Monday, September 5, 2011
AFP: USPS boss warns of 'extremely serious' cash woes: report
USPS boss warns of 'extremely serious' cash woes: report(AFP) – 42 minutes ago
WASHINGTON — The US Postal Service will be unable make a $5.5 billion payment this month and deliveries could shut down entirely this winter if the government does not step in, The New York Times reported Monday.
"Our situation is extremely serious," Postmaster General Patrick Donahoe told the newspaper in an interview. "If Congress doesn't act, we will default."
The service, a public employer that claims to handle nearly 40 percent of global mail, has been piling up losses since early 2008 due to rising costs and a decline in volumes caused by rising Internet use and e-commerce.
In July, the service unveiled a plan to close more than 10 percent of its post offices throughout the United States. It had already slashed 110,000 jobs -- 16 percent of its workforce -- in the past four years to cut its wage bill.
The $5.5 billion payment due at the end of this month is meant to finance retirees' future health care. A Senate committee will meet on Tuesday to discuss the postal service's financial difficulties.
Donahoe has in recent weeks been considering the elimination of Saturday deliveries, the closure of 3,700 postal locations and the laying off of 120,000 workers to help close a $9.2 billion financial hole, the Times report said.
Further job cuts would be considered extremely difficult to implement because of a new no-layoffs clause in contracts negotiated with postal unions in May.
"We're going to fight this and we're going to fight this hard," Cliff Guffey, president of the American Postal Workers Union, was quoted by the newspaper as saying.
"It's illegal for them to abrogate our contract," he added.
Copyright © 2011 AFP. All rights reserved. More »
US recession fears savage world financial markets
By CARLO PIOVANO
The Associated Press
LONDON — World stock markets took a beating Monday over fears that the U.S. economy was heading back into a recession just as the European debt crisis was heating up and the eurozone's economic indicators were slumping.
A trader works on the floor of the New York Stock Exchange on Friday, Sept. 2, 2011 in New York. The jobs report was the weakest in almost a year. It renewed fears that the U.S. might slip back into recession. (AP Photo/Jin Lee)
A man looks at an electronic stock board of a securities firm in Tokyo, Monday, Sept. 5, 2011. Asia-Pacific stocks took a beating early Monday after jobs data out of the U.S. last week revived fears of a recession in the world's largest economy. (AP Photo/Koji Sasahara)
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Any troubles in the world's largest economy cast a long shadow over the markets, and a report Friday that the U.S. economy failed to add any new jobs in August caused European and Asian stock markets to sink sharply Monday.
But the news from Europe was also discouraging. Wall Street, which was closed Monday due to the Labor Day holiday, braced for losses Tuesday after the yields in so-called peripheral eurozone countries — Greece, Italy and Spain — rose sharply against those of Germany, whose bonds are widely considered a safe haven.
Although retail sales in the 17-nation eurozone rose unexpectedly in July, a survey of the services sector Monday showed a slowdown across the continent for the fifth consecutive month. The purchasing managers' index for the eurozone showed the services sector was still growing — unlike the manufacturing sector — but only barely. That will add pressure on the European Central Bank to keep interest rates on hold when it meets this week.
"There's so much uncertainty, so much fear, that investors don't know what to do," said David Kotok, chairman and chief investment officer at Cumberland Advisors. "I don't remember the last time stocks were so cheap and nobody wanted them."
Investors were also shaken by signs that the Italian government's commitment to its austerity program is wavering. Prime Minister Silvio Berlusconi's government has backtracked on some deficit-cutting measures, prompting EU officials to urge Italy to stick to its promised plan.
The difference in interest rates between the Greek and benchmark German 10-year bonds, known as the spread, spiraled to new records on Monday, topping 17.3 percentage points. Yields on the Greek bonds were above 18 percent.
Mario Draghi, the incoming chief of the European Central Bank, told a conference in Paris that among the common currency's problems was a lack of coordinated fiscal policies and that the solution was more integration.
He dismissed the idea of eurobonds — debt issued jointly by the eurozone countries. Some have argued this would help weaker countries borrow more easily because they wouldn't have to pay such high interest rates. But stable countries like Germany would likely see their rates rise.
Instead, Draghi suggested the eurozone should adopt rules that would require more budget discipline.
Renewed jitters over the eurozone debt crisis also contributed to the slump in financial stocks amid concerns the banks would need to raise new capital. Deutsche bank closed down 8.9 percent in Frankfurt, while Societe Generale in Paris shed 8.6 percent.
The U.S. unemployment crisis has prompted President Barack Obama to schedule a major speech Thursday night to propose steps to stimulate hiring. Until then, however, traders coming back from the U.S. holiday weekend will have little to hold onto.
The August jobs figure was far below economists' already tepid expectations for 93,000 new U.S. jobs and renewed concerns that the U.S. recovery is not only slowing but actually unwinding. U.S. hiring figures for June and July were also revised lower, only adding to the gloom.
Many traders have already pulled out of any risky investments — such as stocks, particularly financial ones, the euro and emerging market currencies — and pile into safe havens: U.S. Treasuries, the dollar, the Japanese yen and gold.
With Wall Street closed, investors focused their selling in Asia and Europe, where the equity losses Monday were some of the heaviest this year.
"We've got some rough riding ahead," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago, adding he was "concerned that we could see a second wave of selling when most traders are back at their desks."
Dow futures were down 1.8 percent at 11,010 points while the broader S&P 500 futures were 2.0 lower at 1,145.70.
After Asian indexes closed lower, with the Japan's Nikkei 225 shedding 1.9 percent, European shares booked sharp losses. Britain's FTSE 100 closed the day down 3.6 percent to 5,102.58. Germany's DAX slumped a massive 5.3 percent to 5,246.18, and France's CAC-40 tumbled 4.7 percent to 2,999.54.
The health of the U.S. economy is crucial for the wider world because consumer spending there accounts for a fifth of global economic activity. The U.S. imports huge amounts from Japan and China and is closely linked at all levels with the European market. The U.S. has seen a slump in consumer and business sentiments.
Traders were hoping for signs that the Federal Reserve might take action at its September meeting to support the economy — perhaps a third round of bond purchases, dubbed quantitative easing III or QE3, analysts said.
"Right now the possibility has increased," said Linus Yip, a strategist at First Shanghai Securities in Hong Kong. "I think they have to do something. The markets are expecting QE3."
Banking stocks were among the hardest hit Monday, partly because the U.S. government on Friday sued 17 financial firms for selling Fannie Mae and Freddie Mac billions of dollars worth of mortgage-backed securities that turned toxic when the housing market collapsed.
Among those targeted by the lawsuits were Bank of America Corp., Citigroup Inc., JP Morgan Chase & Co., and Goldman Sachs Group Inc. Large European banks including The Royal Bank of Scotland, Barclays Bank and Credit Suisse were also sued.
In Asia, Australia's S&P/ASX 200 followed the broaden trend to close down 2.4 percent and South Korea's Kospi slid 4.4 percent. Hong Kong's Hang Seng slid 3 percent. Benchmarks in Singapore, Taiwan, New Zealand and the Philippines also were down.
Shanghai's benchmark Composite Index down 2 percent to 2,478.74, its lowest close in 13 months. The Shenzhen Composite Index lost 2.4 percent.
In currencies, the euro weakened to $1.4100 from $1.4187 in New York late Friday. The dollar was roughly flat at 76.87 yen. Last month, the dollar fell under 76 yen, which was a new post-World War II high for the Japanese currency.
Benchmark oil for October delivery was down $2.12 to $84.33 a barrel in electronic trading on the New York Mercantile Exchange. Crude fell $2.48 to settle at $86.45 on Friday.
In London, Brent crude for October delivery was down $1.63 at $110.70 on the ICE Futures exchange.
___
Samantha Bomkamp in New York, Pamela Sampson in Bangkok and Fu Ting in Shanghai contributed to this report.
___
September 05, 2011 05:01 PM EDT
Copyright 2011, The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Labor Day: What and Why? - Norwood, MA Patch
Labor Day: How it Came About; What it Means
Labor Day, the first Monday in September, is a creation of the labor movement and is dedicated to the social and economic achievements of American workers. It constitutes a yearly national tribute to the contributions workers have made to the strength, prosperity, and well-being of our country.
Founder of Labor Day
More than 100 years after the first Labor Day observance, there is still some doubt as to who first proposed the holiday for workers.
Some records show that Peter J. McGuire, general secretary of the Brotherhood of Carpenters and Joiners and a cofounder of the American Federation of Labor, was first in suggesting a day to honor those "who from rude nature have delved and carved all the grandeur we behold."
But Peter McGuire's place in Labor Day history has not gone unchallenged. Many believe that Matthew Maguire, a machinist, not Peter McGuire, founded the holiday. Recent research seems to support the contention that Matthew Maguire, later the secretary of Local 344 of the International Association of Machinists in Paterson, N.J., proposed the holiday in 1882 while serving as secretary of the Central Labor Union in New York. What is clear is that the Central Labor Union adopted a Labor Day proposal and appointed a committee to plan a demonstration and picnic.
The First Labor Day
The first Labor Day holiday was celebrated on Tuesday, September 5, 1882, in New York City, in accordance with the plans of the Central Labor Union. The Central Labor Union held its second Labor Day holiday just a year later, on September 5, 1883.
In 1884 the first Monday in September was selected as the holiday, as originally proposed, and the Central Labor Union urged similar organizations in other cities to follow the example of New York and celebrate a "workingmen's holiday" on that date. The idea spread with the growth of labor organizations, and in 1885 Labor Day was celebrated in many industrial centers of the country.
Labor Day Legislation
Through the years the nation gave increasing emphasis to Labor Day. The first governmental recognition came through municipal ordinances passed during 1885 and 1886. From them developed the movement to secure state legislation. The first state bill was introduced into the New York legislature, but the first to become law was passed by Oregon on February 21, 1887. During the year four more states — Colorado, Massachusetts, New Jersey, and New York — created the Labor Day holiday by legislative enactment. By the end of the decade Connecticut, Nebraska, and Pennsylvania had followed suit. By 1894, 23 other states had adopted the holiday in honor of workers, and on June 28 of that year, Congress passed an act making the first Monday in September of each year a legal holiday in the District of Columbia and the territories.
A Nationwide Holiday
The form that the observance and celebration of Labor Day should take were outlined in the first proposal of the holiday — a street parade to exhibit to the public "the strength and esprit de corps of the trade and labor organizations" of the community, followed by a festival for the recreation and amusement of the workers and their families. This became the pattern for the celebrations of Labor Day. Speeches by prominent men and women were introduced later, as more emphasis was placed upon the economic and civic significance of the holiday. Still later, by a resolution of the American Federation of Labor convention of 1909, the Sunday preceding Labor Day was adopted as Labor Sunday and dedicated to the spiritual and educational aspects of the labor movement.
The character of the Labor Day celebration has undergone a change in recent years, especially in large industrial centers where mass displays and huge parades have proved a problem. This change, however, is more a shift in emphasis and medium of expression. Labor Day addresses by leading union officials, industrialists, educators, clerics and government officials are given wide coverage in newspapers, radio, and television.
The vital force of labor added materially to the highest standard of living and the greatest production the world has ever known and has brought us closer to the realization of our traditional ideals of economic and political democracy. It is appropriate, therefore, that the nation pay tribute on Labor Day to the creator of so much of the nation's strength, freedom, and leadership — the American worker.
UPDATE: About 60% Of Gulf Oil Production Still Offline Due To Storm
--About 61.4% of the oil production and 46% of the natural-gas production in the region remained shut in.
--Thousands of people without power in Louisiana, Mississippi, Texas and Arkansas.
--Major Gulf oil, gas producers waiting for weather to improve to restart operations.
(Updates to rewrite top of the story, adds amount of production that remains shut in and background about platforms and companies throughout.)
HOUSTON (Dow Jones)--A large part the Gulf of Mexico's oil and gas production remained offline Monday as sea conditions and high winds delayed the deployment of workers and the restarting of production of hundreds of platforms that were evacuated last week ahead of Storm Lee.
After making landfall Sunday morning near Lafayette, La., and bringing torrential rains, the slow-moving storm was expected to continue to draw moisture from the Gulf as it gradually drifts north to drench the Appalachian mountains and Tennessee River valley.
The U.S. government said that about 61.4% of the oil production and 46% of the natural-gas production in the region remained shut in as of Monday. That amounts to about 859,000 barrels of oil per day and 2.44 billion cubic feet of natural gas per day. The amount of oil and gas output that remained shut-in Monday was slightly higher than Sunday, when the government said about 60.2% of the oil production and 44.3% of natural gas production remained offline.
Lee also left thousands of people without power in the region. About 6,265 customers in Louisiana, 990 in Mississippi, 1,292 in Texas and 383 in Arkansas were without power as of Sunday evening, according to major utility Entergy Corp. (ETR).
"In an ongoing battle with Tropical Storm Lee, Entergy crews continued restoration work as the storm's heavy squalls and winds slowly moved through Louisiana and Mississippi, and its effects were felt across the utility's four-state service territory," the company said in a press release.
Major Gulf producers such as Chevron Corp. (CVX), Royal Dutch Shell (RDSA), Apache Corp. (APA) and BP PLC (BP) said Sunday that extreme weather was putting a break in their efforts to send workers back and restart production. BP said it expected to start sending workers back Tuesday morning to several platforms that have evacuated last week. The oil giant shut productions at Mad Dog, Holstein, Atlantis, Nakika, Thunderhorse, Pompano, Horn Mountain and Marlin.
Mad Dog, Thunderhorse and Nakika are three of the Gulf's six largest production platforms, with combined output of equal to about 367,000 barrels of oil per day.
The Gulf of Mexico accounts for 30% of all U.S. oil production and about 7% of U.S. natural gas production.
The Louisiana Offshore Oil Port said tanker offloading remained halted as of Monday morning because of poor sea conditions. LOOP is a deep-water port off Louisiana that provides tanker offloading and receives oil from underwater pipelines. The port, however, continues to make deliveries to customers from its onshore storage facilities, according to its website. Tanker offloading was halted Friday ahead of the storm.
-By Isabel Ordonez, Dow Jones Newswires; 713-547-9207; isabel.ordonez@dowjones.com
Searching for Bachmann - Maggie Haberman
Cillizza looks at Michele Bachmann's fade from the spotlight since her Ames Straw Poll victory, and the challenge of proving in the next two months that she can be seen as electable:
That’s the question the Republican political class is asking itself: why the Minnesota congresswoman — who seemed primed to emerge as a major figure in the quest for the party’s presidential nomination after her Iowa straw-poll win last month — seems to have slipped backward.
Even her campaign acknowledges that she is on the outside looking in at a developing two-man contest between Texas Gov. Rick Perry and former Massachusetts governor Mitt Romney.
“The Perry-Romney race is now the story, with us the third candidate,” said Ed Rollins, Bachmann’s campaign manager.
(snip)
Although Bachmann has seen her star eclipsed in recent weeks, Rollins argued that the next 40 (or so) days will afford her a chance to reestablish her prominence.“The six debates in the next six weeks will test Governor Perry and give us a chance to recapture some of the attention,” he said.
Continue ReadingRollins added that with Congress returning to Washington after Labor Day, Bachmann’s “role in fighting the runaway spending will give her many media opportunities.”
Bachmann will be in a difficult position in the upcoming debates - trying for a breakout moment that's also serious, while competing with Perry for attention.