April 30, 2004
Consumer Spending Gain Less Than Expected
Consumer spending posted a
smaller-than-expected rise in March, a government report showed today,
Reuters reported. Personal spending rose 0.4 percent in March, the
Commerce Department said, below market expectations of a 0.7 percent
gain. While spending was softer in March than analysts had predicted,
the department increased readings on spending in the prior two
months.
Personal income rose 0.4
percent in March, slightly higher than expected on Wall Street.
Factoring in the tax burden, disposable income was also up 0.4 percent.
But when inflation is taken into account, disposable income gained just
0.1 percent, the newswire reported.
Kennedy Looks To Class Action Bill For Minimum Wage Increase
A spokesman for Senate Health, Education, Labor and Pensions ranking
member Edward Kennedy (D-Mass.) said the senator is considering class
action legislation as a vehicle for his amendment to raise the federal
minimum wage when it reaches the floor, not the bill that repeals the
foreign sales corporation/extraterritorial income tax break, which is
set for action next week, CongressDaily reported. Kennedy did
not have a slot reserved for his amendment under a unanimous consent
agreement approved by the Senate on the FSC/ETI bill, the spokesman
said. Kennedy's amendment would raise the minimum wage from the current
$5.15 per hour to $7, the newswire reported.
Pennsylvania Governor
Rendell Creates Working-Families Task Force
Pennsylvania Governor Edward G.
Rendell, responding to a decade-long decline in personal savings rates
and rising personal-bankruptcy and foreclosure filings, announced in a
press release yesterday that he had signed an Executive Order
establishing the Governor's Task Force for Working Families and creating
the Office of Financial Education. 'Financial literacy skills can
greatly improve the quality of Pennsylvanians' lives, provide them with
skills for success and contribute to positive changes for the
communities in which they live and work, and ultimately benefit the
state's economy,' said Governor Rendell, according to the press
release.
United Parent Reports
$459 Million Loss, Bankruptcy Progress
United Airlines' parent company
posted a net loss of $459 million for the first quarter - improved from
a year ago but reflecting continuing challenges as it targets emergence
from chapter 11 bankruptcy later this year, the Associated Press
reported. UAL Corp. said in reporting quarterly results on Thursday that
passenger unit revenue rose 14 percent from a year earlier, mainline
operating costs dropped 11 percent and the company continues to meet its
bankruptcy lenders' financial requirements monthly. But increasing jet
fuel costs cost it $80 million to $100 million more than anticipated,
and United also is still awaiting a $1.6 billion federal loan guarantee,
the newswire reported.
Winston-Salem Lawyer
Tapped As Bankruptcy Court Judge
Thomas Waldrep, a partner in the law firm of Bell Davis &
Pitt in Winston-Salem, was selected to fill a bankruptcy judgeship in
the bankruptcy court for the Middle District of North Carolina, the
Triad Buisness Journal reported. Waldrep, a bankruptcy attorney
by practice, will largely handle cases in Greensboro. Bankruptcy
Court is a unit of the U.S. District Court. Waldrep is expected to
take office in the next three months.
International Steel Group
Reports First-Quarter Profit
International Steel Group Inc.,
which has emerged as a top U.S. steelmaker by buying and reviving the
assets of bankrupt steelmakers, on Thursday posted a first-quarter
profit as steel prices and demand surged, Reuters reported. The company,
which went public in December, posted net income of $70.9 million, or 68
cents a share, on revenue of $1.77 billion. International Steel said the
average price per ton of steel shipped in the first quarter rose 13
percent from the fourth quarter to $458 per ton. Shipments rose to 3.86
million tons from 3.50 million tons over the same period, the newswire
reported.
Lea Fastow Reaches New Plea
Deal With Enron Prosecutors
The wife of Enron Corp.'s former CFO yesterday reached a new
plea deal with prosecutors that could limit her prison sentence and
avert a costly June trial, the Washington
Post reported. The Justice Department's Enron Task Force amended a
six-count conspiracy and false documents indictment against Lea W.
Fastow, replacing the previous charges with a single misdemeanor count
of filing a false tax return. Lea Fastow is scheduled to enter a guilty
plea to the new tax charge May 6. Andrew Fastow will be a key witness
against indicted former Enron CEO Jeffrey K. Skilling and accounting
chief Richard A. Causey, the newspaper reported.
Delta Names New Chief
Financial Officer
Delta Air Lines today named a
new executive vice president and CFO, to replace Michele Burns, the
third senior executive to depart in the last four months, Reuters
reported. Michael Palumbo, a long-time airline finance executive will
replace Burns, who will resign at the end of the month. Burns will join
energy company Mirant Corp. as CFO. Mirant has been in bankruptcy since
July. Delta has had extensive turnover at the top in recent months as it
struggles to regain its financial footing, the newswire
reported.
Prudential Indonesia Appeals
Court Bankrupt Ruling
PT Prudential Life Assurance
has appealed against an Indonesian court ruling that declared it
bankrupt, Reuters reported. The Jakarta Commercial Court handed down its
bankruptcy ruling last Friday after a petition from a former consultant.
Prudential said the court ruled its Indonesian unit owed the
ex-consultant around $400,000. The company said then that PT Prudential
Life Assurance was financially strong and it would appeal the ruling,
the newswire reported.
GE Capital
Extends Air Canada's $1.5 Billion Loan
General Electric Capital
Aviation Services (GECAS) gave Air Canada a five-month extension on a
$1.5 billion loan package on Thursday, on the condition that the
insolvent carrier emerges from bankruptcy protection by Sept. 30,
Reuters reported. The deal will help Air Canada finance a planned order
for 90 regional jets from Bombardier Inc. and Embraer SA. 'Our priority
continues to be the successful emergence of Air Canada from bankruptcy
protection and experience tells us speed is absolutely critical to
success,' GECAS president Henry Hubschman said in a release, the
newswire reported. GECAS also reiterated its support for Air Canada CEO
Robert Milton, who initially hoped to get the carrier out of bankruptcy
protection by the end of last year. 'We remain committed to working with
the airline's senior management team and other stakeholders,' Hubschman
said, Reuters reported.
MCI Sees Net Loss for
2004
Long-distance company MCI Inc. yesterday said it expected to post a
net loss for 2004, as revenues fall and depreciation costs rise, Reuters
reported. MCI, which emerged from the largest U.S. corporate bankruptcy
earlier this month, said it expects revenues for all of 2004 'in the
lower end' of its previous forecast of $21 billion to $22 billion.