(Adds more details from U.S Treasury) By Alister Bull WASHINGTON, Nov 24 (Reuters) – The United States and India will establish a new economic partnership which U.S. Treasury Secretary Timothy Geithner will help formally launch in India early next year, the White House said on Tuesday. The new partnership aims to strengthen economic ties between the two nations and echoes the strategic economic dialogue Washington established with China in 2006. U.S. President Barack Obama, hosting his first state visit since taking office in January, earlier met Indian Prime Minister Manmohan Singh and said that the world’s largest democracy would be a key source for U.S. growth. “India will play a pivotal role in meeting the major challenges we face today. And this includes my top economic priority: creating good jobs with good wages for the American people,” he told a joint White House press conference. The Treasury said the new partnership represented “a significant elevation” of the existing bilateral economic relationship between the two countries. “India is an emerging global power and a country with which the United States has an increasingly important economic and financial relationship,” Geithner said in a statement. Representatives will meet annually at cabinet level, alternately in the United States and India, with working groups getting together throughout the year to push ahead on specific economic policy areas. The Chinese-U.S. forum, created by Obama’s predecessor George W. Bush, gathers twice a year. The United States had a modest $3.2 billion trade deficit with India in the year to September, compared with its $165.8 billion trade gap with China. Singh echoed Obama’s hope the two countries could build a mutually beneficial economic relationship. He said the transfer of advance technology could open doors for U.S. investment into fast-growing Indian markets. “The lifting of U.S. export controls on high technology exports to India will open vast opportunities for giant research and development efforts,” said Singh, after Obama reaffirmed that he intended to fully implement a civil nuclear agreement between the two nations. “It will enable U.S. industry to benefit from the rapid economic and technological transformation that is now underway in our country,” Singh said. (Editing by Alan Elsner ) ((See also USA-ECONOMY/INDIA (FACTBOX) [nN24299011])) ((+1-202-354-5820, email: alister.bull@thomsonreuters.com)) Read this articl e: UPDATE – U.S. and India agree on new economic partnership (at Reuters)

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By Paritosh Bansal NEW YORK (Reuters) – Deal advisers are searching hard for unorthodox ways to pull off mergers of healthy U.S. banks in the face of a gloomy prognosis for such transactions. As capital raisings and auctions of failed institutions dominate the U.S. banking sector, deal advisers said it also makes sense in some cases for strong banks to buy one another. The financial crisis, economic uncertainty and fears about asset quality have made it nearly impossible to go about doing bank deals as one would in normal times, these experts said. So some of the country’s roughly 8,200 banks and their advisers are putting on their creative hats to come up with deals that can account for factors such as future losses in a weak economy and doubts about a target’s assets. These structures could involve separating out bad assets, fixing payouts based on performance and even seeking some help from regulators. “These are all things that are being kicked around in different forms and fashions,” said Joseph Moeller, a managing director at investment bank Keefe, Bruyette & Woods. “These are theoretical things that have not been ironed out yet.” If a buyer doesn’t like certain parts of the seller’s loan portfolio, for instance, the deal could be structured so that the problem assets are separated out into another subsidiary, Moeller said. The subsidiary would then become part of the deal consideration depending on how the loan portfolio worked out, Moeller said. But he added that there are problems that need to be addressed in a situation like that: the subsidiary will have to be capitalized and someone will have to service the loans. Valuation of assets, particularly those related to commercial real estate, is still very much a subjective process, said Rob McCarthy, a senior director in Alvarez & Marsal’s transaction advisory group. “The sellers and the buyers will take their own independent views, which are often mismatched,” McCarthy said. “I don’t think the market’s found itself yet as far as commercial real estate goes,” he said. “That remains an impediment to pricing and structuring of deals.” Chip MacDonald, a financial institutions lawyer at Jones Day, said they had been working on some deals involving payouts depending on the performance of problem loan portfolios. But he added that some other structures such as those where the payout is based on earnings performance or includes clawbacks for future losses on loans are harder to put together. Once the banks are merged it is more difficult to isolate and track such performance measures. Some discussions also revolve around seeking help from regulators such as the Federal Deposit Insurance Corp for a potential deal involving an open bank.  Continued… See original here: Advisers get creative in quest for healthy bank M&A

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FOLSOM, Calif.–(BUSINESS WIRE)–During the Celebration of Miracles — a fund-raising event hosted by Friends of NICU ( www.friendsofnicu.org ) — Charlie Garrido made a most generous gift as he bid on a lithograph signed by the Rolling Stones. After submitting the winning bid, he quickly donated the item back so that it could be reauctioned and generate more money for the cause. “My initial thought was ‘Cool, I won!’ but then I remembered the parents and children,” said Mr. Garrido. “So, I donated my hard-fought Rolling Stones lithograph back so that it could be reauctioned and thought ‘now we are all winners!’” When the evening ended, over $34,000 had been raised to help families who are dealing with indescribable fear and strain while their babies are in the NICUs (neonatal intensive care units) of Mercy hospitals in the Sacramento region. “The Celebration of Miracles was a magical evening that no one will ever forget. The outpouring of support and contributions were amazing,” said Elanie Purkis, founder of Friends of NICU. “We shared tears and smiles and generally came together to help families.” Courtney Dempsey, reporter/anchor from Good Day Sacramento CW31 emceed the dinner program. Dr. Robert Kahle, director of the Mercy hospital NICUs delivered a heartfelt speech about the challenges families face. Social worker Gigi Eskin-Norman explained how Friends of NICU contributions help families, some of whom must drive three hours from the far northern communities like Redding and Red Bluff to be with their critically ill babies. ECO:LOGIC Engineering ( www.ecologic-eng.com ), an engineering and consulting firm that designs and manages water and wastewater projects in the Western United States, was the title sponsor. A silent auction and live auction were the primary fund-raising activities of the night. The top selling item was a 5-day luxury vacation in Chicago. Other sponsors include: Sponsors: ECO:LOGIC Engineering ( www.ecologic-eng.com ) Gold Country Media ( www.goldcountrymedia.com ) California Family Fitness ( www.californiafamilyfitness.com ) Community Neonatology of Sacramento Folsom OB-GYN, Dr. Jeffrey Cragun ( http://folsomobgyn.com ) Greater Sacramento Pediatrics Associates Goddard Claussen Strategic Advocacy ( www.goddardclaussen.com ) Mainstay Business Solutions ( www.mainstaybusiness.com ) Mercy Foundation ( www.supportmercyfoundation.org ) OnPointNetwork ( www.onpointnetwork.com ) In-kind donors and premium silent auction donors: A Tale of Two Truffles ( www.ataleoftwotruffles.com ) ADG Designs ( www.adgdesigns.net ) The Christian DeWild Band ( www.myspace.com/christiandewild ) Dawn Roberts Photography ( www.dawnrobertsphotography.com ) Exquisite Events & Entertainment ( http://exquisitedjs.com ) J Harrison Public Relations Group ( www.JHarrisonPR.com ) Luke Benton Productions ( www.productionstrategies.biz ) Paint All Night Studios ( www.paintallnightstudios.com ) Pottery World ( www.potteryworld.com ) Friends of NICU operates under the auspices of the Mercy Foundation, all of the money raised goes directly to the families who need help. There are no overhead or administrative fees for this entirely volunteer-run, nonprofit organization. Note: Photographs and interviews with founders, donors and NICU families available upon request. See the rest here: Friends of NICU Fund-raiser Nets Enough to Help 250 Families with Sick and Premature Babies in Mercy Hospitals (Business Wire)

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* Lower U.S. Q3 GDP lifts yen vs dollar * Firmer Ifo helps euro reverse earlier losses * U.S. consumer confidence higher than expected, (Recasts, updates prices, adds comment, U.S. data) By Gertrude Chavez-Dreyfuss NEW YORK, Nov 24 (Reuters) – The yen rose to six-week highs against the dollar on Tuesday, while the greenback climbed versus higher-yielding currencies after economic growth and consumer confidence data suggested a U.S. recovery could be slower and less robust than previously thought. The reports rekindled the safe-haven allure of both the dollar and yen and reduced appetite for riskier assets such as stocks and commodity currencies with higher yields such as the Australian and New Zealand dollars. Data on Tuesday indicated that the U.S. economy in the third quarter grew at a slower pace than previously thought, while a consumer confidence report still pointed to weak labor market sentiment. “The (consumer confidence) breakdown is less encouraging with the main components that broadly track PCE (in coincident fashion) generally weak,” said Alan Ruskin, chief currency strategist at RBS Global Banking and Markets in Stamford, Connecticut. “That includes the present situation numbers, and the labor market indicators that show jobs hard to get remaining at extraordinary high levels…This has…triggered profit-taking on short dollar exposure.” For U.S. consumer confidence report, see [ID:nN24300840]. The dollar fell to session lows against the yen at 88.36 JPY= , the lowest since early October, according to Reuters data. By mid-morning, the dollar was last at 88.44, down 0.6 percent on the day. The euro, meanwhile, was slightly down at $1.4964 EUR= , in choppy trading. Earlier it had gained versus the greenback as firmer-than-expected German sentiment survey offset concerns about the country’s banking sector. The euro, which has become one of the proxies for risk appetite, also had slipped earlier after data showed the U.S. economy grew 2.8 percent, lower than the government’s first estimate of a 3.5 percent growth rate a month ago. The figure was also slightly lower than market forecasts. For GDP data, click on [ID:nN23258482]. “This number is slightly negative for risk appetite because of the downgrade in the personal consumption number. But overall, this is an old number and it should have limited impact going forward,” said Jacob Oubina, senior currency strategist at Forex.com in Bedminster, New Jersey. In line with the market’s diminished market appetite, the Australian dollar fell 0.6 percent to US$0.9180 AUD= , while the New Zealand dollar slid more than 1 percent to US$0.7252 NZD= . (Editing by Diane Craft)) ((gertrude.chavez@thomsonreuters.com; +1 646 223 6322; Reuters Messaging: gertrude.chavez.reuters.com@reuters.net)) The rest is here: FOREX-Yen rises to 6-wk high vs dollar; high-yielders fall (at Reuters)

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By Frank Pingue TORONTO (Reuters) – The Canadian dollar was lower versus the U.S. currency on Tuesday, hurt by a weaker oil price and soft equity markets, but some upbeat overseas data helped it bounce off an overnight low. Overnight the Canadian currency fell as low as C$1.0645 to the U.S. dollar, or 93.94 U.S. cents, on the heels of a rally on Monday that snapped four-session skid in the currency. It staged a rebound when a German business sentiment survey came in better than expected, reaching its highest level since August 2008, to offset concerns about the country’s banking sector. “The report came out stronger than expected and essentially caused a nice little rally in the euro which in turn generated some broader-based U.S. dollar weakness,” said George Davis, chief technical strategist at RBC Capital Markets. “Since then we’ve really been in a bit of a holding pattern where the market seems a little bit unsure as to whether it wants to try and continue to move lower or start to break back to the topside.” At 9:30 a.m. EST, the Canadian unit was at C$1.0584 to the U.S. dollar, or 94.48 U.S. cents, down from C$1.0558 to the U.S. dollar, or 94.71 U.S. cents, at Monday’s close. The price of oil, a major Canadian export, dropped below $77 a barrel on Tuesday ahead of data expected to show crude inventories rose in the United States. With no major Canadian data due until Friday’s currency account report for the third quarter, investors are expected to shift their focus to the U.S. Federal Reserve, which will release minutes of its November 3-4 meeting at 2:00 p.m. Markets will look at the report for hints on when and how the Fed will draw down extraordinary economic support measures. The minutes also include economic projections. “People will be watching that for any clues as to what the Fed’s insight is into the economy as things unfold here,” said Davis. “It will certainly garner some interest but I think in terms of broader themes people will continue to focus on the equity markets.” Toronto’s main stock index was lower shortly after the opening bell on Tuesday as strength in banking stocks stemming from firm Bank of Montreal quarterly results were not enough to offset weakness in the weighty commodity-based groups. Domestic bond prices were a touch higher across the curve as data that showed the U.S. economy grew slower than initially thought in the third quarter triggered demand for more secure assets like government debt. In its second reading of third-quarter GDP, the Commerce Department said the U.S. economy grew at a 2.8 percent annual rate, rather than the 3.5 percent pace it had estimated last month. In issuance news, the province of Ontario will sell at least 1 billion euros of a new 10-year benchmark bond, according to IFR, a Thomson Reuters service. The two-year bond was up 3 Canadian cents at C$100.03 to yield 1.235 percent, while the 10-year bond rose 7 Canadian cents to C$103.15 to yield 3.360 percent. (Editing by Jeffrey Hodgson) See the rest here: Dollar softer as oil dips, bounces from overnight low

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‘Tis the season to take cheap shots at other pundits, it would seem. Let’s see. You’ve got Peter Schiff and Niall Ferguson vs. Roubini . You’ve got David Rosenberg throwing haymakers at cheery Jim Paulsen. And you’ve got Raymond Jamess strategist Jeff Saut, who in his latest letter wrote: The call for this week: As the S&P 500 traded out to new reaction “highs” in the first part of last week we heard a cacophony of crybabies. First was Meredith Whiney, banking analyst now turned strategist, who stated, “I have not been this bearish in over a year!” One-upping her was Nouriel Roubini who exclaimed, “The worst is yet to come.” Then there was Timothy Geithner’s statement that, “I can’t take responsibility for the legacy of crises you (read: Republicans) bequeathed the country.” While I think Tim Geithner has done a really good job, excuse me Mr. Secretary but wasn’t it you that resided over NY Fed as President from 2003 through January 2009, which also brings the privilege of being Vice-Chairman of the FOMC? Accordingly, it was you who served as regulator of the country’s large financial institutions. Thus, it was on your watch that the big banks ran amok. Despite such cantankerous cries, we have indeed entered the strongest seasonality of the year and we remain constructive. As the sagacious Bespoke Investment Group writes, “Since 1941, the Dow has averaged a gain of 0.50% in the week before Thanksgiving.” That said, we would not like to see the S&P 500 break below 1083. And speaking of breaking down, the Japanese stock market is breaking down and we are close to “uncle points” on those recommendations. View original post here: Saut: Market Keeps Pushing Higher Despite A “Cacophany Of Crybabies”

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MOSCOW and NEW YORK, Nov. 24 /PRNewswire-FirstCall/ – Open Joint Stock Company “Vimpel-Communications” (”VimpelCom” or the “Company”) (NYSE: VIP – News ), a leading international provider of telecommunications services operating in Russia, the Commonwealth of Independent States (CIS) and South-East Asia, today announced its financial and operating results for the quarter ended September 30, 2009. Third Quarter 2009 Highlights and Recent Developments Operational Mobile subscribers increased by 1.7 million versus 2Q09, reaching 65.4 million Successful launch of operations in Vietnam under Beeline brand Agreement signed to enter Laos mobile market 3G presence in all regions of Russia as of November 21, 2009 Financial Net operating revenues reached 71.3 billion Russian rubles, an increase of 3.3% versus 2Q09 OIBDA reached a record 36.0 billion rubles, an increase of 2.9% versus 2Q09 Continued strong consolidated fixed and mobile OIBDA margin of 50.4% Net income attributable to VimpelCom amounted to 13.5 billion rubles Other Interim dividend payment of 190.13 rubles per common share proposed by the Board of Directors Major shareholders agreed to combine their stakes in VimpelCom and Kyivstar in a new company Commenting on the performance of the Company, Boris Nemsic, Chief Executive Officer of VimpelCom, said, “During the third quarter we continued to demonstrate growth in challenging market conditions and delivered a record 71.3 billion rubles in revenues and 36.0 billion rubles in OIBDA with a consolidated fixed and mobile OIBDA margin of 50.4%. We are particularly pleased with the OIBDA performance which demonstrates our ability to increase revenues and control costs in the new economic environment. The number of active mobile subscribers reached 65.4 million, which is 13% more than we had a year ago. We serve 1.9 million fixed and mobile broadband subscribers, which makes us one of the largest broadband providers in Russia and the CIS. Stable operational cash flow strengthened our financial position. As of today, we have repaid more than $2 billion dollars of our debt and fully funded capital expenditures. We continue to optimize our debt portfolio with the non-ruble portion of our debt decreasing to 76% of our total debt, compared with 85% at the beginning of the year. On October 5th, 2009, Altimo and Telenor agreed to combine their interests in VimpelCom and Kyivstar, paving the way for the creation of one of the largest telecom operators in the emerging markets. Management of VimpelCom welcomes this transaction and believes that the transaction, when completed, will bring benefits to our shareholders, employees and customers.” Key Consolidated Financial and Operating Results* CONSOLIDATED OPERATIONS* (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————— —— —— —– —— —– Net operating revenues 71,338 68,933 3.5% 69,035 3.3% ———————- —— —— — —— — OIBDA 35,980 33,636 7.0% 34,958 2.9% —– —— —— — —— — OIBDA margin, % 50.4% 48.8% 50.6% ————— —- —- —- Operating income 22,299 21,568 3.4% 22,250 0.2% —————- —— —— — —— — Operating income margin, % 31.3% 31.3% 32.2% ————————– —- —- —- SG&A 18,760 18,167 3.3% 18,458 1.6% —- —— —— — —— — including Sales & Marketing Expenses 5,766 5,867 -1.7% 5,414 6.5% ——————- —– —– —- —– — including General & Administrative Costs 12,994 12,300 5.6% 13,044 -0.4% ——————— —— —— — —— —- SG&A percentage 26.3% 26.4% 26.7% ————— —- —- —- Net income attributable to VimpelCom 13,513 6,513 107.5% 22,599 -40.2% ————————– —— —– —– —— —– Net income attributable to VimpelCom per common share, basic (RUR) 266.83 128.68 446.43 ————————– —— —— —— Net income attributable to VimpelCom per ADS equivalent, basic (RUR) 13.34 6.43 22.32 ————————– —– —- —– Capital expenditures 3,842 16,799 -77.1% 5,027 -23.6% ——————– —– —— —– —– —– Mobile subscribers (’000) 65,358 57,758 13.2% 63,676 2.6% ————————- —— —— —- —— — Broadband subscribers*) (’000) 1,930 785 145.9% 1,739 11.0% ———————– —– — —– —– —- * See definitions in Attachment A. Y-o-y stands for 3Q09 vs. 3Q08 comparison while q-o-q stands for 3Q09 vs. 2Q09. Net operating revenues 3Q ‘09* Russia CIS SEA Eliminations Total (RUR, millions) —— — — ———— —– ————— Mobile business 51,502 9,221 74 -138 60,659 ————— —— —– — —- —— Fixed business 13,583 2,167 0 -608 15,142 ————– —— —– — —- —— Eliminations -3,874 -312 0 -277 -4,463 ———— —— —- — —- —— Total net operating revenue 61,211 11,076 74 -1,023 71,338 ————————— —— —— — —— —— * Due to the increasing integration between different parts of our business, we include inter-company transactions in the reported revenues of geographic and business segments and indicate the amount of inter-company eliminations within and between the segments. The quarterly net operating revenues increased by 3.5% year-on-year and 3.3% as compared with the previous quarter demonstrating the strength of our core business. Continued focus on operational efficiency helped us to maintain a strong consolidated fixed and mobile OIBDA margin of 50.4%. We continue to maintain solid operational cash flow, which provides a basis for further investment in the development of our business. We invested 3.8 billion rubles during the third quarter of 2009. Taking into consideration the further strengthening of the Russian ruble, we have recalculated our CAPEX guidance for 2009 and expect CAPEX to be in the range of 10%-12% of our 2009 annual revenue. During the third quarter we repaid $690 million of debt. Our net debt continued to decline from $6.3 billion at the end of the second quarter down to $5.5 billion at the end of the third quarter. Our quarterly net income attributable to VimpelCom amounted to 13.5 billion rubles, including a modest 0.7 billion ruble net foreign exchange gain due to the strengthening of the ruble. Russia – Financial and Operating Results RUSSIA (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————- —— —— —– —— —– Net operating revenues 61,211 58,816 4.1% 59,136 3.5% ———————- —— —— — —— — OIBDA 30,951 29,457 5.1% 30,279 2.2% —– —— —— — —— — OIBDA margin, % 50.6% 50.1% 51.2% ————— —- —- —- Operating income 20,724 20,112 3.0% 20,574 0.7% —————- —— —— — —— — Operating income margin, % 33.9% 34.2% 34.8% ———————— —- —- —- SG&A 15,644 15,191 3.0% 15,417 1.5% —- —— —— — —— — including Sales & Marketing Expenses 4,940 4,918 0.4% 4,726 4.5% ——————- —– —– — —– — including General & Administrative Costs 10,704 10,273 4.2% 10,691 0.1% ——————— —— —— — —— — SG&A percentage 25.6% 25.8% 26.1% ————— —- —- —- Net income attributable to VimpelCom 13,754 6,274 119.2% 21,835 -37.0% ———————– —— —– —– —— —– Our quarterly net operating revenues in Russia amounted to 61.2 billion rubles, growing 3.5% quarter-on-quarter. The quarterly net operating revenues in Russia grew 4.1% compared to the exceptionally strong third quarter of 2008, when we reported high revenues from roaming and handset sales. The total Russia fixed and mobile OIBDA increased 5.1% year-on-year and reached 30.9 billion rubles with a total fixed and mobile OIBDA margin of 50.6%. In the mobile segment our revenues increased by 4.2% quarter-on-quarter. Slight upward trends in usage coupled with a seasonal increase from roaming led to an increase in ARPU of 2.8%. Our fixed-line revenues increased by 4.4% quarter-on-quarter. A seasonal decline in the usage by business customers during the summer months was offset by increasing wholesale revenues, which grew by 13.3% quarter-on-quarter. The fixed-line OIBDA margin decreased quarter-on-quarter from 29.6% to 26.4%. As a result the quarterly fixed-line revenues were also impacted by the appreciation of the Russian ruble as part of our contracts in the business segment are denominated in US dollars and Euro. In the third quarter of 2009 the total number of residential broadband subscribers in Russia, including FTTB and mobile broadband, reached 1.8 million, a 140% increase year-on-year and a 10% increase quarter-on-quarter. RUSSIA REVENUES (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————————- —— —— —– —— —– Net operating revenues 61,211 58,816 4.1% 59,136 3.5% ———————- —— —— — —— — Mobile revenues 51,502 49,401 4.3% 49,410 4.2% ————— —— —— — —— — Fixed revenues 13,583 10,789 25.9% 13,007 4.4% ————– —— —— —- —— — Eliminations -3,874 -1,374 -3,281 ———— —— —— —— RUSSIA OIBDA DEVELOPMENT*) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q (RUR, millions) —— —— —– —— —– ————— OIBDA Total 30,951 29,457 5.1% 30,279 2.2% ———– —— —— — —— — Mobile OIBDA 27,360 26,772 2.2% 26,427 3.5% ———— —— —— — —— — Fixed OIBDA 3,591 2,685 33.7% 3,852 -6.8% ———– —– —– —- —– —- Total OIBDA margin, % 50.6% 50.1% 51.2% ——————— —- —- —- Mobile OIBDA margin, % 53.1% 54.2% 53.5% ———————- —- —- —- Fixed OIBDA margin, % 26.4% 24.9% 29.6% ——————— —- —- —- RUSSIA OPERATING DEVELOPMENT 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q —————————- —— —— —– —— —– Mobile subscribers (’000)**) 51,028 45,093 13.2% 49,971 2.1% —————————- —— —— —- —— — MOU, min 213.6 228.5 -6.5% 211.8 0.8% ——– —– —– —- —– — ARPU mobile, (RUR) 331.4 368.2 -10.0% 322.5 2.8% —————— —– —– —– —– — Broadband subscribers (’000) 1,833 764 139.9% 1,659 10.5% —————————- —– — —– —– —- * Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ32009.xls on our website at http://www.vimpelcom.com/news/qrep.wbp . ** Starting with this quarterly report, we no longer provide information on subscriber market share. This is because different churn policies used by mobile service providers result in reported subscriber market share figures that could be misleading. CIS – Financial and Operating Results CIS OPERATIONS (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————– —— —— —– —— —– Net operating revenues 11,076 10,663 3.9% 10,668 3.8% ———————- —— —— — —— — OIBDA 5,322 4,232 25.8% 4,908 8.4% —– —– —– —- —– — OIBDA margin, % 48.0% 39.7% 46.0% ————— —- —- —- Operating income 2,056 1,509 36.2% 1,929 6.6% —————- —– —– —- —– — Operating income margin, % 18.6% 14.2% 18.1% ———————— —- —- —- SG&A 2,851 2,945 -3.2% 2,844 0.2% —- —– —– —- —– — including Sales & Marketing Expenses 748 949 -21.2% 633 18.2% ——————- — — —– — —- including General & Administrative Costs 2,103 1,996 5.4% 2,211 -4.9% ——————— —– —– — —– —- SG&A percentage 25.7% 27.6% 26.7% ————— —- —- —- Net income attributable to VimpelCom 86 323 -73.4% 841 -89.8% ———————– — — —– — —– Mobile subscribers (’000) 14,235 12,665 12.4% 13,626 4.5% ————————- —— —— —- —— — Broadband subscribers (’000) 97 21 361.9% 80 21.3% ——————— — — —– — —- The total quarterly revenues from the CIS markets increased year-on-year by 3.9% to 11.1 billion rubles. Our continued focus on cost control increased consolidated OIBDA margin for the CIS segment by 2 percentage points to a record high of 48.0%, a remarkable achievement in challenging market conditions. In the third quarter of 2009, we observed a good increase in subscriber numbers across all markets where we operate. Our subscriber base in the CIS reached 14.2 million active users, 12.4% more than a year ago. Net income attributable to VimpelCom in the CIS segment reached 86 million rubles in the third quarter, with a modest impact from the foreign exchange gain as compared with the second quarter of 2009. CIS Revenues Development KAZAKHSTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– Net operating revenues 5,387 4,815 11.9% 5,061 6.4% ———————- —– —– —- —– — Mobile 5,311 4,750 11.8% 4,988 6.5% —— —– —– —- —– — Fixed 211 146 44.5% 190 11.1% —– — — —- — —- Elimination -135 -81 -117 ———– —- — —- Net operating revenues (KZT, millions) 25,928 23,830 8.8% 23,679 9.5% —————————- —— —— — —— — UKRAINE (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– Net operating revenues 1,773 2,283 -22.3% 1,645 7.8% ———————- —– —– —– —– — Mobile 1,066 1,653 -35.5% 956 11.5% —— —– —– —– — —- Fixed 879 787 11.7% 800 9.9% —– — — —- — — Elimination -172 -157 -111 ———– —- —- —- Net operating revenues (UAH, millions) 442 456 -3.1% 390 13.3% —————————- — — —- — —- ARMENIA (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– Net operating revenues 1,611 1,667 -3.4% 1,584 1.7% ———————- —– —– —- —– — Mobile 637 764 -16.6% 634 0.5% —— — — —– — — Fixed 974 903 7.9% 950 2.5% —– — — — — — Elimination 0 0 0 ———– — — — Net operating revenues (AMD, millions) 19,167 20,786 -7.8% 18,253 5.0% —————————- —— —— —- —— — UZBEKISTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– Net operating revenues 1,568 1,416 10.7% 1,693 -7.4% ———————- —– —– —- —– —- Mobile 1,467 1,345 9.1% 1,594 -8.0% —— —– —– — —– —- Fixed 103 71 45.1% 100 3.0% —– — — —- — — Elimination -2 0 -1 ———– — — — Net operating revenues (US$, millions) 50 58 -13.8% 53 -5.7% —————————- — — —– — —- TAJIKISTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– Mobile net operating revenues 468 358 30.7% 461 1.5% —————————– — — —- — — Mobile net operating revenues (US$, millions) 14.9 14.8 0.7% 13.7 8.8% —————————– —- —- — —- — GEORGIA (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– Mobile net operating revenues 279 131 113.0% 229 21.8% —————————– — — —– — —- Mobile net operating revenues (GEL, millions) 14.9 7.6 96.1% 11.8 26.3% —————————– —- — —- —- —- CIS (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————- —— —— —– —— —– Net operating revenues 11,076 10,663 3.9% 10,668 3.8% ———————- —— —— — —— — Mobile 9,221 8,999 2.5% 8,859 4.1% —— —– —– — —– — Fixed 2,167 1,907 13.6% 2,040 6.2% —– —– —– —- —– — Elimination -312 -243 -231 ———– —- —- —- CIS OIBDA Development* KAZAKHSTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– OIBDA total 3,187 2,573 23.9% 2,745 16.1% ———– —– —– —- —– —- Mobile 3,064 2,495 22.8% 2,643 15.9% —— —– —– —- —– —- Fixed 123 78 57.7% 102 20.6% —– — — —- — —- OIBDA margin, % 59.2% 53.4% 54.2% ————— —- —- —- UKRAINE (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– OIBDA total 380 -40 n/a 322 18.0% ———– — — — — —- Mobile 140 -215 n/a 82 70.7% —— — —- — — —- Fixed 240 175 37.1% 240 0.0% —– — — —- — — OIBDA margin, % 21.4% n/a 19.6% ————— —- — —- ARMENIA (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– OIBDA total 825 813 1.5% 799 3.3% ———– — — — — — Mobile 306 337 -9.2% 298 2.7% —— — — —- — — Fixed 519 476 9.0% 501 3.6% —– — — — — — OIBDA margin, % 51.2% 48.8% 50.4% ————— —- —- —- UZBEKISTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– OIBDA total 738 798 -7.5% 865 -14.7% ———– — — —- — —– Mobile 696 774 -10.1% 825 -15.6% —— — — —– — —– Fixed 42 24 75.0% 40 5.0% —– — — —- — — OIBDA margin, % 47.1% 56.4% 51.1% ————— —- —- —- TAJIKISTAN (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ————————– —— —— —– —— —– Mobile OIBDA 162 115 40.9% 173 -6.4% ———— — — —- — —- Mobile OIBDA margin, % 34.6% 32.1% 37.5% ———————- —- —- —- GEORGIA (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– Mobile OIBDA 30 -27 n/a 4 650.0% ———— — — — — —– Mobile OIBDA margin, % 10.8% n/a 1.7% ———————- —- — — CIS (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————- —— —— —– —— —– OIBDA total 5,322 4,232 25.8% 4,908 8.4% ———– —– —– —- —– — Mobile 4,398 3,479 26.4% 4,025 9.3% —— —– —– —- —– — Fixed 924 753 22.7% 883 4.6% —– — — —- — — OIBDA margin, % 48.0% 39.7% 46.0% ————— —- —- —- * Please find information on respective operating income amounts in the supplementary file FinancialOperatingQ32009.xls on our website at http://www.vimpelcom.com/news/qrep.wbp. CIS Operating Highlights KAZAKHSTAN 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———- —— —— —– —— —– Mobile subscribers*) (’000) 6,835 5,614 21.7% 6,635 3.0% ————————— —– —– —- —– — MOU, min 98.1 108.1 -9.3% 90.7 8.2% ——– —- —– —- —- — ARPU mobile, (RUR) 257.9 294.1 -12.3% 253.6 1.7% —————— —– —– —– —– — ARPU mobile, (KZT) 1,240.7 1,455.4 -14.8% 1,187.1 4.5% —————— ——- ——- —– ——- — Broadband subscribers (’000) 0.3 n/a 0.3 0.0% —————————- — — — — UKRAINE 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——- —— —— —– —— —– Mobile subscribers*) (’000) 2,199 2,403 -8.5% 1,934 13.7% ————————— —– —– —- —– —- MOU, min 203.7 261.5 -22.1% 217.8 -6.5% ——– —– —– —– —– —- ARPU mobile, (RUR) 168.3 234.9 -28.4% 166.8 0.9% —————— —– —– —– —– — ARPU mobile, (UAH) 42.0 47.4 -11.4% 39.7 5.8% —————— —- —- —– —- — Broadband subscribers (’000) 70 16 337.5% 53 32.1% —————————- — — —– — —- ARMENIA 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——- —— —— —– —— —– Mobile subscribers*) (’000) 502 784 -36.0% 486 3.3% ————————— — — —– — — MOU, min 269.0 139.9 92.3% 238.4 12.8% ——– —– —– —- —– —- ARPU mobile, (RUR) 429.7 336.9 27.5% 436.9 -1.6% —————— —– —– —- —– —- ARPU mobile, (AMD) 5,117.2 4,200.1 21.8% 5,034.7 1.6% —————— ——- ——- —- ——- — Broadband subscribers (’000) 18.1 5.4 235.2% 19.2 -5.7% —————————- —- — —– —- —- UZBEKISTAN 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———- —— —— —– —— —– Mobile subscribers*) (’000) 3,652 3,148 16.0% 3,605 1.3% ————————— —– —– —- —– — MOU, min 409.3 298.5 37.1% 225.6 81.4% ——– —– —– —- —– —- ARPU mobile, (RUR) 140.7 157.5 -10.7% 150.6 -6.6% —————— —– —– —– —– —- ARPU mobile, (US$) 4.5 6.5 -30.8% 4.7 -4.3% —————— — — —– — —- Broadband subscribers (’000) 8.3 n/a 7.6 9.2% —————————- — — — — TAJIKISTAN 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———- —— —— —– —— —– Mobile subscribers*) (’000) 706 527 34.0% 677 4.3% ————————— — — —- — — MOU, min 173.3 255.9 -32.3% 173.1 0.1% ——– —– —– —– —– — ARPU mobile, (RUR) 224.1 250.7 -10.6% 221.6 1.1% —————— —– —– —– —– — ARPU mobile, (US$) 7.2 10.4 -30.8% 6.9 4.3% —————— — —- —– — — GEORGIA 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——- —— —— —– —— —– Mobile subscribers*) (’000) 341 189 80.4% 289 18.0% ————————— — — —- — —- MOU, min 129.3 109.8 17.8% 123.1 5.0% ——– —– —– —- —– — ARPU mobile, (RUR) 288.5 238.9 20.8% 283.6 1.7% —————— —– —– —- —– — ARPU mobile, (GEL) 15.4 14.0 10.0% 14.5 6.2% —————— —- —- —- —- — * Starting with this quarterly report, we no longer provide information on subscriber market share. This is because different churn policies used by mobile service providers result in reported subscriber market share figures that could be misleading. South-East Asia Cambodian operations have been actively developing since our launch in May 2009. As of the third quarter of 2009, our services are available in the 17 largest provinces reaching 42% of the country’s population. By the end of 2009, we plan to expand coverage to reach more than two thirds of the country’s population. According to the latest independent research Beeline brand awareness was ranked third among 9 mobile operators in Cambodia with brand awareness at 62% on a country-wide level and 98% in the capital. Two months after the network launch in Vietnam, our networks cover the capital and the two largest cities as well as the 8 most populated provinces. By the end of January 2010, we plan to cover more than 40 provinces of Vietnam with a population of about 41 million. Our distribution network in Vietnam was extended to more than 10,000 points of sales including traditional retail outlets and new channels like Branded Trade Counters. According to the latest independent research, in the three largest cities of Vietnam the Beeline brand has reached 80% awareness level among the 15-65 year-old audience. SEA*) (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————— —— —— —– —— —– Net operating revenues 74 0 n/a 28 164.3% ———————- — — — — —– OIBDA total -234 -4 n/a -174 n/a ———– —- — — —- — *) See definitions in Attachment A. For more information on financial and operating data for specific countries, please refer to the supplementary file FinancialOperatingQ32009.xls on our website at http://www.vimpelcom.com/news/qrep.wbp. The Company’s management will discuss its third quarter 2009 results during a conference call and slide presentation on November 24, 2009 at 6:30 pm Moscow time (10:30 am US ET). The call and slide presentation may be accessed via webcast at the following URL address http://www.vimpelcom.com . The conference call replay will be available through December 1, 2009. The slide presentation webcast will also be available for download on VimpelCom’s website http://www.vimpelcom.com . The VimpelCom Group consists of telecommunications operators providing voice and data services through a range of mobile, fixed and broadband technologies. The Group includes companies operating in Russia, Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Georgia, Armenia, as well as Vietnam and Cambodia, in territories with a total population of about 340 million. VimpelCom was the first Russian company to list its shares on the New York Stock Exchange (”NYSE”). VimpelCom’s ADSs are listed on the NYSE under the symbol “VIP”. This press release contains “forward-looking statements”, as the phrase is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements relate to the proposed combination with Kyivstar and its benefits, the Company’s 2009 capital expenditures and the Company’s development plans in Cambodia and Vietnam. These and other forward-looking statements are based on management’s best assessment of the Company’s strategic and financial position and of future market conditions and trends. These discussions involve risks and uncertainties. The actual outcome may differ materially from these statements as a result of continued volatility in the economies in the markets in which the Company operates, unforeseen developments from competition, governmental regulation of the telecommunications industries, general political uncertainties in the markets in which the Company operates and/or litigation with third parties. The actual outcome may also differ materially if the Company is unable to obtain all necessary corporate approvals relating to its business, if the Company is unable to successfully integrate newly-acquired businesses, including Golden Telecom, and other factors. There can be no assurance that such risks and uncertainties will not have a material adverse effect on the VimpelCom Group. Certain factors that could cause actual results to differ materially from those discussed in any forward-looking statements include the risks described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2008 and other public filings made by the Company with the United States Securities and Exchange Commission, which risk factors are incorporated herein by reference. VimpelCom disclaims any obligation to update developments of these risk factors or to announce publicly any revision to any of the forward-looking statements contained in this release, or to make corrections to reflect future events or developments. IMPORTANT NOTICE: The proposed exchange offer described in this communication has not yet commenced, and the description of the proposed exchange offer contained in this communication is not an offer to buy or the solicitation of an offer to sell securities. If the proposed exchange offer is commenced, the Company expects that VimpelCom Ltd. will file with the SEC a registration statement and other related materials with respect to the proposed exchange offer, and the Company will file with the SEC a solicitation/recommendation statement on Schedule 14D-9 with respect to the proposed exchange offer. Investors and shareholders are urged to read the registration statement and other related materials, the solicitation/recommendation statement on Schedule 14D-9 and any amendments, exhibits or other applicable documents regarding the proposed exchange offer if and when they become available because they will contain important information. Those materials will be made available to the Company’s shareholders at no expense to them. In addition, all of those materials (and all other exchange offer documents filed with the SEC) will be made available at no charge on the SEC’s website at www.sec.gov . – Definitions and tables are attached – Attachment A: Definitions Mobile subscribers are those subscribers in the registered subscriber base who were a party to a revenue generating activity in the past three months and remain in the base at the end of the reported period, except for the subscriber base in Cambodia which is calculated on a one month basis. Such activities include all incoming and outgoing calls, subscriber fee accruals, debits related to service, outgoing SMS, MMS, data transmission and receipt sessions, but do not include incoming SMS and MMS sent by our Company or abandoned calls. Total number of mobile subscribers also includes subscribers using mobile internet service via USB modems. Each ADS represents 0.05 of one share of common stock. This ratio was established effective August 21, 2007. ARPU (Monthly Average Revenue per User), a non-U.S. GAAP financial measure, is calculated by dividing the Company’s service revenue during the relevant period, including roaming revenue and interconnect revenue, but excluding revenue from connection fees, sales of handsets and accessories and other non-service revenue, by the average number of the Company’s subscribers during the period and dividing by the number of months in that period. The Company believes that ARPU provides useful information to investors because it is an indicator of the performance of the Company’s business operations and assists management in budgeting. The Company also believes that ARPU provides management with useful information concerning usage and acceptance of the Company’s services. ARPU should not be viewed in isolation or an alternative to other figures reported under U.S. GAAP. Broadband subscribers are those subscribers in the registered subscriber base who were a party to a revenue generating activity in the past three months. Such activities include monthly internet access using FTTB, xDSL and WiFi technologies as well as mobile internet service via USB modems. CIS Geographic Segment for the purpose of VimpelCom reporting includes our operations in the following countries: Kazakhstan, Ukraine, Uzbekistan, Tajikistan, Armenia and Georgia Fixed-line subscriber is an authorized user of fixed-line communications services. General and administrative costs (G&A) include salaries and outsourcing costs, including related social contributions required by Russian law; stock price-based compensation expenses; repair and maintenance expenses; rent, including lease payments for base station sites; utilities; other miscellaneous expenses, such as insurance, operating taxes, license fees, and accounting, audit and legal fees. Households passed are households located within buildings, in which indoor installation of all the FTTB equipment necessary to install terminal residential equipment has been completed. Mobile services are wireless voice and data transmission services excluding WiFi. MOU (Monthly Average Minutes of Use per User) is calculated by dividing the total number of minutes of usage for incoming and outgoing calls during the relevant period (excluding guest roamers) by the average number of mobile subscribers during the period and dividing by the number of months in that period. OIBDA is a non-U.S. GAAP financial measure. OIBDA, previously referred to as EBITDA by the Company, is defined as operating income before depreciation, amortization and impairment loss. The Company believes that OIBDA provides useful information to investors because it is an indicator of the strength and performance of our business operations, including our ability to finance capital expenditures, acquisitions and other investments and our ability to incur and service debt. While depreciation, amortization and impairment loss are considered operating costs under U.S. GAAP, these expenses primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. Our OIBDA calculations are commonly used as bases for some investors, analysts and credit rating agencies to evaluate and compare the periodic and future operating performance and value of companies within the telecommunications industry. OIBDA should not be considered in isolation as an alternative to net income attributable to VimpelCom, operating income or any other measure of performance under U.S. GAAP. OIBDA does not include our need to replace our capital equipment over time. Reconciliation of OIBDA to operating income, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section. OIBDA margin is OIBDA expressed as a percentage of net operating revenues. Reconciliation of OIBDA margin to operating income as a percentage of net operating revenues, the most directly comparable U.S. GAAP financial measure, is presented below in the reconciliation tables section. Prepaid subscribers are those subscribers who pay for their services in advance. Roaming revenues include both revenues from VimpelCom customers who roam outside of home country network and revenues from other wireless carriers for roaming by their customers on VimpelCom’s network. Sales and marketing costs (S&M) include marketing, advertising and dealer commissions expenses. Take-up rate for the FTTB network is calculated by dividing the number of FTTB subscribers by the total number of households passed. VAS (value added services) includes short messages (”SMS”), multimedia messages (”MMS”), caller number identification, call waiting, data transmission, mobile Internet, downloadable content and other services. Capital expenditures (Capex) – purchases of new equipment, new construction, upgrades, software, other long lived assets and related reasonable costs incurred prior to intended use of the non current asset, accounted at the earliest event of advance payment or delivery. Long-lived assets acquired in business combinations are not included in capital expenditures. SEA – VimpelCom operations in South-East Asia, which include operations in Cambodia and VimpelCom’s respective equity in net results of operations of the Company’s Vietnamese associate GTEL-Mobile JSC (”GTEL-Mobile”). Net debt is calculated as the sum of short-term debt and long-term debt minus cash and cash equivalents. Attachment B: VimpelCom financial statements Open Joint Stock Company “Vimpel-Communications” Unaudited Condensed Consolidated Statements of Income Three months ended Nine months ended September 30, September 30, 2009 2008 2009 2008 —- —- —- —- (In millions of Russian rubles, except share (ADS) amounts) Operating revenues: Service revenues 70,359 67,913 204,047 180,516 Sales of equipment and accessories 863 949 2,885 1,054 Other revenues 173 123 475 317 — — — — Total operating revenues 71,395 68,985 207,407 181,887 Revenue based tax (57) (52) (191) (132) — — —- —- Net operating revenues 71,338 68,933 207,216 181,755 Operating expenses: Service costs 15,306 15,916 44,460 40,462 Cost of equipment and accessories 886 921 2,841 1,016 Selling, general and administrative expenses 18,760 18,167 55,424 49,265 Depreciation 11,452 9,687 32,355 27,445 Amortization 2,229 2,381 6,934 6,399 Provision for doubtful accounts 406 293 1,387 1,172 — — —– —– Total operating expenses 49,039 47,365 143,401 125,759 —— —— ——- ——- Operating income 22,299 21,568 63,815 55,996 Other income and expenses: Interest income 242 436 1,342 1,376 Net foreign exchange gain/ (loss) 693 (8,269) (12,304) (3,173) Interest expense (4,914) (3,439) (14,074) (8,220) Equity in net gain/(loss) of associates 152 65 (862) 65 Other (expenses)/ income, net (105) (181) (290) (438) —- —- —- —- Total other income and expenses (3,932) (11,388) (26,188) (10,390) —— ——- ——- ——- Income before income taxes and noncontrolling interest 18,367 10,180 37,627 45,606 Income tax expense 4,809 3,359 10,127 12,326 —– —– —— —— Net income 13,558 6,821 27,500 33,280 Net income/(loss) attributable to the noncontrolling interest 45 308 (98) 1,071 — — — —– Net income attributable to VimpelCom 13,513 6,513 27,598 32,209 ====== ===== ====== ====== Basic EPS: Net income attributable to VimpelCom per common share 266.83 128.68 545.11 634.94 ====== ====== ====== ====== Weighted average common shares outstanding (thousand) 50,643 50,615 50,628 50,728 Net income attributable to VimpelCom per ADS equivalent 13.34 6.43 27.26 31.75 ===== ==== ===== ===== Diluted EPS: Net income attributable to VimpelCom per common share 261.01 128.68 525.36 634.94 ====== ====== ====== ====== Weighted average diluted shares (thousand) 51,771 50,615 52,532 50,728 Net income attributable to VimpelCom per ADS equivalent 13.05 6.43 26.27 31.75 ===== ==== ===== ===== Open Joint Stock Company “Vimpel-Communications” Unaudited Condensed Consolidated Balance Sheets September December 30, 31, 2009 2008 —- —- (In millions of Russian rubles, except share amounts) Assets Current assets: Cash and cash equivalents 75,902 26,873 Trade accounts receivable, net of allowance for doubtful accounts 13,341 13,974 Inventory 2,461 4,191 Deferred income taxes 2,104 2,432 Input value added tax 3,994 5,349 Due from related parties 8,509 4,942 Other current assets 5,924 12,941 —– —— Total current assets 112,235 70,702 Property and equipment, net 168,407 188,778 Telecommunications licenses, net 17,862 22,470 Goodwill 98,930 102,148 Other intangible assets, net 21,996 25,935 Software, net 12,584 16,134 Investments in associates 13,801 14,501 Other assets 22,707 21,314 —— —— Total assets 468,522 461,982 ======= ======= Liabilities and equity Current liabilities: Accounts payable 15,198 26,409 Due to employees 3,343 3,108 Due to related parties 502 142 Accrued liabilities 11,646 8,484 Taxes payable 10,476 4,471 Customer advances, net of VAT 9,302 12,492 Customer deposits 824 868 Short-term debt 74,516 56,093 —— —— Total current liabilities 125,807 112,067 Deferred income taxes 16,453 18,934 Long-term debt 168,293 191,963 Other non-current liabilities 5,266 3,608 Commitments, contingencies and uncertainties – - Equity: Convertible voting preferred stock (.005 rubles nominal value per share), 10,000,000 shares authorized; 6,426,600 shares issued and outstanding – - Common stock (.005 rubles nominal value per share), 90,000,000 shares authorized; 51,281,022 shares issued (December 31, 2008: 51,281,022); 50,683,660 shares outstanding (December 31, 2008: 50,617,408) 3 3 Additional paid-in capital 42,688 42,624 Retained earnings 115,194 87,599 Accumulated other comprehensive (loss)/income (5,105) 3,992 Treasury stock, at cost, 597,362 shares of common stock (December 31, 2008: 663,614) (5,692) (5,983) —— —— Total VimpelCom shareholders’ equity 147,088 128,235 Noncontrolling interest 5,615 7,175 —– —– Total equity 152,703 135,410 ——- ——- Total liabilities and equity 468,522 461,982 ======= ======= Open Joint Stock Company “Vimpel-Communications” Unaudited Condensed Consolidated Statements of Cash Flows Nine months ended September 30, 2009 2008 —- —- (In millions of Russian rubles) Operating activities Net cash provided by operating activities 88,998 62,117 Investing activities Purchases of property and equipment (15,699) (33,206) Purchases of intangible assets (435) (1,747) Purchases of software (4,180) (5,093) Acquisition of subsidiaries, net of cash acquired – (100,348) Late payment for investment in associate (389) – Exercise of escrow cash deposit – 4,856 Loan granted – (8,491) Short-term deposits – (2,368) Purchases of other assets, net (958) (1,578) —- —— Net cash used in investing activities (21,661) (147,975) Financing activities Proceeds from bank and other loans 38,920 130,718 Proceeds from sale of treasury stock – 608 Repayments of bank and other loans (54,817) (10,227) Payments of fees in respect of debt issues (1,671) (1,322) Net proceeds from employee stock options 171 – Purchase of noncontrolling interest in consolidated subsidiaries (14) (23,462) Payment of dividends to noncontrolling party (23) (14,240) Purchase of treasury stock – (2,751) — —— Net cash (used in)/provided by financing activities (17,434) 79,324 Effect of exchange rate changes on cash and cash equivalents (875) 259 —- — Net increase/(decrease) in cash and cash equivalents 49,029 (6,275) Cash and cash equivalents at beginning of period 26,873 24,637 —— —— Cash and cash equivalents at end of period 75,902 18,362 ====== ====== Supplemental cash flow information Cash paid during the period: Income tax 8,917 12,603 Interest 9,335 4,905 Non-cash activities: Equipment acquired under financing agreements 6 1,448 Accounts payable for equipment and other long-lived assets 3,856 7,495 Acquisitions : Fair value of assets acquired – 64,159 Fair value of noncontrolling interest acquired – 4,968 Difference between the amount paid and the fair value of net assets acquired – 85,062 Consideration for the acquisition of subsidiaries – (129,430) — ——– Change in fair value of liabilities assumed – 24,759 === ====== Attachment C: Reconciliation Tables (Unaudited) Reconciliation of Consolidated OIBDA (In millions of Russian rubles) OIBDA Consolidated Total 3Q ‘09 3Q ‘08 2Q ‘09 ———————— —— —— —— OIBDA 35,980 33,636 34,958 —– —— —— —— Depreciation (11,452) (9,687) (10,451) ———— ——- —— ——- Amortization (2,229) (2,381) (2,257) ———— —— —— —— Operating income 22,299 21,568 22,250 —————- —— —— —— Reconciliation of OIBDA Margin OIBDA Margin Consolidated Total 3Q ‘09 3Q ‘08 2Q ‘09 ——————————- —— —— —— OIBDA margin 50.4% 48.8% 50.6% ———— —- —- —- Less: Depreciation as a percentage of net operating revenues (16.0%) (14.0%) (15.1%) ———————————- ——- ——- ——- Less: Amortization as a percentage of net operating revenues (3.1%) (3.5%) (3.3%) ———————————- —— —— —— Operating income as a percentage of net operating revenues 31.3% 31.3% 32.2% ———————————– —- —- —- Attachment D: Capex Development CAPEX (RUR, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ——————— —— —— —– —— —– Total capex 3,842 16,799 -77.1% 5,027 -23.6% ———– —– —— —– —– —– Russia 2,827 12,224 -76.9% 3,440 -17.8% —— —– —— —– —– —– CIS 756 4,527 -83.3% 817 -7.5% — — —– —– — —- Kazakhstan 310 1,868 -83.4% 376 -17.6% ———- — —– —– — —– Ukraine 95 1,137 -91.6% 95 0.0% ——- — —– —– — — Armenia 48 462 -89.6% 12 300.0% ——- — — —– — —– Uzbekistan 207 688 -69.9% 241 -14.1% ———- — — —– — —– Tajikistan 16 156 -89.7% 24 -33.3% ———- — — —– — —– Georgia 80 216 -63.0% 69 15.9% ——- — — —– — —- SEA 258 9 2767% 761 -66.1% — — — —- — —– Attachment E: Key Financial Results in US Dollars (Convenience Translation) CONSOLIDATED OPERATIONS (US$, millions) 3Q ‘09 3Q ‘08 y-o-y 2Q ‘09 q-o-q ———————– —— —— —– —— —– Net operating revenues 2,277 2,843 -19.9% 2,143 6.3% ———————- —– —– —– —– — OIBDA 1,149 1,388 -17.2% 1,085 5.9% —– —– —– —– —– — OIBDA margin, % 50.5% 48.8% 50.6% ————— —- —- —- Operating income 712 890 -20.0% 691 3.0% —————- — — —– — — Operating income margin, % 31.3% 31.3% 32.2% ———————— —- —- —- SG&A 599 749 -20.0% 573 4.5% —- — — —– — — including Sales & Marketing Expenses 184 242 -24.0% 168 9.5% ——————- — — —– — — including General & Administrative Costs 415 507 -18.1% 405 2.5% ——————— — — —– — — SG&A percentage 26.3% 26.3% 26.7% ————— —- —- —- Net income attributable to VimpelCom 431 269 60.2% 702 -38.6% ———————– — — —- — —– Net income attributable to VimpelCom per common share, basic (US$) 8.52 5.31 13.86 ———————— —- —- —– Net income attributable to VimpelCom per ADS equivalent, basic (US$) 0.43 0.27 0.69 ———————— —- —- —- Capital expenditures 123 692.9 -82.2% 156.0 -21.2% ——————– — —– —– —– —– Attachment F: Average Rates of Functional Currencies to Ruble* Functional Currency/ 1 RUR 1Q ‘08 2Q ‘08 3Q ‘08 4Q ‘08 1Q ‘09 2Q ‘09 3Q ‘09 ————— —— —— —— —— —— —— —— Kazakhstan KZT 4.9690 5.1038 4.9540 4.4077 4.0948 4.6771 4.8200 ———- — —— —— —— —— —— —— —— Ukraine UAH 0.2081 0.2101 0.2003 0.2274 0.2281 0.2376 0.2496 ——- — —— —— —— —— —— —— —— Tajikistan USD 0.0412 0.0423 0.0412 0.0367 0.0295 0.0311 0.0319 ———- — —— —— —— —— —— —— —— Uzbekistan USD 0.0412 0.0423 0.0412 0.0367 0.0295 0.0311 0.0319 ———- — —— —— —— —— —— —— —— Armenia AMD 12.6926 13.0012 12.4664 11.2309 9.6090 11.5227 11.9095 ——- — ——- ——- ——- ——- —— ——- ——- Georgia GEL 0.0641 0.0612 0.0582 0.0568 0.0495 0.0515 0.0535 ——- — —— —— —— —— —— —— —— Cambodia USD 0.0311 0.0319 ——– — —— —— * Functional currencies in Tajikistan, Uzbekistan and Cambodia are US dollars. See the rest here: VimpelCom Announces Third Quarter 2009 Financial and Operating Results (PR Newswire)

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VimpelCom Announces Third Quarter 2009 Financial and Operating Results (PR Newswire)

BERLIN (AFP) – German business confidence surged in November, a closely-watched survey showed on Tuesday, fuelling hopes that Germany, Europe’s economic powerhouse, could lead the continent out of recession. The survey, by the Ifo institute, showed business sentiment rose to 93.9 from 92.0, the eighth successive rise and the highest level since August 2008. It was also better than expected, with economists polled by Dow Jones Newswires expecting a rise to 92.6 points. “The German economy continues on the road to recovery,” said the institute’s president Hans-Werner Sinn, in a statement. The positive news followed data from the national statistics office confirming that German growth was gingerly returning after the country suffered its deepest recession for six decades. Output increased by 0.7 percent in the third quarter of the year, driven higher by companies replenishing their stocks. Exports and consumer spending, however, were weak and dragged output down in the third quarter. Buoyed by sunnier data in recent months, the German government has raised its growth outlook for the whole year, but still expects the economy to contract by around five percent, by far its worst post-war performance. Next year, Berlin sees the economy hauling itself back into positive territory, with 1.2 percent growth. See the original post here: German firms see brighter future ahead: survey

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LONDON (AFP) – Britain’s partly-nationalised Lloyds Banking Group on Tuesday said it was offering shareholders new stock at a discount of almost 60 percent under the country’s largest ever rights issue. LBG, 43-percent state-owned after a massive government bailout, said existing shareholders would be able to buy new shares in the bank priced at 37 pence each. LBG shares closed Monday priced at 91.47 pence. LBG earlier this month said it planned to raise 22.5 billion pounds (25 billion euros, 37.2 billion dollars) in fresh capital. It said 13.5 billion pounds would be raised via the biggest-ever sale in Britain of new shares to existing shareholders. It is also raising nine billion pounds by converting existing debt into bonds. By raising 22.5 billion pounds, LBG will avoid taking part in a government scheme that insures banks’ toxic debt. “Lloyds Banking Group is pleased to announce that the issue price at which the new shares will be offered pursuant to the rights issue has been set at 37 pence per new share,” LBG said in a statement published on Tuesday. Lloyds Banking Group was created in January when Lloyds TSB bought ailing rival lender HBOS in a state-brokered deal. Link: Lloyds bank record rights issue set at hefty discount

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BANGKOK (AP) — Asian stock markets were mostly lower Tuesday despite gains on Wall Street as China’s warning to banks to control lending dragged down financial stocks in Hong Kong. The region also got a poor cue from Japan, where stocks fell after the market was closed for a holiday Monday. The dollar was little changed against the euro and the yen. Gold retreated from a record and oil prices hung below $78. Investors shrugged off Wall Street ending a three-day losing streak Monday and figures showing that U.S. home sales rose 10 percent in October. News that China’s central bank was warning banks to control a lending spree underlined there are limits to the easy credit which has underpinned the country’s rapid recovery from the global recession. “The central bank has been concerned about lending to the property sector,” said Franics Lun, general manager of Fulbright Securities Ltd. in Hong Kong. “If they can put on the brakes to avoid an asset bubble it is likely to be better for the longer term,” he said. Japan’s Nikkei 225 stock average was down 72.73, or 0.8 percent, at 9,421.53 and Hong Kong’s Hang Seng was off 48.61, or 0.2 percent, at 22,722.78. Banks fell in Hong Kong trade with Bank of China off 2.1 percent, China Construction Bank down 1 percent and HSBC retreating 0.3 percent. Elsewhere, South Korea’s Kospi dropped 0.9 percent to 1,604.66 and Australia’s S&P/ASX 200 index declined 0.5 percent to 4,691.40 on losses in banks and miners. China’s Shanghai benchmark bucked the trend to rise 0.1 percent to 3,342.28. In the U.S. on Monday, the Dow rose 132.79, or 1.3 percent, to 10,450.95, after losing 120 points over the previous three days. It was the Dow’s highest close since Oct. 2, 2008. The Standard & Poor’s 500 index rose 14.86, or 1.4 percent, to 1,106.24. Oil hovered below $78 a barrel in Asia amid mixed signs about crude demand. Benchmark crude for January delivery was up 10 cents to $77.66 a barrel. The contract rose 9 cents to settle at $77.56 on Monday. In currencies, the dollar fell to 88.89 yen from 88.97. The euro fell to $1.4946 from $1.4964. More: Asia markets lower amid China warning to banks (AP)

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WASHINGTON (AP) — Remember the economy’s return to growth last quarter? Well, it probably wasn’t as energetic as first thought. A government report due out Tuesday morning is expected to show that the economy expanded at a pace of 2.9 percent from July through September, according to Wall Street economists surveyed by Thomson Reuters. If they are right, it would mark a slower expansion than the 3.5 percent pace reported a month ago. Most of that rebound reflected federal support for spending on homes and cars. The main forces behind the expected third-quarter downgrade: commercial construction was weaker, the nation’s trade gap was more of a drag, businesses trimmed more of their stockpiles and consumers didn’t spend as much. So, the good news is the economy finally started to grow again, after a record four straight losing quarters. The bad news: The rebound, now and in the months ahead, probably will be lethargic. Federal Reserve officials and other economists say growth won’t be strong enough to quickly drive down the nation’s unemployment rate. The nation’s current 10.2 percent jobless rate marks only the second time in the post-World War II period that unemployment has topped 10 percent. “It’s a half-speed recovery,” said Stuart Hoffman, chief economist at PNC Financial Services Group. “We’re in the slow lane.” Some economists think growth will slow to around a 2.5 percent pace in the current quarter, although a few say it could clock in at about 3 percent if holiday sales come in better than expected. Most say they think the economy will weaken again next year, with growth at a pace of around 1 percent as the impact of the $787 billion stimulus package fades and consumers keep tightening their belts under the strain of high unemployment and hard-to-get credit. In the third quarter, the popular Cash for Clunkers rebates and an $8,000 tax credit for first-time homebuyers juiced up sales of cars and homes. The clunkers program is over now, but the tax credit has been extended and expanded beyond first-time buyers. What’s not clear is whether the recovery can continue after government supports are gone. If consumers clam up, the economy could tip back into recession. President Barack Obama recently cautioned that the economy could suffer a “double dip” downturn. Fed Chairman Ben Bernanke, however, says he doesn’t think that will happen. But last week the Fed chief did warn the recovery faces “important headwinds,” such as tight credit and a weak job market that will make consumers cautious in their spending. Those factors “likely will prevent the expansion from being as robust as we would hope,” Bernanke said. The government takes three cracks at estimating economic activity for any given quarter. Each estimate is based on more complete data. Tuesday’s will be the second reading of the third-quarter GDP data. The return of economic growth puts the White House in a delicate position: The president wants to take credit for ending the recession, but unemployment is still causing pain and anxiety throughout the country. Millions have yet to feel a benefit from the recovery in the form of a new job or even an easier time getting a simple loan. Even those with jobs are reluctant to go on a spending spree. The values of their homes and 401(k)s remain shrunken. Some economists think the jobless rate could climb as high as 11 percent by the middle of next year before making a slow descent. It could take at least four years for the unemployment rate to drop back down to more normal levels. “The best thing we can say about the labor market right now is that it may be getting worse more slowly,” Bernanke said last week. Against that backdrop, Obama said he’s weighing tax breaks that could encourage businesses to hire again. Unlike past rebounds that were driven by the spending of everyday Americans, this one appears to hinge on spending by businesses, foreigners and — until it runs out — the government. In 1980, businesses led an economic recovery. It quickly fizzled, and the economy fell into a severe recession in 1981 and 1982. The unemployment rate climbed to 10.8 percent, the post-World War II high. Visit link: Economic recovery likely not quite that energetic (AP)

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DENVER (AP) — Newmont Mining has agreed to sell a 14 percent stake in an Indonesian gold mine for $494 million, ending a years-long dispute with the Indonesian government over how the mining company should sell shares as required under its contract to operate in the country. Newmont shares ownership of the Batu Hijau mine with Japan’s Sumitomo Corp. and Indonesia’s PT Pukuafu Indah. The Denver-based company says it will transfer the stake to private company PT Multicapital and PT Multi Daerah Bersaing, a consortium of regional and local Indonesian governments. Last week, Newmont Mining Corp. said a separate 10 percent share was sold to the consortium, for proceeds of about $391 million. See the rest here: Newmont to sell Indonesia venture stake for $494M (AP)

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(Corrects day of week in paragraph 1 to …Tuesday…, not …Monday…) (For more stories on the Japanese economy, click [ID:nECONJP]) * Government, BOJ in fight over how to tackle deflation * Outspoken cabinet minister: “BOJ asleep at the wheel” * Economists say options for govt, BOJ are limited By Stanley White TOKYO, Nov 24 (Reuters) – Japanese cabinet ministers increased the pressure on the Bank of Japan (BOJ) on Tuesday to respond to persistently falling prices after the government declared the country has entered its second bout of deflation in less than a decade. A public battle is brewing between the government and the BOJ, with each saying that the other should play a greater roll in battling deflation UPDATE – Japan govt says BOJ asleep in deflation row (at Reuters) is a post from: Investor Central – centralized penny stock, pink sheet and OTC BB news. See original here: UPDATE – Japan govt says BOJ asleep in deflation row (at Reuters)

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(Adds quote, context) By Javier Mozzo BOGOTA, Nov 23 (Reuters) – Colombia’s central bank on Monday said it cut its key overnight interest rate 50 basis points to 3.5 percent, citing a reduction in trade with Venezuela and low economic activity through September. Colombian inflation is running well under target and the government reported last week that industrial production fell a sharper-than-expected 3.8 percent in September, raising speculation that the bank would cut rates on Monday. The Colombian government expects an economic recovery in the fourth quarter that will pull the country out of recession by the end of the year. But the numbers have continued to be grim. September retail sales slid 7.3 percent from a year earlier. “The rate cut seeks to help the economy recover and counter the negative effects of the reduction in trade with Venezuela,” bank chief Jose Dario Uribe told reporters after the decision was announced. Venezuelan President Hugo Chavez has stopped imports of some Colombian goods in protest of a military cooperation pact signed between Bogota and Washington last month. Leftist firebrand Chavez says the pact could set the stage for a U.S. invasion of oil rich Venezuela, a claim dismissed by Colombia and the United States. The rate-cutting cycle has slowed throughout Latin America after months of central banks moving to loosen credit in a bid to stave off the effects of the global financial crisis. Chile, a relatively advanced economy which often moves in lockstep with the U.S. Federal Reserve, has paused with its key rate at 0.5 percent. Brazil’s central bank in October held its key Selic rate steady for the second straight meeting at an all-time low of 8.75 percent. Colombia’s central bank has cut its key overnight rate by a total of 6.5 percentage points since the monetary policy loosening cycle began in December. The government expects gross domestic product to grow 0.5 percent this year and 2.5 percent in 2010. Colombian exporters, hit by the weakening dollar, have been clamoring for continued rate cuts, hoping that they will help slow foreign portfolio investment flows and reduce upward pressure on the peso. The local currency has climbed 16.3 percent against the greenback over the last 12 months, hurting profits for Colombian farmers and manufacturers who get paid in dollars for their international sales. (Reporting by Javier Mozzo, writing by Hugh Bronstein) ((javier.mozzo@thomsonreuters.com; +571-634-4139; Reuters Messaging: javier.mozzo.reuters.com@reuters.net)) The rest is here: UPDATE – Colombia cenbank cuts key rate 50 bps to 3.5 pct (at Reuters)

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DALLAS, TX–(Marketwire – 11/23/09) – Greatwide Logistics Services, a national provider of third-party logistics services, today announced the acquisition of the contracts, personnel and equipment of the Dedicated Contract Carriage division of YRC Logistics, a subsidiary of YRC Worldwide Inc. (NASDAQ: YRCW – News ). The business will be integrated under the Greatwide Logistics Services brand immediately. Greatwide will acquire all of the customer contracts from Dedicated Contract Carriage, which include customers in the grocery, steel and auto industries, located in 29 operating locations throughout the country. “The business obtained through the acquisition of YRC Logistics’ Dedicated Contract Carriage aligns perfectly with our industry-leading position in providing dedicated transportation to food and grocery, consumer products and retail customers, while also strengthening our presence in the industrial sector of the market,” said Raymond Greer, CEO of Greatwide Logistics Services. “This acquisition allows us to expand our capabilities to include flatbed dedicated service and apply our transportation management services expertise to new industrial shippers.” In February 2009, Greatwide Logistics Services was purchased by affiliates of Centerbridge Partners, a leading private investment firm, and other investors. “We are pleased with the acquisition of YRC Logistics’ dedicated business, which fits squarely into Greatwide’s core dedicated operations. We will fund this acquisition with an additional equity investment and will continue to support the company with additional investments to opportunistically pursue acquisitions that are consistent with Greatwide’s long-term strategic plan,” said Will Manuel, Senior Managing Director of Centerbridge Partners. “Post-acquisition, the company will continue to have no cash-pay debt on the balance sheet.” Greatwide Logistics Services is the second-largest dedicated contract carriage provider in the United States. The company also provides transportation management services, freight brokerage and warehousing service to more than 1,300 clients. “This acquisition is consistent with our strategic growth plan and reinforces our position as a top third-party logistics provider,” added Leo Suggs, Chairman of Greatwide Logistics Services. About Greatwide Logistics Services Greatwide Logistics Services is a privately held third-party logistics provider serving the United States and Canada. Greatwide offers an integrated service platform to customers including dedicated contract carriage, transportation management services, irregular route truckload, full-service truckload brokerage, warehouse-based logistics and transportation management services. Greatwide is the second largest provider in dedicated refrigerated transportation. The company is 11th among Transport Topics’ top 50 logistics providers, a top 70 3PL provider by Food Logistics and a top 100 motor carrier by Inbound Logistics. For more information, visit www.greatwide.com . About Centerbridge Centerbridge Partners was established in 2006 and currently has approximately $10 billion in capital under management across several funds. The firm is dedicated to partnering with world class management teams to invest across multiple stages of a Company’s life cycle and to employ various strategies to help companies achieve their operating and financial objectives. Centerbridge’s limited partners include many of the world’s most prominent financial institutions, university endowments, pension funds, and charitable trusts. Here is the original post: Greatwide Logistics Services Acquires YRC Logistics’ Dedicated Contract Carriage Business (Marketwire)

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* Peso hits 1-month high on priced-in debt downgrade * IPC stock index rises 1.5 pct, bonds also gain * Stable outlook curbs fears of further downgrades * Country’s assets could extend rally on recovery hopes (Adds peso’s closing price) By Michael O’Boyle MEXICO CITY, Nov 23 (Reuters) – Mexico’s peso rose to a one-month high on Monday after Fitch Ratings delivered a widely expected debt downgrade, and the currency could be poised for further gains as the country climbs out of recession. Many market players had expected both Fitch and S&P could cut their ratings on the country, which allowed the currency to brush off news of the downgrade as it had already been priced in by markets, traders and analysts said. With the threat of downgrade behind it, Mexico could enjoy more investment flows on expectations of a recovery in its battered exports. “Most of the bad news for the peso is behind, and now maybe the market can focus on the good news, like the better growth prospects ahead,” said Flavia Cattan-Naslausky, a strategist at RBS in Stamford, Connecticut. The peso MXN= MEX01 gained 0.82 percent to 12.9667 per U.S. dollar following the news, and closed at its strongest level since Oct. 22. For more see [ID:N23261132], [ID:nN23261611] and ID:nN2389048]. The government’s benchmark 10-year peso bond MX10YT=RR was bid down 3 basis points to 7.87 percent while the IPC stock index .MXX closed up 1.5 percent at 31,126.17. Supporting gains, stocks rose sharply worldwide as upbeat economic news in the euro zone and better-than-expected U.S. home sales bolstered demand for riskier assets. Fitch cut its sovereign debt rating one notch but put Mexico on a stable outlook, easing worries of further downgrades from the agency, which could have endangered Mexico’s investment grade. “The fact that they put it as stable is what calmed the market,” said Salvador Orozco, a currency and debt strategist at Santander in Mexico City. “If S&P decides to cut their rating, they will do it in the same way,” he added. GROWTH RALLY AHEAD  Continued… See original here: Mexico peso sets 1-month high in wake of downgrade (at Reuters)

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By David Friend, The Canadian Press TORONTO – Canadian consumers surprised economists with how much spending they did in September, but retail sales remained weaker than a year ago and gave little comfort to many retailers who fear the coming holiday season will be slow. Statistics Canada said Monday that retail sales rose to $34.9 billion in September, up by one per cent from August, on widespread increases across six of eight sectors. While that was a notable increase and higher than consensus economic forecasts, the sales numbers were also 3.3 per cent lower than the same period last year. “It’s an improvement from the fairly hefty decline you saw in the last year, but it’s still, at least on a year-over-year basis, indicating that conditions remain weak,” said Paul Ferley, assistant chief economist at Royal Bank (TSX: RY.TO ). “When you start looking at the month-over-month (results) it’s showing more positive gains over the last two months.” Retail sales have been rising since the beginning of 2009, following a sharp decline at the end of 2008 as Canada was dragged down by a global recession that began to tighten its grip in last year’s fourth quarter. The gradual recovery has left some retailers, particularly in clothing, jittery for the crucial October-December quarter. Some have complained that sales have been slow, and they’ve had to slash their prices to encourage shoppers to spend. In September, apparel sales were down 0.5 per cent over the same time last year. “It’s going to be a constrained environment,” said Stewart Hall, an economist at HSBC Global Research. “What spending is taking place seems to be in response to either significant deals to be had in the auto sector or… the purchase of a home. For general merchandise and retail shopping, the holiday season is going to continue to present some challenges.” Month-over-month, September sales were pushed higher by the food-and-beverage stores sector, mainly supermarkets, where sales rose 1.3 per cent. General merchandise stores sales rose 1.9 per cent over August while miscellaneous retailers rose 1.7 per cent in September after four flat months. Furniture, home furnishings and electronics stores had a 1.2 per cent increase from August, but remained 7.9 per cent below September 2008. Mike Arnett, president of retail at Canadian Tire Corp. (TSX: CTC-A.TO ), said shoppers have remained cautious this year, particularly when it comes to higher-priced items. “If they have more than one reason not to spend, if there’s poor weather, they look for ways to put things off. We saw that through the course of the summer,” he said. The retailer has decided to lure shoppers by focusing on “every day essentials,” often lower priced items. “Those are the things that make it onto the shopping list most frequently and generate the determination of where to shop,” he said, noting that the goal is to get shoppers into the store to buy extra items. Meanwhile, the automotive sector was up one per cent, with all components recording higher sales from August but new car dealers lagging with only 0.6 per cent growth. In contrast, there was two per cent growth at the category that includes used and recreational vehicles and parts dealers. Excluding the automotive sector, retail sales rose 1.1 per cent in September, the largest one-month gain since January 2009. Building and outdoor home supplies stores experienced a 0.2 per cent decline, while clothing and accessories stores were down 0.1 per cent. Overall, September was the seventh increase in nine months and above expectations of a 0.6 per cent increase, according to forecasts compiled by TD Bank. In volume terms, retail sales increased 1.2 per cent. “Whether it’s housing, auto sales or these retail sales figures, there is mounting evidence that the domestic side of Canada’s economy is in full recovery mode,” said Doug Porter, deputy chief economist at BMO Capital Markets. “Unfortunately, the weakness in exports is likely to persist, as it is highly unlikely that U.S. consumers will be matching the comeback by Canadian consumers any time soon. Thus, we will continue to see this heavily lopsided recovery, between solid domestic spending activity and soggy growth overall.” Retail sales rose in eight provinces in September. Quebec, with a 2.2 per cent increase, was the largest contributor with its fourth rise in the last five months. The two provinces in which retail sales did not increase were Saskatchewan and Alberta. Sales fell 0.9 per cent in Saskatchewan in September, partially offsetting the increase in August. In Alberta sales were flat, following two months of declines. Scotiabank (TSX: BNS.TO ) deputy chief economist Aron Gampel said the latest results show that the Canadian economy is recovering from the recession. “You look on a trend basis, you continue to see right across the country that more provinces and regions are now showing better signs of a revival in consumer spending,” Gampel said. “The automobile industry has been a huge beneficiary of the improving retail appetite, but we’re likely to see more and more of it spreading to other areas as well.” See the article here: September retail sales rise, but are still weaker over same time last year

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Retail gasoline prices headed downward in most places to begin one of the country’s busiest travel weeks, with more than 33 million people expected to hit the road for the Thanksgiving holiday. AP – In this photo taken Nov. 20, 2009, a tanker truck makes a fuel delivery at a Little Rock, … Americans are remaining closer to home because of anxiety about the economy and demand for gasoline is weaker now than it was last year at this time. That is telling because a gallon of gasoline then cost only $1.93 as the economic crisis unfolded in 2008. Unlike last year, however, gas is not falling sharply and though prices fell overnight, it still cost about $2.64 per gallon on average, according to Department of Energy data and also auto club AAA, Wright Express and Oil Price Information Service. “I think we will see some increases in the spring like we always do,” said Fred Rozell, retail pricing director at OPIS. “But at this point I think we’re going to kind of see a status quo for a while.” Gasoline prices were either flat or falling in most places, but rose nearly 4 cents across the Midwest, according to a report Monday from the Energy Information Administration. Prices spiked 10 cents in Cleveland, according to the EIA. Crude prices have remained relatively strong, which has helped keep gas prices well above $2.50. A survey by the AAA this weekend found that the number of Americans traveling away from home for Thanksgiving will be up just 2.1 percent this year from 2008. Crude prices have dragged retail gasoline prices higher throughout the year and rose by 9 cents per barrel on Monday. Benchmark crude for January delivery settled at $77.56 a barrel on the New York Mercantile Exchange after the release of some surprising housing numbers. The National Association of Realtors said home sales rose 10.1 percent in October. That is the highest level in more than two years and helped push crude prices higher on expectations of increased demand. Still, crude in storage is above normal levels for this time of year and refiners that turn oil into gasoline, jet fuel and diesel are cutting back because demand is so weak. Valero Energy became the latest to shut down a refinery Friday, the largest U.S. facility shut down so far this year. That follows other refiners like Sunoco and Western Refining, who have shut down plants in recent months and off almost 1,000 workers. Refiners say they can’t raise the price of gasoline and jet fuel because people aren’t traveling as much, but they must pay higher prices for crude because of the weak dollar. Air travel is projected to decline 6.7 percent, or 2.3 million travelers this year compared to 2.5 million in 2008. In other Nymex trading, heating oil rose less than a penny to settle at $1.9799 a gallon. Gasoline for December delivery fell less than a cent to settle at $1.9794 a gallon. Natural gas for December delivery rose about 5 cents to settle at $4.473 per 1,000 cubic feet. In London, Brent crude for January delivery fell 26 cents to settle at $77.46 on the ICE Futures exchange. Associated Press Writers Alex Kennedy in Singapore and Barry Hatton in Lisbon, Portugal, contributed to this report. Visit link: Gas prices fall to begin busy travel week (AP)

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SANTIAGO, Nov 23 (Reuters) – Chile’s peso CLP=CL surged to a new 16-month high on Monday on a broadly weaker dollar and high copper prices, despite the specter of possible central bank intervention, while peso strength punished local exporter shares, analysts said. The peso rose 1.77 percent to 492.50/492.80 per U.S. dollar, compared to Friday’s close of 501.20/501.70. Last week the currency flirted with 17-month intraday highs. The dollar slid against major currencies on Monday after investors sought assets with higher yields following a Federal Reserve official’s comments that affirmed expectations U.S. interest rates would stay low for some time. For more see [ID:nN23375049]. The flight to riskier assets helped lift other currencies such as the Brazilian real ( BRBY ), which has gained about 35 percent so far this year and continued to strengthen on Monday. [ID:nN23240130] “We opened the session with a strong peso appreciation, the product of an advance on global bourses as well as copper prices,” a Chilean trader said. COPPER HELPS PESO SURGE Three-month copper MCU3 prices on the London Metal Exchange hit 14-month highs earlier on Monday, driven by the dollar’s weakness and gains in other commodity markets, before paring gains. Stronger prices for copper, Chile’s No.1 export, tend to boost the country’s currency. The end of a 42-day strike at BHP Billiton’s ( BHP.AX )( BLT.L ) Spence copper mine in Chile partly helped limit expectations of further price gains for the metal. Chilean Central Bank President Jose De Gregorio said last week that he did not rule out intervening in the country’s foreign currency market to curb peso appreciation of around 30 percent against the dollar year-to-date. The peso has been one of the best-performing emerging market currencies this year against a weaker U.S. dollar. Some analysts expect the central bank to intervene if the peso hits 480 per dollar. The peso’s appreciation also dragged Chile’s blue-chip IPSA share index .IPSA 0.63 percent lower at 3,268.85 while the all-market IGPA .IGPA fell 0.50 percent to 15,431.21. “When the exchange rate falls the market falls, when the exchange rate rises the market rises,” said Cristina Acle, head of research for CorpResearch brokerage. “It seems to be related to profitability for foreign investors … All stocks are falling so it seems to be a more generalized effect on exporters.” Conglomerate Copec ( COP.SN ), the most heavily weighted share on the Santiago bourse, fell 2.32 percent to 7,106 pesos, while rival CMPC ( CAR.SN ) fell 1.79 percent to 18,199 pesos. Chile-based regional energy group Enersis ( ENE.SN ) fell 1.57 percent to 188 pesos. Chile steel and iron ore producer CAP ( CAP.SN ) fell 3.5 percent to 13,360 pesos. (Additional reporting by Froilan Romero, Maria Jose Latorre, and Aaron Nelsen; Editing by James Dalgleish) ((simon.gardner@thomsonreuters.com; Tel: +562-370-4250; Reuters Messaging: simon.gardner.reuters.com@reuters.net)) Link: Chile peso hits 16-month high, hurts stock prices (at Reuters)

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(Adds more Gibbs comment, background) WASHINGTON, Nov 23 (Reuters) – The White House said on Monday it was reviewing options to spur economic activity and job creation, but stressed any action would be taken in the context of the fiscal challenges facing the country. “We’re going to work with members of Congress to try to come up with sensible and reasonable measures that might spur economic growth. I know those conversations continue,” White House press spokesman Robert Gibbs told a daily news briefing. “Before we can create jobs we have to have economic growth that is on the positive side of the ledger,” Gibbs said, noting that the economy only began growing again in the third quarter, after suffering the worst recession in 70 years. President Barack Obama’s public approval rating has been hurt by soaring U.S. unemployment which, at 10.2 percent, now stands at a generation-high and could yet get worse. Obama will host a jobs forum on Dec. 3 to brainstorm what else can be done to boost employment, but said last week that he was wary of adding to the country’s record deficit from fear this may trigger a double-dip recession. (Reporting by Alister Bull ; Editing by Vicki Allen ) ((+1-202-354-5820, email: alister.bull@thomsonreuters.com)) © Thomson Reuters 2009 All rights reserved Link: UPDATE – W.House: reviewing ’sensible’ options to spur jobs (at Reuters)

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By The Associated Press NEW YORK – Oil prices rose above US$79 a barrel Monday on a weakening dollar and as Iran’s war games, aimed at protecting its nuclear plants, deepened tensions in the oil-rich region. By late morning, benchmark crude for December delivery gained $2.05 to $79.52 a barrel on the New York Mercantile Exchange. Iran on Sunday began large-scale air defence war games aimed at protecting its nuclear facilities from attack as an air force commander boasted the country could deter any military strike by Israel, state television reported. Analysts said the military exercises sharpened tensions in the Middle East, but they didn’t expect supplies to be affected. In the U.S., the National Association of Realtors said home sales rose 10.1 per cent in October. That is the highest level in more than two years and helped push crude prices higher on expectations of increased demand. Still, crude in U.S. storage is above normal levels for this time of year and it is the dollar that been the biggest driver behind rising oil prices. Investors holding stronger currencies can buy more dollar-based crude when the U.S. currency falls. But the refiners that turn crude into gasoline, jet fuel and diesel are cutting back because demand is so weak. The U.S. dollar began the week lower as a Federal Reserve official urged the continuation of stimulus programs and as home sales in October greatly exceeded market expectations, revving up traders’ taste for higher-yielding assets. In morning trading in New York Monday, the 16-nation euro rose to $1.4975 from $1.4857, while the British pound jumped to $1.6613 from $1.6481. In other Nymex trading, heating oil rose 5.5 cents to $2.03 a gallon. Gasoline for December delivery gained five cents to $2.03 a gallon. Natural gas for December delivery rose 9 cents to $4.515 per 1,000 cubic feet. In London, Brent crude for January delivery rose $1.96 to $79.16 on the ICE Futures exchange. Continued here: Oil rises above US$79 amid Iran war games, weakening dollar

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I am often accused of being a “Permabear” or “Doomer.” Nothing is further from the truth. I simply call things as I see them.  I did so with Musings before The Market Ticker began publication, I did so back in the 1990s when I ran MCSNet, and I still do. And let’s not kid ourselves – the economic news is simply not good.  Nor is it likely to get better. Take the leading economic indicators.  People point to the six-month improvement in the LEI as a sign of a “strong recovery.”  But the internals of that number are more sobering – unlike every other recession since the LEIs began being reported , the “real economy” subset of the LEIs is showing less than half of the “improvement” found in “bubble” components such as “stock prices.” The problem is the willful blindness to the real problem in the economy – that is, excessive debt. James Bullard of the St. Louis Fed, who came out this weekend in support of “more asset purchases”, underlined the reality: The Fed has been buying literally 90% of all of the new issue in Treasuries and MBS this year .  While their “Treasury” program was “only” $300 billion, the MBS program has allowed various people to exit their MBS position and swap into Treasuries – thereby papering over the near-complete destruction of interest in Fannie and Freddie paper. This morning I awoke to CNBC with Mr. Kroszner, former Fed Governor and University of Chicago Booth Business School nutball, “laud” the fact that an “independent” central bank had led to “better” inflation outcomes.  Really? I suppose if you don’t include in “inflation” the change in prices of things people actually need, you might be right.  You know, things like houses?  Food?  Gasoline?  Pharmaceuticals? Never mind that Bullard’s “speaking” over the weekend (and let’s remember, he’s a voting member starting next year!) had the clear effect of further torpedoing the dollar. A clear statement of intent to further debase the currency by purchasing MBS that under any reasonable read of Section 14 are unlawful for The Fed to buy , securities that are likely carrying huge unrealized losses yet will be purchased at intentionally-overinflated prices, is destructive to the currency.  This is what Fed secrecy has brought and continues to bring. The fact is that Krozner is forced to resort to flat-out lying to continue to defend the indefensible acts of his cronies (and indeed his own acts of the last few years at The Fed), which is what so-called “economists” and professors have been reduced to.  Government is complicit in these lies; indeed, they have every reason to do so, especially when it comes to so-called “inflation” numbers, as to do otherwise would be to make clear to everyone in the market exactly what sort of outrageous behavior (and the impact it has had on the economy) they have engaged in.  The CPI is insanely fraudulent by being laced through with “hedonic substitution” (when steak is too expensive they substitute hamburger, and call it “equivalent” since both are beef!) and willful refusal to include certain categories of expenditure at all (e.g. “owners equivalent rent” instead of actual house prices, when more than 60% of American families own a house!) A more accurate way to look at “inflation” is to look at the debt load that has been served up by our “independent” central bank.  And here you find the following chart, courtesy of The Fed’s own data: Notice the change .vs. GDP, and the increase as a percentage. As I have repeatedly pointed out, we are running between 8-9% growth in debt outstanding – on a compounded annual rate – since 1951. If this is “better inflation outcomes” I’d like to ask “what would be a worse inflation outcome?”  And don’t try to claim that the “anomaly” in the 1970s skews the data either – that would be a flat lie.  In fact, since 1990 to present the rate of change has been 7.90% and since 2000 8.49%. Let’s not kid ourselves.  The claim that “inflation has been low and controlled” is a flat lie.  GDP has consistently run 2-3% below debt levels since the 1950s and that “spread” has in fact been increasing in the last decade. This is what our Federal Reserve has brought us in terms of “monetary policy” and it is why we are in this mess. I know I have presented the above chart many times, but it will continue to be presented until people wake up and smell the damn coffee!  It is the policies of The Federal Reserve that have led to this mathematically-impossible circumstance. Secrecy breeds complicity and fraud, and nowhere is that more evident than at The Fed.  The NY Fed, for example, did funnel a huge amount of taxpayer money through AIG to foreign and domestic banks after, in secret, making known that it and Treasury would not allow AIG to fail, thereby destroying their negotiating position.   It was through secrecy that this was able to happen without the public raising a well-justified amount of hell at the time and now we are stuck with the consequences. The FDIC has taken a page out of The Fed’s “bamboozle ‘em by keeping ‘em in the dark” playbook, refusing to act to close banks until they are 20, 30, 40, even 50% underwater on asset prices.  How does this happen?  How do “bank examiners” not know that these “assets” are worth far less (or just plain worthless) than their book value?  There are only two possible explanations – willful blindness or outright idiocy. Neither is acceptable. Then there’s this – apparent FDIC refusal to disclose REO auction results!   It seems to me that a well-placed FOIA is in order, but is one really necessary?  The fact of the matter is that underlying asset prices are still collapsing in the real economy , as the ability to take on more debt to support the bubblelicious values of yesteryear simply does not exist.  The FDIC’s refusal to disclose is a raw attempt to prevent the market from realizing the truth – these so-called “assets” are deeply impaired (at best) and there are literally hundreds of banks and other institutions (including most especially The Fed!) that have securities “backed by” these assets that are worth far less than their alleged “face” value.  Recognition of this will set off another leg down in this crisis and the regulators and Washington DC folks know it.  They have spent over two years playing “extend and pretend” in the futile belief that valuations would recover by now – but they haven’t.  It is in fact mathematically impossible for them to do so as the net debt carrying capacity of the private sector has been exceeded. There are about $10 trillion worth of mortgages outstanding in this country (according to The Fed Z1); of that well over half is linked to Fannie and Freddie.  The actual underlying value of the homes linked to that debt was overinflated by roughly half during the years 2001-2007. Deutche Bank has estimated that more than half of all homes with mortgages will be “underwater” by the end of next year.  Hiding the reality of this calamity has become the mantra of the government and its agencies at this point – there is literally more than $1 trillion, and perhaps as much as $2 trillion, in additional residential real estate losses that are being hidden in the system right here and now, and The Government, either directly or via The Fed, is on the hook for the majority of it. The IMF warned this weekend that a second bailout would “threaten democracy”: Dominique Strauss-Kahn told the CBI annual conference of business leaders that another huge call on public finances by the financial services sector would not be tolerated by the “man in the street” and could even threaten democracy. “Most advanced economies will not accept any more [bailouts]…The political reaction will be very strong, putting some democracies at risk,” he told delegates. I hope you’re prepared for that, because our government has intentionally lied its way through this mess so far.  We have refused to force those who are holding paper at well above its actual value to recognize their losses (and indeed have made such a policy via accounting changes!), we have allowed The Fed to monetize $1.5 trillion dollars in bad paper (into which The Treasury immediately issued more debt in order to fund giveaways of various sorts, thereby instantly destroying any beneficial aspect that this program would have otherwise had), and we still have literal hundreds of trillions of “off exchange” derivatives with no accurate accounting of where the net exposure resides or in what amount it exists. Yes, the Stock Market has had a big rally.  So what?  Is the stock market the economy?  No.  Were Tulip Bulbs reflecting the underlying demand for tulips in Holland during the mania?  No.  Were tech stocks reflecting the underlying demand and business prospects for Internet-based businesses in 1999?  No.  Were stock prices in October of 2007 reflecting a strong fundamental outlook for the economy?  No.  Were housing prices, as Bernanke repeatedly asserted to the public and Congress, reflecting a “strong underlying demand for homes” in 2006 and 2007?  No. I continue to hear rumors of incipient disaster.  One of the latest, which has come at me from multiple sources, is that Moody’s intends to downgrade multiple states , as many as 20, within days or weeks.  This has been floating around in whispers for the last month.  Is this reality?  It damn well should be – California, New York, Michigan, Arizona, Nevada and Florida are all in serious fiscal trouble.  All built up public salaries and pensions, protected by state law or worse their state constitutions from cutbacks, along with unions willing to literally go to war to prevent reductions in expense.  Yet their funding base has and is collapsing – property taxes are going unpaid by banks and the government holding REOs, property valuations (and thus the tax base) are collapsing, business is in the tank destroying sales tax receipts, and those states that charge a personal and corporate income tax have seen those taxes collapse as well. California has what appears to be a $20 billion budget hole all on its own , and no prayer of being able to close it.  Between these states there are literal thousands of firefighters and police officers who have platinum-plated pension plans that are additionally double-dipping in some fashion, all of them “earning” six figures.  Universities that have gorged themselves on debt-fueled increases in tuition and fees running at a double-digit rate for more than a decade are now finding themselves trying to force students and their families to eat the outcome of their profligacy.  The local school district here in my town built a new addition on its elementary school – complete with tens of thousands of dollars in each classroom for “smart boards” and plasma televisions – the latter of which is used to display THE SCHOOL CLOCK for 90% of the instructional day.   Yes, you read that right – we have a school here that uses a $5,000 plasma television to replace a $10 clock.  We have so-called “health care reform” being pushed while the pharmaceutical companies have raised prices by nearly 10% in inflation-adjusted terms over the last 12 months and health insurance premiums have been rising at a double-digit rate annually for more than a decade.  The “support” for all of this has been one and only one thing – the ladling on of more debt throughout the system, and now that the private sector has reached its limit and is choking on it the government is trying to replace all of it with more borrowing of its own. This is the sort of rank stupidity that everyone thinks will be “ok” and it is literally everywhere through government and the mainstream media. This morning I woke up to see The Dollar trashed , down almost 1% overnight.  The expectation was that this would “pump” the stock market, and it did.  But does this matter if your dollars buy nothing? CNBS is full of bubble-heads that smile and make it all sound good.  Is this good? You have to love how destruction of a nation’s currency is cheered, with CNBS trying like hell to lead everyone into the stock market. The public is having none of it – retail simply is not “in” at this point, and the “boyz” are starting to recognize that they aren’t going to be.  Why should they? The “boyz” and “media” have lied to the public twice in the last ten years.  First in the 2000 wreck everything was a “buy” all the way down.  People had their hopes, dreams and retirement destroyed – all led by a bubblicious media that was telling you that it was “time to buy” because “stocks were selling at a tremendous discount.”  The orgasms on CNBC and elsewhere in 2001 and 2002, when there was still plenty of downside left, every time the market put in a good rally was clear, convincing – and outrageous. The “bull market” callers all showed up again on CNBS this summer – right around S&P 900.  Where were they at SPX 666? Indeed if you bought at 900 you’ve done well – for a while.  But who bought into the rally at 900?  Not retail.  This is all a trader’s market; the people have had it.  They’re tired of being lied to and no matter how far the pumpers push things by trading things back and forth the investors of the world have figured out the scam and are sitting on their hands.   Most of the “inflow” from Money Markets has gone not to stock but rather to bond funds .  The lesson?  You can screw people only so many times before they tired of it and simply leave you to play in your rigged casino - with yourself. Gold?  It hit $1172 this morning.  But bonds – especially the short end – are yielding zero .  That makes no sense, and one of them is wrong.  You don’t buy bonds that yield zero on the back of a currency devaluation exceeding 15% unless you expect both the dollar to rocket higher and the stock market to collapse. Gold, to a large degree, is being hyped based on Internet-circulated stories of “salted” bars filled with tungsten.  If true – if the so-called “Gold” at Ft. Knox and elsewhere turns out to be false then there is a nightmare about to unfold, and the dollar could easily collapse – especially if this subterfuge is traced to the US Government. But if this is false, then you’re witnessing one of the biggest scams and correlated frauds ever in the history of the markets – and the bond market will be proved correct. Whichever the case may be someone is going to be proved critically wrong in the coming days, weeks and months.  There are times for tremendous caution, and when asset prices are supported by secrecy and outright fraud the public would be well-advised to stay well away from exposure to those parts of the market that would lead to a 50% or greater loss in a near-straight line. Unfortunately, at present, this is essentially every asset class – except perhaps copper-coated lead. Read the original: Turkeys All Around

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Turkeys All Around

LONDON (AP) — The international economy is still fragile and vulnerable to shocks despite recent improvements in financial markets, the managing director of the International Monetary Fund said Monday. Dominique Strauss-Kahn told business leaders in London that he believes the worst of the economic crisis has passed — but that problems remained. “The economy remains very much in holding pattern — stable and getting better but still highly vulnerable,” he said in a speech to the Confederation of British Industry, the country’s main business lobby group. “It is difficult to claim that the crisis is over when unemployment is at historic highs and getting higher still.” Strauss-Kahn also said Asian countries needed to help drive international growth. American households have traditionally been the main drivers of international growth, consuming goods exported by other countries, but Strauss-Kahn said this model needs to change. “If we are to have sustained global growth, somebody else needs to step in,” he said. “China and other emerging Asian economies are shifting from exports to domestic demand but they have some way to go.” British Prime Minister Gordon Brown, also speaking at the same conference, agreed investment from China could help drive Britain’s economic recovery. “In our new growth strategy I want not just hundreds but thousands of Chinese companies in Britain, and British companies in China,” Brown said. Britain is struggling with a major downturn despite attempts by the government and Bank of England to boost the economy, including holding interest rates at a record low of 0.5 percent since March, an unprecedented 175 billion pound ($290 billion) injection into the money supply and billions more through fiscal measures. Brown said in the speech that he does not expect to withdraw fiscal support soon. “Choking off recovery by turning off the life support for our economies prematurely would be fatal to British jobs, British growth and British prosperity for years,” he said. Brown also said he wants to improve rail links between Britain and continental Europe. He said he wants to build a high-speed line that would link the north of Britain to European cities like Cologne and Amsterdam. At the moment, the rail links between Britain and the rest of Europe originate in London. The rest is here: IMF chief: Global economy still fragile (AP)

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* Two preferred buyers seen to have financial ability -Kumho * S.Korean builder expected to grow share in Middle East (For FACTBOX on South Korean M&A deals in the pipeline, click on [ID:nSEO336770] SEOUL, Nov 23 (Reuters) – An Abu Dhabi fund-led consortium and a group including a U.S. builder have been picked as preferred buyers of Daewoo Engineering & Construction Co Ltd ( 047040.KS ), a deal estimated to fetch about $2.6 billion. Analysts say foreign buyers could be attracted by Daewoo’s reputation as a leading South Korean builder of houses and plants, and its record in high-potential markets in the Middle East and Africa. The Middle East, led by Saudi Arabia and the United Arab Emirates, accounts for 60 percent of South Korean builders’ overseas orders, riding the infrastructure construction boom with strong oil prices and buoyant economic growth. Kumho Asiana Group, parent of the country’s No. 4 builder by market value, and sale managers have selected JABEZ Partners and TR America Consortium as preferred negotiators, they said in a joint statement on Monday. JABEZ Partners attracted wealth fund Abu Dhabi Investment Council (ADIC) as a major investor, while TR America Consortium included Tishman Construction of the United States and an unidentified wealth fund from the Middle East. “Both have a great deal of synergy potential to generate with Daewoo Engineering & Construction in the Middle East and North American markets and showed their strong intentions for the acquisition during preliminary due diligence period,” the statement said. By the Nov. 18 deadline, three bidders had submitted final bids, including an unidentified Russian company, Kumho said on Saturday. Both of the preferred buyers are also seen as financially capable of the possible acquisition of the South Korean builder, it added, dismissing speculation that the bidding groups did not have sufficient financial capability to execute the deal. The two final bidders will study Daewoo Engineering’s books in following weeks, with Kumho aiming to complete the sale within the year. Kumho has put a majority stake in Daewoo Engineering up for sale as it has to buy back a stake held by financial investors at far above the market price in tranches starting in December. [ID:nSEO130689] Tishman Construction, a privately-held firm headquartered in New York, was the construction manager of One World Trade Center, according to its Web site www.tishmanconstruction.com. Bidding prices ranged between 20,000 and 24,000 won per share, the Yonhap reported last week, which was far above Monday’s closing price of 13,900 won. Korea Development Bank (KDB) and Nomura ( 8604.T ) are handling the process.  Continued… Visit link: UPDATE 1-Kumho picks 2 preferred buyers of Daewoo Eng

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By Lincoln Feast SINGAPORE (Reuters) – Gold rose more than 1 percent to a record high on Monday as concerns about accelerating inflation and weak economic growth prompted investors to seek relatively safer assets, while supply concerns boosted oil and copper. Asian stocks also rose, led by gains in Australia thanks to higher resource stocks, although volumes were light with Japan out on holiday. Many investors have been reducing their positions and cutting risk as a strong year begins to wind down and with economic indicators still showing scant evidence of a sustained recovery. Highlighting the growing concerns evident in the market, yields on U.S. 2-year Treasuries have fallen below 0.75 percent, approaching levels seen at the height of the financial crisis in December last year. “It worries me that two-year yields are trading as they are plus (short-dated) bill rates went negative and gold is bid, bid, bid,” said Robert Rennie, chief currency strategist at Westpac. “It makes me think there is a huge flight to quality going on that hasn’t hit FX yet…perhaps a bit of a warning sign.” The dollar, which often rises in times of increased uncertainty and worries about global growth, gave up early gains against a basket of currencies , while the commodity-linked Australian dollar benefited from the strong gold price. Spot gold was trading around $1,162 an ounce, having hit a peak around $1,163, up a third so far this year. Helped by the safe haven bid and purchases by a number of central banks, gold has surged since the start of November, hitting nine record highs and gaining 11 percent in the past three weeks. STOCKS STALLED The heightened sense of caution has stalled a rally in global stocks, which have traded in a broad range since mid-October. After falling last week, MSCI’s index of Asia-Pacific stocks outside of Japan rose 0.7 percent, taking its gains so far this year to almost two-thirds. Japanese markets were closed for a holiday. Australian shares rose 0.6 percent, with shares of Drillsearch Energy Ltd jumping more than 19 percent after the company reported a promising oil find. Crude oil futures rose 1 percent to $78.24 a barrel, supported by heightened tensions between Iran and Western nations which raised speculation of a potential supply risk. Iran’s armed forces launched large-scale air defense war games on Sunday to show off the country’s deterrence capabilities in the face of pressure from the West over its nuclear program, and a cleric in the Revolutionary Guards warned that the Islamic Republic would fire missiles at “the heart of Tel Aviv” if attacked. “There’s always a supply risk premium that can arise from these elevated tensions in the Middle East and that is a factor pushing up oil prices this morning,” said Toby Hassall, a commodities analyst at the Commonwealth Bank of Australia. Supply concerns also supported copper, which was testing $7,000 a metric tons amid strikes by workers in Chilean mines. Originally posted here: Gold at record; resource plays boost stocks

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SINGAPORE (AP) — Crude prices rose above $78 a barrel Monday in Asia as Iran staged five days of war games, boosting tensions in the oil-rich region. Benchmark crude for January delivery was up 78 cents to $78.25 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 26 cents to settle at $77.20 on Friday. Iran on Sunday began large-scale air defense war games aimed at protecting its nuclear facilities from attack as an air force commander boasted the country could deter any military strike by Israel, state television reported. It said the five-day drill will cover an area a third of the size of Iran and spread across the central, western and southern parts of the country. Analysts said the military exercises boosted tensions in the Middle East, but they didn’t expect supplies to be affected. “Given the trading range we’ve been in, some investors are going to view $77 as a possible buying opportunity and the Iranian war games gives an excuse to buy,” said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. Oil has traded between $76 and $82 for more than a month amid concerns a sluggish global economy may not justify the price surge from $32 in December. This week investors will also be mulling data on U.S. home sales and prices, consumer confidence, initial claims for jobless benefits and revised third quarter gross domestic product figures. Friday marks the start of the holiday shopping season with the day after Thanksgiving traditionally considered a key barometer of consumer spending. In other Nymex trading, heating oil rose 2.01 cents to $2.00 a gallon. Gasoline for December delivery gained 1.72 cents to $2.00 a gallon. Natural gas for December delivery jumped 9.1 cents to $4.52 per 1,000 cubic feet. In London, Brent crude for January delivery rose 76 cents to $77.96 on the ICE Futures exchange. Follow this link: Oil rises above $78 amid Iranian war games (AP)

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MADRID (AFP) – With Spain facing its worst recession in decades, the government will approve this week a sweeping package of reforms aimed at changing the nation’s economic growth model, Prime Minister Jose Luis Rodriguez Zapatero said Sunday. The reforms will touch on all areas of the economy from labour laws to the education system so that “Spain once again grows strongly and in a more sustained way,” he told a gathering of his Socialist Party in Madrid. “We have always been the party of change, the party which has known how to give new opportunities to Spanish society. We have known how to do it, we have done it and we will do it again,” he added. The prime minister said the reforms would include a focus on renewable energy, high quality education and a more modern public administration but he provided no concrete details. The Spanish economy contracted 0.3 percent in the third quarter, its fifth straight quarterly decline, contrasting with a return to growth in the entire eurozone of 0.4 percent during the same period. Europe’s fifth-biggest economy has proved especially vulnerable to the global credit crunch because growth relied heavily on credit-fueled domestic demand and a property boom boosted by easy access to loans. Spain’s unemployment rate has doubled over the past two years to hit nearly 18 percent, the highest level in Europe, with construction workers leading the job losses. The country of just over 46 million people accounts for roughly half of the rise in the number of jobless in the 16 countries sharing the euro currency over the last year, according to the European Union’s statistics office Eurostat. Earlier this month, the head of the Bank of Spain, Miguel Angel Fernandez Ordonez, warned that the country’s growth model was “unsustainable” as it was excessively based on construction. He also called for reforms in the labour market, without which he warned Spain faced a long period of high unemployment. Spain accounts for just three percent of “high-quality” European exports, compared with 12 percent for France or almost a third for Germany, according to the Paris-based CEPII institute. Read the original: Spanish PM vows sweeping reforms to boost economy

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BAGHDAD (AP) — An Iraqi official says insurgent attacks caused a 4 percent drop in the country’s oil exports in October compared to the previous month, but that revenues were up due to higher prices. Oil Ministry spokesman Assem Jihad says exports averaged 1.877 million barrels a day in October, grossing $4.187 billion with an average price of $71.94 a barrel. September oil exports stood at 1.956 million barrels a day and yielded $3.877 billion with an average price of $66.05 a barrel. Jihad told The Associated Press Sunday the slip in exports was due to two insurgent attacks on the pipeline that sends crude to Turkey’s Mediterranean port of Ceyhan, causing a nine-day disruption. Oil sales account for about 95 percent of Iraq’s total revenue. Read the original: Iraq’s Oct. oil exports drop due to attacks (AP)

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NEW YORK (AFP) – The 20-year record high bankruptcy rate for US banks and businesses is giving regional banks on sound footing the opportunity to expand swiftly and on the cheap. “It’s a significant opportunity because they are able to acquire assets that have been backed-stopped by the FDIC (Federal Deposit Insurance Corporation), that means the losses are covered by the FDIC,” Standard & Poor’s analyst Erik Oja told AFP. Quite often, he added, it’s a “very, very good deal for the surviving bank” that gets assets at a discount. More than 120 banks went belly-up this year in the United States, the highest bankruptcy rate since the savings and loan crisis of 1992. The current financial crisis has led to a big consolidation drive by the country’s largest banks: JPMorgan Chase bought Bear Stearns, Bank of America acquired Countrywide and Merrill Lynch, Wells Fargo purchased Wachovia and PNC absorbed National City. The same consolidation move is sweeping smaller, regional banks, with some launching into real takeover frenzies. Earlier this month, California’s East West Bank doubled in size after it acquired San Francisco-based United Commercial Bank. Minnesota-based US Bancorp, the country’s sixth-largest commercial bank with 264 billion dollars in assets, has expanded across the country this past year to the tune of some 26 billion dollars. In October alone, US Bancorp took over nine banks in the southwest. Even the small Ameris Bank, of Moultrie, Georgia, the US state hardest hit by the sub-prime mortgage cisis, has bought two banks in recent weeks. By agreement with the FDIC, Ameris acquired United Security Bank’s 111 million dollar loan portfolio at a 33 million dollar discount. It also assumed 150 million dollars in deposits. Ameris also bought American United Bank at a 20 million dollar discount, assuming 101 million in deposits and 83 million in loans. In both cases, “the loans being purchased are covered by a loss share agreement which affords Ameris Bank significant loss protection for the next five years,” Ameris said on its website. The Stillwater, Minnesota-based Central Bank purchased four banks from its region. A rapid expansion, however, is often based on leverage. East West, for example, financed its acquisition of United Commercial Bank with a new share issue. Despite the FDIC loss-share agreement, takeovers are not risk-free. As with any merger, it involves harmonizing two different business cultures, computer systems and procedures, as well as keeping the best employees and clients, who often move deposits to a rival bank, Oja said. Banks planning a takeover must first touch base with the FDIC, which looks into their financial standing before allowing access to a target bank’s balance sheet and possibly giving a green light for bids. The purchasing offer for the target bank has to be reconciled with the asking price, and the FDIC also makes sure the takeover does not reduce banking services in rural areas. Originally posted here: US regional banks grow on the cheap amid crisis

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MADRID (AFP) – Thousands of Spanish farmers on Saturday marched through the streets of Madrid, halting traffic to protest the low prices they receive for their produce which they say is leading them to financial “ruin.” The farmers and their supporters came from across the country and they walked behind tractors along Madrid’s main avenues under banners with the theme “The countryside is heading towards ruin, take action.” “Prices must be held steady. Producing a kilogramme of olives costs me three times more than the price they are sold for,” a farmer from the southwestern region of Extremadura, Antonio Sanchez, told AFP. Spain’s largest farmers federations — the ASAJA, COAG and UPA which organised the demonstration — say farmers suffered a 26 percent drop in real income between 2003 and 2008, while their costs rose by 34 percent during this time leading to the loss of 124,000 jobs. They want the government to guarantee the minimum prices paid for their products by commercial middlemen who they say are taking too high a cut and limits on prices rises for fuel, fertilisers and pesticides. “The cauliflower which I sell for 30 cents is resold for 1.50 euros in the supermarket. Profits must be shared, its unjust,” said Fernando Ambros Carpi who runs a farming cooperative near the southern town of Arco de la Frontera. Spain’s agriculture sector accounts for around three percent of the nation’s gross domestic product. Read this articl e: Thousands of Spanish farmers protest low prices

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BERLIN (AFP) – A panel of top German economists, which has slammed the country’s huge public debt, says Chancellor Angela Merkel’s new government should take back its “gift baskets” of tax relief, a German weekly reported. Merkel “promised us that the government would do everything so that our gloomy forecasts would not happen… They can therefore pack up again their beautiful gift baskets,” Wolfgang Franz, head of the so-called “Five Wise Ones”, told Der Spiegel in the issue to be published Monday. The influential panel of economists has forecast growth of 1.6 percent for 2010, which it says is not enough to replenish the public coffers. Two weeks ago they criticised the lack of “concrete information” from the new centre-right government about their plans to reduce the deficit and deal with expected massive drop in tax revenue. A tax relief package, already voted on by the German parliament amounting to some 8.5 billion euros (12.6 billion dollars), is set to take effect in January. In the panel’s annual report released earlier this month, the economists issued a sharp attack on the new government saying its plans to reduce the country’s ballooning debt were “vague” and “deceptive”. Merkel, re-elected in September at the head of a new coalition, failed to recognise the scale of the challenges facing Europe’s biggest economy, it said. In particular the new coalition of conservatives (CDU) and liberals (FDP) has failed to spell out how it will reduce Germany’s budget deficit and an “exit strategy” for reducing massive stimulus measures propping up the economy, the panel said. Michel Fuchs, deputy head of the CDU parliamentary group, called the panel’s criticisms “not only presumptuous and false, but also dangerous”. “We are an independent group…. We deliberately express ourselves in terms that are clear and not very diplomatic,” Franz told Der Spiegel. “Our mandate is to warn against bad developments, not to sing someone’s praises.” He said “the government cannot rely only on growth, which will not be enough to generate the 37 billion euros which we estimate are needed between now and 2016 to consolidate” the public finances. Data from the national statistics office earlier this month indicated that the German economy made a comeback in the second and third quarters of 2009 from its worst post-war recession, in large part owing to huge injections of cash — some 80 billion euros — from the state. Read the original post: Top German economists critical of tax relief: report

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SAINT PETERSBURG (AFP) – Russian Prime Minister Vladimir Putin on Saturday strongly backed President Dmitry Medvedev’s call for economic modernisation, moving to smother talk of differences between the two leaders. Medvedev had in a state-of-the-nation address on November 12 made his strongest call yet for Russia to end its dependence on oil exports and modernize its economy, in a speech some analysts saw as a challenge to Putin. “I am sure that this call reflects the mood of all of Russian society,” Putin responded in a keynote speech to the annual congress of the ruling United Russia party in Saint Petersburg as Medvedev looked on. “The crisis, with all its severity, has shown how costly it is for a country to reject innovation, have low work productivity, waste resources and have a slow bureaucracy,” Putin said in his hour-long speech. “The president posed the question about the necessary, thorough modernization of the Russian economy — overcoming chronic backwardness and moving the country to a more modern level of development,” Putin added. United Russia, which holds a majority of 315 out of 450 seats in the lower house of parliament, has been criticised by some analysts for holding a dominant position akin to that of the Communist Party in the Soviet Union. The party showed off its confidence with a glitzy conference marked by a deafening rendition of the Russian national anthem and the attendance of celebrities ranging from pop singers to Olympic gymnasts to cosmonauts. Yet Medvedev — who has made pledges for reform in Russia his calling card — said it was also time for United Russia to modernize and appeared to scold it over alleged violations in local elections earlier this year. “The party needs to modernise and make itself more flexible. It needs to start winning in an open fight,” Medvedev said in a speech just before Putin’s keynote address. “Democracy exists, at the end of the day, not for the party… but for the citizen,” said Medvedev. In a rare rebuke for the ruling party, the president lambasted regional offices of factions, including United Russia, for letting “office intrigues” and “administrative procedures” get in the way of democracy in elections. Parliament speaker Boris Gryzlov hailed the speeches, which he described as setting out “how the country will look in 10 years time”. He said the congress had also set the seal on the concept of “Russian conservatism” as the party’s main ideology. Putin is the leader of United Russia, although curiously he and Medvedev have declined to become card-carrying members of the party in an apparent bid to stand above the fray of day-to-day politics. Putin congratulated United Russia, which dominates the Russian parliament, on working to prevent the economic crisis from turning into the financial meltdown that Russia had experienced in 1998. “We have held this promise,” Putin said to a burst of applause from thousands of delegates in his home city. But he also warned that Russia’s GDP would still contract 8.0-8.5 percent this year. “This is not as much as we expected… but it is still a lot and worse than in several other countries,” Putin said. Putin pledged the government in 2010 would press on with its policy of offering state guarantees for corporate loans, allowing companies to take out around 500 billion rubles (17.2 billion dollars) in credit. Economists say Russia has suffered especially badly in the economic crisis due to its failure to implement reforms during Putin’s 2000-2008 presidency when it was helped by high oil prices. The speech represented a reversal of the November 12 state-of-the-nation address when Putin — still seen by most as the Russian number one — had sat quietly and attentively as Medvedev laid out his vision for Russia’s future. But this time it was Medvedev who listened to the speech, although he had earlier repeated his call for economic modernization in his shorter introductory address. Read this articl e: Putin backs Medvedev’s call for Russia modernisation

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A growing number of states reported rising jobless rates in October, and thirteen states reported unemployment rates above the national average of 10.2%, according to a government report released on Friday. Overall, jobless rates increased in 29 states and the District of Columbia last month, while they fell in 13 states, according to a monthly Labor Department survey on state unemployment. In September , 23 states and Washington D.C. reported that their unemployment rates increased, and 14 states had jobless rates above the national average. Michigan remained the state with the highest rate of unemployment at 15.1%, though that rate was down 0.2 percentage points from September. October was the 11th straight month in which Michigan posted an unemployment rate above 10%. Still, that’s nowhere near the 68-consecutive months in which Michigan had double-digit unemployment between 1980 and 1985. That included a record high of 16.9% in November 1982. Some signs of improvement In a sign that the worst-hit state may be experiencing a glimmer of recovery, Michigan added 38,600 jobs in October, more than any other state except for Texas, which added nearly 42,000 jobs. California added 25,700 jobs last month. In fact, the Labor Department reported that 28 states added jobs in October. “While we have been focusing on a very broad, deep recession, as we get into a recovery, we may see some more regional improvements,” said Robert Dye, senior economist at PNC Financial Services Group. “Those that will do well are areas tied to the federal government, manufacturing, oil production and trade. But those more heavily exposed to the housing industry will lag behind.” Dye said Texas, Louisiana and the surrounding Washington D.C. areas in particular will start creating jobs faster than other locations. Florida, Arizona and Nevada, which have been hit the hardest by the housing crisis, will continue to lose jobs, he said. Unemployment rates, which are taken from a separate survey, tend to rise even as the employers start hiring again, because the survey only counts people who are looking for work. When times are bad, many people become discouraged and give up their job search, so they are not counted in the unemployment data. Job losses nationwide Every state had an unemployment rate in October that was higher than a year ago, and every state has lost jobs over the course of the year. The vast majority of states showed very slight increases or decreases in their unemployment rates. Only a few had significant jumps in their jobless rates. Unemployment rates in Alaska and Wyoming both rose 0.6 percentage points. Arkansas’ rate grew 0.5 points last month. North Dakota continued to post the lowest jobless rate, coming in at 4.2%, which was unchanged from September. It was followed by Nebraska with 4.9%, South Dakota at 5%, Montana at 6.4%, and Vermont and Utah at 6.5%. Unemployment was highest in the western part of the country. That region now has a jobless rate of 10.8% — the highest rate ever in the 33-year old state unemployment report. The Northeast again had the lowest rate of unemployment at 9%, the same level as the previous month. Earlier in November, the Labor Department reported that the nation’s unemployment rate rose above 10% for the first time since 1983. With unemployment rising, the Obama administration announced it will hold a jobs summit on Dec. 3. Obama will meet with financial experts and business leaders to discuss strategies to deal with the nation’s labor problem. To make matters worse, a government report released on Wednesday showed that 1 million people could lose their unemployment benefits in January if Congress doesn’t extend federal aid to the jobless. Earlier this month, President Obama signed a bill to extend government-provided unemployment insurance, but the law only helps those who exhaust their benefits by the end of 2009. Continued here: State unemployment rates rise (CNNMoney.com)

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WASHINGTON, Nov 21 (Reuters) – President Barack Obama on Saturday urged Americans to show patience over the economy and argued that his just-concluded Asia trip was critical for U.S. exports, countering criticism he had returned empty-handed. With unemployment at a generation high of 10.2 percent and once-lofty popularity ratings down, Obama said a December White House forum will leave no stone unturned in the hunt for jobs. “Even though it will take time, I can promise you this: we are moving in the right direction; that the steps we are taking are helping,” Obama said in his weekly address, amid signs that the public is getting impatient for results. A Gallup poll on Friday showed Obama’s job approval rating had dropped to 49 percent, the first time he has fallen below 50 percent in this survey, as Americans express dissatisfaction with his handling of the economy and other issues. Obama’s remarks on the economy were his first in public since returning to Washington after an 8-day Asian tour where critics said he had failed to win significant concessions on trade or currency manipulation from partners like China. But Obama said that progress had been made with Russia and China in sending a unified message to Iran and North Korea about giving up nuclear weapons “or face the consequences,” while also maintaining pressure to stimulate growth. “Above all, I spoke with leaders in every nation I visited about what we can do to sustain this economic recovery and bring back jobs and prosperity for our people,” he said. U.S. growth jumped in the third quarter, ending the longest economic slump the country has suffered in 70 years, but this has not yet translated into a faster pace of hiring. Obama’s Dec. 3 jobs forum will gather leaders from business and labor to review how to boost credit to small business, encourage firms to hire and boost green jobs and other ideas. But the White House has already said it will not be about a second stimulus package, potentially limiting how much of a dent the initiative will be able to make in the 15.7 million Americans who were drawing unemployment aid in October. Obama signaled that any measures hammered out during the jobs conference would have to be fiscally responsible. “It is important that we do not make any ill-considered decisions — even with the best of intentions — particularly at a time when our resources are so limited. “But it is just as important that we are open to any demonstrably good idea to supplement the steps we’ve already taken to put America back to work. That’s what I hope to achieve in this forum,” he said. (Additional reporting by Steve Holland in Washington) (Reporting by Alister Bull ; Editing by Sandra Maler ) See the original post here: Obama asks Americans for patience on economy (at Reuters)

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After a successful late-night bargaining session, the Canadian Auto Workers Union and management at Johnson Controls have reached a tentative agreement on a new three-year labour deal. The deal, which will be subject to a ratification vote set for Sunday at 1 p.m. ET, was struck early Saturday morning between management and workers of the plant located in Lakeshore, Ont., east of Windsor. Both sides had been in talks over a new contract since Monday. CAW representatives told CBC News they were confident the deal would be ratified. If ratified, the deal means Johnson’s 120 employees can remain on the job and thereby avoid interrupting production at Chrysler’s Windsor assembly plant. Johnson Controls builds overhead components, or headliners, for the Dodge Grand Caravan and Chrysler Town and Country minivans. Headliners involve wiring in the roof of vehicles and are installed during the earliest stages of assembly. Without them, the Chrysler assembly plant would have to shut down in about three hours, forcing more than 4,500 plant workers off the job, said CAW Local 444 vice-president Dino Chiodo. Even car dealers were worried about what a strike at Johnson Controls would do to business. The two sides bargained until 9 p.m. Thursday night and were back at the table by 7 a.m. on Friday, Chiodo told CBC News. Job security was a key issue in the negotiations. Johnson Controls’ 2009 fourth-quarter sales dropped 15 per cent, from $9.3 billion US in 2008 to $7.9 billion in 2009, forcing the company to find new ways to cut costs. Read this articl e: CAW, Johnson Controls reach tentative deal

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WASHINGTON (AP) — Suitably opaque, Section 2006 takes up only a few dozen lines in a sweeping health care bill that runs to 2,074 pages and mentions neither Sen. Mary Landrieu nor her state of Louisiana. AP – Sen. Mary Landrieu, D-La., walks in the Capitol before heading into a Democratic caucus on health care reform … But the section’s purpose is indisputable: to deliver $100 million or more in federal funds to the state. And in the process clear the way for one of three moderate Democratic fence-sitters — Ben Nelson of Nebraska and Blanche Lincoln of Arkansas are the others — to help propel the legislation past its initial hurdle in a crucial Saturday vote. Nelson, Landrieu and Lincoln emerged several days ago as the last public holdouts among 58 Democrats and two independents whose votes Majority Leader Harry Reid and the White House must have to overcome the Republicans’ attempt to strangle the bill before serious debate can begin. Each has moved carefully with an eye on home-state voters. And inside the Senate, each has taken advantage of the political leverage newly available. Alone among the three, Nelson issued a statement Friday ending any lingering public suspense about his intentions. “The Senate should start trying to fix a health care system that costs too much and delivers too little for Nebraskans,” he said, adding his decision should not be seen as an indication of how he will vote on the legislation itself. Nelson had been publicly signaling his intentions for more than a week, and his words presumably came as no surprise to Reid or the White House, which issued a statement Friday saying the bill “provides the necessary health reforms that the administration seeks.” This sort of political minuet can be delicate, as shown when the Senate’s second-ranking Democrat, Dick Durbin of Illinois, said earlier on Friday that Lincoln had already confided to Reid how she planned to vote. Republicans, eager to scuttle the bill — and defeat Lincoln in 2010 — instantly accused the two-term senator of telling Democratic party leaders before informing her own constituents in Arkansas. “No other senator speaks for Senator Lincoln. She is still reviewing the bill,” declared the senator’s spokeswoman, Leah Vest DiPietro, adding her boss had not yet made up her mind. For his part, Durbin sought to quickly close the loop with a statement saying he had been unclear and misinterpreted. As for Nelson, several officials, speaking on condition of anonymity, said he had insisted Reid omit from the bill any change in the insurance industry’s protection from federal antitrust law. The House version of the legislation would expose the industry to scrutiny by both the Justice Department’s antitrust lawyers and the Federal Trade Commission. Reid, who spoke out strongly in favor of the change in antitrust treatment earlier in the fall, left it out of the bill he drafted over several weeks and unveiled on Wednesday. Lincoln has been the most close-mouthed about her intention. As a committee chairman, she is the most powerful of the group. As the only one of the three seeking re-election next year, she is also the most politically vulnerable. In public, she has asked that the bill be available for 72 hours before the vote occurs. In private, her demands have been more substantive, according to officials who did not describe them. She is virtually certain to be criticized no matter what her vote. After the House cleared its version of the legislation this month, a conservative group began airing commercials criticizing Rep. Vic Snyder, D-Ark., for voting in its favor. At the same time, MoveOn.org, a liberal organization, slammed another one of the state’s lawmakers, Rep. Mike Ross, for opposing it. A hint: At home, Lincoln has suggested her vote will be influenced by former President Bill Clinton, who was Arkansas governor for 12 years before winning the White House. Clinton recently met privately with Senate Democrats, telling them that passing an imperfect bill was better than nothing. “We don’t ever go to Washington with the idea that we’re going to create a work of art,” Lincoln said afterward. “It’s got to be a work in progress.” She and the other moderates face pressure from business groups opposed to the legislation. In a statement Friday the Business Roundtable, which represents big company CEOs, said the Senate bill “will not effect the needed changes to measurably improve the American health care system.” Democrats and the White House had seized on a report by the same group last week concluding that some of the provisions under consideration by Congress had the potential to tame runaway medical inflation. Of the three centrists, Landrieu has been the clearest about her intentions, and her interests ranged beyond health insurance to the oysters for which Louisiana is famous. When the Food and Drug Administration proposed banning sales of raw oysters from the Gulf of Mexico during warm weather months, Landrieu and others objected. A week ago, the agency thought better of the idea and shelved the plan in favor of further study. “I’m really thankful that they listened,” said Landrieu, who had met with FDA Commissioner Margaret Hamburg to discuss the issue. Over recent weeks, Landrieu has issued a string of statements outlining the areas she wanted addressed for the benefit of her constituents — issues that could be dealt with only after health legislation made it to the Senate floor. After meeting with Reid almost a month ago, she mentioned the “unique challenges Louisiana is facing in terms of Medicaid.” In a Senate speech and statement, she noted that Louisiana has the highest breast cancer death rate in the country and the lowest female life expectancy of any state. And she said, “Unless something is done, annual health care costs for small firms over the next 10 years are expected to more than double to reach $339 billion in 2018.” Landrieu can point to provisions in the legislation that are designed to attack all three problems. They include Section 2006. Reading it is of little assistance. “Special adjustment to FMAP Determination for Certain States recovering from a Major Disaster” is the title, and about two pages of similarly indecipherable legalese follows. According to the Congressional Budget Office, it will send an additional $100 million to Louisiana to help it cover costs for Medicaid, the federal-state health care program for the poor. Should Landrieu decide to side with Republicans this weekend, she would also be voting to deny her state those funds. Associated Press writer Andrew DeMillo in Little Rock, Ark., contributed to this story. Originally posted here: Moderate Dems pivotal in Saturday health care vote (AP)

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* C$ falls to C$1.0699 to U.S. dollar * Currency down 1.8 pct for the week * Sluggish oil, equity prices weigh (Updates to close, adds quotes) TORONTO, Nov 20 (Reuters) – The Canadian dollar fell on Friday, mirroring losses in commodity and stock markets, as many investors sold riskier assets on concerns about global growth and to lock in gains as year-end approaches. The currency was also hit by broad-based gains by the U.S. dollar against a range of currencies for a second session as the greenback benefited from the drop in risk tolerance. [USD/] The Canadian dollar touched a session low of C$1.0733 to the U.S. dollar, or 93.17 U.S. cents, its weakest level since Nov. 9. The unit “hasn’t really exhibited much strength at all. It seems to me a fair portion of this does fall to the U.S. dollar,” said Eric Lascelles, chief economics and rates strategist at TD Securities. Canada’s currency finished at C$1.0699 to the U.S. dollar, or 93.47 U.S. cents, down from Thursday’s close C$1.0635 to the U.S. dollar, or 94.03 U.S. cents. The greenback’s gain and falling risk appetite hit commodity prices, which heavily influence the Canadian dollar because the country is a commodity exporter. Oil edged lower, dropping nearly 1 percent to below $77 a barrel, extending a 2 percent fall in the previous session. [O/R] The market appeared to shrug off comments late on Thursday from Bank of Canada Governor Mark Carney who said Canada’s economy performed worse than expected in the third quarter and risks further setbacks due to the sharp rise of the Canadian dollar. [nN19514256] Finance Minister Jim Flaherty vowed on Friday to resist big, new spending measures in his next budget, but said it was too early to pull stimulus away from a still shaky economy. [ID:nN20237039] A report out on Friday showed Canadian bankruptcies rose about 29 percent in September from a month earlier, as consumers felt the squeeze of rising debt and a weak job market. [ID:nN20314679] Canadian economic reports due out next week include monthly retail sales and third-quarter current account data. ECONCA BOND PRICES MOSTLY FIRMER With no major Canadian economic data out on Friday, most domestic bond prices tracked moves in the big U.S. Treasury market, where short-term issues rallied on fund demand before the year’s end. [US/] “It has long been our view that the Canada short end has been cheap and some of that mis-valuation is being worked out in the market today,” said Lascelles. “This is very much a day of adjustment as opposed to responding to any particular news.” The two-year bond CA2YT=RR rose 2.5 Canadian cents to C$99.99 to yield 1.255 percent, while the 30-year bond CA30YT=RR fell 30 Canadian cents to C$117.75 to yield 3.937 percent. Canadian bonds outperformed their U.S. counterparts across much of the curve. The Canadian 10-year bond was 1.8 basis points above the U.S. 30-year yield, compared with 4.5 basis points on Thursday. (Reporting by Jennifer Kwan and Jeffrey Hodgson; editing by Rob Wilson) © Thomson Reuters 2009 All rights reserved Visit link: CANADA FX DEBT-C$ falls with commodities as risk appetite wanes (at Reuters)

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(Adds closing stock prices, comment) MEXICO CITY, Nov 20 (Reuters) – Mexican stocks fell on Friday as investors around the world cut exposure to risky assets and high-yield currencies amid worries about the strength of the global economic recovery. The IPC stock index .MXX closed down 0.49 percent at 30,666.51 while the peso MXN= MEX01 slipped only 0.03 percent to 13.072 per U.S. dollar, despite broad gains in the U.S. currency, with support coming from speculation Mexico may be able to skirt a downgrade of its debt from Wall Street ratings agencies. European Central Bank President Jean-Claude Trichet said Friday it was premature to declare the financial crisis over, and he warned that banks risk becoming addicted to the cheap money from emergency government stimulus programs and must be prepared for its withdrawal. “Trichet’s comments feed the worry a bit that the recovery could be a bit limited if they start pulling out stimulus,” said Carlos Alonso, a trader at Interacciones brokerage firm in Mexico City. Also hurting assets in Mexico, which sends about 80 percent of its exports to the United States, U.S. homebuilder D.R. Horton Inc ( DHI.N ) posted a fourth-quarter loss that was wider than expected and said market conditions were “still challenging.” “We have more U.S. housing data next week, and Horton’s report suggests the numbers could be weak and this correction could continue,” Alonso said. Doubts about the strength of the U.S. economic recovery could undermine confidence in Mexico’s own recovery prospects. Speaking in New York on Thursday, Mexican Finance Minister Agustin Carstens addressed fears of a ratings downgrade, saying the country’s finances are on a “sustainable path” while ongoing infrastructure reforms will support economic growth. [ID:nN19653552] “We still believe a downgrade can be avoided for the time being,” wrote HSBC analyst Clyde Wardle in a note to clients. The peso has lagged far behind the rally in emerging markets this year because of worries that U.S. ratings agencies could downgrade Mexico’s debt. Standard & Poor’s and Fitch Ratings have threatened to cut Mexico’s debt rating unless it reduces its dependence on taxing declining oil output. Lawmakers on Tuesday passed a 2010 budget that included watered-down versions of tax hikes proposed by President Felipe Calderon. Market opinions are divided on whether the reforms will be enough to avoid a downgrade. “The budget left a bad taste in the mouth,” said a trader in Mexico City, who said the peso would likely weaken toward its 100 day-moving average around 13.25 in the coming sessions. In stock trading, shares in miner Grupo Mexico ( GMEXICOB.MX ) lost 2.13 percent to 30.39 pesos and America Movil ( AMXL.MX ), Latin America’s biggest cell phone provider, lost 0.77 percent to 30.74 pesos. (Reporting by Michael O’Boyle; Editing by Dan Grebler) Read the original here: Mexico stocks slip as investors trim risk bets (at Reuters)

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* Mexico to allow direct market access, algo trading * Regulator expects to publish rules in January * High-frequency trading likely to boost volume (Adds detail on co-location, additional quote, background, byline) By Noel Randewich MEXICO CITY, Nov 20 (Reuters) – Mexico’s market regulator expects to publish rules in January allowing direct market access and algorithmic trading, a change that could boost liquidity in the country’s securities markets. Under the new rules, brokers in Mexico will be able to let their clients execute buy and sell orders directly through their trading platforms, dramatically speeding up executions. “One of the things you’ll be able to do is DMA and algorithmic trading,” National Banking and Securities Commission spokesman Carlos Lopez-Moctezuma told Reuters. “We expect to publish the rules in January.” High-frequency trading now accounts for an estimated 50 percent to 70 percent of all U.S. equity trading and is growing fast in other regions and asset classes. Banks, hedge funds, and independent shops use ultra-quick algorithms to make markets and capitalize on tiny spreads and market imbalances. “We want to be very active participants,” Alvaro Garcia, head of trading in Mexico for Bank of America Merrill Lynch ( BAC.N ) said in an interview. The bank, which already offers algorithmic trading in emerging markets including India, Malaysia, Thailand and Singapore, is anxious to do the same in Mexico once the rules are published, Garcia said. Mexico’s stock exchange, the Bolsa Mexicana de Valores ( BOLSAA.MX ), or BMV, launched “co-location” this month, which allows trading firms rent space near the exchange’s main trading system in order to cut milliseconds off execution times. “These changes will bring Mexican rules in line with stock exchanges in developed markets,” said a European banker familiar with the situation. Brazil’s BM&FBovespa ( BVMF3.SA ) has benefited in recent months from a surge in volumes after high-frequency and algorithmic trading were launched. In the United States, the Securities and Exchange Commission is delving into increasingly automated equity markets after some politicians and investors raised concerns that high-frequency trading creates a two-tiered market favoring the most sophisticated players. (Reporting by Noel Randewich; Additional reporting by Michael O’Boyle, Jane Baird in London and Elzio Barreto in Sao Paulo; Editing by Richard Chang) The rest is here: UPDATE – Mexico to publish direct market access rules in Jan (at Reuters)

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LOUISVILLE, Ky. (AP) — A Kentucky appeals court upheld a $6.1 million award to a former fast food worker who was forced to strip in a McDonald’s restaurant office after someone called posing as a police officer. The appellate court on Friday ruled that Illinois-based McDonald’s Corp., knew about a series of hoax calls to restaurants around the country, but didn’t warn employees before Louise Ogborn was strip searched and sexually assaulted as the result of such a call in 2004. The appeals court ruled that to reverse the verdict would cut against the weight of the evidence. Ogborn was 18 at the time of the call to the store about 20 miles south of Louisville. A Kentucky man, Walter Nix Jr., the fiance of a McDonald’s assistant manager, served a prison sentence for sexually abusing Ogborn during the call. A Florida man, David Stewart, was acquitted of making the hoax call. Police have said similar calls stopped after Stewart’s arrest. McDonald’s spokeswoman Danya Proud said the company doesn’t dispute what happened to Ogborn, but is disappointed with the decision of the appeals court. “However, it has been our position throughout these proceedings that she was the victim of a malicious hoax perpetrated by individuals not representing McDonald’s,” Proud said. Ogborn’s attorney, Ann Oldfather, told The Associated Press that the ruling affirms Ogborn’s position that McDonald’s should have warned employees after more than 40 other restaurants received hoax calls. “I don’t think all of this is ever going to go away,” Oldfather said. “But, she’s a solid, solid gal. She felt validated by the decision.” The Associated Press generally does not identify victims of sexual abuse. Ogborn’s name, however, has appeared in previous newspaper and broadcast stories with her permission. The unanimous three-judge appeals panel ruled that Ogborn was unlawfully held against her will for the duration of the 3 1/2 hour call. “She was deprived of her clothes and all her other possessions,” Judge Glenn Acree wrote. “And Ogborn did not only face the false assertion of police authority, she also faced the real authority of her supervisors.” A jury awarded Ogborn $5 million in punitive damages and just over $1.1 million in compensatory damages following a four-week trial in 2007. Ogborn sought $200 million from the restaurant chain. The same jury awarded $1.1 million to Donna Summers, a former McDonald’s assistant store manager who also sued the fast-food chain. Summers, who had asked the jury to award her $50 million, led the strip search of Ogborn at the direction of the hoax caller. Summers was fired and claimed she was traumatized. She underwent counseling after the incident. The appeals court knocked down the award to Summers to $400,000, saying the amount granted by the jury was unconstitutionally high. Summers, who was engaged to Nix at the time of the assault, was placed on probation for a misdemeanor conviction related to the incident. McDonald’s attorneys argued the company was not responsible for the incident. Ogborn accused the company of negligence leading up to the strip search, saying it did not act to warn employees of a rash of similar hoax calls to fast-food restaurants. In the lawsuit, Ogborn said someone called the restaurant in Mount Washington impersonating a police officer and gave a description of a young, female employee, accusing her of stealing from a customer. The caller instructed an employee to strip search the woman, according to testimony. Ogborn was forced to undress, endure a strip search, and to perform sexual acts, the lawsuit said. The events were captured on surveillance video, which was shown to jurors during the trial. Continued here: Ky. court upholds $6M verdict in strip search case (AP)

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