DM/y/e3L...Io30G2B0HZVm0EJ

Guatemala Races to Profit From 'Survivor' Publicity

EL REMATE, Guatemala-The reality show has brought unprecedented
exposure to the nation and boosted tourism. By Aaron Kremer.
http://email.latimes.com/cgi-bin1/DM/y/e3L...Io30G2B0HZVn0EK

IMF's Rato says high oil prices here to stay Reuters
High oil prices are here to stay and world interest rates are likely to continue to rise, the International Monetary Fund's Managing Director Rodrigo Rato said in remarks published on Sunday. "Oil prices are going to remain at high levels given the forecasts of rising demand and the supply limitations," Rato said in an interview with Spanish newspaper El Mundo. "They bring clear risks of inflation and (risks) to growth," he said, adding that so far most economies had been able to absorb the added cost of oil without much extra inflation. "Inflationary pressures in the world are being increased by the rise in the price of raw materials, but also by a monetary expansion that has not yet been fully corrected," Rato added. Although rates have risen in major economies, monetary policy cannot yet be described as restrictive, but that is because inflationary pressures have not yet shown their full strength, he said. "Looking to the future, we can expect interest rates to keep rising, but moderately. Of course that is unless inflation shoots upwards." European Union countries meanwhile needed to reform their labour laws and markets if they wanted to reach the same level of productivity and growth potential as the United States, Rato added. "In Europe there is too much rhetoric and too little reform."

Salem Five Bank buys insurance firm The Boston Globe
Salem Five Bank made its first acquisition outside of basic banking last week, agreeing on terms to buy Boyle Insurance Agency of Woburn, a 70-year-old, family-run company. Terms of the deal were not disclosed but it is expected to be finalized early next month. The acquisition will give Salem Five, a bank with $2.4 billion in assets, a foothold in the state's insurance industry. Salem Five also will get a new platform to expand its banking services in Middlesex County. "As with banking, insurance is a relationship business," Joseph Gibbons, the Salem Five president, stated in a release. "The [agency] has done a remarkable job building and servicing their valued client relationships." Boyle Insurance specializes in personal and commercial insurance. Jay Boyle , a third-generation owner, said Salem Five approached him and his brother, Brian, about buying their agency, which has about 7,000 customers. "They reached out to us, saying they wanted to expand their product base," Boyle said in an interview. "We've watched the whole financial services landscape change, too. They can bring a lot of products to our agency, like checking and investments, that we can't offer." Boyle said the agency's 23 employees will keep their jobs once the acquisition is completed in early June. The agency will remain based on Main Street in Woburn, where the Boyle brothers will continue to run it. But its name will be changed to Salem Five Boyle Insurance Services.

After the deluge
Eastern Bank of Lynn and the Saugus Federal Credit Union have rolled out low-cost loans to help homeowners and small businesses recover from this month's fierce floods. Eastern is targeting small businesses with revenue of up to $5 million that can show they were affected either by the heavy rains or flooding that started on May 12. A credit line of up to $50,000 carries a 1 percent interest rate, instead of the usual 7 percent . A five-year unsecured loan, at a rate of 8 percent, also is available. During the first year, a borrower will have to pay only the interest on the loan. The bank also will waive a $150 fee it usually charges for loans, and promises to make a decision about an application within 24 hours. Since flooding struck key areas of Eastern's marketplace, including Peabody and Saugus, bank officials anticipate strong demand. "It's clear that this storm, and the devastating floods it created, will be felt by businesses for quite some time," said Joseph F. Riley , senior vice president for retail and small-business banking at Eastern. Saugus Federal Credit Union has set aside $200,000 for a special flood-relief loan program to assist homeowners and renters. "By making this program available to renters as well as homeowners, we can help alleviate some of the financial burden and the anxiety of finding a way to repair or replace things like washing machines, rugs, heating systems, and even clothing," said John Smolinsky , the credit union's president. Renters may apply for a personal unsecured loan of up to $6,000, at a rate of 6 percent, for 48 months. The usual interest rate is 12 percent. Homeowners may apply for a home-equity line of credit of up to $20,000, at an interest rate of 4.5 percent, instead of the usual 7.75 percent. The deadline to apply is June 20, at which time the credit union will decide if the program will continue, Smolinsky said.

Tracing Da Vinci
Childhood trips to the old Peabody Museum of Salem inspired Ellen McBreen's love of art, leading her from Peabody, her hometown, to Paris, where she's trying to crack the Da Vinci Code at the Louvre. McBreen, 35, runs Paris Muse , a tour company, that offers Da Vinci Code tours of the Louvre, the museum at the heart of Dan Brown's best-selling novel, recently turned into a movie. An art historian, McBreen moved to Paris five years ago to research her doctoral thesis for New York University. She also teaches art history at a Paris university, often taking students to the Louvre. Two years ago, English-speaking visitors started tagging along with her class, peppering McBreen with questions about the Da Vinci "code." "People kept asking me, `Are there really secret symbols hidden in Leonardo Da Vinci's paintings?' `Is it true that he was a member of the Priory of Scion?' " McBreen said, in a telephone interview from Paris. But "The Da Vinci Code" hadn't yet been translated to French. So, on a trip home to Peabody, she picked up a copy of the controversial novel, which asserts that Jesus Christ was married to Mary Magdalene, and the clues are contained in Da Vinci's paintings, most notably, "The Last Supper." "I thought if I read it, I could at least answer these questions intelligently," said McBreen, a graduate of Peabody High who majored in art history at Harvard. "When I read the book, I realized there is more there to talk about than just Leonardo Da Vinci in the Louvre." So, McBreen created a tour that gives visitors a lesson in early Christian art and Da Vinci. It quickly became the most popular tour offered by Paris Muse, the company she runs with five other art historians. And now she expects demand to grow because of the movie, despite criticism from Christians, particularly Catholics, who say its assertions about Jesus Christ are untrue. *The tour follows the scenes of the book, but it was not designed to correct Dan Brown," McBreen said. "It's designed to give people more information about Da Vinci and early Christian art, so that they can go home more informed." McBreen's only regret is that she can't take visitors to see Da Vinci's actual painting of "The Last Supper." "Too bad," she said with a laugh. "It's in Milan."
By Kathy McCabe

Weak dollar could mean tighter Fed policy: Yellen Reuters
Depreciation in the U.S. currency could increase the need for tighter Federal Reserve monetary policy, San Francisco Federal Reserve President Janet Yellen said on Saturday. The Fed is watching the U.S. dollar's depreciation for its possible impact in raising import prices as well as boosting export demand, Yellen said in answer to a question after a speech at the University of California Santa Cruz on "Monetary Policy in a Global Environment." A depreciating dollar could stimulate aggregate demand and raise inflation somewhat, and "would appear to call for a response of tighter policy," Yellen said. In keeping with Fed tradition, Yellen -- a voting member of the policy-setting Federal Open Market Committee in 2006 -- declined comment on the appropriate level of the U.S. currency, but said Fed policy impacts both interest rates and the dollar. "The tendency of the dollar to appreciate in response to a tighter monetary policy also creates a direct link to inflation via lower import prices," she said. Yellen said an increasingly globalized economy did not damage the Fed's ability to attain its inflation objectives. "From the perspective of monetary policy, globalization does matter ... even so, globalization does nothing to imperil the Fed's ability to attain its inflation objectives," Yellen said at a conference on "The Euro and the Dollar in a Globalized Economy." Yellen's speech did not directly address the current U.S. economic or monetary policy outlook. Financial markets lean toward a 17th consecutive quarter-point interest rate hike by the FOMC at its June 28-29 meeting, which would take the benchmark federal funds rate to 5.25 percent from a low of 1.0 percent.

GLOBALIZATION EQUALS RECALIBRATION?
Yellen said globalization may force a "recalibration" of Fed policy. For example, the level of labor market slack associated with price stability -- NAIRU, or the non-accelerating inflation rate of unemployment -- could be affected by global issues, she said. "Globalization may have an effect on wage/price dynamics and, as such, may require that monetary policy be recalibrated to take these changes into effect," Yellen said. A similar tweaking took place in the latter half of the 1990s in response to a surge in U.S. productivity growth, she noted. Many economists view 5 percent as the jobless rate below which U.S. wage pressures can start to build. The U.S. unemployment rate has been below that mark for five months. By contrast, Yellen said the impact on U.S. prices from the surge in cheap imports from China in recent years was "only modest" and not a major source of disinflation. At this point Chinese imports pull U.S. consumer prices down by about 0.1 percentage point, Yellen said. "A rise in China's share of imports in a particular sector lowers U.S. import prices, but this effect is not substantial." Overall, "some very tentative evidence supports the proposition that increasing global capacity has, on balance, held inflation down over the last decade," she said. That evidence includes the direct effect of reductions in the prices of imported goods and services, and also indirectly through wage demands and the way they are influenced by prices of imported consumer goods, Yellen said. "Lower import prices could reduce workers' demand for nominal wage increases," she said. At the same time, globalization may be undermining U.S. workers' bargain power by making them fearful of job loss -- thus lowering wage demands and holding inflation down. "It could be that global, not domestic, labor market slack explains changes in U.S. wages and inflation," she said. Yellen said Fed action -- "a credible commitment to price stability consistently backed by actions to anchor inflation to price stability" -- could help stop supply shocks from the energy market becoming embedded in inflation expectations. Credibility remains key to the Fed's effectiveness, she said, adding the Fed has established "a strong and credible record" as an inflation fighter.

India May Increase Fuel Prices Next Week, Deora Says Bloomberg
India's government may take a decision on raising gasoline and diesel prices next week, Oil Minister Murli Deora said. The government will try and avoid increasing the prices of kerosene and liquefied petroleum gas, used for cooking, Deora told reporters in Mumbai today. "In view of the fact of high oil prices, we have no other choice but to increase the prices of some of the products,'' Deora said. "We will make all efforts to increase prices in a way that it will not hurt the poor and the increase will be as minimum as possible.'' Prime Minister Manmohan Singh's government limited fuel cost increases to 15 percent in the past year, as global crude prices climbed 45 percent, to control inflation and keep an election pledge to protect the poor. Communist parties, whose support is critical for the survival of Singh's government, wants to keep fuels affordable by maintaining the cap on prices. The government may announce a package by May 29 that includes raising prices, lowering duties and issuing bonds to state-run refiners for selling fuels below cost, an official who declined to be identified, said on May 25. The communist allies of the ruling federal coalition opposed any increase in retail prices at a meeting with Deora on May 10, saying the government should share the burden without passing it on to the people by cutting duties.

Losses
State-run refiners, including Indian Oil Corp., may lose 750 billion rupees ($16.4 billion) in revenue this year if the government maintains a cap on fuel prices, M.S. Srinivasan, secretary to India's oil ministry, said on May 3. The price freeze led to Indian Oil, the nation's largest refiner, and its state-run competitors Hindustan Petroleum Corp. and Bharat Petroleum Corp. reporting losses in the quarter ended Dec. 31. The state-run refiners reported profits for the quarter ended March 31 after the government gave them bonds worth 115 billion rupees to partly compensate for losses incurred in selling fuels below cost. The refiners lost 400 billion rupees revenue in the year ended March 31 due to the price freeze. Crude oil prices in New York rose to a record $75.35 on April 21 and April 24 on concern Iran's refusal to halt nuclear research would prompt international sanctions and lead to a cut in supplies. Oil prices have risen 17 percent this year.

Google, Dell in deal on PC software package Washington Post
Google Inc. and Dell Inc. said on Thursday that the No. 1 personal computer maker will install Google software on its systems, potentially dealing a blow to Microsoft Corp.. Google will incorporate on Dell computers its desktop software, which integrates a number of personal computing applications, a Google tool bar and a co-branded Internet home page, officials from both companies said on Thursday. "There's probably more to come" in the Google-Dell partnership, Google chief executive Eric Schmidt told investors at a Goldman Sachs & Co. Internet conference. "This is the first" of several agreements. The companies will share revenue from the tie-up, but Schmidt and Dell spokesman Jess Blackburn declined to give details. "We're doing this because we feel the tools will help the customers search and organize digital information quickly and easily right out of the box," Blackburn said. Dell will start selling Google-equipped PCs to consumers and small and mid-sized businesses by the end of this month, Blackburn said. The systems will also be offered to some large corporate customers. Google of Mountain View, California, and Dell of Round Rock, Texas, in February said they had begun to test incorporating Google's software package, which would allow PC customers to search both the public Web and information stored on their computers. At the time, Dell and Google were reported to be in talks to install the software on as many as 100 million new Dell PCs, following a bidding process in which Google edged out Microsoft, the world's biggest software maker, and after Web search rival Yahoo Inc. withdrew. A large-scale agreement with the world's No. 1 PC maker would be a major coup for Google. A decade ago, Microsoft used its leverage over PC makers to control which software came installed in new computers, betting that customers rarely bothered to replace many of those programs. Dell, whose growth has slowed for the past year as competitors reduced prices, stands to benefit by aligning itself with the Internet's most popular search engine. The company last week announced it would equip some high-end corporate server computers with microchips from Advanced Micro Devices Inc., whose advanced processors have been gaining in popularity at the expense of industry leader Intel Corp., previously Dell's sole chip supplier. Dell, led by Chief Executive Kevin Rollins, has been trying to enhance its image by buying and selling more consumer electronics such as wide-screen televisions, buying Alienware Inc., a seller of high-powered gaming PCs, and opening two storefront outlets to showcase its products.

Collaborative Innovation and The Humble Corporation Alwayson
Just about every study on innovation identifies the power of collaboration and communities as one of the major forces driving innovation in today's environment. But this is much easier said than done, especially in a society as focused on "winning" as is ours in the US. For example, in our own such studies in IBM, a major conclusion of the 2004 Global Innovation Outlook (GIO1.0) was that innovation is increasingly collaborative and open, as more and more, it results from people working together in new and integrated ways. Specifically, the report noted that ". . . close cooperation across an ecosystem will stimulate new business designs, as companies redefine what they do and what they rely on others to do." The GIO 2.0 report which came out earlier this year identified the power of networks, i.e., communities, as one of its top findings, as individuals told us that increasingly "their power comes largely from their ability to tap into and sometimes transform a larger network of people and ideas." Similarly, in the 2006 CEO study that was released this past March one of the key themes that emerged from the CEO interviews was that external collaboration is indispensable for innovation, with customers and business partners cited as top sources of innovative ideas. In today's fast-moving and highly competitive world, more and more businesses recognize that there exist a lot more capabilities for innovation in the marketplace than they could try to create on their own, no matter how big and powerful the company. While CEO's told us that collaboration is absolutely critical, they also told us that partnering, whether crossing internal or external boundaries is easy in principle but very difficult in practice. This is not at all surprising. Working with different groups to achieve common objectives usually requires a change in the culture of most organizations - and cultural transformations are arguably the hardest of all. Deep down, to truly embrace a culture of collaboration requires a certain degree of humility in an individual, group or company, that is, an acceptance of limitations in ones ability to get things done without help, which then makes it emotionally easier to reach out and work effectively with others. We like to use sports metaphors when discussing competition in the marketplace, and our business vocabulary is infused with all kinds of sports and martial terms, starting with our notions of "winners" and "losers." We use such terms even as we know that the world of business is much more complex than the artificial world in which sports teams compete, and that the time frame in which a business has to prove its excellence is much longer that the typical sports season. Collaboration and humility are particularly important for those companies that like IBM are addressing problems in business, government, health care, technology and science that are very sophisticated in nature and are pushing the envelope in what is possible. You cannot work on such problems - say information based medicine, integrated supply chains or advanced engineering design - unless you have established a very close relationship with your clients, business partners, and even other vendors that might very well be competitors. In such an environment, to boast about being "the best" would frankly be considered crass, a sign of corporate insecurity rather than the strength of a confident leader. Instead, you want to be known as a company that helps all the various members of the team succeed in whatever problems are being addressed. Rather than claiming that you are the most innovative of companies, you want to be known as a company that helps those that you work with become more innovative themselves. In the end, a company can only be as innovative as the collective capacity of the people in the organization, and clearly, that requires attracting top talent. In today's highly competitive business environment, a company cannot attract and retain the top talent it needs unless such people feel that they are respected as individuals and professionals, which increasingly means that in addition to their work in the business, they are involved in activities as part of communities. GIO 2.0 participants observed that "innovation in business and society is fueled by the unifying notion of 'the endeavor' - activities driven by a common set of interests, goals or values." We see that for example with the rise of open communities, social networks, online discussions or "jams", as well as the collaboration that is such an integral part of the world of research, whether your discipline is physics, medicine, history or law. In such an environment, a business needs to not only attract top talent, but it needs to trust them and encourage them to collaborate and innovate with colleagues within and outside the business, driven as much by pride of contribution as by loyalty to the company. For companies used to hierarchic organizations and strategies driven down from the top, this management style is not easy at all. It requires that the company and its top managers accept the fact that they don't have all the answers, and that in today's fast changing and complex world such answers are best found with their own people, their business partners, their customers, researchers in universities and government labs and so on. Often, the way people get inspired and come up with new ideas will be through their interactions with colleagues within and outside the business, and consequently, the humble - and wise - corporation does everything possible to encourage such community interactions. For collaborative innovation to become part of the DNA of a company, its culture must embrace a set of seeming paradoxes. It must be both aggressive and self-conscious, both prideful and humble, both confident and second-guessing. Without abandoning its competitive spirit -- indeed, while enhancing it -- the company must truly accept the notion that the way to make progress and solve problems is to work as a team and tap into the collective knowledge of the team. In fact, such a culture of collaboration often enables the company to better compete in the marketplace in those areas in which it chooses to do so. The wise corporation recognizes that a major element of business strategy in the 21st century is to achieve the proper balance of proprietary and collaborative innovation. This is really difficult, but doable, as IBM's own experience attests. For example, we have simultaneously accelerated our creation of intellectual property -- evident in 13 years-and-counting as the top U.S. patent earner -- while deeply embracing the open source movement and the spread of open standards. In other words, we're holding in our heads at the same time notions of profiting-from-ownership and profiting-from-collaboration. I'm convinced that those companies that make a similar transition will increasingly attract the most talented people, the best partners, and in the end - the most loyal customers.
By Irving Wladawsky-Berger - IBM

Japan's retail sales dip in April BBC News
Japanese retail sales fell during April as poor weather and a decline in the stock market put people off shopping. The Ministry of Economy, Trade and Industry said sales dropped by 0.6%, and were 2.4% lower than a year ago. Higher fuel costs, which pushed fuel sales up 8.1%, probably was another factor hitting demand, analysts said. The decline in retail sales was bigger than expected and surprised many analysts as Japan's economy and its job market has been steadily improving.

Slowly recovering
However, the analysts said that sales should pick up again in coming months and would be strong enough to prompt higher interest rates. "Retail sales were a bit weaker than expected, probably because clothing did not sell as well as we had thought due to bad weather at weekends in April," said Mamoru Yamazaki of HSBC Securities Japan. "Given favourable job and income conditions, I think consumption will likely recover," he explained. "Retail sales may be somewhat weak at the moment, but won't fall as a trend."Japan, the world's second-biggest economy, has endured years of stagnating prices that have eroded the value of wages and depressed growth. Recent figures have shown that inflation is returning, and the Bank of Japan is expected to raise borrowing costs over the summer months to keep price growth in check as the economy continues to expand. Earlier this month, the Bank of Japan reported that the country's economy grew by an annualised rate of 1.9% during the first three months of this year - nearly double what observers had expected. Analysts said that no recovery was ever flawless and despite April's dip in retail sales growth remained on track and conditions were improving. "These figures were not exactly brilliant," said Seiji Adachi of Deutsche Securities. But "the environment surrounding consumption, such as employment, has been improving for some time and raising hopes of a further pickup in spending", he continued.

German consumer optimism surges BBC News
German consumers are becoming more optimistic about the future, a report has said, boding well for a continuing recovery in Europe's largest economy. According to research company GfK, its consumer sentiment index rose to 6.8 in June - the highest level since 2001. Recently, strong export growth has pulled Germany out of a slowdown but consumer spending remained weak. That may now change as the improving economic environment and job market prompts people to shop, analysts said.

Expert view
"With the end of the long winter, the mood among consumers has significantly brightened and it looks as if the trough of recent years has now been left behind," said Rolf Buerkl of GfK. "Optimism that the German economy will develop positively has increased considerably, while personal income expectations have also improved," he added."Strengthening optimism among consumers is partly thanks to the positive picture painted of the current state of the economy by experts," he said. GfK found that its index measuring consumers' willingness to spend surged to 49.8 in May, its highest level since records began in 1980. Despite the positive implications of the report, analysts warned that a number of other short-term factors may have been stoking up consumers spending. GfK's Mr Buerkl pointed out that plans to raise value added tax from next year may have prompted consumers to bring forward purchases, while there was a wage increase for workers in the metals and engineering industries. Meanwhile, the football World Cup - due to start in Germany next month - may also be buoying sentiment.

Developments
Even though these effects may be short-lived, Germany has shaken off its label as Europe's problem economy and earlier this month leading analysts upped their prediction for growth in 2006 to 1.8% from their previous 1.2%. The six economic institutes behind the forecast cited strong exports and higher consumer spending for the increase. GfK said on Monday that: "Trust in a positive development of the German economy has increased considerably."

Risks Close In on the Fed

WASHINGTON - Setting rates becomes a delicate task as inflation
and growth move in the wrong directions. By Joel Havemann.
http://email.latimes.com/cgi-bin1/DM/y/e3M...Io30G2B0HZah0Ej

Menace to Comic Heroes?

Digital piracy is creeping into the industry, threatening small
publishers. Some say, though, that it can attract new readers. By
Michelle Keller.
http://email.latimes.com/cgi-bin1/DM/y/e3M...Io30G2B0HZai0Ek

http://news.goldseek.com/InternationalFore.../1148837213.php

International Forecaster May, 2006
Bob Chapman

http://money.excite.com/ht/nw/bus/20060529...-pek241484.html



GE says China sales could soar

Monday May 29, 7:28 AM EDT


BEIJING (Reuters) - General Electric Co. (GE), the world's second most valuable company, said it expects sales in China could double to $10 billion by 2010, with some of that growth coming from the development of clean energy technologies.

The International Energy Agency has said China needs to spend $2.5 trillion by 2030 to meet its energy needs, but as a result of the country's already dynamic growth, pollution has become major issue because 70 percent of China's energy comes from dirty-burning coal.

It also frets about a growing dependence on imported oil, and so has pledged to double the portion of energy it gets from renewable sources by 2020.

"We are working closely with our customers and government in China to bring our new ideas in (clean) technologies to see that they are applied in China," chairman and chief executive Jeff Immelt told reporters at a press conference on Monday.

"We think business in China could double in four or five years. It's energy ... it's rail, it's locomotive, it's oil and gas, and the financial services associated with that," he said.

GE had sales of $5 billion in China last year, about 3 percent of total sales, and employed almost 13,000 workers there.

On Monday, the company also signed an agreement with China's National Development and Reform Commission to develop advanced environmentally friendly technologies.

Immelt said one example of these new technologies was coal gasification, which he said could generate energy as cleanly as natural gas, but at a cost that is close to pulverized coal.

"You have technology that is truly creating advancement for the economy, we will get paid for it and our customer will be better off," he said.

The country plans to expand energy production with an extra 72 gigawatts of new capacity expected this year, rising from 66 gigawatts installed in 2005. Britain has total installed capacity of about 80 gigawatts.

GE gets 35 to 40 percent of its revenue from infrastructure products, which it says makes it a good fit with the goals of the Chinese government as Beijing modernizes and expands the economy.

China's significance to GE's overall strategy was also growing beyond the geographic borders of the mainland.

"Almost everything we do here we think has global applicability," he said.

(US$=8.02 yuan)

http://news.yahoo.com/s/ap/20060528/ap_on_...HE0BHNlYwN0bWE-

Quest for energy alternatives heats up
By DAVE CARPENTER, AP Business WriterSun May 28, 7:06 PM ET

The future of energy is bright in Said Al-Hallaj's invention lab at the Illinois Institute of Technology, and not just because of the solar window that lies in development on a table.

All around the lab are advanced alternative energy projects that testify to the war on oil that's proceeding quietly at laboratories and research centers across the country.

A tiny two-passenger electric car stands ready to drive 25 miles on one charge of its custom-designed pack of lithium-ion batteries, not unlike the ones that power laptops. A research assistant who's working out the kinks on an electric bicycle motors down a hallway at 20 mph, triple the speed of the hybrid fuel-cell scooter developed here.

Elsewhere, Al-Hallaj and another professor are converting an SUV into a plug-in hybrid vehicle using lithium-ion cells to double the fuel efficiency and reduce emissions. And a team of students is converting a gasoline-powered lawnmower to use hydrogen as fuel.

Some of the projects could be manufactured commercially right now, said Al-Hallaj, research associate professor of chemical and environmental engineering and coordinator of IIT's renewable energy program. The problem is cost, which keeps them from competing with oil — for now.

"The implications if we succeed are unbelievable," Al-Hallaj said. "You're coming up with a solution that is clean and advanced — (good for) energy, the environment and people who are burdened by high prices."

Solutions for high gasoline prices might seem painfully far off to drivers as summer travel season begins, but experts say the skyrocketing costs of oil and gas have given new momentum to the push to develop alternative fuels and alternative energy sources.

The efforts are readily apparent in the nation's heartland, where a boom in ethanol is expanding and scientists at laboratories far and wide are working to turn agricultural waste or "biomass" such as switchgrass, wheat straw, cornstalks and miscanthus into a fuel called cellulosic ethanol that could be produced commercially to reduce U.S. dependence on oil.

In a separate burst of alternative energy developments unrelated to transportation fuels, wind farms are sprouting up across the country thanks to larger, more efficient turbines, and nascent coal-to-energy technology holds promise for pollution-free power plants in the future.

The driving force for most of the energy efforts, though, is oil. And researchers are thrilled about the impetus that soaring prices have given their work.

"With petroleum prices being as high as they are, the stars are aligning for looking seriously at alternative fuels and chemicals," said Hans Blaschek, a University of Illinois microbiology professor working on the conversion of corn into butanol, a promising alternative to petroleum-based fuels.

The highest-profile existing oil alternative is ethanol. The corn-based fuel might not hold the key to an oil-free future, but it is providing at least a stopgap remedy while scientists look beyond corn for an answer.

The runup in gas prices has softened for now the argument that ethanol isn't economically competitive without federal subsidies, and it has accelerated plans for ethanol plants by farmers' cooperatives and Archer Daniels Midland Co., the Decatur, Ill.-based agribusiness, among others.

Still, ethanol's potential is limited by cost and transport issues and the fact that even those seemingly endless fields of corn in the Midwest are finite. Experts say corn-based ethanol isn't ever likely to displace more than 10 percent of the gasoline supply.

"We just don't have enough corn," said Dan Basse, an analyst for Chicago-based AgResource Co. "If you turned every corn plant in the country into ethanol, there still wouldn't be enough."

That's where biomass comes in. By using other crops and forest waste along with the entire corn plant, not just the kernels, the Department of Energy says enough cellulosic ethanol could be produced by 2030 to lower U.S. gasoline consumption 30 percent.

Scientists at the National Center for Agricultural Utilization Research in Peoria are among those on a mission to expand ethanol beyond a grain-based fuel, working intensely on how best to break down the cellulose of biomass into sugars and complex chemicals in order to produce ethanol economically. An optimal solution might still be a decade away.

Mike Cotta, who heads the U.S. Department of Agriculture-run center in Peoria, says many technical challenges remain to be overcome. Researchers must come up with more inexpensive and environmentally viable ways of converting the polymers that the bulky biomass materials are made of into simple sugars.

But a lot has happened in recent years to move them closer to their goal, including great progress cited by Cotta in developing cheaper, more efficient enzymes to break the materials down.

"We're going to need some major breakthroughs, but once these things get in place ... it's going to happen," he said.

At Argonne National Laboratory, 25 miles southwest of Chicago, a variety of biomass-related projects are being carried out with close involvement of not only the Energy Department but large corporations such as ADM and energy group BP PLC. Teams immersed in biofuels research there for years have had their efforts not only validated but given new life by the intensified focus on high energy prices and by President Bush's call in this year's State of the Union Address for America to break its "addiction" to oil by developing alternative fuels.

"It's just been totally crazy," Seth Snyder, section leader for chemical and biological technology, said of the stepped-up demand for workshops and research information. "Everybody's interested now. ... We've been saying all along we can make a big impact, and suddenly people are saying 'Maybe these people are right.'"

Environmentalists and scientists alike applaud the fact that alternative fuels and alternative energy sources are in the spotlight more than ever, but they say energy efficiency is still being neglected.

"There are many people who believe that biomass has the power to replace our appetite for gasoline," said Kimberly Gray, professor of civil and environmental engineering at Northwestern University. "But that will only occur with significant improvements in energy efficiency and smart growth."

Without a trend toward more and smaller hybrid vehicles combined with high-density, walkable communities, Gray said, the suggestion by some experts that biofuels could virtually eliminate Americans' demand for gasoline by 2050 is unrealistic.

Another biofuel with promise is biodiesel, which uses vegetable oil and other nontoxic ingredients and can be blended with conventional diesel fuel. The trucking industry in particular has interest, and the Department of Agriculture says it can reduce carbon emissions by 78 percent.

But despite growing use in some areas of B11 — an 11 percent biodiesel fuel — overall consumption is still relatively tiny and biodiesel is not likely to be an everyday alternative for motorists in the near future. Only a handful of large biodiesel plants exist nationwide.

"It's a small interest, pretty much where ethanol was back in the '80s, but it's growing," Basse said.

Dayton Keyes of the central Illinois town of Maroa decided not to wait. Angry about prices spiraling ever higher, the 37-year-old police officer built a small biodiesel reactor in his garage last year and now tanks up his Volkswagen Golf with a homemade fuel concocted from used cooking oil.

"It just ticks me off to no end to see that even a 10-cent change in the average fuel price kills us and our politicians are doing nothing to solve it," said Keyes, who commutes 105 miles round-trip daily to his job in Springfield. "I thought, 'Shoot, I'm going to try to do something about this.'"

Inspired by media reports about a cross-country excursion using cooking oil as fuel, he found information on the Internet, ordered a how-to book and invested close to $1,000 in constructing a reactor — plus a few hours every week brewing up batches of biodiesel.

The result is a fuel that costs him only about 70 cents a gallon, gets 45 miles per gallon and has converted him to a biodiesel proselyte who hopes to hasten the time when biofuels abound. He is trying to get a full-fledged biodiesel plant up and running.

"Renewable resources is a buzzword right now, but you don't see evidence of it," he said. "I'm trying to get a biodiesel revolution going where people will start making their own fuel."

Those now in labs trying to devise cheaper energy solutions applaud federal and state government support but emphasize that more will be needed if they are to succeed.

"A lot of people in government who ridiculed energy conservation and alternative energies ... are now investors," said Al-Hallaj. "The people who are funding these projects are the same ones who said, `Drill and spend and forget about it.'"

Rather than a single breakthrough, experts say it will likely take a combination of energy developments to help break free of oil's grip.

"There are a lot of people out there who think there's a silver bullet to answer the energy challenge facing this country — one technology that will answer everything," said Gerald Groenewold, director of the Energy and Environmental Research Center in Grand Forks, N.D. "Some people say wind's the answer to electricity generation, ethanol's the answer to vehicle generation. We think it will be a mix of a lot of things."

But ... there are many sources of manure ...

http://abcnews.go.com/GMA/print?id=2016420



Cow Manure Could Be Cheap Alternative to Gas
A Cow Can Power a Car for 15 Miles a Day
May 29, 2006 — - The secret to cheaper gas could lie in cow dung.

The Vehicle Research Institute of Western Washington University in Bellingham, Wash., has been turning cow manure into fuel that can power a natural-gas car. Researchers are not shoveling manure straight into the gas tank but pumping the methane -- a gas created by the manure -- into the car.

They have some hard-working cows at a dairy farm in Lyndon, Wash., to thank for this experiment, which could mean cheaper car fuel for many people.

"We are talking about dairy cows," said Eric Leonhardt, an engineering technology professor and director of the Vehicle Research Institute. "So they are very well-trained. They go in one spot. They feed and do their business in one location. And then that material is pumped into a holding tank."

For 21 days, the manure sits in an underground tank and stews. Then, using regular old garden hoses, researchers siphon floating methane out of the holding tank. They must purify the methane to remove other gases before pumping it into the car.

Every cow can produce enough manure in a day to make a car go about 15 miles. If you take 20 cows, you get 300 miles of gas in your car.

There are not enough cows in the United States to power every vehicle. But Vehicle Research Institute researchers say a natural-car powered by methane could be a great solution for certain rural communities.

The price of cow fuel will put some consumers, well, over the moon.

"The gas is currently being sold at one-fifth the pump price," Leonhardt said.

EU court blocks data deal with US BBC News
The European Court of Justice has blocked an EU-US agreement that requires airlines to transfer passenger data to the US authorities. The court said the decision to hand over the data was not founded on an "appropriate legal basis". European airlines have given US authorities passengers' names, addresses and credit card details. The US said the data would help fight terrorism, but the European Parliament said the data could be misused. The agreement demands that within 15 minutes of take-off for the United States, a European airline must send the US authorities 34 items of personal information about the passengers on board. Washington had warned that it would impose heavy fines and deny landing rights for any airline failing to comply with the agreement. The US authorities also said passengers would be subject to long security checks on arrival, if the data was not sent in advance.

Parliament opposition
The US demanded tighter airline security worldwide after the 11 September 2001 attacks on New York and Washington by suicide hijackers. But the European Parliament consistently opposed handing over the passenger details to the US, arguing that the US did not guarantee adequate levels of data protection. It asked the European Court of Justice to annul the deal. In its ruling on Tuesday, the court found that the EU Council of Ministers' decision to sign the agreement on "Passenger Name Records" lacked an adequate legal basis. "Consequently, the Court annulled the Council decision approving the conclusion of the agreement," a court press release said. But the court gave EU member states until 30 September 2006 to find a new legal solution "for reasons of legal certainty".

No effect
The US Mission to the EU said it had already agreed with the Commission to look for "an agreed interim approach to data transfers that fully respects the court's ruling." European airlines said there should be no short-term effect on travellers. "What we understand is that it has been ruled out on a technicality and the Commission has been given the opportunity to find another legal basis to satisfy the court," said David Henderson, a spokesman for the Association of European Airlines, quoted by the Reuters news agency. The European Commission took the decision under the EU Data Protection Directive, but the court said the directive does not apply to data collected for security purposes.

Daewoo boss gets 10 years in jail BBC News
Kim Woo-choong, the founder of Daewoo Group, which at one time was among South Korea's largest industrial firms, has been sentenced to 10 years in jail. Kim, who was on the run for six years, was found guilty of charges including embezzlement and accounting fraud. The 69-year-old also has been ordered to hand over 21 trillion won (£12bn: $22bn) and was fined 10m won. The group collapsed in 1999 under debts of more than $80bn and Kim fled the country, only returning in 2005.

Growing concern
The court said that a "severe sentence was unavoidable" after Kim was found guilty of ordering his executives to inflate the group's assets so that the company could get bank loans. He also funnelled billions of dollars overseas. Daewoo started out as a small textile firm, bought by Kim for $5,000 in 1967. From this simple beginning, Kim turned Daewoo into one of South Korea's most powerful industrial conglomerates, or "chaebols", with close ties to other business leaders and top politicians. At its height, Daewoo employed 320,000 people in 110 countries. But the company encountered problems in the 1990s after borrowing heavily to finance expansion. The killer blow came with the Asian financial crisis of 1997 and the company started to crumble.

Under the microscope
However, Daewoo was not an isolated incident and a number of Korean firms have found themselves in the spotlight over their finances. Earlier this month, South Korean prosecutors indicted Chung Mong-Koo, the chairman of carmaker Hyundai Motor for his alleged role in a bribery and embezzlement scandal. Mr Chung, 68, denies the charges that can carry jail sentences of up to life.

http://www.swissamerica.com/article.php?=S...0605261205f.txt


"IN COINS WE TRUST"
The ultimate form of true wealth beckons investors
By David Bradshaw, IFN
May 25, 2006

Tangible commodities and high quality collectible investments are on track to outperform intangible investments like stocks, bonds and CDs again in 2006, just like they have every year since 2001!

Gold and silver coins, the famous 'old world' currency are fast becoming the 'new world' currency because they offer the missing link in all paper currencies: a "benchmark" store of value.


A "benchmark" is defined as;
1) Something that serves as a standard by which others may be measured or judged.
2) An index used by market players as a yardstick to compare performance.
3) Originates from the chiseled horizontal marks by surveyors to bracket a leveling rod.

The U.S. dollar is slowly but steadily sliding into oblivion , taking with it the hopes and dreams of all Americans -- along with the value of their savings account or investments. It is no longer a benchmark of anything, except the public's faith in government (which is evaporating daily)!

In today's post-Greenspan era, Americans are facing a pile of unpaid debts. Now at the helm is a new Fed chief whose already been nicknamed "Helicopter Ben" based on admitting he'd print enough paper currency and distribute it from helicopters if he needed to keep the U.S. economy from sliding into a recession, deflation… or worse!

Decisive action must be taken now by individual investors to divest a portion of their "paper" assets into gold and silver assets -- which are fast becoming a new economic benchmark in the 21st century.

In Gold We Trust?!

Most Wall Street pundits still view gold as just a commodity which has been overbought due to the growing speculative fever. Gone from the psyche of most stock or even commodity traders is the historic respect for gold as the only real and true benchmark for all currencies.

Thankfully, The Wall Street Journal recently published an excellent commentary, "IN GOLD WE TRUST" by Mr. David Ranson and Ms. Russell of H. C. Wainwright & Co., which explains why gold prices are a much truer barometer of falling confidence and growing inflation than any other index out there. The key points Mr. Ranson and Ms. Russell bring to light are;

* It is gold that is a benchmark for the value of the dollar -- not the other way around
* The run on the dollar is largely being ignored by Washington and Wall Street
* The gold value of the dollar appears to be going into free fall, and the further it declines the more dire the consequences
* Gold's sharp rise represents an equally sharp decline in the confidence of investors -- large and small -- in the likelihood that Washington will pay back its mounting obligations in undepreciated money
* Gold is the barometer of public confidence in fiat money
* The dollar's collapse is nothing less than a body blow to capitalism

Mr. Ranson's research for the World Gold Council resulted in a report called, "GOLD AS A LEADING INDICATOR OF INFLATION" which concluded;

* Gold is an effective way to gauge and combat the ravages of inflation on a portfolio
* Gold consistently moves earlier than official measures of inflation - using the Consumer Price Index to formulate a sound strategy for protecting investments against inflation is bound to fail
* Given the evidence that the US and other major economies have entered an inflationary period, investors should consider an exposure to gold in their portfolios

Why "In COINS We Trust"?

While gold and silver bullion have made amazing gains since 2001, there's another tangible asset market niche that's also growing very nicely -- investment-grade gold and silver coins.

Traditionally the investment-grade coin market lags behind dramatic increases in the bullion market -- perhaps waiting to see if the bullion gains are sustainable -- thereby offering more stable price advances without as much volatility due to speculators.

For example since 2001, silver bullion has risen 175% (from $4.50/oz. to $12.50/oz.) -- 38% of that gain has come so far in 2006. Meanwhile, Mint-State-65 Morgan Silver dollars are also up 175% since 2001 (from $90 to $250) -- 65% of that gain has come so far in 2006. So, in addition to offering as good or better growth and liquidity as silver bullion, Morgan silver dollars offer less volatility, more privacy and more portability. Sounds like a winning combination to me.

Investment-grade U.S. gold coins offer a similar comparison. Since 2001, gold bullion has risen 145% (from $265/oz. to $650/oz.) -- 25% of that gain has come so far in 2006. Mint-State 65 Saint Gaudens $20 gold coins are up 110% (from $1,100 to $2,300) -- 21% of that gain has come so far in 2006.

Dr. Ray Lombra's 1998 study for Congress has proven that U.S. rare coins are a buy-and-hold investment which historically outperform bullion over the long-term. This aspect is helpful to those investors and collectors who want the financial protection precious metals offer without the day-to-day worry of wild price fluctuations driven by ETFs or speculators.

Reflecting back on the last major bull market in gold and silver of 1979-80, bullion prices rose an average of 721%, while investment-grade numismatics escalated 1222%. That equates to 60% more growth than bullion. Of course past performance is no guarantee of future performance, since the size and scope of the rare coin and bullion markets have grown dramatically in the last 25 years.

Coins Outperform Stocks 3-to-1 since '03

In January 2003, Kiplinger's magazine did a cover story, "If Not Stocks, What?" The reporter interviewed Craig Smith and discussed the alternatives to stocks including U.S. rare coin investing. The reporter's big problem with collectible coins was the "spread" between retail and wholesale prices, which can range from 14% to as much as 28%. Therefore, his conclusion, "I'll take my chances with stocks." Our response: Not Just Stocks, Gold!.

Let's see how well Kiplinger's advice panned out over the last 3 1/2 years. If you took Kiplinger's advice and put say $10,000 in Dow stocks back in January 2003 (with the DJIA at its low of 8,500) that equates to a 30% rise to today's DJIA at 11,100. So your $10,000 would have grown to $13,000, less brokerage fees, inflation, etc.

However, if you would have taken Mr. Smith's advice and instead bought $10,000 worth of U.S. rare coins, today that $10,000 would have grown 110% to $21,000! Of course we must deduct the $1,400 "spread" from the original purchase, leaving us with a net of $18,700 -- for an 87% net gain -- almost three times the return of stocks. My point is that most of Wall Street has not seen the golden opportunity available in investment-grade coins yet, but some are starting to catch on now.

Now let's say you bought the higher quality numismatic coins which have a 28% maximum spread, such as a set of U.S. Gold Commemoratives, minted between 1904-1926. The eleven-coin series in Mint-State 64 grade sold for $28,000 in Jan. 2000. Today the same set has grown in value to $54,225 -- almost doubled. After deducting the 28% spread from the original purchase price you have a net gain of 65% -- over 10% per year with no hassles.

Keep in mind that during the height of the last bull market in U.S. rare coins in 1989, this 11-coin set of U.S. Gold Commems sold for $150,000 in 1989-inflation-adjusted dollars (That's using the 66.4% official gov't dollar decline calculator). So, there's plenty of room for the 1904 Lewis & Clark $1 -- and the ten other masterpiece coins in the set to dramatically grow in value over the next decade -- regardless of whether gold prices are up... or down.

You'd have lost money over the last six years if you sunk $28,000 into the Dow back in Jan 2000, near the all time high of 11,700. My point is that even the rarest of coins at our highest spread have provided much better growth than stocks. During virtually any time period you compare over the last six years coins have outperformed equities -- without the volatility, worry and rollercoaster ride we've seen in stocks and recently in commodities.

For the long-term investor the spread is rarely a significant factor. Whether you pay 5-10% spread for a bullion coin or 14%+ for a numismatic coin becomes less important if you plan to hold on to the coins for at least 3 to 5 years, and even less yet for those holding 10-15+ years. Nevertheless, this should be discussed with your broker up front so there are no surprises later. Here's more common sense "Before you buy" advice from Craig Smith.

For nearly a quarter century Swiss America has advised clients to diversify a portion of their portfolio into both bullion coins and numismatic coins -- a strategy that many other hard money advocates agree is wise, such as Richard Russell, Marketwatch's Kevin Kerr and even the WSJ back in December 2004.

Conclusion: The dollar has no clothes, coins are true wealth

As more and more central banks, institutional investors and foreigners discover the U.S. dollar is like an emperor with no clothes, the gold rush will continue and the dollar's perceived value will continue to decline. Unless the U.S. can get it's house of debt in order soon, we will see four-digit gold prices in the near future.

As for the speculators who've had their way driving precious metal prices up sharply recently, I say thank you ... and good bye for now. Why should the raiders of the lost metal be the primary beneficiaries of a declining dollar? There are too many other good reasons for precious metal and rare coin prices to rise in the future besides greed.

Investment-grade coins are the benchmark asset of true wealth and offer investors the best of the best of all worlds -- the world of commodities bulls, the world of a collectible bulls, the world of stock and economic bulls, and the world of economic surprise and even "sky is falling" bears. Yes, everyday the world is growing to love gold a little more, to hate paper a little more, and to cherish historically significant U.S. gold and silver coins a lot!

The time has come for all prudent investors to diversify a portion of their money into hard assets like U.S. rare coins for the long-term, and then relax, even hope the prices fall a bit -- so those who've ignored gold's call to financial preparation can take action before the world officially establishes gold as the new global monetary benchmark.

Richard Russell's recently gave Dow Theory Letters readers some advice on how to turn junk paper into gold... "Take your junk paper dollars to a coin dealer, tell the dealer you want to swap your dollars for gold. Try it, I guarantee it works. But don't let all your friends in on this secret, because in time they'll all try it -- and drive the price of gold higher. I don't want them to do that -- at least, not until I'm finished buying all the gold I want."

Yes, the ultimate form of true wealth beckons wise investors again today, so please, don't wait to buy gold and silver... buy them now and wait! They will provide you with the insurance you need, the growth you seek, and the peace of mind you deserve.

Record £14.9bn loss at Vodafone BBC News
Vodafone made a £14.9bn ($27.9bn) loss last year - a record for a UK firm - after writing down the value of assets. It incurred one-off costs of more than £23.5bn after revaluing its German business Mannesmann, which it bought in 2000 for £112bn ($183bn at the time). The firm said it would also cut 400 jobs as part of a move to reduce costs. Excluding one-off costs, Vodafone made a £8.8bn profit and it said its overall performance had exceeded expectations, after adding 21 million new customers. Vodafone's shares rose nearly 2% after it said it would return a further £3bn to shareholders - in addition to the £6bn it has already earmarked for investors following the sale of its Japanese arm to Softbank. Richard Hunter, at stock brokers Hargreaves Lansdown, spoke of a possible turning point for the company: "Given the mauling that the share price has had over the last year, down 14% during which time the FTSE 100 has risen 16%, inevitably some positive news was overdue," he said.

Pressure growing
Vodafone, whose global headquarteres are situated in Newbury, Berkshire, warned earlier this year that its assets may be worth up to £28bn less than previously calculated. When Vodafone bought German mobile phone operator Mannesmann in February 2000 - in what was Germany's first hostile takeover by a foreign firm - it added substantial value to its balance sheet. However, the real income generated by Mannesmann did not live up to the £112bn price tag, and now Vodafone has adjusted the value of its subsidiary on its books - a process that accountants call a write-down. The firm's sales have been under pressure over the past year with the firm coming up against tougher competition. It decided to sell its Japanese Business for £8.9bn after failing to make much headway in the country. However, it has seen continued growth in other key markets such as Germany, Spain and the United States. Vodafone said the market remained "challenging" and that it needed to do more to meet customer demands for new products. But it stressed that its business remained fundamentally healthy, despite the huge loss. "Vodafone has met or exceeded expectations, outperforming its competitors in an increasingly challenging marketplace," said chief executive Arun Sarin. "Vodafone is well positioned to deliver on its strategy."

New focus
A new strategic focus will see Vodafone concentrate on growing sales in emerging countries such as India, reducing costs in more mature European markets and seeking to be more innovative. Mr Sarin has been under pressure from investors as the firm's previously buoyant sales growth has slowed.Revenue growth is set to slow to between 5% and 6.5% next year while profit margins from mobile phone activities are set to be 1% lower. Mr Sarin has sought to stamp his authority over the company by restructuring the firm's senior management and pulling out of markets such as Japan. He stressed that Vodafone may exit other markets which did not offer strong long term growth prospects and that future acquisitions would be subject to "strict criteria". However, Vodafone gave a vote of confidence to its US joint venture business Verizon Wireless, which some analysts want it to sell. Verizon Wireless's market share grew to 25% in the US, as it added more than three million new customers, while Vodafone's share of profit from the business rose by more than 21%.

'X-Men' Scores a Record Weekend

Its four-day take of $120.1 million is the best ever for a movie
over the Memorial Day holiday. By E. Scott Reckard.
http://email.latimes.com/cgi-bin1/DM/y/e3N...Io30G2B0HZdC0EQ

CEOs Getting Handed a Bigger Slice of the Pie

Chief executives' pay at 100 big California companies averages
6.6% of net income. By Kathy M. Kristof.
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Hollywood Wants No Part in SEC Plan
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Stock Prices Again in Retreat

Stocks resumed their May slide Tuesday, with the Dow index losing
more than 180 points amid mounting concerns about the economy. By
Tom Petruno.
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High-Tech Sign Language Could Replace the Mouse

G-speak's technology allows users to interact with computers using
hand gestures. By Dawn C. Chmielewski.
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Wall Street insider gets nod to lead Treasury Fort Wayne Journal Gazette
President Bush named Goldman Sachs Chairman Henry Paulson Jr. as Treasury secretary Tuesday, turning to a highly respected Wall Street insider to lead his economic team and become the chief promoter of his administration’s fiscal policies. The nomination, announced by Bush in a brief Rose Garden ceremony, marked the first time that this president has chosen a chieftain from the world of finance to head the Treasury after two industrial-sector executives who struggled to hold sway with Bush’s inner circle. Although Bush has shown mistrust of financiers in the past, he hailed Paulson’s service as head of “one of the most respected firms on Wall Street” who has “an intimate knowledge of financial markets and an ability to explain economic issues in clear terms.” The move culminated a monthslong recruitment effort during which Paulson rebuffed several White House overtures to consider the post, according to administration officials and people familiar with Paulson’s decision-making. White House chief of staff Joshua Bolten renewed those efforts in recent weeks and convinced his former Goldman Sachs colleague to meet with Bush at the White House this month. It was then, after a long Saturday meeting 11 days ago, that Bush persuaded Paulson to take the job. In the meeting, Paulson sought assurances that the post, which at times has been seen as subordinated by the White House, would have the proper stature. “He was curious about what was myth and what was reality when it came to the inner workings of the job,” said a top Bush adviser with close knowledge of the selection process. “I think he was reassured by understanding how the job operates.” If confirmed by the Senate, Paulson, 60, will replace outgoing Treasury Secretary John Snow, who in December told the White House that he wanted to step down after three years in the job, a pledge he carried through on last week. Although a loyal booster of Bush’s policies, Snow suffered from the widespread perception in markets and on Capitol Hill that he was an advocate rather than a key policymaker. The White House sought Paulson despite the fact that he and his wife had contributed nearly $1 million to an environmental organization that has been harshly critical of the president. Paulson’s nomination comes as the economy is exhibiting robust growth and strength, but also some troubling signs. Although the economy grew at its fastest rate in 2 1/2 years during the first quarter and unemployment remains low, public opinion polls show that a majority of Americans believe the economy is in fair or poor shape. Rising gas prices and a median household income that, adjusted for inflation, has fallen during the years have fanned public anxiety. “Everything is going great in the economy until you look at the people in it,” said Jared Bernstein, senior economist with the liberal-leaning Economic Policy Institute. In brief remarks, Paulson said 32 years on Wall Street have given him a keen sense of the power that markets have in fostering economic growth and efficiency. “Our economy’s strength is rooted in the entrepreneurial spirit and the competitive zeal of the American people, and in our free and open market,” Paulson said as Bush looked on. “It is truly a marvel, but we cannot take it for granted.” In choosing Paulson, Bush defied skeptics who predicted that late in his presidency he would be unable to attract a Wall Street heavy hitter for a position that up to now has held little power in his administration. As chief since 1998 of one of Wall Street’s wealthiest investment banking firms, Paulson brings high-caliber financial credentials that contrast with Bush’s previous Treasury chiefs: Paul O’Neill, who ran Alcoa, and Snow, of the CSX railroad. The White House was eager to find a candidate with credibility among investors. Markets have turned highly volatile in recent weeks, with the biggest dips coming in commodities and stocks in Asia, Latin America and Eastern Europe. U.S. stocks, which have also dropped sharply from recent highs, sank anew Tuesday, with the Dow shedding 184.18 points, mainly because of a rise in oil prices and a report showing a decline in consumer confidence. “We have a very strong economy, a very strong banking system, but these things do happen, just like hurricanes,” said Stephen Friedman, former director of Bush’s National Economic Council and a predecessor of Paulson’s as Goldman’s CEO. “Hank is someone with a superb background, who understands markets in his bones. That’s something the White House was very aware of.”
By Michael A. Fletcher and Paul Blustein
Japan welcomes new US treasury chief BusinessWeek
Bush's Nominee From Wall Street Washington Post
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German figures suggest recovery BBC News
Germany's retail sales rose in April, indicating that Europe's largest economy is improving, data shows. Retail sales rose 2.8% in April compared to March, including seasonal adjustments, the Federal Statistics Office said. But sales were 1% lower in real terms on a year-by-year basis, in contrast to analysts' expected 0.6% rise. The data echoed an earlier consumer confidence survey, which showed that households are likely to spend more. The retail sales data came as figures showed that Germany's unemployment rate also fell in May. Unemployment was down to 11% in May, compared to 11.3% in April, according to seasonally-adjusted figures from the Federal Labour Agency. One of the factors prompting greater job opportunities is the World Cup, both for employment in services and construction, the agency said.

French economy
However, while Germany's economy seems set for a recovery, data for France was not as positive. Consumer confidence for May declined to a net -30, according to INSEE, France's National Statistics Office. "We have extremely weak confidence and the only thing that could be a catalyst to help this would be a change in government," said Emmanuel Ferry, economist with Exane BNP Paribas. However, French producer prices were up slightly less than expected, rising by 0.6% in April for the month, and 3.6% on a year-by-year basis. Meanwhile, unemployment was lower in April at 9.3%, compared to 9.5% in March.

German unemployment falls, retail sales rise MarketWatch
The Federal Labor Office said the number of jobless fell by 93,000 people last month, placing Germany's adjusted unemployment rate at 11% compared to 11.3% in April. Separately, the Federal Statistical Office said April's sales, when adjusted for seasonal and calendar effects, improved 2.8%. The number of unemployed was smaller than forecast, and retail sales were stronger than economists had anticipated. Still, economists found reason to be cautious over the German data. Matthew Cairns, of Moody's Economy.com, said the unemployment figures may point to an improving picture but hardly represent a dramatic shift in the country's employment situation. "While the last six months have indeed seen similar, slow improvements, the gains have been, by and large, small, and not nearly enough to get the country's near 5 million unemployed back into jobs," he said. "That said, with unemployment benefits proving more lucrative for some workers than actually working, the country's system remains largely to blame and is in dire need of adjustment." Alexander Koch, an economist for German bank HVB, said the upcoming World Cup soccer tournament as well as tax hikes planned for 2007 are lifting spending now, in what could be a short-term phenomenon. "Due to the stagnation of real aggregate income, consumers will have to offset money spent now on other occasions. Adjusted for the one-off effects, the rebound in private consumption will thus remain moderate," Koch said. The German DAX 30 turned higher after early losses, reflecting a similar rise in U.S. stock-market futures. See Europe markets. The euro edged higher against the U.S. dollar. See live currencies.
Steve Goldstein is MarketWatch's London bureau chief.
German Unemployment Fell by 93,000 in May; Biggest Drop in 2006 Bloomberg
Jobless fall adds to economic hopes Expatica
German unemployment dips below 11 percent BusinessWeek
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Workmenrs' Comp Cuts Are Pushed

SACRAMENTO-If insurers follow Insurance Commissioner Garamendi's
suggestion, rates would be half of those three years ago. By Marc
Lifsher.
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Sony Failing to Connect in Online Music Market

Company's Internet offering is falling far behind in digital race
with Apple's iTunes. By Dawn C. Chmielewski and Charles Duhigg.
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Sweden Pulls the Plug on Pirate Bay

The website was known to enable illegal copying. The U.S. movie
industry praises the action. By Michelle Keller.
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Treasury pick draws praise, policy doesn't Yahoo! News
President Bush's selection of a savvy Wall Street veteran to be his third treasury secretary is winning widespread praise, but Democrats say it will take a change in policies — not just personnel — to deal with budget and trade deficits and other economic problems. With his approval rating at record lows despite strong economic growth and low unemployment, Bush announced Tuesday that he was turning to Henry Paulson, chairman and chief executive of Goldman Sachs, to become the administration's chief economic spokesman. By choosing a 32-year veteran of one of Wall Street's premier investment houses, Bush is hoping for the same economic credibility that Bill Clinton gained when he picked Robert Rubin, one of Paulson's predecessors at Goldman Sachs, as his treasury secretary. Paulson, whose Senate confirmation seems assured, would succeed John Snow, the former head of CSX Corp. Snow had followed Alcoa chief executive Paul O'Neill, who was forced to resign in late 2002. While both Snow and O'Neill came from corporate America, the administration decided it needed someone with high standing on Wall Street to be a more effective salesman for its economic program. "Mr. Paulson's experience in running Goldman Sachs, a global financial firm involved in all kinds of sophisticated corporate and financial activities, makes him a near-perfect appointment," Allen Sinai of Decision Economics said in a typical Wall Street reaction. Snow had been rumored to be on his way out for more than a year, but the selection of Paulson, 60, came as a surprise because of recent administration signals that it had failed to lure a big Wall Street name as a replacement. White House press secretary Tony Snow said Bush met with Paulson on May 20 and Paulson accepted the job the next day. He said White House chief of staff Joshua Bolten, who used to work at Goldman Sachs, was the matchmaker, and the president sealed the deal after Paulson expressed reservations. "I know that there had been some conversations, and that he expressed reluctance — I'm not sure it was a flat `No,'" Snow said Wednesday. "I do know that the final answer was yes and I do know that Josh Bolten continued to speak with him." Snow did not elaborate on how the president convinced Paulson to do the job. "It is safe to say that he (Paulson) had some reluctance about doing it, and was insistent on a series of conditions, and apparently his concerns were addressed," Snow said. While Paulson was chosen to bolster confidence on Wall Street about the administration's policies, investors on Tuesday ignored the initial news to focus instead on worries about higher oil prices and sliding consumer confidence, pushing the Dow Jones industrial average down by 184 points. Analysts said the sell-off, one of a number of recent steep slides, highlighted the challenges Paulson faces at a time when inflation is threatening to accelerate and economic growth is slowing. Given this administration's past practice of using its treasury secretary chiefly as a salesman for policies set inside the White House, some analysts questioned how much impact Paulson will have. "Will the new treasury secretary have any more influence than his two predecessors did, and will this administration be able to get anything through Congress with just 2 1/2 years to go?" said David Wyss, chief economist at Standard & Poor's in New York. Bush's top second term domestic priority, Social Security overhaul, is currently dead, his drive to overhaul the tax code is in the deep freeze, and Democrats are massing to defeat the president's effort to make permanent his first-term tax cuts, charging they are unaffordable in light of huge budget deficits. "The Bush administration must use its remaining years in office to right the fiscal wrongs of its first term," said Rep. Charles Rangel (news, bio, voting record), top Democrat on the tax-writing House Ways and Means Committee. "It is essential that Mr. Paulson provide a realistic viewpoint of the serious issues facing the American economy," said Sen. Jack Reed (news, bio, voting record), D-R.I. Sen. Charles Schumer (news, bio, voting record), D-N.Y., said Paulson's long experience in dealing with China should help in the administration's campaign to get the Chinese government to allow its currency rise in value against the dollar as a way of dealing with a record $202 billion U.S. trade deficit with China. In his writings and speeches, Paulson has been a strong supporter of the administration's tax cuts and its free-trade agenda. He also gave a pivotal speech in 2002 in support of a crackdown on corporate crime in the wake of the Enron Corp. and other business scandals. A strong environmentalist and devoted bird watcher and fisherman, Paulson has supported the need to attack global warming, a stand that could put him at odds with Bush's environmental views, although treasury does not have responsibility for those issues. Paulson, a Christian Scientist who does not drink or smoke, has used a fortune estimated at well over $500 million to make generous contributions to Republican candidates, according to the Center for Responsive Politics, a campaign watchdog group. During a brief White House announcement ceremony on Tuesday, Paulson called the American economy "truly a marvel, but we cannot take it for granted. We must take steps to maintain our competitive edge in the world."
On the Net: White House: http://www.whitehouse.gov
By MARTIN CRUTSINGER, AP Economics Writer

http://www.atimes.com/atimes/Global_Economy/HF02Dj01.html
EYE ON AMERICA
The trials of Henry Paulson
By Peter Morici

Failing to convince voters and financial markets that the US economy is sound, Treasury Secretary John Snow is being replaced by Wall Street investment banker Henry M Paulson, Jr. President George W Bush hopes he will bring the kind of clout with financial markets and the general public that Robert Rubin enjoyed during the Bill Clinton years.

Don't hold your breath. The Bush administration labors under the false assumption that better media spin will fix its flagging fortunes, even as systemic ills truly bedevil the American economy.

Under Bush's stewardship, the federal budget has swung from a US$236 billion surplus to a $423 billion deficit. This is thanks to runaw