Monday Business Edition

Monday Business Edition is an Open Thread

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From Yahoo News Business

1 Greece heads for audit after euro exit scare

by John Hadoulis, AFP

Sun May 8, 2:09 pm ET

ATHENS (AFP) – Greece heads for another audit of its battered finances this week after European officials closed ranks to quash fears of an inglorious Greek exit from the euro cited in a German online report.

A high-level team of experts from the EU, the IMF and the European Central Bank will pore over plans by the Greek government to economise some 26 billion euros over three years to help bring down the country’s enormous debt.

“The mission will begin on Tuesday,” a finance ministry source said.

AFP

2 Europe faces prospect of new Greek aid calls

by Roddy Thomson, AFP

Sat May 7, 11:26 am ET

BRUSSELS (AFP) – Europe faced the spectre of Greek calls for new financial aid Saturday as Athens’ “catastrophic” finances returned to haunt stressed eurozone states, despite efforts to prevent panic.

Greek Prime Minister Georges Papandreou on Saturday urged “the EU in particular, to leave Greece in peace to do its job,” after Finance Minister George Papaconstantinou warned at G20-eurozone talks in Luxembourg late Friday that Athens needs “breathing space.”

But both national and specialist financial media reports raised the possibility that the government may yet come calling for fresh European Union funds on top of the 110 billion euros ($160 billion) agreed a year ago.

3 Eurozone ‘mulling easier recovery terms’ for Greece

AFP

Sat May 7, 5:48 am ET

ATHENS (AFP) – Eurozone members are debating milder recovery terms for debt-hit Greece as it struggles to stick to a harsh austerity plan, Greek media said Saturday after emergency talks in Luxembourg late Friday.

The reports said Finance Minister George Papaconstantinou had flown to a “secret” meeting among G20 eurozone states that debated giving Athens more time to repay a 110-billion-euro ($157 billion) EU-IMF loan and easier deficit reduction targets.

The prospect of a repayment extension on Greek debt held by banks was also raised, the Greek reports said.

4 Coke celebrates 125 years of being ‘the real thing’

by Gregor Waschinski, AFP

Sun May 8, 4:57 pm ET

WASHINGTON (AFP) – Exactly 125 years ago an Atlanta pharmacist mixed up a cure for headache and fatigue and stumbled upon the recipe for what has become one of the world’s most recognizable drinks and brand names.

Coca-Cola is celebrating the moment when on May 8, 1886 John Pemberton made his way into American culture, creating a soft drink now sold in more than 200 countries and earning the company a place among the world’s top 100 firms.

Regular Coke, as opposed to its numerous offshoots such as Diet Coke, remains the world’s favorite soda with a whopping 17 percent market share, trouncing its rival Pepsi.

5 Speculation rife as Merkel keeps mum on ECB candidate

by Ouerdya Ait-Abdelmalek, AFP

Sun May 8, 5:56 pm ET

FRANKFURT (AFP) – German Chancellor Angela Merkel is playing her cards close to her chest on her pick for the next head of the European Central Bank, though frontrunner Mario Draghi is emerging as an acceptable choice for Berlin, analysts said.

Merkel has kept mum on the issue, although sources close to German Finance Minister Wolfgang Schaeuble have not concealed that he would prefer Draghi, the head of the Italian central bank, to be the next head of the eurozone central bank.

A former Goldman Sachs banker, Draghi would succeed Frenchman Jean-Claude Trichet whose appointment ends at the end of October, but this has never been said officially. France last week threw its support behind Draghi.

6 Brazil giant Vale opens Mozambique mine

by Johannes Myburgh, AFP

Sun May 8, 11:25 am ET

MOATIZE, Mozambique (AFP) – Brazilian mining giant Vale opened a new $1.7 billion coal mine in Mozambique on Sunday, tapping the southern African country’s thermal and coking coal reserves of around 23 billion tonnes.

Mozambican President Armando Guebuza and outgoing Vale chief Roger Agnelli opened the mine together by pressing a button that triggered an underground explosion, enabling the company to bring to the surface its first coal from the mine in Moatize, outside the city of Tete in northwest Mozambique.

As a giant smoke cloud mushroomed over the hundreds of VIP guests, a large truck brought a symbolic load to a conveyor belt and onward to a coal washing plant.

7 Europe faces up to boomerang Greek debt chaos

by Roddy Thomson, AFP

Sun May 8, 4:29 am ET

BRUSSELS (AFP) – Europe faced the spectre of Greek calls for new financial aid Saturday as Athens’ “catastrophic” finances returned to haunt stressed eurozone states.

Greek Prime Minister George Papandreou urged “the EU in particular, to leave Greece in peace to do its job”, but Finance Minister George Papaconstantinou later warned that Athens may need more hard cash support.

“We need to plan our next steps for 2012 and 2013 so that Greece can either access markets or use the European council’s recent decision that enables the European (rescue) fund to buy Greek bonds,” Papaconstantinou said, after G20-eurozone talks overnight in Luxembourg.

8 Russian-born billionaire buys Warner Music for $3.3bn

by Veronique Dupont, AFP

Sat May 7, 9:13 am ET

NEW YORK (AFP) – Russian-American billionaire Len Blavatnik’s Access Industries won a bidding war on Friday for Warner Music Group, buying the storied music company for $3.3 billion in an all-cash transaction.

The sale of Warner Music, whose artists range from current stars such as Eric Clapton and Kid Rock to legends such as Frank Sinatra and Ray Charles, comes at a challenging time for the music industry with digital piracy rampant and CD sales slumping.

It also comes amid reports that EMI Group, a Warner Music rival which is owned by Citigroup, is on the block.

9 BP cedes Arctic project to Russia partner

AFP

Fri May 6, 2:04 pm ET

LONDON (AFP) – British energy giant BP said Friday it will cede the Arctic exploration part of its tie-up with Rosneft to its Russian unit under an arbitration ruling that may see it salvage the $16 billion deal.

The announcement is a part of BP’s strategy to preserve the share swap portion of its agreement with Rosneft and thus retain its foothold in the market of the world’s largest oil producer.

But both parts of the revised agreement are subject to Rosneft’s approval and the state-held company has previously ruled out working with TNK-BP — the British firm’s much smaller and less experienced local subsidiary.

10 LVMH-backed fund hunts for emerging Asian brands

by Bernice Han, AFP

Sun May 8, 1:42 am ET

SINGAPORE (AFP) – A $650-million private equity fund backed by the world’s top luxury retailer LVMH is on the prowl for emerging Asian brands in the hope of transforming them into global names.

The L Capital Asia fund has so far spent a total of $90 million on minority stakes in two Singaporean fashion companies and a Hong Kong-listed watch and jewellery company.

It is in advanced talks with a fashion-related firm from China and another from India and hopes to make an announcement about the investments in the next few months, said Ravi Thakran, the fund’s managing partner.

Reuters

11 EU eyes lower rates for Greece, Ireland amid chaos

By John O’Donnell and Stephen Brown, Reuters

1 hr 7 mins ago

BRUSSELS/BERLIN (Reuters) – The European Union is looking to lower interest rates on bailout loans to Greece and Ireland and is working on a second rescue for Athens in a chaotic effort to prevent a disorderly debt restructuring.

The executive European Commission said on Monday it hoped to see a decision within weeks on reducing the rate charged to Ireland to make Dublin’s debt more sustainable.

“The Commission is clearly in favor of a rate cut,” a spokesman for EU Economic and Monetary Affairs Commissioner Olli Rehn said. “The Commission is against debt restructuring.”

12 Special report: What really triggered oil’s greatest rout

Reuters

Mon May 9, 2:45 am ET

NEW YORK (Reuters) – When oil prices fell below $120 a barrel in early New York trade last Thursday, a few big companies that are major oil consumers started buying around $117.

It looked like a bargain. Brent crude had been trading above $120 for a month. But the buying proved ill-timed. Crude kept on falling.

“They were down millions by the end of the day, trying to catch a falling piano,” an executive at a major New York investment bank said.

13 Barclays, HSBC hit by compensation capitulation

By Sudip Kar-Gupta, Reuters

2 hrs 40 mins ago

LONDON (Reuters) – British banks gave up a fight over compensating customers wrongly sold insurance, forcing Barclays Plc (BARC.L) and HSBC (HSBA.L) to take a combined hit of more than $2 billion in the latest blow to the industry.

Barclays said it would make a 1 billion pound ($1.6 billion) provision in the second quarter of 2011 to cover the costs related to the mis-selling of payment protection insurance (PPI), with HSBC setting aside $440 million.

British banks, already under pressure from regulators to clean up their act following the financial crisis, said they would not appeal against a ruling requiring them to pay compensation. The bill could total around 8 billion pounds.

14 Commodities’ drop curbs risk appetite

By Caroline Valetkevitch, Reuters

Sun May 8, 4:35 pm ET

NEW YORK (Reuters) – U.S. stock investors head into this week with added worries about the sustainability of the recent rally and a desire to reduce risk, as shown by the stampede out of commodities on Thursday.

Stocks also will begin to lose the support they have enjoyed from stronger-than-expected earnings, with the first-quarter reporting period nearing an end.

The drop in commodities last week spilled over into commodity-related stocks, which were among the top performers in the last two quarters.

15 Japan expected to shut nuclear plant over quake worries

By Chikako Mogi, Reuters

Mon May 9, 12:22 am ET

TOKYO (Reuters) – Japan’s third biggest power company on Monday is expected to shut a nuclear plant because of its vulnerability to a major quake, adding to concerns about electricity supplies after a giant quake and tsunami crippled another nuclear facility in March.

The expected announcement follows a call by Prime Minister Naoto Kan to close the Hamaoka plant in central Japan, about 200 km (120 miles) southwest of Tokyo, and signals a potential shift in energy policy following the worst nuclear crisis in 25 years.

Chubu Electric Power Co shares tumbled as much as 14 percent on the call by the prime minister. Chubu will hold a board meeting at 0630 GMT at which it is expected to make a final decision to close the plant, Japanese media said.

16 Internet boom 2.0 is here, starts to look bubbly

By Jenny Harris and Jennifer Rogers, Reuters

Sun May 8, 3:49 pm ET

NEW YORK (Reuters) – The tantalizing prospect of finding the next Facebook, Groupon or Twitter is driving the biggest rush of venture capital into the Internet start-up arena since dot-com mania first boomed and then fizzled more than a decade ago.

More than $5 billion of venture capital investment flowed into young web companies globally in the first four months of the year, data from Thomson Reuters Deals Intelligence shows.

Though small compared with the boom years, the sum puts 2011 on track to be the busiest in dollar terms since 2000, when more than $55 billion was deployed to back nascent technology firms.

17 Greek PM denies euro exit; says leave Greece alone

By Dina Kyriakidou and Renee Maltezou, Reuters

Sat May 7, 1:23 pm ET

ATHENS (Reuters) – Greek Prime Minister George Papandreou on Saturday denied there was even unofficial discussion over Greece quitting the euro zone and asked that his troubled country be “left alone to finish its task.”

Ministers from the euro zone’s biggest economies met in Luxembourg to discuss Greece’s debt crisis on Friday but Athens and senior EU officials denied a report by Germany’s Spiegel Online that the Greek government had raised the prospect of leaving the 17-member euro zone.

“These scenarios are borderline criminal,” Papandreou told a conference on the Ionian island of Meganisi. “No such scenario has been discussed even in our unofficial contacts…I call upon everyone in Greece and abroad, and especially in the EU, to leave Greece alone to do its job in peace.”

18 Irish government sees opportunity from Greek crisis

By Carmel Crimmins, Reuters

Sun May 8, 11:28 am ET

DUBLIN (Reuters) – Ireland’s government is watching to see what concessions it can win on its EU-IMF bailout if Greece is given a new deal to resolve its worsening debt crisis, a senior government minister said on Sunday.

“The thing I am interested in is whether there are positive implications for Ireland about dealing with the situation the Greek government now confronts,” Minister for Energy Pat Rabbitte told state broadcaster RTE.

“The Irish government intends for the duration of the programme to continue to negotiate improvements and to take advantage of developments elsewhere in the hope that there will be a multilateral approach to renegotiating (the) bailout.”

19 Goldman sees new oil rally

By Dmitry Zhdannikov and David Sheppard, Reuters

Fri May 6, 7:55 pm ET

LONDON/NEW YORK (Reuters) – Goldman Sachs, which in April predicted this week’s major correction in oil prices, said on Friday that oil could surpass its recent highs by 2012 as global oil supplies continue to tighten.

The Wall Street bank, seen as one of the most influential in commodity markets, said it did not rule out a further short-term fall after Thursday’s near record drop, especially if economic data continued to disappoint.

But the bank reaffirmed its traditional long-term bullish view of oil, helping crude to pare some of its earlier heavy losses on Friday. And it wasn’t alone: JP Morgan took the bold step of raising its oil price forecasts for this year by $10, becoming the most bullish of 27 forecasts in a Reuters poll.

20 Greece denies may quit euro

By Michele Sinner and Dina Kyriakidou, Reuters

Fri May 6, 7:45 pm ET

LUXEMBOURG/ATHENS (Reuters) – Top finance officials of the euro zone’s biggest economies met to discuss Greece’s debt crisis on Friday and Athens denied a media report that it was considering whether to leave the bloc.

Jean-Claude Juncker, head of the group of euro zone finance ministers, said the meeting in Luxembourg was attended by ministers from Germany, France, Italy and Spain. He said there was a broad discussion of Greece and other international economic issues.

Juncker denied a report in Germany’s Spiegel Online magazine that the talks were held to discuss the possibility, raised by Athens, of Greece withdrawing from the 17-member euro zone, as well as the idea of restructuring Greece’s 327 billion euro ($470 billion) sovereign debt.

21 Oil crash pits floor veterans versus computer algorithms

By David Sheppard, Emma Farge and Jonathan Spicer, Reuters

Fri May 6, 6:31 pm ET

NEW YORK (Reuters) – A day after oil prices plunged an unprecedented $12 a barrel, a New York trader sat on the steps of the dormant oil futures pit, playing a word game on his tablet computer.

Back to business as usual for floor traders, a vanishing breed in a market now dominated by machines and algorithms, a fact that some of them say worsened one of the most shocking — and baffling — trading sessions ever.

On the waterfront of Manhattan’s southern tip, veterans of the New York Mercantile Exchange’s (NYMEX) pits recounted how the crash reminded them of the heyday of the trading floor.

22 Goldman Sachs CEO Lloyd Blankfein is cordial but sniffly

By Lauren Tara LaCapra, Reuters

Fri May 6, 6:26 pm ET

JERSEY CITY, New Jersey (Reuters) – Goldman Sachs Group Inc Chief Executive Lloyd Blankfein was in good spirits on Friday at his firm’s annual meeting, despite battling some testy shareholders and what seemed to be a cold.

The Wall Street chieftain sipped water and blew his nose through the two-hour proceedings, and declined to shake one investor’s hand after the meeting for fear of spreading germs.

But while Blankfein might have preferred chicken soup over the continental breakfast on display, his demeanor remained strong and, some might say, resilient.

23 In commodity rout, more traders getting in than out

By Lisa Shumaker, Reuters

Fri May 6, 6:22 pm ET

CHICAGO (Reuters) – When commodities melt down as abruptly as they did on Thursday, the first assumption is that big investors dumped massive long positions.

This time around, that doesn’t seem to be whole story, or even the right one. Exchange data shows that not all traders were running for the doors; some added to positions, many betting on more losses rather than locking in profits.

In the hardest hit markets — oil and silver — the number of bets on the market rose even as prices crashed. Because oil dwarfs the rest of the commodities, the rise in the number of bets on oil was enough to drive up the notional value of all commodities markets even though crude fell 9 percent in price.

24 Berkshire Hathaway profit falls on Japan quake

By Ben Berkowitz, Reuters

Fri May 6, 6:13 pm ET

NEW YORK (Reuters) – Warren Buffett’s conglomerate Berkshire Hathaway Inc reported a smaller profit for the first quarter, as reinsurance losses from the March 11 earthquake in Japan dragged down results.

But the company’s quarterly report made no mention at all of David Sokol, the former Berkshire executive whose sudden resignation at the end of the quarter created a scandal for Berkshire and prompted an SEC probe.

Buffett preannounced quarterly results at last Saturday’s annual meeting of Berkshire, the ice-cream-to-insurance giant the world’s third-richest man controls.

25 JPMorgan in talks with SEC to resolve probe

By Joe Rauch and Tom Hals, Reuters

Fri May 6, 5:42 pm ET

CHARLOTTE, N.C./WILMINGTON, Delaware (Reuters) – JPMorgan Chase & Co is in advanced talks with U.S. regulators to resolve a probe into its role in selling subprime mortgage-backed bonds in 2007, a case that highlights a rare misstep by Chief Executive Jamie Dimon.

JPMorgan disclosed in a regulatory filing on Friday that it was in talks with the U.S. Securities and Exchange Commission to resolve the probe, which a source familiar with the situation said was about the bank’s dealings with hedge fund Magnetar over the creation of collateralized debt obligations (CDOs).

The second-largest U.S. bank by assets, and its chief executive, have avoided much of the mortgage controversy that has dogged competitors such as Goldman Sachs Group Inc, Bank of America Corp and Wells Fargo & Co over the financial crisis.

26 Fed officials show in no rush to scale back stimulus

By Leah Schnurr, Reuters

Fri May 6, 4:38 pm ET

NEW YORK (Reuters) – Two Federal Reserve officials on Friday stressed there will be no rush to roll back the U.S. central bank’s super-easy monetary policy with the labor market still healing and inflation expectations largely in check.

William Dudley, head of the New York Federal Reserve Bank and one of the Fed’s most powerful policy makers, said the U.S. labor market is improving but the economy still has a “considerable way to go” before returning to health.

Earlier on Friday, data showed U.S. payrolls grew by a more-than-expected 244,000 jobs in April.

27 High-frequency aura lifts year after "flash crash"

By Herbert Lash, Reuters

Fri May 6, 2:38 pm ET

NEW YORK (Reuters) – Regulators are moving to lift a veil of secrecy over a key constituency on Wall Street a year after the “flash crash,” but how much disclosure should be required of high-frequency traders remains an open question.

One proposal to boost market transparency, rooted in the Black Monday crash of 1987 when the Dow plunged more than 22 percent in the largest, single-day drop in U.S. history, is pending and would be a key tool for regulators.

But the creation of a large trader reporting system still has not passed a year after the idea got preliminary, unanimous approval by the Securities and Exchange Commission, which was supposed to vote again after 60 days and public comment.

28 Citi seeks shares’ past glory with reverse split

By Maria Aspan, Reuters

Fri May 6, 2:30 pm ET

NEW YORK (Reuters) – Citigroup Inc (C.N), which needed $45 billion in U.S. government handouts to survive the financial crisis, is about to paper over a visible remnant of its near-failure: its single-digit share price.

Shares of Citigroup, the third-largest U.S. bank by assets, will start trading on Monday at around $45 each for the first time since October 2007, as a result of a 1-for-10 reverse split. The shares changed hands at $4.52 on Friday afternoon.

The maneuver will let Citigroup start paying shareholders a nominal dividend — with its regulator’s blessing.

29 Downturn hands Glencore investors pricing power

By Sinead Cruise and Cecilia Valente, Reuters

Fri May 6, 11:48 am ET

LONDON (Reuters) – European mutual fund managers sense an opportunity to drive down the price of Glencore International’s (GLEN.UL) bumper $11 billion listing, as fears of slowing global economic growth rattles commodity markets.

The Reuters-Jefferies CRB index, a benchmark for commodities prices, is on course for its biggest weekly plunge since July 2008 as Glencore’s top brass begin a roadshow aimed at charming investors, some of whom remain skeptical about the Swiss trader’s corporate governance and its motivations for listing.

Glencore, the world’s largest diversified commodities trader, has already lined up buyers for all of the shares in its planned float. Part of that success is due to the relatively small stake in the company being placed with funds, and also due to Glencore’s size, which makes is a must-buy for many.

AP

30 EU considers more help for bailed-out Greece

By PAN PYLAS and GABRIELE STEINHAUSER, AP Business Writers

31 mins ago

LONDON – European authorities have conceded they may need to do more to help Greece with its massive debts more than a year after it was first bailed out, but robustly denied the country wanted to leave the common currency.

Experts from the European Union and the International Monetary Fund are in Greece to check up on economic reforms promised in return for euro110 billion ($160 billion) in rescue loans last year. They will also examine whether the current program will be enough to allow Athens to stand on its own feet again when the loans run out in 2013 – a scenario most investors think unlikely.

After a top European official said over the weekend that Greece needs another program, the experts’ conclusions may give the green light to another rescue loan or an easing in its current terms.

31 Japan nuclear plant closing while seawall is built

By TOMOKO A. HOSAKA, Associated Press

1 hr 22 mins ago

TOKYO – A Japanese utility agreed Monday to shutter three nuclear reactors at a coastal power plant while it builds a seawall and improves other tsunami defenses there.

Chubu Electric Power Co. acted at a special board meeting after Prime Minister Naoto Kan requested the temporary shutdown at the Hamaoka plant amid concerns an earthquake magnitude 8.0 or higher could strike the central Japanese region sometime within 30 years.

The government’s decision came after evaluating Japan’s 54 reactors for quake and tsunami vulnerability after the March 11 disasters that crippled the Fukushima Dai-ichi nuclear plant in northeast Japan.

32 Softbank reports robust earnings on smartphones

By YURI KAGEYAMA, AP Business Writer

Mon May 9, 5:37 am ET

TOKYO – Softbank Corp., the only Japanese mobile carrier offering the hit iPhone, said annual profit nearly doubled despite suffering damage from the March 11 quake and tsunami that battered northeastern Japan.

Softbank, which did not break down quarterly numbers, reported Monday that profit for the fiscal year ended March 31 swelled to 189.71 billion yen ($2.37 billion) from 96.72 billion yen the previous year.

It said the increase was driven by a booming smart phone business that offset a special loss of 14 billion yen ($175 million) caused by the disasters.

33 Schools may ban chocolate milk over added sugar

By CHRISTINA HOAG, Associated Press

Mon May 9, 3:18 am ET

LOS ANGELES – Chocolate milk has long been seen as the spoonful of sugar that makes the medicine go down, but the nation’s childhood obesity epidemic has a growing number of people wondering whether that’s wise.

With schools under increasing pressure to offer healthier food, the staple on children’s cafeteria trays has come under attack over the very ingredient that made it so popular – sugar.

Some school districts have gone as far as prohibiting flavored milk, and Florida considered a statewide ban in schools. Other districts have sought a middle ground by replacing flavored milks containing high-fructose corn syrup with versions containing sugar, which some see as a more natural sweetener.

34 Why junk bond rally should be cheered – and feared

By BERNARD CONDON, AP Business Writer

Sun May 8, 2:24 pm ET

NEW YORK – Here’s a markets riddle for you: What has jumped in value more than its biggest fans expected and withstood worries like slowing U.S. growth, European debt woes and even the specter of the U.S. losing its top credit rating?

No, it’s not the stock market.

Stumped? It’s junk bonds, a sort of IOU from risky companies thought most likely to not pay back their debt.

35 Thai, Cambodian PMs fail to resolve border dispute

By NINIEK KARMINI, Associated Press

Sun May 8, 11:12 pm ET

JAKARTA, Indonesia – Southeast Asian leaders failed to find a solution to a deadly border dispute between Thailand and Cambodia that could undermine peace and stability in the region as it pushes for economic integration.

The prime ministers of the two feuding nations held talks Sunday – mediated by Indonesia’s president – as part of efforts to hammer out a lasting cease-fire.

But neither seemed in any mood to back down.

36 Shortages choke Tripoli as sanctions take hold

By DIAA HADID, Associated Press

Sun May 8, 10:43 pm ET

TRIPOLI, Libya – Cars sat abandoned in miles-long fuel lines, motorists traded angry screams with soldiers guarding gas stations, and many shops were closed Sunday on what should have been a work day.

In ever-multiplying ways, residents in the Libyan capital are feeling the sting of shortages from uprising-related disruptions of supplies.

The shortages are a dramatic sign of how Libya’s nearly 3-month-old rebellion – and the resulting chaos – is affecting daily life in Moammar Gadhafi’s stronghold and other western areas of Libya still under his rule. International sanctions have begun to bite, many supply routes are unstable, and there are shortages of skilled people in some sectors to keep the city running smoothly.

37 Ecuador ballot gets modest voter nod

By GONZALO SOLANO, Associated Press

Sun May 8, 4:56 pm ET

QUITO, Ecuador – Ten ballot questions devised by leftist President Rafael Correa in what his opponents call a blatant power grab all appeared headed for victory Sunday, albeit by modest and even slim margins.

Some ballot questions were simple, such as those that would ban bullfighting and gambling. Others were complex. Two of the most controversial would bar owners of news media from having other commercial interests and create a government media oversight panel.

Many who voted “yes” for the measures said they did so out of esteem for Correa’s government.

38 Bahrain’s king orders end to emergency law

By BRIAN MURPHY, Associated Press

Sun May 8, 2:02 pm ET

DUBAI, United Arab Emirates – Bahrain’s king set a fast-track timetable to end martial law-style rule Sunday in a bid to display confidence that authorities have smothered a pro-reform uprising even as rights groups denounced the hard-line measures.

The announcement to lift emergency rule two-weeks early on June 1 came just hours after the start of a closed-door trial accusing activists of plotting to overthrow the Gulf state’s rulers.

The decision appears part of Bahrain’s aggressive international campaign to reassure financial markets and win back high-profile events. They include the coveted Formula One grand prix that was canceled in March amid deadly clashes and protests by the country’s majority Shiites, who are seeking greater rights and freedoms.

39 More confident China confronts US in latest talks

By MARTIN CRUTSINGER, AP Economics Writer

Sun May 8, 1:31 pm ET

WASHINGTON – Five years and one financial crisis since the United States and China commenced regular high-level economic talks, fast-growing Beijing might have the upper hand this week in the latest round of discussions between the world’s two biggest economies.

China faces threats of penalties against goods shipped to its largest foreign market unless it does more to end what U.S. manufacturers say are unfair trade practices, including currency manipulation, that have cost American jobs.

At the same time, America’s biggest foreign creditor wants assurances that its $1.2 trillion in U.S. Treasury holdings are safe despite uncertainty in Washington over how much money the U.S. can borrow to pay its bills. If Congress fails to increase that borrowing limit before August, that probably would send interest rates soaring and reduce the value of those Chinese investments.

40 Gas prices expected to drop 50 cents by summer

By CHRIS KAHN, AP Energy Writer

Sun May 8, 3:06 am ET

NEW YORK – Some relief from suffocating gas prices will likely arrive just in time for summer vacation. Expect a drop of nearly 50 cents as early as June, analysts say.

After rocketing up 91 cents since January, including 44 straight days of increases, the national average this past week stopped just shy of $4 a gallon and has retreated to under $3.98. A steady decline is expected to follow.

It might not be enough to evoke cheers from people who recall gas stations charging less than $3 a gallon last year. But it would still ease the burden on drivers. And it might help lift consumer spending, which powers about 70 percent of the economy. A 50-cent drop in prices would save U.S. drivers about $189 million a day.

41 More evacuations in Memphis as Mississippi rises

By ADRIAN SAINZ, Associated Press

Sun May 8, 7:10 pm ET

MEMPHIS, Tennessee – The swollen Mississippi River has swamped houses in Memphis and threatens to consume many more, but its rise has been slow enough that some people were clinging to their normal lives just a bit longer. That much was clear Sunday from an unexpected smell – barbecue – in a neighborhood that already lost three houses.

With the river just feet from her single-story home, Shirley Woods had the grill going in the backyard, cooking ribs, pork chops, chicken and hot dogs. She was getting ready to make potato salad.

When she woke up at first light, she was prepared to leave if the Mississippi had gotten high enough, but she decided she had time to at least celebrate Mother’s Day here with relatives.

42 Automatic budget cuts have spotty record

By ALAN FRAM, Associated Press

Sat May 7, 5:10 pm ET

WASHINGTON – Congress and President Barack Obama are proposing ways to automatically trigger budget savings if they can’t rein in deficits the old-fashioned way, by enacting laws to cut spending or raise taxes. Similar efforts in the past have a spotty record.

The last quarter-century has seen plenty of missed deficit and spending targets and inventive evasions of budget curbs. This is because the same legislators who put in place those budget constraints can pass laws to ignore them.

That history has convinced analysts that automatic triggers work best when lawmakers already have approved spending cuts, taxes increases or both. They’re least effective when used as an incentive to force legislators into such agreements in the first place.

43 Is new Warner Music buyer a sucker or savant?

By RYAN NAKASHIMA, AP Business Writer

Fri May 6, 7:11 pm ET

LOS ANGELES – Billionaire Len Blavatnik is spending $1.3 billion to buy Warner Music Group Corp. a decade into a steep decline in CD sales for the music industry.

That could make him a sucker in line for many more years of slashing staff, or a savant for buying the company at the start of a digital music revolution.

The deal values Warner Music at $3 billion including debt and cash – even higher than the $2.6 billion it sold for in 2004 when the music industry was twice as big.

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