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China should do more to rebalance its economy from investment, exports and industry to consumption and services as it rolls out a $586 billion stimulus package, the World Bank said.

“Additional measures are necessary to make headway with rebalancing the pattern of growth,” the Washington-based lender said today. Steps should include extra spending on health, education and social welfare and raising energy and resource prices, it said.

The World Bank cut its forecast for China’s economic growth next year to 7.5 percent from 9.2 percent in the previous quarterly report after the global financial crisis deepened. More than half of the expansion will come from “government-influenced spending,” after the State Council this month announced measures including infrastructure projects, the report said.

“China urgently needs to rebalance its growth towards domestic demand,” said Mark Williams, an economist at Capital Economics Ltd. in London. “With the world economy facing a painful downturn it can no longer rely on consumers overseas to lift it up.”

China’s economy, the world’s fourth largest, expanded 9 percent in the third quarter from a year earlier, the slowest pace since 2003. The World Bank’s forecast is for the weakest growth in almost two decades next year.

‘Sharp’ Export Decline

“The impact of the international financial and economic turmoil on China’s economy has been manageable so far, but is expected to intensify,” Louis Kuijs, a World Bank economist, said in Beijing. “Looking ahead, prospects are for a sharp reduction in export growth.”

Country director David Dollar said the nation is in the “early stage” of talks with the lender on providing money for loans to other developing nations. He wouldn’t give more details.

The World Bank praised China for keeping the yuan stable against the dollar as the U.S. currency strengthened.

“China’s exchange-rate policy has thus been a source of stability in regional and global financial markets,” the lender said business card design. China’s “effective exchange rate has strengthened considerably,” it said.

The U.S. Dollar Index, which tracks the dollar against six major currencies including the euro and the pound, has climbed 19 percent since the end of June. The yuan has gained 0.4 percent against the U.S. currency in that time.

Health, Welfare, Yuan

Strengthening further the exchange rate and increasing the yuan’s flexibility would help to rebalance the economy, partly by making monetary policy more effective, the World Bank said.

Boosting spending on health, education and social welfare would aid low-income earners and “reduce the reluctance to consume,” the report said. Some measures announced in the stimulus package, such as rural subsidies, will help, it said.

Charging industries the full cost of energy, water, utilities, and natural resources would also aid rebalancing efforts, the World Bank said.

The economy will probably grow 9.4 percent this year, down from a previous estimate of 9.8 percent, it said, noting a “particularly pronounced” slowdown in the housing market.

China’s export slowdown is set to spread from destinations including the European Union to emerging markets, where more than half the nation’s shipments go, the report said. The World Bank predicts imports worldwide will shrink next year for the first time since 1982.

Inflation “is no longer an issue of concern for the immediate future” and is likely to cool to 2 percent in 2009 from 6.5 percent this year, the World Bank said.

China’s foreign-exchange reserves, already the world’s biggest, will likely swell to $2.045 trillion this year and $2.547 trillion by the end of 2009, the report said.

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Singapore's economy probably shrank last quarter as a manufacturing slump and easing demand for financial services drove the nation into its first recession since 2002, adding pressure on policy makers to stimulate growth.

Gross domestic product declined an annualized 6.3 percent from the second quarter, after shrinking 5.7 percent in the previous three months, according to the median estimate of 10 economists in a Bloomberg survey. That matches last month's initial estimate by the government, which will release the revised data at 8 a.m. tomorrow.

Singapore is bringing forward its 2009 budget announcement to January from February and plans to help companies secure loans and train retrenched workers as the global credit crunch pushes the world into a recession. The central bank, which ended a policy favoring gains in its currency to bolster the economy last month, may seek a weakening by April, analysts say.

“The situation warrants urgency,'' said Vishnu Varathan, an economist at Forecast Singapore Pte. “We can expect a generous budget aimed at mitigating the sharp slowdown that is expected in growth. As far as monetary policy is concerned, we expect that more easing moves will be under way given the escalation of risks from the deterioration in global economic and financial conditions.''

The Singapore dollar fell as much as 0.3 percent to 1.5336 against the U.S. currency today, and traded at 1.5293 as at 10:28 a.m. local time.

Policy Announcements

Traders are awaiting the growth data “and likely some growth-supportive fiscal policy announcements, with some market speculation about an inter-meeting easing on the monetary policy front,'' analysts including Emmanuel Ng at Oversea-Chinese Banking Corp cash in 1 hour. said in a research note to clients today.

There is “a very high chance'' that the central bank will ease policy before the next meeting in April, Varathan said.

The Monetary Authority of Singapore, which conducts monetary policy by guiding the currency within an undisclosed band based on a basket of major trading partners' currencies, may be open to depreciation to help revive exports and the economy, UBS AG currency strategists Ashley Davies and Nizam Idris wrote this week.

Asian policy makers and their counterparts around the world have lowered interest rates and announced economic stimulus plans in recent weeks as the global financial crisis that's toppled banks in the U.S. and Europe forced companies such as Citigroup Inc. to eliminate thousands of jobs. That's pushed the U.S., Japan, Europe, Hong Kong and New Zealand into recession, hurting demand for Singapore's exports.

The island's exports have dropped for six straight months and Prime Minister Lee Hsien Loong foresees several years of slow growth. The trade ministry predicts Singapore will grow about 3 percent in 2008 from a year earlier, the weakest pace in seven years.

The $161 billion economy probably shrank 0.5 percent from a year ago last quarter, after gaining 2.3 percent between April and June, a separate survey showed. That prediction matches the government's estimate released Oct. 10.

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The Federal Deposit Insurance Corp. may revise a $1.4 trillion debt-insurance program to address complaints that it would spur an exodus from the $250 billion market for overnight loans between banks.

The FDIC is considering charging different fees depending on the maturity of the debt, instead of its previous plan for a flat fee. Companies including JPMorgan Chase & Co. and Bank of America Corp. said the original proposal threatened to make the overnight federal funds market too costly compared with alternatives such as direct loans from the Federal Reserve.

“We are definitely thinking through how to respond to some of the concerns that have been raised,'' Art Murton, director of the FDIC's insurance and research division, said in an interview. “Complexity is somewhat inevitable. We're doing our best to take away unnecessary confusion.''

The deliberations show how officials are trying to avoid some of the unintended consequences that have plagued other government programs. Banks in September protested a Treasury plan to insure money-market funds, saying it could spur a rush out of bank deposits. Some companies claim the Fed's purchases of top-ranked commercial paper penalize second-tier firms.

The FDIC had proposed charging a standard fee to insure all eligible senior unsecured debt. Banks argued that the federal funds market should be treated differently. If that market costs too much, banks might switch to government lending programs like the Fed's discount window or Federal Home Loan Bank advance programs, they said.

Banks Complain

“Such an outcome would not achieve the FDIC's goal of improving shorter-term unsecured inter-bank funding markets,'' law firm Sullivan and Cromwell wrote in a letter to the agency on behalf of nine large banks, including Goldman Sachs Group Inc., JPMorgan and Bank of America.

High premiums on federal funds lending “could effectively shut down the overnight funds market,'' said Louis Crandall, chief economist of Wrightson ICAP in Jersey City, New Jersey. “Most current activity in the overnight funds market would either not take place or be diverted to other instruments such as Eurodollars that are not subject to the FDIC's new fees.''

Banks have until Dec. 5 to decide whether to participate in the FDIC's program. Premiums started accruing on Nov. 13 for all banks, and those that don't want to take part must notify the agency. The FDIC plans to release final regulations for the program as soon as this week.

“We have certainly heard a lot on the fed-funds issue,'' Murton said.

Backstop for Lending

The program is separate from Treasury Secretary Henry Paulson's $700 billion bank bailout freecreditscore. It is designed to provide a broad backstop for interbank lending. The FDIC rolled out the plan on Oct. 14, in response to debt guarantees announced by European governments.

The FDIC is offering the debt insurance through its Temporary Liquidity Guarantee Program, which also includes expanded deposit insurance for business checking accounts. As laid out in the interim regulation, the FDIC will guarantee all new senior unsecured debt issued between Oct. 14 and June 30, 2009, up to a cap that will be set for each institution when it signs up.

Critics say the program is too complicated and won't be as effective as intended. FDIC Chairman Bill Isaac, now chairman of Secura Group LLC, said the idea is “convoluted'' and has drawn fire from smaller banks.

“The small banks are just livid about what's going on,'' Isaac said. “The small banks feel like they didn't have anything to do with creating these problems, yet they're being asked to pay for them.''

`Competitive Disadvantage'

Chip MacDonald, a banking lawyer at Jones Day, said banks may choose to participate so they don't lose an edge against rivals. Bankers who opt out “may be at a competitive disadvantage,'' he said.

Banks are automatically enrolled unless they opt out. If a bank holding company joins, all of its banking subsidiaries must also join, and the program terms apply to all commercial paper, promissory notes and other eligible debt like federal funds loans. That was a change in the FDIC's thinking, Murton said.

“We may have signaled an openness'' to partial participation, he said. “As we thought more about it in the next few days, we decided that it made more sense to have all in or all out for the instruments and the entities.''

Nonbank affiliates are excluded from the program. A finance unit, such as General Electric Co.'s, can apply to join, the FDIC said. GE said last week it had been accepted, which will provide a backstop for up to $139 billion in the company's debt.

That puts the company on a more even footing with banks, according to Crandall.

“Once the terms of the FDIC guarantee program are set, we're likely to see a wave of issuance of guaranteed medium-term notes by participants,'' Crandall said.

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The Federal Reserve is working on a plan that would give it authority to regulate the clearing of trades for the $33 trillion credit-default swap market, according to people with knowledge of the proposal.

The Fed, the U.S. Securities and Exchange Commission, the Treasury Department and the Commodity Futures Trading Commission are discussing a memorandum of understanding that lays out oversight of clearinghouses that would become the central counterparty to credit-default swap trades, said the people who asked not to be named because the discussions are private.

The SEC and CFTC would also share trading information under the plan, the people said.

“The main concern is systemic risk and that's much more in the Fed's wheelhouse than the SEC or CFTC,'' said Craig Pirrong, a finance professor at the University of Houston who studies futures markets. “The Fed is the natural place for it to go.''

The Fed has been pushing the industry to form a clearinghouse that would absorb losses should a market maker fail. Regulators stepped up their efforts after the failure of Lehman Brothers Holdings Inc. in September and the near-collapse of American International Group Inc. The New York Fed has been meeting with groups including CME Group Inc., Intercontinental Exchange Inc. and NYSE Euronext to press them to accelerate their progress.

New York Fed spokesman Andrew Williams and Treasury spokeswoman Michele Davis didn't immediately respond to requests for comment. CFTC spokesman David Gary and the SEC's John Nester declined to comment.

Announcement This Week

Credit-default swaps are financial instruments based on bonds and loans that are used to speculate on a company's ability to repay debt. They were conceived to protect bondholders against default, and pay the buyer face value in exchange for the underlying securities or the cash equivalent should the company fail to adhere to its debt agreements short-term cash loans.

An announcement of the regulatory structure could come by the end of the week when President George W. Bush hosts a gathering of world leaders in Washington to discuss ways to fix the financial crisis, said one of the people who has read a draft of the plan.

“All the regulators want to push this forward,'' Pirrong said. “The credit crisis meeting on Friday is as good an excuse as any.''

Chicago-based CME Group is competing with Intercontinental Exchange of Atlanta and NYSE Euronext to create a system. CME Group Chief Executive Officer Craig Donohue said last week that he is open to Fed oversight for his clearing plan. CME Group is currently regulated by the CFTC.

ICE, CME

Intercontinental Exchange Chief Executive Officer Jeff Sprecher has set up his clearing plan as a special purpose banking entity within the state of New York. Intercontinental agreed to buy Chicago-based Clearing Corp. last week to help it get participation in its plan from the nine major banks that own the Clearing Corp. and that make up the majority of the market.

CME Group, partnered with hedge fund Citadel Investment Group LLC, has said it is ready to begin clearing CDS contracts as soon as it receives regulatory approval. Sprecher said today his group may be ready before year end.

“We're waiting for regulatory approval. I think positions will start moving in the next few weeks,'' he said at the Futures Industry Association conference in Chicago today.

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Japanese machinery orders tumbled 10.4 percent last quarter, matching the biggest drop on record, as manufacturers cut investment plans in anticipation the global slowdown will stifle overseas demand.

The decline in orders, an indicator of capital spending in the next three to six months, matched a record drop set 10 years ago, the Cabinet Office said today in Tokyo.

Falling profit for Japan's exporters has driven the Nikkei 225 Stock Average down 44 percent this year and forced some of the country's biggest companies to cut costs. Toyota Motor Corp. last week forecast earnings will drop by almost 70 percent this fiscal year and said it plans to lay off workers and scale back investment.

“The deterioration in demand has become clearer and that's eroding companies' willingness to invest,'' said Yoshimasa Maruyama, a senior economist at BNP Paribas Securities Japan Ltd. in Tokyo. “We're going to see companies make deeper cuts.''

The yen traded at 99.21 per dollar at 9:57 a.m. in Tokyo, from 98.95 before the report was published.

On a monthly basis, orders for Japanese machinery rose 5.5 percent in September, an increase the government described as a “weak rebound.'' The gains ended a three-month losing streak that was the worst since the country's 2001 recession.

Economists predicted a 5.2 percent rebound they said provided little relief amid an overall slowdown in corporate investment.

26-Year Low

The Bank of Japan, which last month cut its key interest rate to 0.3 percent after stocks fell to a 26-year low, forecasts that business spending will remain sluggish for the next several quarters Faxless pay advance. The slowdown in Japan's export markets and the 8 perent appreciation of the yen since October will create a “severe'' earnings environment, the bank said.

The International Monetary Fund expects the economies of the U.S., Japan, and euro zone to shrink next year.

Governments and central banks are taking steps to spur demand. The U.S., Europe, South Korea and India have lowered borrowing costs in the past two weeks and China last night unveiled a $586 billion stimulus plan to prop up growth.

Toyota expects its earnings this fiscal year will be the lowest since 1999. President Katsuaki Watanabe, who started his career at the carmaker by cutting costs at the company cafeteria, said last week he'll head an emergency committee to trim spending and review the timing and scale of new projects. The company will also layoff 3,000 contract workers by the end of March.

Global Slowdown

Today's report is another sign the global slowdown has pulled the world's second-largest economy into a recession. Manufacturers said last month they plan to cut production in November. Economists say conditions may deteriorate in coming months after the U.S. economy suffered its biggest decline since 2001 in the third quarter.

“U.S. economic activity slowed significantly in September and October, which may affect Japan's exports,'' said Chotaro Morita, head of fixed-income strategy research at Barclays Capital in Tokyo. “We will probably see the impact materializing from the November data.''

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More than one in four American adults have encountered employment discrimination, according to a new survey by FindLaw.com.

The survey, which asked 1,000 adults if they believe they have ever experienced discrimination by an employer in job interviews, hiring, pay or promotions, found race topped the list (39 percent), followed by age (34 percent), gender (30 percent), religion and sexual orientation (7 percent) and other (26 percent)

"It is important to note that not all discrimination is prohibited by law," said Stephanie Rahlfs, an attorney and editor at FindLaw.com. "Only discrimination based upon a classification that is considered ‘protected’ – race, color, religion, national origin, sex, age, disability, or union activity under the federal anti-discrimination laws – is illegal 1 hour cash advance.”

Among the survey’s findings:

• Forty-two percent of African-Americans have experienced racial discrimination in the workplace.

• One in 10 women claim they have experienced gender discrimination in the workplace.

• One in seven people age 45 and older (15%) claim they have experienced age discrimination in the workplace.

• One in eight people ages 18 to 24 (13%) say they have also experienced age discrimination.

• While racial discrimination was highest in the South, age, gender and religious discrimination were most likely to occur in the Midwest.

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The Bishop Museum announced three new members to its board of directors.

Sanne Higgins, of the Higgins Family Foundation; Anton Krucky, co-founder, president and CEO of Tissue Genesis Inc.; and Gulab Watumull, a businessman and philanthropist, were all named to the board.

“These board members are all well connected in the community and have very skilled backgrounds,” said Timothy Johns, president and CEO of Bishop Museum bad credit payday loans. “They are a great addition to our current board and I look forward to working with them.”

Museum officials also recognized outgoing board member David Hulihee for his nine years of service, during which he was chairman for three years.

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The U.S. Treasury said it plans to sell $55 billion in long-term government debt this quarter and bring back auctions of three-year notes, as a slowing economy balloons the budget deficit to a record level.

The Treasury's quarterly refunding of longer-dated securities is the biggest in four years. Three-year notes, which had been suspended since May 2007, will now be issued on a monthly basis, the department said in Washington today. The government will also increase the frequency of 10-year and 30- year debt auctions.

Borrowing needs have surged in the wake of higher spending, a $700 billion financial rescue plan and plunge in tax receipts amid what economists estimate may be the worst recession since the early 1980s. Debt issuance may increase further after bond trading firms this week predicted the budget shortfall will more than double to $988 billion in 2009.

“These are highly uncertain times,'' Karthik Ramanathan, head of the Treasury's debt management, said in a press briefing. He said private deficit estimates “vary greatly, and the marketable borrowing estimates are even broader,'' ranging from a projected shortfall this year of $1.1 trillion to $2.1 trillion.

The Treasury plans to auction $25 billion in three-year notes on Nov. 10, $20 billion in 10-year notes Nov. 12 and $10 billion in 30-year bonds Nov. 13, the department said.

Most Since 2004

The total was in line with analysts' forecasts and was the largest quarterly figure since the first three months of 2004. The department last quarter said it was considering a second reopening of the 10-year note and a move to quarterly new issues of 30-year bonds.

In a Bloomberg News survey of six analysts, the median estimate predicted $25 billion in three-year note sales, $20 billion in 10-year-note sales and $8 billion in bond sales.

Three months ago, the Treasury's announced quarterly sales of $17 billion in 10-year notes and $10 billion in reopened 30- year bonds.

“We will continue to monitor projected financing needs and make adjustments as necessary including, but not limited to, the reintroduction or establishment of other benchmark securities,'' Ramanathan said in a statement.

The Bush administration's most recent budget forecast, issued in July, projected a $482 billion deficit for the 2009 fiscal year, which started Oct. 1. Since then, the government has taken over mortgage companies Fannie Mae and Freddie Mac, intervened to save insurance company American International Group Inc., and embarked on the bank rescue program.

$550 Billion

As a result, borrowing needs are expected to rise to a record $550 billion in the three months to Dec. 31, the Treasury said Nov. 3. That follows a $530 billion record in the July to September quarter bad credit pay day loans.

“From a fiscal perspective, borrowing requirements have steadily increased,'' the Treasury said in charts prepared for its advisory committee meeting. “The economic outlook continues to present challenges.''

The borrowing announcement noted that upcoming auctions of 10-year and 20-year Treasury Inflation Protected Securities, also known as TIPS, will help meet financing needs. In the department's meeting this week with bond dealers, there was debate over whether five-year TIPS are an effective way for the government to borrow.

Longer-Dated TIPS

“Recent cost studies as well as investor participation statistics suggest that TIPS issuance, particularly for shorter- dated TIPS, has not reduced borrowing costs nor diversified the investor base, both of which were objectives at the start of the program,'' minutes of the meeting said.

“Focusing on longer-dated TIPS may be an approach to reducing effective costs, capturing a higher inflation premium, and increasing liquidity among benchmark TIPS instruments while at the same time extending the duration of the portfolio,'' the Treasury said.

Ramanathan told reporters there were no immediate plans to change the TIPS borrowing calendar, which includes a prospective five-year note TIPS sale in April. He noted the cost studies and said the Treasury would consider their findings.

The government sells debt to finance the excess of spending over revenue. The Treasury also sells shorter-term debt on a monthly and weekly basis to manage the government's finances.

In today's announcement, the Treasury said it expects to issue cash-management bills, “some longer dated,'' during the current quarter. The Treasury said unscheduled reopenings of government securities will be the “exception'' in its debt management because the department has a policy of “transparency, regularity and predictability.''

Treasury, Fed

The Treasury also has borrowed money on behalf of the Federal Reserve, which has launched a slate of new lending programs to fight the credit crunch.

Ramanathan said in the statement that the department “strongly encourages'' financial firms to step up efforts to settle failed transactions in the secondary debt market.

“Recent market turbulence and the low level of short-term interest rates resulted in a substantial and broad increase in persistent fails in U.S. Treasury securities,'' Ramanathan said. “Other regulatory measures may be considered if private sector efforts are not implemented.''

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MOD-PAC Corp. said revenues declined in the third quarter but the printer and paper board packaging company was able to turn a slight profit.

Net income was $14,000 compared to a $1.1 million loss last year.

Revenue totaled $12.6 million, off 3.4 percent from $13.1 million in the 2007 second quarter cash loan till pay day in one hour.

Officials of the Buffalo-based company (NASDAQ: MPAC) said the sluggish economy hampered sales but restructured operations have helped reduce costs.

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