Federal Reserve Chairman Ben S. Bernanke avoided saying anything yesterday at his first press conference that shocked or confused investors. In other words, economists said, his appearance was a success.
During 46 minutes answering questions, Bernanke commented on a broad spectrum of economic issues, saying he expected inflation in fuel costs to slow and the end of the central bank’s $600 billion bond purchase program in June to have little impact on markets. He veered away once from the business at hand to mention his “big mistake” to play chess against economist Kenneth Rogoff, a former professional player.
Bernanke’s success in avoiding a gaffe may help validate the Fed’s decision to open up more to the public after decades in which Fed chairmen limited their appearances largely to speeches and congressional testimony. The Fed has now joined central banks in Europe, Japan and the U.K. in holding regular press briefings.
“From the Fed’s point of view it was beautiful, brilliant,” said William Ford, a former Atlanta Fed president who teaches at Middle Tennessee State University. “He didn’t make any goofs and came away as knowledgeable and smart. It was wonderful PR for him,” Ford said.
Bernanke, 57, said the central bank decided to hold press conferences four times a year after judging that the benefits from providing more information and transparency outweighed the risks of potentially creating “unnecessary volatility in financial markets.”
The press conference gave the chairman the chance to elaborate on a Federal Open Market Committee statement that was little changed from last month. He also discussed economic projections that were released concurrent with the meeting for the first time, instead of three weeks later.
Traders took Bernanke’s comments, and the FOMC statement released two hours earlier, as a signal the Fed is likely to maintain record monetary stimulus. The Standard & Poor’s 500 Index rose to an almost three-year high, while long-term Treasury yields rose and the dollar tumbled.
The press conference contrasted with Bernanke’s rocky start with the media after he took office in 2006. In April of that year, he told CNBC reporter Maria Bartiromo at a Washington party that markets had misinterpreted his remarks to Congress that had suggested the Fed was finished raising rates. Bonds tumbled when CNBC reported the conversation. Bernanke later said the incident was a “lapse in judgment.”
Bernanke was lampooned in December by U.S. comedian Jon Stewart for likening Fed loans in 2009 to “printing money” and then telling CBS Corp.’s “60 Minutes” program in December that the Fed wasn’t printing money by buying $600 billion in Treasury securities.
The Fed chief showed more control of the message yesterday, commenting on how the Fed may maintain stimulus and respond to any increase in inflation expectations. He tried to show compassion for the average American, saying the Fed has pursued record stimulus to help people facing long-term unemployment and that higher gasoline prices are “absolutely creating a great deal of financial hardship for a lot of people no fax payday loan.”
Bernanke’s body language betrayed his emotions and conveyed “hopelessness” over long-term unemployment, said Greg Hartley, a former U.S. Army interrogator and author of “The Body Language Handbook.” Bernanke also showed emotion when discussing Japan’s response to its March earthquake and nuclear disaster, Hartley said.
‘Natural Human Reaction’
“That’s a natural human reaction,” Hartley said on Bloomberg Television’s “Taking Stock” with Pimm Fox. “He got more comfortable as time went, and I think the next time we’ll see a more polished person, but he could use some coaching.”
Bernanke appeared at precisely 2:15 p.m., striding into a conference room at the central bank’s Martin Building, across the street and reachable via tunnel from the Eccles Building headquarters where he chaired the FOMC meeting.
The former Princeton University professor took a seat, to the clatter of camera shutters, at a mahogany desk on a platform in front of about 60 reporters seated classroom-style in five rows of tables. For 11 minutes, or almost one-fourth of the allotted time, Bernanke read a statement discussing the FOMC’s actions and its forecasts.
Michelle Smith, Bernanke’s chief spokeswoman, stood off camera selecting reporters for questions. Bernanke didn’t hesitate after a reporter suggested that the Fed has been “unsuccessful” in supporting the dollar. He said investors flocked to the dollar as a safe haven during the financial crisis, and its drop over the last couple of years reflects reduced “uncertainty.”
Reinhart, Rogoff Book
The final question, about a book on the history of financial crises by Carmen Reinhart and Rogoff stoked Bernanke’s memory about Rogoff, a graduate school classmate of Bernanke’s at Massachusetts Institute of Technology in the late 1970s who is now at Harvard University.
“I’ve known him for a long time,” Bernanke said. “I even played chess against him, which was a big mistake.”
Charles Lieberman, former head of monetary analysis at the New York Fed, said Bernanke parried well questions that put him in a “no-win situation.”
“He refused to answer hypothetical questions or get distracted by weak arguments,” said Lieberman, chief investment officer with Advisors Capital Management LLC in Hasbrouck Heights, New Jersey.
The central bank chairman succeeded in “being informative and clarifying and not making a lot of news,” said Diane Swonk, chief economist at Mesirow Financial Inc. in Chicago, who has tracked the Fed since 1987.
Rogoff in an interview today declined to comment on his chess game against Bernanke, other than to say Bernanke played as black using an opening strategy known as Petrov’s Defense.
As for the press conference, “I thought he gave, speaking of chess, a masterful performance,” Rogoff said.
The stars are aligned for Barack Obama’s re-election in November 2012. He won’t join Jimmy Carter as the only Democrats in 120 years to miss out on a second term as U.S. president.
Five things are playing in Obama’s favor.
First, the Republicans — driven by their most conservative members in Congress — will face a primary with many candidates who will advance harsh ideological positions. Michele Bachmann, Newt Gingrich, Donald Trump and others might as well be on the Democratic National Committee payroll. House Budget Committee Chairman Paul Ryan’s reverse Robin Hood plan to cut more than $6 trillion in spending over a decade will provide the outrage, stoked by a sitting president possessed of verbal discipline.
Second, the Republican governors’ attacks on unions are turning off the swing voters and Reagan Democrats in Ohio, Florida, Pennsylvania and Wisconsin. Imagine the voter reaction if millions of workers lose their right to collective bargaining, and the impact that cuts in benefits and wages will have on their lives.
Democratic governors, such as Jerry Brown of California, Pat Quinn of Illinois and Andrew Cuomo of New York, are cutting — but not taking away — workers’ bargaining rights. This is a politically useful contrast for Obama. Reagan Democrats, who have won many elections for the Republicans, are a big plus for Obama in the contested states.
Third, no candidates are emerging to challenge Obama in the primaries. A discussion of Obama’s forgotten campaign promises and record would have public support among Democrats. Even so, the liberal base has nowhere to go to send a message about war, free-trade agreements, raising the minimum wage or union membership.
Nor does a third party or independent candidacy pose a threat, given the winner-take-all, two-party system.
Fourth, Obama has neutered much of the big corporate lobby’s zeal to defeat him. He decided from the beginning not to prosecute executives from Wall Street banking, brokerage and rating firms. Multinational companies are pleased with Obama’s position on trade, on not disturbing the many corporate subsidies, handouts and giveaways, such as the corn-ethanol subsidy.
Shelters for Wealthy
By 2014, Obamacare will deliver some 30 million subsidized customers to health-insurance companies. The auto industry is forever grateful for its bailout. Obama hasn’t moved on corporate-tax reform, tax shelters for the wealthy, or the preferential capital-gains tax treatment on the 20 percent service fees of hedge fund managers. Don’t forget last December when Obama agreed to extended tax cuts for the rich while the budget deficit gets larger.
The military-industrial complex about which President Dwight Eisenhower warned in his farewell address 50 years ago, is still uncontrollable, leading departing Defense Secretary Robert Gates to express serious concerns. Obama has even surprised George W. Bush and Dick Cheney and his cohort of neocons, who can scarcely believe how militarily aggressive Obama has been on just about every move that liberals used to call impeachable offenses by former President George W. Bush.
Then there’s Jeffrey Immelt, the chairman and chief executive officer of General Electric Co., who can attest to Obama’s outreach to big business. GE Capital was bailed out. The company effectively paid no federal income taxes on $14.2 billion in 2010 profit and received a $3.2 billion benefit. Immelt got a $15.5 million pay raise. And in January, Obama appointed him chairman of the President’s Council on Jobs and Competitiveness while letting him stay as head of a company receiving many government contracts and having regulation problems with the federal authorities. The corporate state doesn’t get much better than that.
Fifth, since the Republicans have little to offer by way of creating jobs, Obama need only show improvement in macroeconomic indicators, as Ronald Reagan did in 1983-1984, and proceed to showcase all the tax breaks he has signed into law for big and small businesses. Poor Americans who continue to bear the brunt of the recession are hardly going to vote Republican. It will be easy for Obama, with his oratorical skills, to paint the Republican-controlled House of Representatives as obstructionist, especially as he develops an economic plan for his second term.
There remain the Black Swans, events that defy prediction as those in Japan and the Middle East have shown. Handling them with firmness and calmness from the White House is what most people expect of a president. Obama will surely not repeat Bush’s mistakes after Hurricane Katrina in 2005.
Obama is averse to conflict with corporate power and disarmingly expedient in compromising with Republicans, leaving the latter to argue largely among themselves. The political duopoly lets the tactical Obama use the Bully Pulpit to his political advantage, even if his principles perish. Obama can look forward to four more years in 2012.
(Ralph Nader is the founder of Public Citizen and author of the book “Only the Super-Rich Can Save Us!” The opinions expressed are his own.)
For nine days, miners more than a mile underground burrowed around the clock to reach one of their own caught in a cave-in _ never wavering from calling the effort a rescue mission.
That changed Easter Sunday as officials announced the death of 53-year-old Larry Marek. His body was discovered in a collapsed portion of the Lucky Friday silver mine were he had been working with his brother.
“Words cannot express the deep sorrow we feel at the tragic loss of our friend, colleague and 30-year veteran of the mining industry. Our thoughts and prayers are with his family, loved ones and friends,” a Hecla Mining Co. statement said.
Marek, a 12-year company employee, and his brother, Mike, had just finished watering down blasted-out rock and ore April 15 in northern Idaho mine when the ceiling of a 6,150-foot deep tunnel collapsed. Mike Marek escaped unharmed.
Rescuers worked on the hope that not all of the 75-foot section of tunnel collapsed and the missing miner had perhaps survived in an open space amid the tons of fallen rock and debris.
Efforts to reach that possible area included an attempt to dig through the collapsed tunnel and building a second intersecting tunnel. But dangerous conditions halted the first effort, and work on the second tunnel slowed as crews encountered increasingly difficult obstacles that required a special tunneling technique to prevent the new tunnel from collapsing.
Then drill holes sent forward Saturday to probe conditions at the end of the tunnel _ where they hoped to find an open area where Marek was working _ found only sand and rubble. Officials said that indicated the entire tunnel collapsed, leaving no space in which the miner might have found refuge.
A company official and a representative of the Federal Mine Safety and Health Administration told the family late Saturday that the rescue mission had changed to a recovery operation.
Sunday morning, the company said it believed Marek was dead. His body was discovered a short while later.
The family declined to comment Sunday.
The company said Sunday it was beginning an in-depth investigation to discover how and why the collapse occurred.
Hecla spokeswoman Melanie Hennessey said the last fatality at the mine occurred in 1986.
The mine employs roughly 275 workers, about 50 of whom were underground in various parts of the mine when the collapse occurred.
The first foreign leader to tour Japan’s tsunami-ravaged coast, Australian Prime Minister Julia Gillard expressed shock and sorrow at the devastation and visited evacuees at a shelter Saturday, giving toy koalas and kangaroos to excited children.
Walking through a fishing village where hundreds of people are dead and missing, she said Minamisanriku looked as if it had been “bombed into oblivion.”
Mayor Jin Sato showed her the red skeleton of the disaster management building where he was standing when the mammoth wave ripped off its shell March 11. Exterior stairwells were ripped from the walls. A small shrine of flowers had been created on a mound of rubble.
“It’s a scene of incredible tragedy and incredible sorrow,” Gillard said on the last day of a four-day trip here.
More than 27,000 people are dead or missing from the earthquake and tsunami. Tens of thousands are living in shelters after an estimated 90,000 homes were destroyed or damaged.
Recovery efforts have been complicated by the crisis at the Fukushima Dai-ichi nuclear power plant, where the tsunami wiped out power and cooling systems. Workers have struggled to stop radiation leaks, and the utility says bringing the plant fully under control may take all year.
Plant operator Tokyo Electric Power Co. said Saturday that 30 workers at the plant had exceeded the former limit of radiation exposure. That limit, 100 millisieverts a year, was raised amid the crisis to 250 millisieverts. None of the workers had yet reached that limit, the company said.
Leaks from the plant reactors have stabilized somewhat since the early days of the crisis, but some interior spaces in the quake- and tsunami-damaged buildings still have such high radiation levels the workers are not able to enter them no faxing 1 hour payday loans.
A few hundred workers have toiled in rotating shifts at the plant since the disaster started, most of them middle-age men employed by TEPCO or affiliated companies. TEPCO spokesman Junichi Matsumoto said managers have been instructed to closely watch employees who are nearing radiation limits; measures that might be taken include moving workers from the riskiest tasks, such as clearing radioactive debris, to jobs indoors, such as clerical duties.
Workers in the U.S. nuclear industry are allowed an upper limit of 50 millisieverts per year. A typical individual might absorb 6 millisieverts a year from natural and manmade sources such as X-rays.
Radiation specialists say cumulative doses of 500 millisieverts have been shown to raise risks of future cancers. Evidence is less clear on smaller amounts, but in theory, any increased radiation exposure raises cancer risks.
Radiation sickness, which develops from acute exposure, sets in at 1,000 millisieverts. Symptoms include nausea, vomiting and hair loss.
The workers also face health problems due to fatigue and stress of working in the harsh environment, a doctor who spoke to them said this week. He said the workers have insomnia, dehydration and high blood pressure and are at risk of developing depression or heart trouble.
Meanwhile, Japan’s railway company announced that bullet train service from Tokyo to the Sendai, the biggest city in the quake zone, would resume on Monday. Parts of the route had been restored earlier, but Monday is the first day the route is fully operational.
Yuan forwards traded at the biggest premium to the spot rate in more than five months, reflecting speculation the central bank will allow faster currency gains to help tame inflation.
More rapid appreciation may be a tool for curbing prices, Wang Yong, a professor at the People’s Bank of China’s training center in the city of Zhengzhou, wrote in a commentary published in today’s Securities Times newspaper. The central bank set the yuan’s reference rate 0.11 percent stronger at 6.5156 per dollar, the highest level since July 2005.
“The frequent record highs in the reference rate are pushing up appreciation bets in the offshore market,” said Liu Dongliang, a Shenzhen-based senior analyst at China Merchants Bank Co., the country’s sixth-largest lender by market value. “There won’t be any one-off move in the foreseeable future, especially when the trade surplus is narrowing.”
Twelve-month non-deliverable forwards rose 0.3 percent to 6.3285 per dollar as of 10:43 a.m. in Hong Kong, 2.9 percent stronger than the onshore exchange rate of 6.5133, according to data compiled by Bloomberg. That’s the largest gain projected since Nov. 10. The currency appreciated 0.1 percent today in Shanghai and earlier touched a 17-year high of 6.5131, according to the China Foreign Exchange Trade System.
Relatively large pressure for yuan gains has affected companies’ export orders, the Ministry of Commerce said on its website today. The country’s import growth may be faster than export growth this year, the ministry said. The world’s second- biggest economy had a $1.02 billion trade deficit in the first three months of this year, the first quarterly shortfall in seven years.
Consumer prices rose 5.4 percent in March from a year earlier, exceeding the government’s 2011 target of 4 percent, according to data released last week.
–Judy Chen. Editors: Sandy Hendry, James Regan
A gain in U.S. sales of existing homes during March probably failed to make up for a drop the previous month, a sign that the housing market is struggling to rebound, economists said before a report today.
Purchases rose 2.5 percent to a 5 million annual rate after dropping 9.6 percent in February, according to the median forecast of 74 economists surveyed by Bloomberg News. Sales in January of existing homes, which make up 90 percent of the market, climbed to the highest level in eight months as buyers used all-cash transactions to obtain distressed properties.
Housing may remain a weak link in the economic recovery that began in June 2009 as unemployment, falling property values and stricter loan rules push foreclosures to record levels. At the same time, a drop in prices has made houses more affordable, a sign demand may not fall much more.
“We’re on a recovery track, it’s just going to be slower than we would all like,” said Robert Dye, a senior economist at PNC Financial Services Group Inc. in Pittsburgh. “Credit constraints are working against home sales right now. By the end of this year, we’ll start to feel like we’ve turned a corner.”
The National Association of Realtors’ data are due at 10 a.m. in Washington. Economists’ estimates ranged from 4.59 million to 5.4 million.
The figures would underscore the Federal Reserve’s view that the housing market “continues to be depressed” even as the rest of the economy improves.
The drop in purchases in February sent the median price of existing homes to the lowest level since 2002. Distressed properties accounted for 39 percent of sales, and the share of all cash transactions was 33 percent, the highest since at least August 2008, when the agents’ group began tracking the monthly figure.
CoreLogic Inc. last month estimated that about 1.8 million homes were delinquent or in foreclosure, a so-called “shadow inventory” set to add to the 3.5 million existing homes already on the market.
A glut of unsold properties may push prices down further, a disincentive for homebuilders to break ground on new homes.
A report from the Commerce Department yesterday showed builders began work on 549,000 houses at an annual rate in March, up from 512,000 the previous month. The increase followed a 19 percent plunge in February that was the biggest drop since 1984.
Homebuilders have underperformed the broader stock market. The Standard & Poor’s Supercomposite Homebuilder Index has gained 3.6 percent so far this year, compared with a 4.4 percent increase for the broader S&P 500 Index. (SPX)
“We do not anticipate a net profit for 2011,” Chief Executive Officer Jeffrey Mezger said during a conference call with analysts on April 5 pay day loans. “The economy is continuing to improve. Even so, this recovery has yet to include significant job growth and has not spilled over into housing.”
Builders overall are not optimistic. The National Association of Home Builders’ confidence fell to 16 this month, according to the group’s gauge released this week. A reading under 50 means a majority of builders view conditions as poor.
Bloomberg Survey ================================================================ Exist Exist Homes Homes Mlns MOM% ================================================================ Date of Release 04/20 04/20 Observation Period March March —————————————————————- Median 5.00 2.5% Average 5.01 2.6% High Forecast 5.40 10.7% Low Forecast 4.59 -5.9% Number of Participants 74 74 Previous 4.88 -9.6% —————————————————————- 4CAST Ltd. 5.05 3.5% ABN Amro Inc. 5.03 3.0% Action Economics 5.05 3.5% Aletti Gestielle SGR 5.00 2.5% Ameriprise Financial Inc 4.95 1.4% Banesto 5.40 10.7% Bank of Tokyo- Mitsubishi 4.95 1.4% Barclays Capital 5.05 3.5% BBVA 4.95 1.4% BMO Capital Markets 4.98 2.1% BNP Paribas 5.00 2.5% BofA Merrill Lynch Resear 5.00 2.5% Briefing.com 5.15 5.5% Capital Economics 5.00 2.5% CIBC World Markets 5.00 2.5% Citi 5.00 2.5% ClearView Economics 5.00 2.5% Commerzbank AG 5.00 2.5% Credit Agricole CIB 5.10 4.5% Credit Suisse 4.86 -0.4% Daiwa Securities America 4.75 -2.7% Danske Bank 5.00 2.5% DekaBank 5.00 2.5% Desjardins Group 5.05 3.5% Deutsche Bank Securities 5.00 2.5% Fact & Opinion Economics 5.00 2.5% First Trust Advisors 5.01 2.7% FTN Financial 5.00 2.5% Goldman, Sachs & Co. 4.59 -5.9% Helaba 5.00 2.5% HSBC Markets 5.10 4.5% Hugh Johnson Advisors 5.20 6.6% IDEAglobal 5.10 4.5% IHS Global Insight 4.93 1.0% Informa Global Markets 5.05 3.5% ING Financial Markets 5.00 2.5% Insight Economics 5.10 4.5% Intesa-SanPaulo 5.10 4.5% J.P. Morgan Chase 4.95 1.4% Janney Montgomery Scott L 4.96 1.6% Jefferies & Co. 5.15 5.5% Landesbank Berlin 5.00 2.5% Landesbank BW 5.03 3.1% Manulife Asset Management 4.95 1.4% Maria Fiorini Ramirez Inc 5.00 2.5% MET Capital Advisors 5.00 2.5% MF Global 4.93 1.0% Moody’s Analytics 5.08 4.1% Morgan Stanley & Co. 5.20 6.6% National Bank Financial 4.99 2.3% Natixis 4.98 2.1% Nomura Securities Intl. 5.00 2.5% OSK Group/DMG 4.95 1.4% Parthenon Group 4.88 0.0% Pierpont Securities LLC 5.00 2.5% PineBridge Investments 5.10 4.5% PNC Bank 5.00 2.5% Raiffeisenbank Internatio 5.00 2.5% Raymond James 5.00 2.5% RBC Capital Markets 4.80 -1.6% RBS Securities Inc. 5.15 5.5% Scotia Capital 5.10 4.5% Societe Generale 5.07 3.9% Standard Chartered 4.64 -5.0% State Street Global Marke 5.07 3.9% Stone & McCarthy Research 5.10 4.5% TD Securities 4.95 1.4% UBS 5.00 2.4% UniCredit Research 5.00 2.5% University of Maryland 5.00 2.5% Wells Fargo & Co. 4.98 2.1% WestLB AG 5.00 2.5% Westpac Banking Co. 5.08 4.0% Wrightson ICAP 5.05 3.5% ================================================================
To contact the reporter on this story: Timothy R. Homan in Washington at email@example.com
Nissan says it will fix a software glitch on 5,300 Leaf electric cars worldwide.
The company says owners of a small number of Leafs have reported that the car won’t start after they’ve turned it off.
About 500 Leafs sold in the U.S. are affected.
Nissan says dealers will reprogram the engine control computer. Owners will get a message on their car’s dashboard telling them to contact their dealer and they’ll also get letters. Spokesman Brian Brockman says dealers may even send someone to the owners’ homes or workplaces to fix the problem cash advance in one hour.
The company says there is no safety issue with the cars because they will not stop when they are running.
The battery-powered Leaf can go up to 100 miles on a single charge.
With rising oil prices and the possibility of a Tory majority, the future is looking brighter for northern Alberta
Japan’s revered emperor made his first trip Thursday to the disaster zone since the March 11 earthquake and tsunami destroyed much of the northeast coast and set off a crisis of radiation leaks at a flooded nuclear plant.
Emperor Akihito and Empress Michiko visited two evacuation shelters Thursday in Asahi city, about 86 kilometers (54 miles) east of Tokyo near the Pacific coast. The royal couple knelt on mats and spoke quietly with evacuees, who bowed deeply. Some wiped tears from their eyes.
Thirteen people died, and some 3,000 homes were damaged or destroyed in the city. The emperor and empress plan additional visits to other tsunami-affected areas in coming weeks. Overall, more than 26,000 people are believed to have died in the disaster, though only about 11,250 bodies have been recovered so far.
Nearly 140,000 people are still living in shelters after losing their homes or being advised to evacuate because of concerns about radiation leaking from the Fukushima Dai-ichi plant.
Although Japanese officials have insisted the situation at the crippled plant is improving, the crisis has dragged on, accompanied by a nearly nonstop series of mishaps and aftershocks of the 9.0-magnitude quake that have impeded work in clearing debris and restoring the plant’s disabled cooling systems.
The setbacks are angering and frustrating residents whose lives have been derailed by the crisis.
“I’m physically and mentally worn out,” said Yoshihisa Kato, a 66-year-old noodle shop owner in the town of Kawamata, which is about 28 miles (45 kilometers) northwest of the plant and in an area where officials have urged people to evacuate over radiation concerns.
“I’ve been going to funerals almost everyday because many elderly people in my neighborhood have died due to shocks and exhaustion,” said Kato, whose business has dried up as residents have fled the area.
Japan acknowledged this week that overall leaked radioactivity already has catapulted the crisis into the highest severity on an international scale, on a par with Chernobyl, though still involving only a tenth of the radioactivity emitted in that 1986 disaster.
Powered by WordPress