Editors: Bloomberg News moves a combined business/general news budget at 13:30 New York time each business day. Graphics and photos can be found at www.bloomberg.com/photos or www.bloomberg.com/newsfeed.
Stories identified with the prefix PUBLISH in the slug have been shaped for newspaper use, and the suffix -TRIM indicates the original version has been shortened. All move times are New York time. Inquiries should be directed to Jon Bixby in content syndication, email@example.com or number for the department is TOP BUSINESS NEWS
U.S. Stocks Decline Amid Concerns Global Economy Is Slowing
U.S. stocks fell, extending the biggest quarterly drop since 2008 for the Standard & Poor’s 500 Index, after reports from China and Germany fueled concerns the global economy is slowing. Developing. US-STOCKS-FINAL to move by 17:00. By Inyoung Hwang. Also see GLOBAL-MARKETS-WRAP, US-OIL-MARKETS.
U.S. Economy: Consumer Spending Cooled in August as Wages Fell
Consumer spending slowed in August as incomes dropped for the first time in almost two years, showing scarce jobs are preventing the U.S. economy from gaining ground.
Purchases rose 0.2 percent after a 0.7 percent increase the prior month, and earnings decreased 0.1 percent, according to Commerce Department figures today in Washington. Other reports indicated business activity unexpectedly accelerated this month, while consumer sentiment held near an almost three-year low. 900. Moved at 11:30. By Alex Kowalski and Bob Willis. 900. Moved at 11:30. Also see ECONOMY-CHICAGO, ECONOMY-SENTIMENT.
Berkshire Added $4 Billion in Stock Investments in Quarter
Warren Buffett’s Berkshire Hathaway Inc. added about $4 billion in common stock to its investments during the third quarter, taking advantage of undervalued equities as stock markets slid.
The net change, described by Buffett today in a Bloomberg Television interview, compares with $3.4 billion in the second quarter. That was the most since Omaha, Nebraska-based Berkshire plowed a net $3.6 billion into stocks during the third quarter of 2008, the height of the global credit crisis.
“We’re ready to buy lots of things,” Buffett, 81, said in the interview with Betty Liu on the floor of the New York Stock Exchange. Berkshire’s program to purchase its own stock, announced earlier this week, “won’t keep us from investing billions and billions and billions in plants and equipment, in new acquisitions.” 400. Moved at 12:55. By Andrew Frye and Charles Mead.
BP’s $7.1 Billion Argentina Sale to Cnooc Said to Risk Collapse
BP Plc’s $7.1 billion deal to sell Argentine crude producer Pan American Energy LLC is at risk of collapse, jeopardizing China’s biggest energy acquisition this year, according to a person with knowledge of the matter.
BP’s agreement to sell its 60 percent stake to partner Bridas Corp., a company owned by Chinese oil producer Cnooc Ltd. and Argentina’s billionaire Bulgheroni family, has hit opposition from politicians and may not complete when the accord expires in November, the person said, declining to be identified as the details are private.
BP is prepared to let the deal lapse and continue as a partner in the oil production venture, he said. Still, no final decision has been made and the transaction could yet be completed. 470. Moved at 12:00. By Brian Swint and Brett Foley.
Bond Issuance Plunges on ‘Armageddon’ Scenarios: Credit Markets
Corporate bond offerings worldwide plunged in the third quarter to the lowest level since Lehman Brothers Holdings Inc.’s 2008 failure as Europe’s sovereign debt crisis caused investors to shun all but the safest securities.
Hewlett-Packard Co., the world’s largest maker of personal computers, and Santa Clara, California-based chipmaker Intel Corp. led borrowers issuing $543.2 billion of bonds in the past three months, according to data compiled by Bloomberg. Issuance fell 41 percent from the second quarter and 38 percent from a year ago as offerings by financial firms and junk-rated companies largely evaporated. 1710. Moved at 12:15. By Tim Catts and Ben Martin.
Toyota-Honda U.S. Rebound Brings Call of ‘What Recession?’: Cars
Toyota Motor Corp. and Honda Motor Co.’s return to full production this month is boosting U.S. auto sales back near the pace reached before Japan’s earthquake.
September light-vehicle sales, to be released Oct. 3, probably rose to a 12.8 million seasonally adjusted annual rate, the average estimate of 14 analysts surveyed by Bloomberg. That would be the fastest pace since April, when lost output caused by Japan’s tsunami crimped supply of parts and finished cars.
“Recovering inventory levels have helped to bring buyers back into the market,” said Jeff Schuster, executive director of global forecasting at J.D. Power & Associates. 1400. Moved at 9:45. By Craig Trudell and Alan Ohnsman.
Netflix to Tussle With Telefonica, Slim in Latin American Drive
Netflix Inc., seeking growth in Latin America after a price increase angered its U.S. DVD and online customers, is confronting entrenched competitors and cultural hurdles in its drive south of the border.
The company, based in Los Gatos, California, began selling subscriptions in Latin America on Sept. 5 and now offers movie streaming in 43 countries, including the Caribbean. The price is 99 pesos ($7.24) a month in Mexico and $7.99 elsewhere.
Lower incomes, less broadband availability and competitors such as Telefonica SA’s TerraTV and Carlos Slim’s Net Servicos de Comunicacao SA will complicate the effort, Chief Executive Officer Reed Hastings said in July. Compared with the U.S., fewer Latin Americans have credit cards, the main Netflix payment tool, and fewer have Internet-ready game consoles. 1000. Moved at 11:40. By Ronald Grover, Manuel Baigorri and Cliff Edwards.
Bank of America’s Countrywide Sued by Sealink Funding
Bank of America Corp.’s Countrywide unit was sued by Sealink Funding Ltd. in New York over $1.6 billion of residential mortgage-backed securities the fund purchased between 2005 and 2007.
Sealink filed the suit against Countrywide in New York State Supreme Court yesterday, seeking unspecified compensatory, rescissory and punitive damages. Sealink is a fund created to manage Landesbank Sachsen AG’s riskiest assets after the German lender almost collapsed. 450. Moved at 11:15. By Chris Dolmetsch and David McLaughlin.
Micron Falls After Reporting Loss as PC Slump Cut Chip Prices
Micron Technology Inc., the largest U.S. maker of computer- memory chips, fell in U.S. trading after reporting a fiscal fourth-quarter loss on weak demand for personal computers. 400. Moved at 9:45. By Ian King.
Semiconductor Investment Decline to Accelerate, Gartner Says
Semiconductor makers may cut worldwide capital-equipment investment by 19 percent in 2012, more than estimated earlier, as slowing economic growth causes sales to drop, according to research company Gartner Inc.
Industry spending on chip production capacity will total $35.2 billion next year compared with an estimated $43.5 billion in 2011, Stamford, Connecticut-based Gartner said today in a report. The drop is steeper than a 2.6 percent reduction that Gartner predicted in June. Investment cutbacks have already started and will last until mid-2012, it said. 200. Moved at 6:00. By Katie Linsell.
TOP GENERAL NEWS
Al-Qaeda’s American-Born Agent Al-Awlaki Killed in Yemen
Anwar al-Awlaki, a U.S.-born Islamic cleric who masterminded the attempted bombing of a Detroit-bound airplane in 2009 with explosives hidden in underwear, has been killed in Yemen, the Defense Ministry said.
A U.S. government official, who spoke on condition of anonymity, confirmed al-Awlaki’s death. Al-Awlaki was targeted and killed 8 kilometers (5 miles) from the town of Khashef in the province of Jawf, the Yemeni foreign press office said in an e-mailed statement today. Intelligence services say he inspired a shooting rampage that killed 13 people last year at an army base in Fort Hood, Texas. 960. Moved at 13:15. By Mohammed Hatem and Vivian Salama.
Obama Backed by 63% of Investors for Buffett Rule to Cut Deficit
Global investors overwhelmingly support President Barack Obama’s proposed tax increase for those earning annual incomes of $1 million or more in an effort to reduce the deficit.
By a margin of 63 percent to 32 percent, respondents in a Bloomberg Global Poll approved of the president’s proposal, known as the “Buffett rule” in a nod to Warren Buffett, the chairman of Berkshire Hathaway Inc., who has said it is wrong that he pays a smaller share of his income in taxes than does his secretary. 910. Moved at 12:35. By David J. Lynch.
GRAPHICS: POLL_TAX_MILLIONAIRES_093011. Graphic shows select results from the latest Bloomberg Global Poll. Size: 2C X 3in. (96.0 mm X 76.2 mm) Available now.
Obama Standing With Global Investors Reverses to 57% Unfavorable
Global investors’ confidence in President Barack Obama has plummeted over the past four months, with almost three-quarters of them now viewing his policies as a drag on the U.S. business climate.
Perceptions of European leaders such as German Chancellor Angela Merkel and French President Nicolas Sarkozy also have turned sharply negative after months of tumult in global financial markets, according to a Bloomberg Global Poll. The quarterly poll, conducted Sept. 26, covered 1,031 investors, traders and analysts who are Bloomberg subscribers. 810. Moved at midnight. By Mike Dorning.
Fed Operation Twist Fails to Reduce Unemployment in Global Poll
Global investors say Federal Reserve Chairman Ben S. Bernanke’s bond-swap program, known as Operation Twist, will fail to reduce unemployment as the world’s largest economy slows.
Seventy-eight percent of respondents say the Fed’s plan to replace $400 billion of short-term debt with longer-term Treasuries won’t create jobs for the nation’s 14 million unemployed, according to the quarterly Bloomberg Global Poll of 1,031 investors, analysts and traders who are Bloomberg subscribers. 960. Moved at midnight. By Joshua Zumbrun.
Google Joins Apple Mobilizing Lobbyists to Push for Tax Holiday
As a coalition led by Apple Inc., Google Inc., and Cisco Systems Inc. presses for a tax holiday on more than $1 trillion in offshore profits, it is turning to a well-positioned lobbyist: Jeffrey Forbes, once chief of staff to Max Baucus, chairman of the tax-writing Senate Finance Committee.
Data compiled by Bloomberg News show that Forbes is part of an army of more than 160 lobbyists, including at least 60 who once worked for a sitting member of the House or Senate, pushing for the repatriation holiday. Their job is to persuade Congress to establish a tax break estimated to cost the U.S. government $78.7 billion over the next decade. 1270. Moved at 9:35. By Richard Rubin and Jesse Drucker. Editors: this story moved earlier and is being available to newspapers today.
U.S. Economic Clout May Sink Palestinian Quest at UN Council
Economics and political expediency may trump historical connections to determine whether two swing votes on the United Nations Security Council, Nigeria and Gabon, back the Palestinians’ bid for membership.
The two African nations were among the more than 100 countries that responded to Yasser Arafat’s 1988 declaration of independence by recognizing Palestine. This has led Palestinians to look to them for the ninth vote needed for approval by the 15-member council.
While the Palestinians have dispatched diplomats to the capitals of both nations to plead their case, they carry neither the economic heft nor the far-reaching influence of the U.S., which is working to block the Palestinians’ UN initiative. 1240. Moved at 13:10. By Flavia Krause-Jackson and Bill Varner.
California Shifts Thousands of Criminals to Jails to Cut Costs
California will shift responsibility for thousands of criminals from state control to county lockups and local probation under a plan by Governor Jerry Brown to ease prison crowding and cut spending.
Starting tomorrow, felons convicted of nonviolent, low- level crimes such as drug possession will no longer be sent to prison. Instead, they’ll be held in a county jail or sentenced to alternatives such as house arrest, diversion programs or GPS ankle-bracelet tracking. Local parole officers, instead of state agents, will monitor most ex-convicts.
California, which slashed spending on schools and the poor this year to erase a $26 billion projected deficit, runs the nation’s largest correctional system, with about 161,000 inmates. The U.S. Supreme Court, citing overcrowding and inadequate health care, ordered the state to reduce the prison population by 33,000 in two years. 450. Moved at midnight. By Michael B. Marois.
Canceled Flights at 10-Year High Amid Blizzard-to-Irene Upheaval
U.S. airlines are canceling flights at the fastest clip in a decade as storms from blizzards to hurricanes wallop the busiest hubs, and full planes are making it harder for stranded travelers to rebook trips.
United Continental Holdings Inc., Delta Air Lines Inc. and other large carriers have scrubbed almost 104,000 flights this year through Sept. 21, or 2.36 percent of the scheduled total. A full-year rate at that level would be the highest since 2001, according to the U.S. Bureau of Transportation Statistics. 1050. Moved at midnight. By Mary Jane Credeur.
BUSINSES NEWS FEATURES
Wall Street’s Top Economist Hyman Makes ISI No. 1 in Tennis Too
Every morning at 7, employees at ISI Group Inc.’s midtown Manhattan office huddle around a green ping-pong table to discuss sales strategy.
The racket-sport theme continues throughout the day at ISI, an investment research provider and broker-dealer, where tennis has become a business tool. It is used to build camaraderie and client relationships at a firm where the company team includes a collegiate championship doubles finalist and a Davis Cup player, a local club champion and a former ATP Tour player.
“A big part of helping with clients’ performance is getting to know them, their appetite for risk, how they trade, their investment style,” ISI President Vinayak Singh said in an interview. “The more time you find to do that, the better your chances of success, and tennis is one way we achieve that goal.”
ISI, founded by Ed Hyman and Nancy Lazar in 1991, is a 200- employee company that made Institutional Investor’s Top 10 All- America Research Teams in October. The magazine also named Hyman Wall Street’s best economist for the 31st consecutive year. 800. Moved at midnight. By Eben Novy-Williams.
PHOTO: ISI Group President Vinayak Singh poses with Managing Director Charlie Roberson and sales associate Federico Chavarria behind a ping-pong table in the company’s conference room in New York. Photographer: Jin Lee/Bloomberg.
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