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November 18, 2004
Reports Suggest Economy Is Warming Up
Industrial production and new home construction rose sharply last
month, suggesting that the economy is overcoming high energy prices and
rebounding from the summer slump, the New York Times
reported. The Federal Reserve reported yesterday that industrial
production rose 0.7 percent in October, the fastest pace since July. In
addition, the Commerce Department reported that new housing starts had
recovered from a September dip to rise 6.4 percent last month. Investors
in financial markets seemed encouraged by the emerging panorama of
economic strength, as prices of stocks and bonds rose sharply on the
news.
Bankruptcy Judge Takes Novel Approach in Warning Young People of
Debt’s Dangers
An outreach program called CARE (Credit Abuse Resistance Education),
founded two years ago by John C. Ninfo II, chief judge of the U.S.
Bankruptcy Court for the Western District of New York, sends bankruptcy
professionals—judges, attorneys and trustees—into high
schools and colleges all over the country to share their personal
experiences in dealing with people who have filed for bankruptcy
protection, the Washington Post reported. Read the full
article at
href='http://www.washingtonpost.com/wp-dyn/articles/A58800-2004Nov17.html'>www.washingtonpost.com/wp-dyn/articles/A58800-2004Nov17.html.
Third Ex-National Century Financial Executive to Plead Guilty
A third former executive of National Century Financial Enterprises
Inc., a now-defunct health-care financier, will plead guilty to criminal
charges stemming from the company’s 2002 collapse, Bloomberg News
reported. John Snoble, ex-CFO of the Dublin, Ohio-based company,
“is expected to plead guilty to one count of conspiracy to launder
money,” said Fred Alverson, spokesman for the U.S.
Attorney’s Office for the Southern District of Ohio. Under former
CEO Lance Poulsen, National Century gave health-care providers cash for
their receivables, or bills due to be paid, and packaged the income
stream into notes it sold to investors. The company’s November
2002 collapse pushed at least 30 health-care companies in 13 states and
the District of Columbia into bankruptcy when the cash vanished, the
newswire reported.
JetBlue May Bid on ATA’s Chicago Gates, Neeleman Says
JetBlue Airways Corp. may accelerate plans to begin flights to
Chicago by bidding on Midway Airport gates leased by bankrupt ATA
Holdings Corp., Bloomberg News reported. “We’d probably get
in the market,” JetBlue CEO David Neeleman said in an interview at
the airline’s New York headquarters. ATA Holdings said on Oct. 26
that it agreed to sell the 14 Midway gates to AirTran Holdings Inc. when
it sought protection from creditors. Chicago officials dispute ATA
Holdings’ control of the gates, saying the city can reclaim and
reallocate the leases if the airline is forced to reduce its
operations.
Catholic Bishops Launch Marriage Initiative
U.S. Catholic bishops on Wednesday launched a plan to promote
marriage, an institution they see as being under extreme pressure,
Reuters reported. The U.S. Conference of Catholic Bishops also approved
plans to collect more information on clerical sex abuse, as the church
struggles to respond to victims of priest pedophilia in a scandal that
surfaced more than two years ago, the newswire reported.
Avianca Cuts Debt to $44 Million in Restructure
The restructuring plan for Colombian airline Avianca approved by a
New York bankruptcy judge will reduce its commercial debt to $44 million
from $140 million, the company’s financial chief said on
Wednesday, Reuters reported. Avianca entered chapter 11 in March last
year after accumulating net losses of $600 million since 1998.
Federal-Mogul’s UK Pension Votes Down Rescue Plan
The trustees of the UK pension fund of bankrupt U.S. auto parts firm
Federal-Mogul, with 37,000 members, said they have been forced to vote
against a rescue plan for the scheme as they consider new proposals from
the U.S., Reuters reported. The proposed plan by Federal-Mogul Corp. for
the fund of UK subsidiary Turner & Newall, had not been adjusted to
include a new offer led by U.S. financier Carl Icahn, the largest holder
of the company’s debt, in October, they said, the newswire
reported.
Wife of Ex-Enron Chief Stock Sale Probed
Federal prosecutors are investigating whether the wife of former
Enron Corp. Chairman Ken Lay illegally sold shares in the company just
before it went bankrupt, a lawyer for Lay said on Wednesday, Reuters
reported. The Department of Justice’s Enron Task Force is
investigating whether Linda Lay engaged in insider trading in the sale
of 500,000 shares of Enron stock on Nov. 28, 2001, through the
Lay’s charitable foundation, according lawyer Michael Ramsey, the
newswire reported.
Trying to Get Big Enough to Battle Wal-Mart
In the world of retailing, there is no such thing as “too big
to fail,” as investors have often learned to their sorrow, the
New York Times reported. It may be a measure of just how
far Sears, Roebuck & Company has fallen from its perch as the
nation’s largest retailer that it has agreed to be acquired by
Kmart, which itself was once No. 2 to Sears. But that was before Kmart
went broke. The combined company will be No. 3 in American retailing,
the companies said in announcing the transaction. With $55 billion in
revenue, it will trail Wal-Mart and Home Depot. Read the full article at