Beth Daniels had a big problem.
Orders were coming in for her "Around the Table" conversation games, so she ordered a lot of inventory. Then she and her husband, Tom Daniels, looked at each other. "How are we going to come up with the money for this?" she asked. "We were in crisis mode for sure."
Daniels found the answer in the Missouri Small Business Loan program, run by the state Department of Economic Development.
Daniels, of Eureka, invented a series of games consisting of questions printed on cards. They are designed to get conversations started, with questions such as "What’s the funniest hair style ever?" Or "What’s the one thing you can’t live without?" There are varieties for families, grandparents, teens, camps and buddies.
Daniels, an occupational therapist turned work-at-home entrepreneur, just landed a contract with Cracker Barrel restaurants, and she expects sales of over $100,000 this year. But she has to pay to produce the games before she can sell them.
The Missouri Small Business Loan program provides loans of $2,500 to $25,000 to companies with five or fewer employees. The state allocated $2 million for the program this year, and less than half of it has been lent.
Daniels got a $25,000 loan at 3 percent interest. Problem solved.
More information on the loan program can be found at http://ded.mo.gov.
Midland States Bank hired Jason M. Ramthun as vice president for commercial relationship management at its Chesterfield office.
He is responsible for overseeing the office’s commercial banking business, establishing long-term partnerships and providing financial advice to the bank and its commercial customers.
Ramthun joined Midland States Bank from First Bank, where he was a vice president for commercial lending.
He also has been a bank examiner for the Federal Reserve Bank of Chicago advance payday loans.
He is on the finance committee of Voices for Children and is a member of the St. Louis Sports Commission Associates, a group of local young professionals who volunteer to help the commission.
Loans to households and companies in Europe posted their second straight annual decline in October as the economic slump curtailed demand for credit and made banks more reluctant to lend.
Loans to the private sector fell 0.8 percent from a year earlier after a drop of 0.3 percent in September, the European Central Bank said today. On the month, loans slipped 0.2 percent. M3 money-supply growth, which the ECB uses as a gauge of future inflation, slowed to 0.3 percent in October, the lowest rate since records began in 1981, from 1.8 percent in September.
The economy of the 16-nation euro region resumed expansion in the third quarter after global trade boosted exports and government stimulus measures fueled domestic consumption. Still, growth is likely to remain muted unless credit flows improve and companies and households increase spending. The ECB has cut its benchmark interest rate to a record low of 1 percent and is flooding banks with cash in an effort to revive lending.
“The euro-zone recovery could be held back by a significant number of companies being unable to get the credit that they need,” said Howard Archer, chief economist at IHS Global Insight in London. Today’s data point to “very muted inflationary pressures” and “support the case for the ECB to only very gradually withdraw its emergency liquidity measures and to keep interest rates down at 1 percent until deep into 2010,” he said.
Weak Banks
While an ECB survey last month showed European banks expect to ease credit standards for companies in the fourth quarter after tightening them less aggressively in the third, it may take up to three years for lending to return to pre-crisis levels, according to Daiwa Securities SMBC Europe Ltd.
In Germany, Europe’s largest economy, banks may have to write off another 90 billion euros ($136 billion) on bad loans and securitization instruments, the Bundesbank said yesterday.
The world’s largest financial-services companies have racked up more than $1.7 trillion of losses and write-downs since the start of the financial crisis, according to Bloomberg data.
The euro-area economy will expand 0.7 percent in 2010 and 1.5 percent in 2011, after contracting 4 percent this year, the European Commission said on Nov. 3.
M1 Growth Slows
M1, which captures the most liquid form of money in the economy such as cash and overnight deposits, grew 11.8 percent in October from a year earlier, the ECB said, down from an annual increase of 12.8 percent in September.
The ECB has said it will “gradually” withdraw the additional liquidity it has pumped into the banking system as financial markets normalize and the economy strengthens. It has already signaled it is unlikely to offer banks 12-month loans next year after its third tender in December.
Economists don’t expect the ECB to raise interest rates until the third quarter of next year, a Bloomberg survey shows.
“From the real economy side, there’s no single reason why they should hike interest rates or even think about hiking interest rates,” said Carsten Brzeski, senior economist at ING Group in Brussels. “Economic growth is still too fragile.”
Spanish producer prices fell the least in six months in October as oil prices rose.
Prices of goods leaving Spain’s factories, mines and refineries declined 4.2 percent from a year earlier, the National Statistics Institute in Madrid said today, after a 5.4 percent drop in September. Prices were unchanged from the prior month, today’s report showed.
The price of crude oil rose 14 percent in the year to the end of October and traded at $76.94 today. Weak demand is still pulling producer prices lower as the Spanish economy contracted for a sixth quarter from July through September even as Germany, France and the euro region expanded.
Spanish consumer prices have been falling in annual terms since March, as inflation slows more sharply than in the euro region overall. The Spanish economy may contract 0.7 next year, the International Monetary Fund forecast on Oct. 1, while the euro area, the U.S. and the U.K. post full-year growth.
Industrial production in Spain decreased 12.5 percent from a year earlier in September, declining for a 17th month as companies reduced staff to weather the slump. Nissan Motor Co. cut production of cars and light trucks 57 percent in September from a year earlier, compared with a global decline of 8.5 percent, it said on Oct. 28.
Every weekday morning, as soon as I look through the overnight e-mails, I go to my bank’s bookmarked website and check that everything is in order with my checking, savings and credit card accounts.
People used to tease me about this habit, some telling me to get a life (or worse). But it turns out what I do — it took just 53 seconds this morning — is the advice now commonly given to consumers to avoid rising and irritating bank and credit card fees.
By always knowing the overall and available balances (and verifying that all deposits and debits are recorded properly and promptly), I’ve never bounced a check or incurred a bank overdraft fee or over-the-limit or late-payment credit card fee.
I’ve never paid "maintenance," "low-balance" or ATM fees. I have never paid credit card interest, because I always make sure there’s enough money in the bank to pay the balance in full.
For the five minutes a week it takes me to keep track of the account balances — and a couple of times, to spot errors and have them fixed — that’s a big payoff.
Consider, for instance, that the average "non-sufficient funds" or bounced-check bank fee rose to an average of $29.58 this year, according to an annual study by Bankrate.com, a bank-tracking, consumer oriented website.
Ostensibly to avoid such fees, many banks offer automatic "overdraft protection" programs that temporarily cover expenditures exceeding a customer’s available balance. But such programs can be costly.
In 2008, banks and credit unions collected nearly $24 billion in overdraft fees, 35 percent more than two years earlier, according to a study by the Center for Responsible Lending, a not-for-profit, nonpartisan group.
More than 50 million Americans overdraw their checking accounts at least once over a 12-month period, the Center estimates based on a Federal Deposit Insurance Corporation study, and 27 million incur five or more insufficient-funds or overdraft fees payday loans.
Americans also pay dearly for access to cash. The average fee for using an automated teller machine from another bank is $2.22, up 12.6 percent from 2008, Bankrate.com found. On top of that, your own bank is also likely to ding you with fees averaging $1.32 for using somebody else’s machine.
There’s more. "Service" charges for interest-bearing checking accounts falling below a minimum balance rose to a new average high of $12.25 a month. To avoid the charge, you need to maintain an average balance of $3,372.18. And the interest? "A miserable average yield of 0.12 percent," the Bankrate.com study said (at that rate, I calculated, your minimum balance would earn $4.05 in interest a year).
As to credit cards, late-payment and other fees have proliferated as card issuers prepare to meet requirement of federal legislation regulating interest rate increases.
I won’t get into whether banks and card issuers are gouging customers or simply trying to make an honest profit. I’ll focus on the practical, what consumers can do.
For starters, match your accounts to your needs. If it’s just simple checking, bill pay, ATM or debit card transactions, a non-interest paying but free checking account with no minimum balance and no per-check charges is best, Bankrate.com advises. Once you set up the right accounts, my suggestion is simple: Keep track of them (don’t forget debit card transactions that can cause an overdraft).
You don’t have to give up your "life" to do this. You just have to get a grip.
The number of first-time filers for unemployment insurance was unchanged last week, holding at the lowest level since January, said a government report released Thursday.
There were 505,000 initial jobless claims filed in the week ended Nov. 14, the same as the revised figure the previous week, the Labor Department said in a weekly report.
A consensus estimate of economists surveyed by Briefing.com expected 504,000 new claims.
The 4-week moving average of initial claims was 514,000, down 6,500 from the previous week’s revised average of 520,500.
"After two hefty declines, claims were due a pause this week," said Ian Shepherdson, economist at High Frequency Economics, in a research note.
"Even when the underlying trend is clear, claims tend not to run in the same direction week after week," Shepherdson added.
Claims are "heading in the right direction," Shepherdson said, and he believes employment will level off in the first half of next year — possibly as soon as the end of the first quarter.
Continuing claims: The government said 5,611,000 people filed continuing claims in the week ended Nov. 7, the most recent data available. That’s down 39,000 from the preceding week’s ongoing claims.
The 4-week moving average for ongoing claims fell by 83,500 to 5,711,500.
But the slide in continuing claims may signal that more filers are falling off those rolls and into extended benefits.
Continuing claims reflect people filing each week after their initial claim until the end of their standard benefits, which usually last 26 weeks. The figures do not include those who have moved to state or federal extensions, nor people who have exhausted their benefits.
State-by-state data: Only one state reported a decline in initial claims of more than 1,000 for the week ended Nov. 7, the most recent data available.
Claims in Florida fell by 1,915, which a state-supplied comment attributed to fewer layoffs in the construction, trade, service, manufacturing and agriculture sectors.
Eighteen states said that claims increased by more than 1,000. Michigan reported the most new claims with 6,001; New Jersey’s rose by 4,153; Pennsylvania saw a jump of 3,552; New York had 3,508 new claims; and Ohio’s increased by 3,292.
Wells Fargo Financial will close three stores on the Big Island and Kauai next week as part of a plan to consolidate its Hawaii operations.
The plan to close the Hilo, Kailua-Kona and Lihue stores is in response to the slow economy, a company spokesman said.
Customers on the Big Island and Kauai will be served by one of the company’s three remaining stores in Wailuku on Maui and in Aiea and Waipahu on Oahu.
The company, which offers home equity and auto loans and credit cards, has 40 employees in Hawaii low fee cash advance.
All of the employees on the Big Island and Kauai were offered the opportunity to transfer to one of the other Hawaii stores or the Mainland, the company said. Most chose to take the transfer offer, but seven employees turned it down and elected to receive a severance package, the company said.
Motor Trend magazine named the Ford Fusion mid-sized sedan as its 2010 Car of the Year on Tuesday. The award includes both the gas-only and hybrid versions of the Fusion.
This year’s Car of the Year was selected from among a field of 22 different cars all of which were newly introduced or, like the Fusion, substantially redesigned for the 2010 model year.
The Fusion was first introduced in 2006 but has been substantially upgraded and redesigned for the 2010 model year.
"It’s a credit to the [Ford] team to deliver a car in the hottest selling segment in the market and to make it absolutely competitive with the benchmarks," said Motor Trend editor-in-chief Angus McKenzie at an award presentation ceremony.
The benchmark cars in the mid-sized segment are generally considered to be the Toyota Camry and Honda Accord, which have been the two top-selling cars in America for years.
McKenzie praised the Fusion for the excellence of all versions of the car including the 4-cylinder, V6 and hybrid models.
"Another thing that impressed us was the attention to detail," McKenzie said cash til payday.
While the 2010 Fusion shares much of its engineering with the previous version, the car looked and felt like a completely new car, McKenzie said.
Motor Trend, one of the most influential automotive enthusiast magazines in the United States, also gives out SUV of the Year and Truck of the Year awards. The SUV of the Year was announced earlier with the award going to the 2010 Subaru Outback. The Truck of the Year will be announced in December.
Vehicles were judged on six different criteria: design, engineering, efficiency, safety, value and how well the vehicle fulfills its intended function.
The cars were put through track tests by Motor Trends editors. Then cars that were not eliminated in the track testing process were put through additional road tests.
Derrick Kuzak, Ford Motor Co. group vice president for product development credited the Fusion with "getting Ford back into the car market" in 2006 after the carmaker had become competitive only in large trucks and SUVs.
First Banks Inc., parent of First Bank and the eighth largest bank in St. Louis, lost another $91 million in the third quarter as bad loans kept piling up.
The quarterly loss brought losses for the year to date to $274 million, following a $287 million loss for 2008.
As of September, 8.8 percent of the bank’s loans had gone sour, up from 5.1 percent at the beginning of the year. The September bad-loan percentage was roughly double the number at banks that regulators consider First Bank’s peers.
The Clayton-based bank continued to suffer from its foray into the financing of housing development in California. The bank reported $402 million in troubled loans and foreclosed property in California and $109 million in Chicago. By contrast, bad loans in St. Louis were only $47 million.
St. Louis’ comparatively good record may be short-lived. The bank listed $198 million in "potential" problem loans in St. Louis, higher than its other regions. The count included two real estate construction loans worth $60 million, along with general business loans and real estate loans.
In phone interview, CEO Terrance McCarthy said there are a "couple of quarters to go" before the bank can stop putting aside large amounts of money to cover loans that won’t be repaid payday loan companies. The bank put aside $107 million to cover bad loans in the latest quarter. Such money comes directly from profits.
Losses continued to eat into capital. The parent company’s capital slipped below the level that regulators deem "well capitalized" into the "adequately capitalized" bracket. The First Bank subsidiary remained "well capitalized," but just barely.
First Banks raised more than $400 million in new capital as its troubles mounted last year and in January. That included $295 million from the federal government’s bank bailout fund and more than $100 million from the bank’s owner, Jim Dierberg and family.
The bank has been trying to shrink its way to greater soundness, selling off its banks in Chicago and Texas, the Adrian N. Baker & Co. insurance firm, and bank branches in Lawrenceville and Springfield, Ill. It has generally made a profit on those sales, which boosts capital.
Capital is measured as a percentage of a bank’s assets. By selling off assets, the bank improves its capital ratio, the key measure of soundness.
First Banks has $10.6 billion in assets.
Shares in Exxon Mobil Corp, the world’s largest publicly traded oil company, could rise more than 20 percent to $90 next year if energy prices increase as expected, Barron’s reported on Sunday.
Exxon shares have lagged rivals in the stock market rally this year, falling about 10 percent, but futures contracts anticipate higher energy prices next year that would be a major boost to the company, according to Barron’s November 16 edition.
The Irving, Texas-based company could earn $6.50 a share in 2010 if the higher oil and natural-gas prices materialize, compared to its expected 2009 profit of $4 a share, the newspaper said. Exxon earned a record $8.69 a share in 2008 when oil prices peaked.
Analysts have criticized Exxon for weak production growth, but it has an impressive record for getting a high return on its investments, according to Barron’s. It replaced more than 100 percent of its production in each of the last 15 years and, between 2004 and 2008, its finding costs of $7 a barrel on average were below its peers, Barron’s said.
In addition, Exxon has a relatively low dividend yield of 2.3 percent, which is below several of its rivals, but analysts estimate the dividend could rise another 5 percent or more in 2010, Barron’s reported.
Exxon shares closed at $72.47 on the New York Stock Exchange on Friday.
(Reporting by Elinor Comlay; Editing by Leslie Adler)
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