Financial News

Jackie Krovblit’s heart is bigger than the 120-pound inspiration behind her company’s namesake, Big Dog Bakery.

Having instantly fallen in love with Trixie, her Great Dane and silent business partner, Krovblit opened Big Dog Bakery when she realized her "child" was too important for mass-produced pet food.

And now Big Dog Bakery is the big dog on Queen Street in the Beach – the only boutique pet store in the area that bakes products on the premises.

The bakery, located in the building that once housed the Three Dog Bakery, is decorated in a rainbow of colours. Cupcakes covered in blue, pink, white and cocoa icing sit in display windows. The shelves are stacked with cookies and empanadas for cats and dogs. Dog cakes are baking in an oven behind the counter.

Trixie greets customers with a wag of her tail. The gentle Great Dane is the hallmark of Big Dog Bakery. Her face is on every package of treats the stores sells.

Trixie "is my big dog in a little package," says Krovblit, who confesses, "I never thought I would have a dog. But when I got Trixie, my whole world opened up, like a lightning bolt."

Krovblit started Big Dog Bakery from her home in 2004. Making biscuits and treats in her toaster oven, she used Trixie and dogs in the park to figure what worked.

Big Dog then moved to Toronto’s Woofstock – a festival for dogs in the Distillery District – in its first year.

"They (cakes and cookies) are healthy – it’s like giving your dog something really special," Krovblit says. "Yes, the look is entirely marketing, it is for the person, the dogs can’t really see the colour but they can smell. So the dog will think, `What’s that?’

"It goes back to what makes something really palatable for the dog payday loans for bad credit. The market is there, so give people what they want. And the dog is going to feed off it and the person will get a kick out of it."

After her inaugural year at Woofstock, she started selling gourmet cakes, made with natural, human-grade ingredients and an assortment of dog treats through select stores around the GTA. It was in 2006 when she lost her job in the restaurant industry and put all her efforts into the bakery, which she opened in July.

Big Dog Bakery has since expanded to Home Sense locations throughout Ontario and Quebec at Christmas.

"I had to carry over from an existing store (Three Dog Bakery) with an American branding so it took a bit of work to convince people our product is better and healthier. All our bakery stuff is almost 100 per cent made in store. It’s a new concept so people need to realize that," says Krovblit.

Iced with either carob or cream cheese, the store sells about 40 customized cakes each month in flavours like Peanut Butter Bliss, Chop Lick ‘n Liver and Banana Rama.

Krovblit has also discovered the purrfect companion products for dogs – cat food. So Big Dog Bakery now includes freshly made gourmet cat treats in its menu.

"People these days really care (about their pets), and they want to know where things are coming from and everybody in our market and demographic consider the dog to be part of the family," Krovblit said.

"They want to give that dog a lot and they want them to live as long as possible. And why shouldn’t that dog be on the same level of health and nutrition (as its masters)?"

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The Bank of Nova Scotia said Tuesday it has been approved to set up independent operations in Dubai's financial district, making it the first Canadian bank to do so.

The licensing clearance from the Dubai International Financial Center allows the bank's ScotiaMocatta division to open an independent branch in one of the Middle East's hubs for international finance.

ScotiaMocatta has operated in Dubai since 1998 through an alliance with the National Bank of Dubai to provide financial services to gold traders, jewellers and others.

"This is a strategic initiative that reflects our confidence not only in the precious metals market, but also in the region," said Barry Wainstein, vice-chairman and deputy head, of Scotiabank Global Capital Markets.

The move comes as debt-burdened Dubai struggles to retain its prominence as a centre for Middle East investors and traders.

"We are very happy to welcome Scotiabank, the first Canadian bank to join the DIFC," said DIFC governor Ahmed Humaid Al Tayer in a statement Tuesday morning.

"As the DIFC begins to play a more prominent role in the global economy, we are keen to expand the industry cluster within the financial district with new companies from across the global financial industry," he said.

Pramod Mohan, a senior executive at Scotiabank's Dubai branch, said the bank recognized the importance of establishing a stand-alone presence in the region as the previous metals market in the Middle East continues to grow.

"Dubai is ideally located in a large wholesale and consumer market and is uniquely positioned to channel gold from the international markets to the ultimate destination," he said.

ScotiaMocatta is the precious metals division of the Scotiabank Group. Scotiabank Group currently employs close to 68,000 people in about 50 countries.

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In a reversal of earlier gains, more states lost jobs than added them in November, signaling that hiring is occurring only sporadically around the country.

Thirty-one states and the District of Columbia suffered a net loss of jobs, the Labor Department reported Friday quick guaranteed personal loans. Nineteen states added jobs in November, down from 28 in October.

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Wind Mobile will announce its handsets and rates Wednesday and if online speculation is anything to go by, consumers will be pleased, though perhaps not surprised.

The company has refused to comment on rumours and leaks on blogs and online forums – some supposedly posted by insiders, others leaked by disgruntled ex-employees. But top industry analysts, who did not want to be named, said some of the information looked "dead-on," while adding some aspects were likely to change.

According to a posting on Howardforums.com, a site for cellphone junkies, Wind seems to be coming in with an expansive low-rate plan, with unlimited calling between the company’s subscribers and 100 minutes for $15 – twice the minutes of Telus Corp.’s discount Koodoo brand and Rogers Wireless Inc.’s Fido, which have similar $15 plans.

The posting, which has almost 50,000 page views, also lists a $35-per-month plan with unlimited provincial calling (but only 50 outgoing texts) and a $45 monthly plan that includes unlimited national calling and texting.

In interviews, Anthony Lacavera, chairman of Wind Mobile parent Globalive, has stressed that cheap pricing is not his strategy. Rather, he says, his goal is to provide value for money, good customer service and clear billing.

"It’s right in line with what we’ve expected, what the market has expected," one analyst said.

"That’s why you’ve seen the stock get knocked from the big three (incumbents Rogers, Telus and Bell Canada)."

Websites have also described the company’s data packages, pointing to a $10 social BlackBerry package and an unlimited mobile data plan for $35.

One analyst said he doubted whether the data would be truly unlimited, adding that "tethering" – effectively using a BlackBerry’s Internet service as a modem for a laptop – is unlikely to be included, as was suggested.

"It’s very difficult to give people unlimited data because it’s just so expensive," the analyst said.

The upstart wireless carrier’s launch was delayed by a Canadian Radio-television and Telecommunications Commission ruling that said Globalive was a foreign company and ineligible to operate in Canada.

It received the green light from Industry Minister Tony Clement last Friday, after cabinet concluded that the CRTC had erred in its decision payday loan. Almost all of Globalive’s debt and 65 per cent of its equity is held by Egyptian telecom giant Orascom Telecom Holdings SAE, which has cellular services in Greece, Italy and Algeria.

The delay has been costly. After the CRTC ruling, many of Wind’s 800 or so employees sat idle, and were then sent out volunteering in the community.

And the company, which previously said it was ready to launch, is now grappling with the actual process, and the difficulties that come with erecting a complicated network.

However, it is doing so without the established resources of the giant incumbents, one analyst said.

It is also unclear if Wind will have the BlackBerry at launch, since it sucks up a lot of bandwidth on the network and may get wonky service – a disaster for a company such as Wind, which is launching with an emphasis on customer service.

Lacavera has told the Star that Wind was in discussions to begin carrying Apple Inc.’s iPhone, though analysts said not to expect it in the short term, as the company struggles with more practical tasks.

The new year will see other new entrants, as well, which will challenge Globalive for the roughly 30 per cent of Canadians who do not currently have a cellphone.

Public Mobile CEO Alek Krstajic told the Star earlier the company aims to be the cellular provider "of the working class," with lower rates and cheaper devices.

DAVE Wireless president Dave Dobbin has a target audience more similar to Globalive’s, and said in an interview on Monday his company won’t be the cheapest but will focus on value.

"What I can assure you is that Canadians will have greater choice," Dobbin said.

Wind will be selling phones out of 13 Blockbuster Video locations in Toronto and three in Calgary, the company’s first launch markets, as well as designated stores.

At the Liberty Village Blockbuster in Toronto, four cheery employees stood by a kiosk empty of phones.

"We’ve been waiting to tell people for months," said Chanel Manthorpe, 22. "We’re excited."

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Surging stock markets pushed up Canadians’ net worth in the third quarter but debt levels are rising, too, according to a report from Statistics Canada.

The result is a record household debt-to-income ratio of 145 per cent, the agency said.

Household net worth, the value of families’ assets such as cars, homes, and savings accounts, minus what they owe, reached $5.72 trillion at the end of September, StatsCan said Monday.

That’s an increase of 2.3 per cent, marking two quarters of gains after three consecutive drops.

Household debt, mainly mortgages and consumer credit, kept rising from July to September as Canadians rushed to take advantage of low interest rates to buy homes, renovate, and shop. Personal sector liabilities rose to $1.41 trillion, up 1.6 per cent.

National net worth, which includes business and government assets and liabilities, fell 1 No teletrak payday loan.3 per cent to $5.89 trillion as governments and consumers took on more debt, the report said.

Canada’s premier stock market, the S&P/TSX Composite Index rose 9.8 per cent in the third quarter. That’s on top of a 19 per cent gain in the previous three months.

The central bank has made a pledge to stand pat on interest rates until June 2010 to preserve the nascent economic recovery that is taking root. Keeping rates low encourages spending and borrowing, and that spurs economic growth.

Still, the Bank of Canada warned last week that rising debt levels will make Canadian households more vulnerable when interest rates do go up.

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The Federal Reserve may cause another crisis by botching the withdrawal of liquidity from the U.S. economy, Morgan Stanley Asia Chairman Stephen Roach said.

The Fed is the “weak link” among central banks and may fail to tighten monetary policy in time to stop asset bubbles from forming, Roach said at a conference in Berlin today. The Fed helped trigger the boom and then bust of the subprime mortgage market by being “quick to slash, slow to normalize” interest rates, he said.

Fed Chairman Ben S. Bernanke said Dec. 3 he doesn’t rule out using monetary policy to prevent unfounded increases in asset prices, though he said financial regulation is a better approach. Bernanke said this week the U.S. economy continues to face “formidable headwinds,” signaling the Fed will keep its benchmark interest rate near zero for an extended period.

“They need to be very early in executing their exit strategies,” Roach, a former Fed economist, told Bloomberg Television. “I take Mr. Bernanke at his word that he’s looking for an extended period of monetary accommodation, which, quite frankly, I find very worrisome in assessing the prospects of a next bubble and the next crisis.”

‘Ludicrous’ View

The traditional view of central bankers that asset bubbles are hard to spot and deflate with rates is “ludicrous,” he said.

“This is a failed flaw in the intellectual construction of modern central banking that must be addressed,” said Roach. “If we don’t fix this problem we’re doomed to repeat the failed asymmetric policies of the past and set ourselves up” for another crisis.

Roach recommended the Fed be required to “hardwire” the goal of preserving financial stability into its mandate, alongside the pursuit of full employment and low inflation paydayloans. Central banks should not be “allowed to outsource their responsibilities” to regulatory bodies, he said.

Nobel laureate Robert Mundell told the conference that the Fed mismanaged monetary policy by not raising interest rates fast enough in the last recovery when gold and commodity prices rose.

It was an “insane, stupid policy,” he said. “Where’s the mea culpa from the Fed?”

Asset Bubbles?

While no Fed official spoke at the Berlin event, European Central Bank Vice President Lucas Papademos told reporters that in the future “there may be scope for the use of monetary policy as an instrument to also contribute to financial stability” in harness with other tools such as supervision.

Asked if he was concerned that asset bubbles are now forming, Papademos said he “wouldn’t come to this conclusion” because even with recoveries in markets and at banks, the financial system “is still facing challenges.”

“Overall financial conditions have not reached a stage that are signaling risks to financial stability,” he said.

Papademos defended central banks as having “avoided the meltdown of the financial system and through a variety of measures we are contributing to the return of the financial system to conditions of normality.”

Bernanke said on Dec. 3 that “regulation of the financial system is the strongest, most effective” way to deal with bubbles. “I do not rule out using monetary policy if necessary, if that situation does become worrisome and threatening,” though there are no signs of “extreme misvaluations,” Bernanke told the Senate Banking Committee.

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The Sobrato Foundation has provided a $300,000 bridge loan to InnVision-The Way Home to help tide it over until about $11 million in stimulus funding is available to help with emergency needs in Santa Clara County.

Christine Burroughs, CEO of InnVision, said the agency can draw against the money over a 13-month period. "Needs are very high right now," Burroughs said, "so if we have to distribute more than we've got this will be a huge help, especially since it's an interest-free loan."

InnVision said the federal government has a reimbursement policy for the distribution of much of its stimulus funding: Do the work first, then submit receipts for reimbursement.

"For the CalWORKs program, InnVision was given an estimate of up to 1,400 new clients that would receive over $11 million in emergency assistance over the next year. That’s almost $1 million dollars a month for which InnVision would be liable while waiting for reimbursement, much more than their financial reserves could handle," the agency said installment payday loans.

John Sobrato, chairman of the foundation, said the objective of the emergency fund "aligns perfectly with the Sobrato Foundation’s charitable mission of promoting the economic independence and social well-being of individuals and families across Silicon Valley, especially those earning 50 percent of area median Income or less and are homeless, or who will become homeless if they don’t receive some assistance. We believe that leveraging federal stimulus dollars is a smart role that philanthropists can play in helping address our society’s greatest needs right now due to the current economic depression.”

InnVision serves more than 25,000 people in Silicon Valley annually at 20 locations.

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Wells Fargo, citing the need to make cuts in its Menomonee Falls real estate resource center, will permanently lay off 26 employees beginning in February 2010.

The San Francisco-based financial services firm (NYSE: WFC) said in a notice released late Friday that it will lay off 19 loan servicing specialists, four loan documentation specialists and three administrators or supervisors. The employees work in the Wells Fargo office complex at 200 Woodland Prime.

"We regularly reveiw and adjust our staffing levels to match the needs of our business," Wells Fargo said in its layoff notice to the Wisconsin Department of Workforce Development.

The company said it expects most, if not all, of the laid off employees to accept paid leave benefits based on years of service and compensation levels. The employees will continue to receive health care benefits for an unspecified period, Wells Fargo said.

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Apple Inc. is in talks to acquire online music service Lala, according to two people familiar with the matter.

The terms of the deal weren’t known. The people declined to be identified because talks are still in progress.

The Lala service lets users listen to any song on its site once for free. Customers can then opt to buy the track for 10 cents and listen to it on the Web paperless payday loans.

The service differs from iTunes because the music is stored on servers via so-called cloud computing, instead of being downloaded to the user’s computer.

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The U.S. Treasury Department’s refusal to sell its 34 percent stake in Citigroup Inc. is hampering the bank’s plans to repay $20 billion of remaining bailout funds, people familiar with the bank said.

Executives at the New York-based bank are growing frustrated because they can’t sell stock to raise money for repayment until the Treasury signals when and how it will unload its 7.7 billion shares, said the people, declining to be identified because the matter is under discussion. Investors may be reluctant to buy shares because a Treasury sale could drive down the price.

“The ball is in the government’s court,” said Chris Kotowski, an analyst at Oppenheimer & Co. in New York, who has a “market perform” rating on the bank’s shares. “It’s not Citibank’s decision to sell them or not sell them.”

Bank of America Corp.’s plan to repay $45 billion of bailout funds would leave Citigroup as the only large bank subject to compensation reviews by Treasury paymaster Kenneth Feinberg. Other bailed-out companies under his purview include insurer American International Group Inc. and carmakers General Motors Co. and Chrysler Group LLC.

Citigroup Chairman Richard Parsons said in September that the bank must pay employees competitively to ward off poaching by rivals. Under pressure from Feinberg, the bank cut total 2009 compensation for its 25 highest-paid people by about 70 percent from 2008.

$6 Billion Paper Gain

For almost three months, executives at the bank have tried to persuade Treasury to move ahead with a sale, the people said. At the current market price, the Treasury’s shares are worth about $31.2 billion. Because the common shares were converted from $25 billion of bailout funds, that’s a paper gain of about 25 percent, or more than $6 billion.

Meg Reilly, a Treasury spokeswoman, declined to comment on whether the government has sold any shares or when it may do so. “Treasury does not comment on individual institutions as a general policy,” she said. Citigroup spokesman Jon Diat said he couldn’t comment.

Treasury hasn’t told Citigroup how or when it plans to dispose of the stake, the people said. The shares are held within the department’s Office of Financial Stability, run by Herb Allison, the former chief executive officer of retirement- services firm TIAA-CREF payday loans for bad credit. Allison reports to Treasury Secretary Timothy Geithner.

Pandit’s Vow

Citigroup got a total of $45 billion last year from the Treasury’s $700 billion Troubled Asset Relief Program. In September, $25 billion of that was converted into common stock, which the Treasury is free to sell at any time.

Chief Executive Officer Vikram Pandit, 52, said Oct. 15 he was “focused on repaying TARP as soon as possible.” He said, “We’re going to do so in consultation with the government and our regulators.”

In a report, CreditSights Inc. analyst David Hendler said Citigroup could repay the $20 billion of TARP funds by selling about $10 billion of common stock along with $10 billion or more of junior debt securities. Regulators may be keeping Citigroup in TARP because of lingering concern that the economy won’t recover quickly, Hendler wrote.

The company has almost doubled its cash holdings to $244.2 billion over the past year, the biggest such stockpile of any U.S. bank.

‘Not Cash’

“It’s not a question of cash,” Kotowski said. “It’s a question how much the regulators will force banks to raise to clear themselves of the stigma of being a TARP bank.”

JPMorgan Chase & Co., Goldman Sachs Group Inc. and Morgan Stanley, all based in New York, repaid bailout funds in June. San Francisco-based Wells Fargo & Co., which hasn’t repaid $25 billion of bailout funds, isn’t subject to Feinberg’s rules because it hasn’t received “exceptional assistance.”

Even if the Treasury sold its Citigroup shares and the bank paid off the remaining $20 billion, it still might be subject to the paymaster’s purview because it has $301 billion of government asset guarantees, the people said. Citigroup has no plans to terminate the guarantees, which remain in effect for 10 years on home loans and mortgage-backed securities and 5 years for other types of assets, the people said.

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