Financial News

Swiss food giant Nestle may consider a bid for Britain’s Cadbury to challenge a hostile 9.9 billion pound ($16.3 dollars) bid by Kraft Foods Inc and a potential move by Hershey, Bloomberg reported on Sunday.

Nestle is still weighing its options and may decide against a bid, Bloomberg said, citing two unnamed people with knowledge of the matter.

Nestle declined to comment.

Italian chocolate maker Ferrero and U instant payday loan.S.-based Hershey have teamed up and said on Wednesday they were reviewing a possible offer for Cadbury.

Analysts view Nestle as a potential suitor for Cadbury.

(Writing by Lisa Jucca; Editing by Jon Loades-Carter)

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Indonesia shouldn’t be looking at increasing government spending, the Organization for Economic Cooperation and Development said a day after Morgan Stanley urged a boost in outlays to bolster growth.

“Given that the recovery appears to have begun in earnest, additional fiscal easing would not be advisable,” the Paris- based OECD said in a report yesterday. “Growth picked up significantly in the second and third quarters.”

The OECD’s call for fiscal restraint contrasts with the views of Morgan Stanley economist Deyi Tan, who said on Nov. 18 that Indonesia’s government “has room” to raise spending by about 3 percent of gross domestic product. President Susilo Bambang Yudhoyono, re-elected in July to a second five-year term, expects the budget deficit to narrow to 1.6 percent of GDP in 2010 from around 2.5 percent this year.

Both the OECD and Morgan Stanley acknowledge that some of the pro-growth policies adopted by Yudhoyono’s government are being hampered by infrastructure constraints.

“Implementation bottlenecks continue to delay execution of investment projects,” the OECD said. “The 2009 budget deficit target of 2.5 percent of GDP may therefore be undershot.”

Yudhoyono’s efforts to jump-start development spending during his first term were impeded by a number of “structural impediments,” according to Morgan Stanley.

Tan said none of the 91 projects worth $22.5 billion which Yudhoyono put out to tender at Indonesia’s 2005 Infrastructure Summit have materialized.

‘Lack of Consistency’

“Land acquisition issues, the lack of consistency in regulation at the central and regional government levels, the lack of separation in functions such as policy making, regulating, contracting and operating” are some of the impediments, she said cash advance today.

Yudhoyono told a business summit in Singapore last week that the government will streamline investment procedures, aiming to boost annual economic growth to between 6.3 percent and 6.8 percent over the next five years.

Indonesia’s central bank may start raising interest rates in the first six months of next year as inflation accelerates, the OECD said.

Bank Indonesia maintained its key rate at 6.5 percent for the third consecutive month on Nov. 4, after cutting the measure nine times from December 2008 to August this year to boost economic growth.

“Monetary policy may need to begin to be tightened in the first half of 2010 to ensure attainment of the end-year inflation target,” yesterday’s report said.

Faster Inflation

Inflation may accelerate to between 4 percent and 6 percent next year compared with an estimate of 3.5 percent to 5.5 percent in 2009, central bank Senior Deputy Governor Darmin Nasution said on Oct. 14.

Indonesia’s economy, Southeast Asia’s largest, is forecast by the OECD to expand 5.3 percent next year from an estimated 4.5 percent in 2009.

The $514 billion economy grew 4.2 percent in the third quarter from a year earlier after gaining 4 percent in the previous three months. Indonesia has fared better than its Asian neighbors during the worst global recession since the 1930s as it relies less on exports.

“Activity is picking up in earnest,” the OECD said. Economic growth “is projected to gather some further impetus, buoyed by rising investment and easing credit conditions.”

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Major U.S. mortgage finance source Fannie Mae announced on Thursday a program aimed at turning struggling homeowners into renters in their own homes.

The last-ditch program, to be known as Deed for Lease, is designed for borrowers who are facing foreclosure and have been unable to get a modification or refinance on their existing loan.

Borrowers would transfer their property to the lender by completing a deed in lieu of foreclosure, and then lease back the house at a market rate.

“This new program helps eliminate some of the uncertainty of foreclosure, keeps families and tenants in their homes during a transitional period and helps to stabilize neighborhoods and communities,” said Jay Ryan, vice president at Fannie Mae payday loans for bad credit.

Prospective renters would also have to show that the rent would be at most 31 percent of their monthly gross income.

Dean Baker, co-director of the Center of Economic and Policy Research, a Washington think tank, said the program would be especially useful in areas where the cost of owning is significantly higher than the cost to rent.

“The Deed for Lease Program will keep the homes occupied rather than being an eyesore and a potential safety hazard,” Baker said.

(Reporting by Corbett B. Daly; Editing by James Dalgleish)

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White House economic adviser Lawrence Summers will lead a high-level meeting on Monday to discuss the state of the economy, job creation and ways to achieve sustainable growth.

A White House announcement said the meeting would take place at 2 p.m. EST and would include Cabinet officials from Treasury Secretary Timothy Geithner to Health and Human Services Secretary Kathleen Sebelius, Agriculture Secretary Tom Vilsack and Energy Secretary Steven Chu.

National Security Adviser James Jones, White House climate czar Carol Browner, U.S. Trade Representative Ron Kirk and senior White House adviser Valerie Jarrett are also among those scheduled to attend.

A spokesman for Summers, who is director of the White House National Economic Council, described the meeting as one of the regular gatherings of the council

“This is a principals’ meeting for the department and agency heads who participate in the NEC process to gather and discuss the state of the economy,” said NEC spokesman Matthew Vogel.

The Summers meeting will be separate from a gathering that President Barack Obama will hold with his panel of outside economic experts headed by former Federal Reserve Chairman Paul Volcker.

The Obama administration has been weighing options to address ways to try to restart job growth with the unemployment rate now at 9.8 percent.

Signaling the end to the deepest recession since the 1930s Great Depression, the government last week said U.S. gross domestic product grew at a robust 3.5 percent pace in the third quarter.

Obama trumpeted the GDP numbers in his weekly radio address on Saturday but said, “we have a long way to go before we return to prosperity.”

The White House has credited the $787 billion economic stimulus package passed earlier this year with helping to bring about the rebound.

Republicans have characterized the stimulus package as wasteful and say the continued job losses are an indication it has not worked.

New unemployment numbers due out on Friday are expected to show U.S. employers cut another 175,000 jobs in October, according to economists polled by Reuters. The unemployment rate is forecast to rise to 9.9 percent for October.

(Reporting by Caren Bohan; editing by Chris Wilson)

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It has been 31 years since the last trains left Union Station. And 24 years since its $140 million renovation as a hotel, shopping and entertainment spot on Market Street. But today the station is a shell of what it once was.

Banana Republic? Gone. Talbot’s? Gone. Body Shop, Brookstone, Nature Co.? Gone, gone, gone.

The space formerly occupied by Nature Co. is a gift shop called Fat Sassy’s. Nearby, a shop that calls itself a newsstand has one magazine rack near the front door and several shelves of liquor behind the counter.

But don’t write of this downtown landmark just yet.

A large expansion by Marriott, which in December took over the station’s hotel from Hyatt, is about to get under way. Marriott will move the front desk to the atrium near the station’s western end, allowing greater use of the barrel-vaulted Great Hall for

private events. Marriott also will extend its meeting and restaurant space into much of the retail area along the midway.

As a result, Union Station’s shops will be concentrated along the eastern concourse, where the food court is situated beneath the arched train shed, which dates to 1894. Whether this transformation — the station’s most extensive since the 1980s — will revive the place is yet to be seen.

Barbara Geisman, deputy mayor for development, said city officials hope better times are ahead.

"We would certainly like to see as much retail as possible in Union Station," she said. "As the downtown residential and business population grow, we think there’s a market for more mainstream retail there."

Resuscitating shopping at Union Station will require "some big-time marketing," Geisman said.

"A lot of this is that you get a name draw and then that kind of sets the tone for the rest of it," she said. "We think the station presents opportunities for larger retail."

Bass Pro Shops, based in Springfield, Mo., took a look a few years ago but passed on Union Station, Geisman said. She added that shopping habits have changed since the 1980s, when "festival markets" such as Quincy Market in Boston, South Street Seaport in New York and Union Station drew big crowds. All have faded.

"Things have changed a lot since then," Geisman said. "Instead of people going there on a whim because they want to see a neat old building, you now have a lot of people with disposable income who like to shop."

Frances Percich, Union Station’s marketing manager, said "serious" discussions are under way with two retailers, including one that would be new to St. Louis. She declined to name them. Percich said the station will continue to market itself as a tourist attraction with numerous spring and summer events.

"When people walk in here expecting a mall, they will be disappointed," she said. "We’re not a mall. We have no anchor store."

Among the few Union Station visitors one afternoon last week were Russ and Donna Clark of Yuba City, Calif. They were staying at the Marriott for a meeting. The Clarks said they had been unsure whether Union Station’s emptiness resulted from a renovation still under way or from a lack of business.

Told that the renovation was completed in 1985 and that the station had been in decline for years, Donna Clark said: "Wow, that’s a shame. This looks like a great idea. It’s disappointing not to see a lot of people."

Union Station’s current retail occupancy is 79 percent, Percich said. Ownership has changed in recent years. In 2003, the inability of St. Louis Station Associates, the investment group behind the 1980s renovation, to pay the mortgage led to foreclosure by Regency Savings Bank of Oak Park, Ill. Park National Bank of Chicago bought the property from Regency and owns it through Union Station Holdings LLC.

Doug Dean, the Marriott’s general manager, said the hotel renovation will restore some of the inn’s original 1890s configuration. He noted that the original front desk was off the atrium, remarkable for its glass-block floor. All 539 rooms, including the 67 in the station’s original "headhouse," will be redone. Dean declined to specify the overall cost, saying it remained "a moving target."

Four meeting rooms and a restaurant will be built near the new lobby. One floor above, the existing restaurant will be used mainly for private events. Beginning with a ballroom freshening done by November, the renovation project will be completed in late 2011, he said.

Hotel and shopping areas will remain open during the renovation.

Across Market from Union Station is the western end of the Gateway Mall, the milelong park that extends east to the Old Courthouse. Tricia Roland-Hamilton, head of the project to redo the mall, said that to thrive, the Union Station area must have more offices, residents and stores.

"The key to livening up that space, not just Union Station but that part of the mall, is density," she said. "And we don’t have that right now."

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WASHINGTON–The U.S. federal government faces exploding deficits and mounting debt over the next decade, White House officials predicted yesterday in a bleak new fiscal assessment.

Figures released by the White House budget office foresee a cumulative $9 trillion (U.S.) deficit from 2010-19, $2 trillion more than the administration estimated in May. Moreover, the figures show the public debt doubling by 2019 and reaching three-quarters the size of the entire national economy.

Analysts from the non-partisan Congressional Budget Office, meanwhile, projected a cumulative $7 trillion deficit from 2010-19.

The congressional budget analysts said in a report yesterday that the deficit this year will total $1.6 trillion, and that putting the nation on a sustainable fiscal course will require a mix of lower spending and higher tax revenues than the amounts now projected.

The White House also projected a $1.6 trillion deficit this year – $263 billion less than projected in May, largely because the White House removed a $250 billion item inserted as a "placeholder" in case banks needed another bailout – and a gloomy $9 trillion 10-year shortfall.

Christina Romer, economic adviser to President Barack Obama, predicted unemployment could reach 10 per cent this year and begin a slow decline next year. Still, she said, the average unemployment will be 9.3 per cent in 2009 and 9.8 per cent in 2010.

"This recession was simply worse than the information we and other forecasters had back in last fall and early this winter," Romer said.

The new numbers come as Obama prods Congress to enact a major overhaul of the health-care system – one that could cost $1 trillion or more over 10 years.

Obama has said he doesn’t want the measure to add to the deficit, but lawmakers have been unable to agree on revenues that cover the cost.

The revised estimates project the economy will contract by 2.8 per cent this year, more than twice what the White House predicted in May. Romer projected the economy would expand in 2010, but by 2 per cent instead of the 3.2 per cent predicted in May. By 2011, Romer estimated, the economy would be humming at 3.6 per cent growth.

Both Romer and budget director Peter Orszag said this year’s contraction would have been far worse without money from the $787 billion economic stimulus package.

Associated Press

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MONTREAL–An investigation is underway into what is described in two new lawsuits as yet another Ponzi scheme.

They come the same week that Montreal financial adviser Earl Jones was arraigned on fraud and theft charges in connection with an alleged Ponzi scheme.

In the latest case, lawyer Jacob Rothman is seeking nearly $350,000 on behalf of two clients who say they were victims of the alleged scheme. He plans to file a third lawsuit next week.

The suits allege the parties invested in a Bahamas company called Progressive Management Ltd.

"The fraud can be succinctly described as a Ponzi scheme in that PML, as it developed, was little more than a corporate shell, soliciting funds from innocent victims and utilizing these funds for the personal benefit of a variety of individuals," the documents state.

A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by other investors rather than from any actual profit earned.

According to the suits, the funds were also used to "generate volume in certain offshore gambling institutions."

They implicate several financial advisers who allegedly solicited investment funds knowing the company was not a financial institution that invested in generally recognized valuable securities cash advance.

Provincial police would not say whether a criminal investigation is underway, but Quebec’s securities regulator has confirmed its involvement.

"What we can confirm is we are in fact investigating this file," Autorit? des march?s financiers spokeswoman Cathy Beausejour said.

Rothman said the regulator ought to do more to protect investors.

"They seem to be reactive rather than protective.

"They should at least warn people what not to invest in," he said.

Beausejour said defendant Lance Townend was registered as a mutual-fund representative and group savings plan broker.

Gennaro Natale was registered in group insurance and group annuity plans and as a certified financial security adviser and financial planner.

She had no information for defendants Joe Iaboni who, according to the lawsuit, is a securities adviser in B.C.

Progressive Management’s Anthony Riccio and Jean-Claude Gauthier are also named in the suits. No statements of defence have yet been filed and attempts to reach the parties were unsuccessful. The allegations have not been proved in court.

The Canadian Press

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Hamilton–Harry Stinson stands underneath a massive sign stencilled on brick, bearing his name.

"When they first told me about this place, I thought they were joking," Stinson says. "This is pretty weird. Even the street has my name on it."

Stinson’s latest project is a former elementary school in downtown Hamilton. Built in 1895, the elegant building is historically designated. And, as fate would have it, it has his name on it.

Stinson doesn’t know if the founder of the school, Ebenezer Stinson, is any relation. The Hamilton school board closed the school in March. With the help of private investors, he paid $1.05 million for the building in a deal that closed in June.

Toronto’s once visionary condo king is now the would-be condo king of Steeltown, an industrial city that is the eighth largest in Canada.

The Stinson School project is Harry Stinson’s chance to rise from the ashes.

After the Star first revealed in 2007 that Stinson had placed his landmark 1 King West hotel and condominium in receivership, things started to unravel pretty quickly.

After a bruising and controversial court battle with theatre impresario and former partner David Mirvish, Stinson relocated to Hamilton last year. He had considered Miami, Montreal and New York.

But in Hamilton he spotted a void. And it seems he is getting some Hamiltonians to buy into his vision.

"Harry’s bought a positive new set of eyes to the city, he’s got people excited," says Bob Bratina, the councillor for downtown Hamilton. "I think sometimes we suffer from a lack of self-esteem, that we sometimes need someone who sees value in things you might overlook."

No one has personified the fortunes of the Toronto condo market more than Stinson. He was pushing loft living in Toronto before most people knew that living in an industrial building with concrete floors could be cool. He was the first to build a condo hotel in Toronto.

As he charges through the school, scurrying from boiler room to classroom, Stinson cracks a distinctly Dickensian image. He fits in with the Gothic bones of the school, a kind of Tim Burton doll come to life. The excitable developer is pushing the envelope in his new hometown.

For one thing, no one has sold lofts in Hamilton for $600,000. That’s the price for the penthouse. But smaller units will start at $250,000. That’s still a good bit of change for a city where you can get a century-old home on a big lot for under $300,000.

He envisions 70 lofts and townhomes on the 1.5-acre lot that houses two 30,000-square-foot buildings.

"It’s not the price," insists Stinson. "It’s the lack of having something unique that people can move to. Most people think Hamilton is still this grimy industrial town. But there is also a huge industry of people in technology and health-care services and in academia cash advance."

Stinson admits that, as in Toronto, his ideas have been met with some skepticism.

His name has been associated with failure as much as success. His first idea for building in Hamilton, taking over the Royal Connaught Hotel and turning it into condos, failed to find financing during the credit crunch last year.

"There are always the naysayers, guys who say (Jim) Balsillie will never get a hockey team or Stinson will never build," says Bratina.

"But really, it’s great to see people who appreciate what we have. There aren’t a lot of guys like Harry who have the experience of developing in tight urban settings. We have urban sprawl because it’s a lot easier to buy a farm and put up a subdivision."

Hamilton’s downtown is more known for cheque-cashing centres and Tim Hortons’ outlets than for trendy boutiques and restaurants. The city wants to change that image.

When Ron Marini, Hamilton’s director of downtown and community renewal, lived in the city’s core during the 1970s, he remembers "shoulder to shoulder" traffic during lunchtime.

Over the years, the core started to hollow. Manufacturing began to decline, affecting employment in the city. Meanwhile, suburban sprawl became the norm. "It became something of a ghost town," Marini says.

"We don’t see intensification as a problem. We see it as an opportunity. Our biggest challenge is to make people feel comfortable walking and living downtown again."

That was the refrain in Toronto when Stinson started the Candy Factory Lofts on Queen St. in the early 1990s. It started a loft revolution that Toronto Life magazine declared one of the "10 moments that profoundly changed life in Toronto."

Hamilton today isn’t so different than Toronto 20 years ago, Stinson says.

Some investors in Hamilton have been wary of Stinson’s reputation. But the biggest knock against him has been that his reach has often seemed to exceed his grasp. Stinson is also marketing another project, the Hamilton Grand, a 177-suite condo hotel downtown. But nothing is quite as symbolic as the Stinson School.

So far, he seems to at least have the approval of his neighbours. When he mows the vast lawn outside the school, they will frequently come up to him to talk.

"I think he’s doing a good thing," says former Torontonian Elizabeth Court, who lives across the street from the school.

Court, whose children used to go to the school, says the area could use some gentrification. She has had her car stolen from her driveway and has found knives on her porch.

Toronto, Court says, may not need Stinson. "But Hamilton sure does."

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Boeing Co. leaders say that the U.S. military’s airlift needs are growing and that a Pentagon proposal to halt future orders for the C-17 Globemaster III cargo plane is premature.

Boeing, whose defense unit is headquartered in St. Louis, is trying to rally support for the C-17 on multiple fronts — arguing that ceasing production would erode the U.S. industrial base, costing thousands of jobs at Boeing plants and those of its main suppliers. But Boeing officials also emphasize the plane’s strategic value.

"Right now, since 9/11, the airplane has been flying at about a 15 percent higher rate than was anticipated," said Donald A. Anderson, Boeing’s C-17 program manager in St. Louis. "In addition, they’re talking about rebasing troops in the United States. They’re talking about an increase in the size of the Marines Corps and the Army.

"So it seems like the airlift requirements are growing. And you need airlifters to meet those needs."
Starting with Secretary of Defense Robert Gates’ announcement in early April and continuing through last week, the Pentagon has said it can get by with the 205 C-17s that are either in service or on order. The Air Force also uses the Lockheed Martin C-5 Galaxy to transport weapon systems, cargo and personnel to overseas locations.

Republican Sen. Christopher "Kit" Bond and Democratic Sen. Claire McCaskill, both of Missouri, have written letters supporting more orders of the C-17, and Machinists Union officials have traveled to Washington to show their support for a program that supports 900 jobs in St. Louis.

"This is high political theater," said analyst Richard Aboulafia of The Teal Group in Fairfax, Va. "The bottom line is I don’t think the line is threatened. But it is up to everybody from Department of Defense to Congress to Boeing to the unions to make it look as though it were."

The Defense Department has not sought funding for the C-17 in the last three years. But Congress has stepped in to add funding for more of the $202 million planes through supplemental defense appropriations bills.

Bond and Boeing officials have asked why Gates would halt C-17 orders while there is a study under way into the military’s future air-mobility needs. The results are expected this fall.

"But yet we’re making that decision now to stop the airplane," Anderson said. "So it seems somewhat premature cheap payday loans."

Bond said shutting down production of the C-17 is a "dangerous gamble" and warned that the U.S. can’t afford to "lose the capability to transport safely our troops and equipment to anywhere in the world."

In a letter to President Barack Obama, McCaskill said the U.S. is "literally flying the wings off these planes," and added "this is not the time to end its production, especially in light of projected global mission sets for the U.S. military."

Both legislators also have gone to bat for Boeing’s St. Louis-built F/A-18 Super Hornet, whose future was placed in limbo under the latest Pentagon spending plan.

The C-17 is assembled at a plant in Long Beach, Calif. But the cargo door, cargo ramp, landing-gear pods, nose and engine pylons are built in St. Louis.

A November 2008 report by the Government Accountability Office recommended "careful planning to avoid shutting down the C-17 line prematurely." Both Boeing and the Air Force believe shutting down and restarting production "would not be feasible or cost effective," the report found.

The GAO cited the high costs of hiring and training a new work force, reinstalling equipment to proper working condition and re-establishing a supplier base.

Boeing has delivered the C-17 to other countries, including Australia, Canada and the United Kingdom. The United Arab Emirates has announced its intent to buy four of the planes, and Qatar has ordered two and exercised an option on two additional C-17s.

But Anderson said international sales alone are not enough to sustain the C-17 line. Boeing officials say maintaining C-17 sales to the U.S. Air Force is necessary to keep the price of the planes competitive in the international market.

Defense analyst Loren Thompson of the Lexington Institute in Arlington, Va., said the C-17 is the best strategic airlifter ever built and "a very cogent case" can be made that terminating production at 205 planes would be too early. At the moment, he said, its future will be dictated by Congress.

"Here’s the bottom line to C-17," Thompson said. "If Congress doesn’t add money, there won’t be any more."

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ST. LOUIS — Ten days ago, Joshua Kezer walked out of prison after serving 14 years for a murder he didn’t commit.

Saturday, Kezer walked into a hotel ballroom in St. Louis to tell 25 star high school athletes how to make sure they never get in the situation that he was in.

Kezer was one of several guest speakers Saturday at a luncheon honoring the Demetrious Johnson Charitable Foundation’s Fab 25 All-American Football Team, a collection of the region’s top high school football players. Another speaker was Darryl Burton.

Both have recently been released from Missouri prisons for wrongful murder convictions — Burton in August and Kezer on Feb. 18 — and both had a message for the young men before them: Make smart choices, and don’t give up when things go wrong.
Kezer, of Kankakee, Ill., was arrested when he was 18, the same age as many of the football players in the room. Like them, he dreamed of making it big on the field.

"I could have been safety or a middle linebacker," he said. "But I spent my youth in prison."

He was wrongfully accused. But that happened, he said in part, because he made some bad decisions high risk personal loans. He dropped out of school. He used drugs. He was in the Latin Kings. The prosecution hammered on these points at his trial.

"If I’d just done some things differently, I wouldn’t have been such an easy target," Kezer said. "Decisions you’re making right now can affect the rest of your life."

Everyone, even high school football stars, gets knocked down once in a while, Burton said. What matters is that you get up.

He was angry and bitter when he went to prison in 1985, convicted of killing a man at a St. Louis gas station. He channeled that anger into studying the law and writing letters, hundreds of them, trying to get someone, anyone, to take up his case. He never gave up. Finally in 2000, a New Jersey-based legal services group agreed to help. And in August, a Cole County judge overturned Burton’s conviction, setting him free.

"What’s happened to us," he said, "I wouldn’t wish that on anyone."

tlogan@post-dispatch.com | 314-340-8291

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