Sunday, January 31, 2010

Laid-off executives have farther to fall

Bryan Thompson lost a six-figure salary in Atlanta when he was laid off from his job as a vice president of operations.
He gave up a luxury condominium that came with a concierge service, and he recently moved into an Antioch apartment with his sister. Though living more modestly, he has exhausted a life savings of more than $100,000.

When he bought a new suit for interviews, he had to ask his dad to pay for it.

Once a high-flying executive, the 47-year-old recently accepted temporary work in Portland, Tenn., at a fraction of his previous salary after going 18 months with no offers. He's still searching for something permanent.

"At this point, I'm so far beyond trying to find the perfect job," said Thompson, who was vice president of project planning at Ingram Book in Nashville before he moved to Atlanta to further his career. Or so he thought.

He's back in Nashville now — an example of how a rising tide of job losses has encompassed even the once-well-paid professional.

This, economists say, has been an equal-opportunity recession.

"From laborers and lawyers to plumbers and professors, they've all lost jobs," economist Sean Snaith at the University of Central Florida said. "It's reached across the socio-economic strata and across white- and blue-collar workers."

Highly compensated executives and managers usually fare better than lower-level workers when it comes to finding and keeping jobs, but labor data suggest that they're feeling the pain, too, as Tennessee's statewide unemployment rate edged higher to 10.9 percent in December. The rate in the broader Nashville area was reported at 9.4 percent last week.

CEOs on the rocks

The jobless rate for chief executives averaged 3.4 percent in the third quarter of 2009. That's well below the U.S. unemployment rate of 10 percent but higher than the 2.1 percent jobless rate for CEOs in the third quarter of 2003.

Likewise, unemployment for all management workers stood at 5.1 percent in the third quarter, versus 3.4 percent in 2003.

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Tesla Motors files for IPO

LOS ANGELES — High-end electric-car company Tesla Motors filed for an initial public offering Friday, seeking $100 million in the public-financing arena as conventional automakers are reeling from anemic sales and product recalls.
Palo Alto, Calif.-based Tesla filed documents with the Securities and Exchange Commission, but did not indicate in the filing when those shares would be sold on the public markets or what the initial price would be. Company executives could not be immediately reached for comment.

If successful, the IPO could help usher in a new era for the auto industry, which is steadily moving toward cleaner-burning engines. The IPO is expected to be one of the most high-profile offerings in some time, and is the first by a U.S. automaker since Ford Motor Co. entered the public markets in 1956.

Whether Tesla can take advantage and shift public tastes more toward zero-emission cars is unclear. But the timing of the IPO could prove to be shrewd.

"We believe incumbent automobile manufacturers are at a crossroads and face significant industry-wide challenges," Tesla said in its filing, adding that "the legacy investments made by incumbent automobile manufacturers in manufacturing and technology related to the internal combustion engine have to date inhibited rapid innovation in alternative-fuel powertrain technologies."

While Ford has been prospering of late, rivals General Motors and Chrysler have been suffering, and were taken over by the federal government last year. Meanwhile, top foreign producer Toyota Motor Corp. has recalled millions of its automobiles because of a problem with sticking accelerator pedals.

Family sedan in works

Tesla started selling its $100,000 all-electric sports car, the Roadster, in 2008 and followed that last year with the Roadster 2. In its IPO filing, the company says the car has a range of 236 miles on a single charge, and says it has sold 937 of the vehicles in 18 countries.

It is designing a family sedan, the Model S, which would cost $49,900 after a $7,500 federal tax credit, the IPO filing said. The sedan would have a range of 160 to 300 miles on a single charge.

In addition, Tesla is negotiating with Daimler AG to provide its electric powertrain and battery technology for Daimler's Smart fortwo car. One thousand Tesla battery packs and chargers are being used in a trial with Smart fortwo cars in five European cities.

Tesla said it has taken out a $465 million long-term loan under the Energy Department's advanced-vehicles manufacturing program to build a facility that will manufacture the Model S. The company added that it has been given up to $31 million under similar California state programs.

Tesla indicated its revenue will decrease substantially before the Model S is rolled out — expected to be sometime in 2012. That is because it will cease selling its Roadsters in 2011 and won't resume production on a new model before 2013.

Automakers start to hire again

Bank failures accelerate

WASHINGTON — Regulators shut down a big bank in California on Friday, along with two banks in Georgia and one each in Florida, Minnesota and Washington. That brought to 15 the number of bank failures so far in 2010 atop the 140 shuttered last year in the punishing economic climate.
The failure of Los Angeles-based First Regional Bank, with nearly $2.2 billion in assets and $1.9 billion in deposits, is expected to cost the federal deposit insurance fund $825.5 million.

The Federal Deposit Insurance Corp. took over the bank as well as the others: First National Bank of Georgia, based in Carrollton, Ga., with $832.6 million in assets and $757.9 million in deposits and Community Bank and Trust of Cornelia, Ga., with $1.2 billion in assets and $1.1 billion in deposits; Florida Community Bank of Immokalee, Fla., with $875.5 million in assets and $795.5 million in deposits; Marshall Bank of Hallock, Minn., with $59.9 million in assets and $54.7 million in deposits; and American Marine Bank of Bainbridge Island, Wash., with $373.2 million in assets and $308.5 million in deposits.

First Regional Bank's collapse followed the shutdown of several large California banks in the last months of 2009. California was one of the states hardest hit by the real estate market meltdown, and many banks there have suffered under the weight of soured mortgage loans. Last year saw the failure of 17 banks in the state.

RelatedRegulators close banks in 5 statesRegulators close banks in Illinois, Minnesota and Utah

First-Citizens Bank & Trust Co., based in Raleigh, N.C., agreed to buy the deposits and $2.17 billion of the assets of First Regional Bank. The FDIC retained the remaining assets for later sale. In addition, the FDIC and First-Citizens agreed to share losses on $2 billion of the failed bank's loans and other assets.

Community & Southern Bank, also based in Carrollton, Ga., agreed to assume the deposits and assets of First National Bank of Georgia. SCBT, a national bank based in Orangeburg, S.C., is assuming the assets and deposits of Community Bank and Trust. United Valley Bank, based in Cavalier, N.D., is buying the assets and deposits of Marshall Bank.

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Friday, January 29, 2010

Bernanke slammed, but wins 2nd term

WASHINGTON — Embattled Federal Reserve Chairman Ben Bernanke won confirmation for a second term Thursday, but only by the closest vote ever for the crucial post and after withering criticism from lawmakers for bailing out Wall Street while other Americans suffered in the recession.
The Senate confirmed Bernanke for a new four-year term by a 70-30 vote, a seemingly solid majority but 14 votes worse than the closest previous vote for a Fed chairman.

The Senate battle over Bernanke's confirmation has been a test of central bank independence, a crucial element if the Fed is to carry out unpopular but economically essential policies. Its decisions on interest rates can have immense consequences, from the success or failure of the largest companies to the typical homebuyer's ability to get an affordable loan to the price of cereal at the grocery or gas at the corner station.

Created by Congress in 1913 after a series of bank panics, the Federal Reserve is an independent agency, supposedly outside politics, but its chairman typically is assailed by lawmakers and others when the economy falls and jobless ranks lengthen.

"Bernanke fiddled while our markets burned," Alabama's Richard Shelby, the top Republican on the Senate Banking Committee, said during Thursday's debate. "Ben Bernanke's Federal Reserve played a key role in setting the stage for the financial crisis."

Shelby and other opponents blame Bernanke for failing to spot problems leading up to the crisis, for lax bank regulation and for not cracking down on dubious home mortgage practices. All those missteps contributed to the recession, they contend.

Supporters see it far differently, crediting him with preventing the great recession from turning into the second Great Depression.

"The chairmanship of Ben Bernanke has in no small measure made it possible for this nation to avoid a catastrophe," said Senate Banking Committee Sen. Christopher Dodd, D-Conn.

Supporter Chuck Schumer, D-N-Y., worried that the bitter fight over the nomination would send "the message that the Federal Reserve and its monetary policy decisions are under the thumb of Congress. Businesses will be faced with the prospect that the Fed might not be able to do what's necessary for the economy because of pressure from Congress."

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Business briefs: Chrysler won't fight arbitration

Chrysler Group LLC said Thursday it would not sue to try to stop arbitration with hundreds of dealers it wants to close.
Chrysler shut down 789 dealers in June amid lagging sales. General Motors Corp. also told 2,000 dealers it plans to revoke their franchise agreements by October. But Congress objected and passed a law in December allowing GM and Chrysler dealers to appeal those decisions. That process is under way.


Manager named for trade center

David Osborn has been named general manager of the Nashville Medical Trade Center, which a Dallas-based company plans to open here in 2013. The appointment comes nearly six months after Osborn joined Market Center Management Co. as a senior adviser to oversee strategic development of the project.

Before that, Osborn was founding executive director of the Health Care Solutions Group, a think tank formed through a partnership of Vanderbilt University Medical Center and the Nashville Health Care Council.

The Metro Council recently approved funding for a new $585 million convention hall, clearing the way for re-use of the Nashville Convention Center downtown. A planned 2-million-square-foot medical trade center on the longtime convention center site could include up to 1,200 permanent showrooms for health-care product makers, distributors, and others; plus, it would have temporary trade-show space and conference rooms, developer Market Center Management has said.


Hart to celebrate century mark

Nashville-based Hart Freeland Roberts architects and engineers will celebrate its 100th anniversary this year.

Architect Russell Hart founded the company in 1910 after the completion of Nashville's Hermitage Hotel. The permanent reconstruction of the Parthenon in Centennial Park is another structure designed by Hart in years past. Today, the company employs a staff of 75.


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Toyota scurries to find a fix as recall expands

DETROIT — Toyota has begun shipping parts to fix the faulty gas pedals that led to a still-expanding recall and an unprecedented decision to stop selling and building some of its top-selling models, but it still could not say Thursday when millions of its drivers would get their cars fixed.
The world's largest automaker, bleeding millions of dollars a day in lost sales, also declined to say where the parts are going — to plants so production can start again or to dealers so they can start fixing cars sitting in their showrooms or already on the road.

Amid the uncertainty, the recall grew wider. Toyota expanded the recall beyond an initial 2.3 million vehicles and said it would recall an untold number in Europe and about 75,000 in China because of bad gas pedals that can become stuck.

The recall even spread beyond Toyota. Ford Motor Co. stopped production of some full-sized commercial vehicles built by a Chinese joint venture because they have accelerators built by the same parts supplier as in the Toyota recall.

RelatedWhat should Toyota owners do next? Here is the company's answer

Separately, Toyota recalled 1.1 million more vehicles this week because of floor mats that can bend and hold down the gas pedal.

The gas pedal system recall includes 2009-2010 RAV4, the 2009-2010 Corolla, the 2009-2010 Matrix, the 2005-2010 Avalon, the 2007-2010 Camry, the 2010 Highlander, the 2007-2010 Tundra and the 2008-2010 Sequoia.

Toyota said the maker of the faulty gas pedal systems, CTS Corp. of Elkhart, Ind., was cranking out replacements at three factories and that some of them already have been shipped to Toyota.

At the same time, Toyota engineers are working with CTS to develop ways to repair, rather than replace, the pedal systems in existing cars and trucks, spokesman Brian Lyons said.

But there was no estimate for how long it would be until customers can get their cars fixed. The parts are being made at CTS plants, but Toyota has not said where they're going within its system of plants and dealers.

"We're well past the root cause identification, and we're well past what needs to be done to change the pedal assembly itself," Lyons said.

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Wednesday, January 27, 2010

Rutherford wants fees, taxes reinstated

MURFREESBORO — Rutherford County used to count on about $350,000 in motor vehicle fees and sales taxes from Nissan employee auto leases, but a new state law made most of that disappear.
"The state comes in here and cuts our throats again," County Commissioner Gary Farley said Monday night during the commission's Public Safety Committee meeting. "They killed us on the matter in my opinion."

The Tennessee General Assembly passed the law last year at the urging of Gov. Phil Bredesen.

It was an incentive to help lure Volkswagen to Chattanooga, but sales tax, registration and renewal exemptions there also apply to any original equipment manufacturer in the state.

The commission's Public Safety Committee unanimously voted to recommend the law be changed so that taxes will still be collected for cars Nissan employees lease as part of their company benefits.

The request goes to another committee, then the full commission at its Feb. 11 meeting.

Contact Scott Broden at 615-278-5158 or

Investor Report: New Treasury ProgramNissan sales improve 21 per cent over year-earlier period

GM will sell Saab brand to Spyker

DETROIT — Saab got a new life Tuesday as General Motors Co. agreed to sell the Swedish car brand to the small Dutch luxury carmaker Spyker Cars NV.
Under the deal, GM will get $74 million in cash plus $326 million worth of preferred shares in Saab. GM will get "other considerations," which it did not specify. The Swedish government also is ready to guarantee a loan of up to $550 million from the European Investment Bank, Industry Minister Maud Olofsson said.

The deal is a coup for Spyker and a lifeline for Saab, which has lost money for years under GM's ownership and was slated for liquidation. Saab has about 3,500 employees in Sweden.

It's also a huge challenge for Spyker, which sold only 23 cars in the first half of 2009, its most recent reporting period, and posted a net loss of $12.2 million. The 11-year-old company has yet to make a profit, but it says funding for its operations have been guaranteed through 2010.

Spyker CEO Victor Muller said in a statement that the company is happy to have saved the brand and secured the jobs of thousands of workers.

"Saab is an iconic brand that we are honored to shepherd," he said in the statement, adding that support from many of the 1.5 million Saab drivers worldwide helped get the deal done.

Saab spokeswoman Gunilla Gustavs said, "We are very happy" about the sale.

Under the deal, GM will continue to provide engines and transmissions for the new company for "an extended period of time," and it will keep making the 9-4X crossover vehicle for Saab, said John Smith, GM's vice president of planning and alliances.

Crossovers have the interior room of an SUV but are built on a car instead of a truck frame.

GM hopes to close the deal by mid-February, Smith said.

Spyker will continue to provide vehicles for and support Saab's U.S. dealers, Smith said.

The Dutch automaker also will guarantee up to $10 million in Saab's obligations to GMAC, which is GM's financing arm.

Associated Press writers Malin Rising and Karl Ritter contributed to this report.

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Regions loses $606 million, says loan problems are easing

Regions Financial Corp., the Birmingham, Ala.-based bank that received $3.5 billion in U.S. rescue funds, reported its fourth loss in the past five quarters on Tuesday, in part because of reserves set aside to handle developer and homebuilder loans that went sour.
The stock price for Regions, the bank with the largest portion of deposits in the Nashville market, fell 7 percent on the New York Stock Exchange, closing at $6.08 a share, down 47 cents by the end of trading Tuesday.

For the final three months of 2009, Regions said, its loss narrowed to $606 million, or 51 cents a share. Bank officials said loan problems that have plagued Regions' earnings for several quarters in a row are lessening.

Regions is nearing an "inflection point" at which it won't need to set aside additional money to cover loan losses, President and Chief Operating Officer Grayson Hall said.

"We aren't pleased with the fourth quarter," Hall said on a conference call. "We see improving conditions, but it is still a stressed portfolio."

Regions increased its provision for loan losses to $1.18 billion in the final quarter of the year, and loans no longer collecting interest totaled $4.4 billion, up from $4.1 billion.

The bank said it modified the terms on $1.58 billion of consumer loans during the quarter to assist about 23,500 customers. Restructurings typically involved extending maturities or reducing interest rates.

Some banks have been criticized for not doing enough to work with troubled borrowers to ward off more serious loan problems, but Regions has insisted it is being proactive with its customer base.

For the full year Regions had a net loss of $1.26 billion, or $1.27 a share, compared with a loss of $5.62 billion, or $8.09 a share, in 2008.

Most trouble is in Florida, Georgia

While Regions operates in 16 states, most of its troubled loans stem from Florida and Georgia operations that account for a fourth of total deposits.

Regions paid $63 million of preferred dividends during the quarter, mostly through the U.S. Troubled Asset Relief Program.

Chief Executive Officer Dowd Ritter, 62, will retire at the end of March after four decades with Regions and its predecessor bank, AmSouth Bancorp. Hall, 52, will replace Ritter as CEO, and lead director Earnest W. Deavenport Jr. will become chairman.

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Tuesday, January 26, 2010

Keyless car systems confuse drivers, raise safety questions

Old-school car keys appear headed for extinction, as automakers rush to install wireless systems that allow drivers to unlock their doors and start their engines with an electronic fob that they never have to take out of their purse or pocket.
Introduced less than a decade ago on luxury models, the push-button systems are rapidly spreading to all segments of the market, including bargain-priced Kias. The number of models with them as standard or optional equipment has quadrupled in the last five years.

Many drivers don't fully understand how the systems work, however, leaving them vulnerable to potentially serious safety problems. In complaints to federal regulators, motorists have reported that they were unable to shut down engines during highway emergencies, including sudden acceleration events.

In other cases, parked vehicles accidentally rolled away and engines were left running for hours without their owners realizing it. And although traditional keys all work the same way and are universally understood by consumers, automakers have adopted different procedures for using the keyless ignition systems.

As a result, owners may not know how to operate their own cars in an emergency, let alone a rented or borrowed car.

The sleek Infiniti G37 Cindy Marsh bought last August was the car of her dreams, but the keyless system gave her trouble. To get the engine started, she would sometimes have to tap the power button repeatedly. Sometimes it wouldn't start unless she opened and closed the car doors, said Marsh, who lives in Columbus, Ohio.

She eventually adapted to the system's quirks but said that even now she isn't sure how to shut off the engine in an emergency.

"Where you have a second to make an emergency maneuver, you shouldn't have to search around for the right procedure to use on a switch," said Henry Jasny, general counsel at Advocates for Highway and Auto Safety, a nonprofit group based in Washington, D.C., that pushes for laws to make roads safer.

The risk is considered serious enough that federal regulators and an auto industry trade group are looking at adopting standard procedures. All of the systems rely on a similar architecture that uses a fob: a small transmitter that communicates with the vehicle's computer. The fob can open door locks when the owner approaches the vehicle, and the engine can be started with the push of a button on the dashboard.

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Nashville's general aviation firms see end to downturn

Allen Howell, along with his father, Reece, started a charter-flight business at the Smyrna Airport in 1982, beginning with a single airplane and a single employee.
Today, his company, Corporate Flight Management, operates a fleet of 23 aircraft and employs 180 people in a business that includes worldwide charter flights, aircraft maintenance and restoration. The company also runs a flight school.

Despite all of the growth, Howell found his company mired in the recession over the past year as he faced the worst downturn in his 28 years in the business.

But the company has survived without any layoffs, and there are signs that business may finally be picking up, he said. "The worst is behind us, and I believe that any of us that are still in business now probably will make it."

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Among factors that pulled his company through was a lucrative business restoring old turboprop planes that had been stored for years in the desert of the Southwest in places such as Kingman, Ariz., and selling them to small commuter airlines outside North America, Howell said.

Not all general-aviation industry firms have been as fortunate.

As U.S. commercial airlines have absorbed billions of dollars in losses, the private side of flying — business and recreational aviation — has experienced an unprecedented decline as well because of the weakened economy.

Cutbacks hurt industry

General aviation, which includes almost everything except the major airlines and military aircraft, began to slide in fall 2008, when companies began scaling back their own corporate aircraft fleets and cutting corporate travel, including charter flights.

Manufacturers of business aircraft such as Learjet, Cessna and Gulfstream went almost overnight from having years worth of backlogged orders to having almost no orders at all, said Dan Hubbard, spokesman for the National Business Aviation Association.

During 2009, prices of used business aircraft dropped by as much as 50 percent; many general-aviation manufacturers and flight providers went out of business; and tens of thousands of employees lost their jobs, Hubbard said.

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New farmers grow knowledge at Chattanooga conference

“Weed management techniques” may not sound like a very fetching early morning topic, but it packed more than 225 eager farmers into one ballroom at the Chattanooga Trade and Convention Center.
Up to 1,200 people — many new and hopeful farmers — attended a four-day conference, the Practical Tools and Solutions for Sustaining Family Farms Conference and Trade Show.

Trae Moore, a Chattanoogan who started the Main Street Farmers Market and helped organize the conference, said the farm model is changing, turning away from giant industrial farms to small, locally grown food producers.

Moore said he hopes the conference helps residents see how small farms can work to the local economy’s benefit.

Read full story at the Chattanooga Times Free Press.

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Monday, January 25, 2010

South's jobless seek work in Tennessee

Think the labor market here is bad? Some residents of states with even higher unemployment, like North Carolina and Florida, are moving to Tennessee in hopes of having better luck finding jobs.
And some north Alabama workers are commuting to auto jobs here because work is even scarcer closer to their homes, even with recent mass layoffs at the General Motors assembly plant in Spring Hill.

In 2009, every Southeastern state lost jobs, with the housing collapse in Florida and a steep decline in manufacturing in Alabama and South Carolina sending unemployment rates in those three states zooming up more than in any other Southern states over the past year, according to the U.S. Bureau of Labor Statistics.

The Tennessee jobless rate peaked at 10.9 percent in December after five months of trending downward. The statewide rate didn't reach single digits.

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With nearly 90,000 net job losses last year, Tennessee trailed Florida, Georgia and North Carolina in number of lost jobs in a 12-state Southern region. Tennessee had the fifth-highest unemployment rate among that group.

With Tennessee faring somewhat better than Florida, Tom Mikulski opted to move here after he was laid off from his management job at DHL shipping in Orlando, Fla., last June.

"Tourism and everything it supports was way down in Orlando, and opportunities in my field of transportation were not there," said Mikulski, who spent four weeks job hunting in Florida before moving inland to the Nashville area.

Nashville's cost of living figures to be lower than Orlando's, he said, and the labor market looked much healthier. In midsummer, Davidson County's unemployment rate was 9.2 percent, compared with Orlando's 11.1 percent at the time, and the jobless rate here remains better.

Meanwhile, Louisiana, Arkansas and Virginia have fared reasonably well by comparison, according to the latest employment statistics.

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Poverty rate hits 17.5 percent in Nashville

Marilyn Musser cleaned house for a psychiatrist until a few weeks ago, when the psychiatrist lost her own job and couldn't afford Musser anymore.
So, Musser showed up Friday at St. Luke's Community House in Nashville, where emergency free food boxes are delivered to local residents. "There are no jobs," she said. "People get laid off and they can't find work, and the pay rates went down."

A study released last week by the nonprofit Brookings Institution says that while times are tough all over, Nashville has fared worse than the suburbs that surround it. The city of Nashville added about 32,110 people living below the poverty line between 2000 and 2008, a gain of 4.2 percentage points, reaching 17.5 percent of the city's population.

The suburbs as a group, which comprises 12 surrounding counties, saw an increase of 22,129 people living in poverty, a rise of less than one percentage point. Fewer than 1 in 10 people in the suburbs live below the poverty line, Brookings said.

RelatedSouth's jobless seek work in TN

Those numbers contradict the general trend in the 94 largest metro areas in the country, which saw suburban poverty grow faster than urban poverty in the same time period, the study group said.

With the latest economic blows from the recession since the 2008 figures were tabulated, the Brookings Institution, a research organization that does work on poverty and urban-suburban demographics, now estimates that nearly 20 percent of Nashville lives below the federal poverty line.

That means income of less than $21,834 a year for a family of four.

Those who work on poverty issues cite a variety of reasons for the rising poverty in Nashville: A flight of the middle class to the suburbs for what they perceive as better schools, lackluster job growth and low educational levels all have plunged more of the city's residents into poverty during the last decade or so.

"The kinds of jobs that were sustaining the neighborhood in the past aren't there," said Christopher Sanders, the development director for St. Luke's Community House in West Nashville. "People are running out of options."

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Fed chief vote fans economic fears

WASHINGTON — A defeat of Federal Reserve Chairman Ben Bernanke's quest for another four-year term could raise the risk of a "double-dip" recession if political jousting over a successor were to drag on for months, economists warn.
But Bernanke's prospects appeared to brighten Sunday, with three more senators, including Republican leader Mitch McConnell of Kentucky, predicting that he'll be confirmed. A vote is expected later this week.

Still, the chance of Bernanke's defeat has unsettled Wall Street, contributing to last week's 4 percent loss by the Dow Jones industrial average, its worst performance in 10 months. If Bernanke were rejected, uncertainty over a successor would further roil global markets, at least in the short run.

Anxiety, along with sagging investments, could cause consumers and businesses to cut spending. Joblessness, already at 10 percent, could worsen. And the recovery might fail.

Economists who fear a double-dip recession — in which the recovery would collapse into another recession — regard it as a worst-case scenario. But they don't rule it out, either.

Bad timing for economy

Lynn Reaser, chief economist for the National Association for Business Economics, is among them. She sees the likelihood of a double-dip as less than 50 percent.

"It will become more acute if there are delays in confirming a successor," she said, noting that the economic recovery remains fragile, with spending still weak, credit tight and job creation scarce.

"All the political angst over the confirmation couldn't have come at a worse time for the economy," Reaser said.

A Bernanke loss would heighten uncertainty about Fed policies on interest rates and stimulus measures. In part, that's because Bernanke devised the unconventional supports for the economy and probably knows how best to safely wind them down, said Edward Yardeni, chief investment strategist at Yardeni Research.

But even more worrisome for the markets and the economy would be if Bernanke's Senate foes are seen as having meddled with the Fed's independence for political reasons.

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Sunday, January 24, 2010

Banks ramp up lobbying in second half of 2009

WASHINGTON — With $45 billion in taxpayer money finally repaid and a wave of new regulations building, Bank of America slowly intensified its lobbying in Congress toward the end of 2009.
In all, Bank of America spent $3.6 million last year to lobby Washington lawmakers on a wide range of issues, from credit card reform to a proposed consumer financial protection agency. It wanted a say on how much its leaders should be paid, on the bank's role in preventing foreclosures, on bankruptcy, on student loans and on tricky financial instruments such as over-the-counter derivatives.

Last year's lobbying bill was a 13 percent drop from the $4.1 million it spent in 2008. Bank of America cut back on its lobbying spending the first half of 2009 from the previous year in part because of the recession, the bank said last summer. It also hired far fewer outside firms.

At the time, the bank was part-owned by federal taxpayers through the Troubled Asset Relief Program. Bank of America repaid its TARP money in early December.

Other banks also decreased or held steady in their spending. Goldman Sachs Group Inc. reduced its lobbying costs to $2.8 million in 2009 from $3.3 million in 2008, a 15 percent decline. Citigroup Inc. spent $5.5 million, unchanged from 2008, according to a Bloomberg News report.

Even though Bank of America spent less last year; it began pouring in more money as the year went on. A third of its spending came in the fourth quarter.

After a lull in early 2009 on the financial reform front, suddenly there was plenty of work. Bank of America spokeswoman Shirley Norton said the bank's issues increased in late 2009, needing analysis and evaluation.

"Our focus remains trying to be constructive in helping ensure that regulatory reform is thoughtfully done and fosters sound and competitive banking," Norton said in an e-mail.

Financial bill opposed

The House of Representatives passed a major financial reform bill last fall, anchored by a proposed Consumer Financial Protection Agency, authored in part by U.S. Reps. Mel Watt of Charlotte, D-N.C., and Brad Miller, D-N.C.

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Clarcor: Recovery clears path for growth and brighter future

Filters to make trucks, aircraft, locomotives, factories and other industrial gizmos run cleaner and more efficiently are Franklin-based Clarcor Inc.'s $1 billion-per-year sales niche.
The trouble was that in fiscal 2009 that niche shriveled by about 14 percent — or a little more than $152 million in diminished sales — because the U.S. and world economies hit the skids.

The good news is that Clarcor, which moved its 50-person headquarters staff to the Nashville area six years ago from Rockford, Ill., sees a slightly brighter outlook for its business this year.

Chairman and CEO Norm Johnson expects his company's North American sales to improve, along with business in such major foreign markets as China, Brazil, Mexico and India.

Described as a "steady Eddie" operator by one stock market analyst, Clarcor makes its money selling new and replacement filtration systems to all sorts of transportation, manufacturing and industrial clients. It also makes consumer and industrial packaging products.

Johnson discussed the year ahead and what he sees as good odds that the national economy will gain real momentum by midyear in an interview with Tennessean Business Editor Randy McClain.

Give me a quick overview of Clarcor's size.

There are about 6,000 people in the company worldwide, but we have a relatively lean corporate headquarters staff, with approximately 50 people in Franklin.

We have 25 manufacturing plants in North America; some of the larger plants are in Kearney, Neb.; Louisville, Ky.; Mineral Wells, Texas; and Greensboro, N.C. We also have several manufacturing facilities in China. We just made a couple of acquisitions in China, and we've been in that country 15 years now. We built a new manufacturing plant there a couple of years ago. We also manufacture in Europe, South Africa, Mexico, Morocco, virtually around the world.

What are you forecasting for 2010 in terms of sales, profits and strength of your key markets?

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Investment adviser sees brighter economy in the futureReal Estate Outlook: Housing Recovery

Nashville People in Business

Big Brothers Big Sisters of Middle Tennessee announced its board for 2010:
James Crumlinof Bone McAllester Norton PLLC is board president.

Carolyn Loudenslager of Dell is president elect.

Kevin Roddey of Pinnacle Financial Partners is past president.

Milton Price of Wachovia Bank is treasurer.

Ann Hatcher of HCA is secretary.

Tom Shumate of Kay, Griffin, Enkema & Brothers PLLC is community liaison.

Other board members serving for 2010 are:

Renee Behrman-Greiman of Modern Management, Blaine Bishop a former Tennessee Titan, LaurieCoggins of Regions Bank, Will Clark, Tiffany Dobson of Sprint, Sandy Draper of Wirtgen America, David Gile, Greg Greenwell of TotalPrint, Sally Holland of Caterpillar Financial Services, Scott Holloway of American Cellular, Mark Kornegay of Microsoft Corp., Michael Moore of Synergy Business Environments, Matt Nicholson of Johnson Controls, Kimberly Patterson of Wackenhut-G4S Security Services, Eric Paul of AmeriChoice by United Healthcare, Stan Snipes of XMI Commercial, Charles Sueing of The Sueing Agency and Charles Story of ECS Group.

The Americana Music Association announced its executive committee for 2010:

David Macias of Thirty Tigers is board president.

Tim McFadden, an artist manager, is vice president.

Sylvia Giannitrapani of GO2 Management is secretary.

Pam Matthews of DuVoyant Music is treasurer.

Executive committee members at-large:

Jessie Scott of Music Frog and Al Moss of Al Moss Promotion

Newly elected board members are:

Ashley Capps of AC Entertainment, Joan Kornblith of Voice of America, Pam Matthews of DuVoyant Music, Chip Taylor, Rodney Crowell, Raul Malo and Buddy Miller.

Returning board members are:

John Allen of Bug Music, Kay Clary of BMI, Tamara Saviano of Ellis Creative, Amanda Hale-Ornales of New West Records, Brad First of SXSW, Fred Boenig of the Artist Development Group, Tift Merritt and Jessie Scott.

Tennessee Coaches Alliance announced its board for 2010:

Jackie Welch is president.

Sandra Wimpelberg is president elect.

Sawrie Becker is past president.

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Kira Florita resigns from Leadership Music postGenerating Wealth by Understanding the Complexities of Bank REOs

China calls Clinton speech 'harmful'

WASHINGTON — The U.S-Chinese relationship, smoothed by mutual economic interest during President Barack Obama's first year, has been rocked by new turbulence as the administration has sought to prove its commitment to human rights around the world.
After a harmonious beginning, the two governments are at odds over planned U.S. arms sales to Taiwan, American overtures to Tibet, and, now, the issue of Internet freedom that has been vividly raised by China's treatment of Google.

After Secretary of State Hillary Rodham Clinton complained in Cold War terms on Thursday about China's Internet intrusions, Chinese officials shot back Friday that her remarks were "harmful to Sino American relations," and demanded that U.S. officials "respect the truth."

The exchange set off a diplomatic shuffle. Top U.S. and Chinese officials have huddled in a series of hastily convened meetings in Washington since Clinton's speech to discuss the Google issue and "the broader aspects of our relationship," Philip J. Crowley, the chief State Department spokesman, said Friday.

Some experts believe that Clinton may have been too provocative when, in Churchillian tones, she lamented that "a new information curtain is descending over much of the world." But her remarks highlighted the Obama administration's hardening approach.

"We're in for tough sledding for the rest of the year," predicted David M. Lampton, director of China studies at Johns Hopkins University School of Advanced International Studies.

While both countries want a stable relationship, diplomats and analysts worry that the expanding array of disputes could damage chances of Chinese cooperation on key U.S. strategic issues, such as sanctions against Iran, North Korea's nuclear program, and the international effort in Afghanistan.

Analysts said the new frictions could affect cooperation between the two nations' militaries, an initiative announced by Obama in a visit to China last November. They also could prompt the Chinese to rethink plans to take part in high-level meetings, such as Obama's nuclear security conference this spring.

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Investor Report: REO ListingsTrade taxes pump up America’s tire prices

Middle TN business bankruptcies

(Merle Norman Cosmetics Studio and Day Spa), Brentwood

Assets: $20,451

Liabilities: $111,098


Mogul Construction Inc.


Assets: $0

Liabilities: $392,387

T.G. Trucking Inc.

(formerly doing business as Complete Logistics), Nashville

Assets: $100,000

Liabilities: $120,549

SOURCE: U.S. Bankruptcy Court

Middle TN business bankruptciesCreating A Business Model from the Current Distressed Asset Marketplace

Saturday, January 23, 2010

Harry Reid helps to build up support for Bernanke

Senate Majority Leader Harry Reid backed Federal Reserve Chairman Ben Bernanke for a second term, helping the White House shore up support in the face of several Democratic defections 10 days before his term expires.
"I will continue to impress upon Chairman Bernanke that his most important job as America's central banker is to give families and businesses the peace of mind that their economy is working for them," Reid, a Nevada Democrat, said in a statement late Friday.

Two other Democrats who face re-election this year, Barbara Boxer of California and Russ Feingold of Wisconsin, said they will oppose the 56-year-old former Princeton economist.

Bernanke has drawn fire from some lawmakers for lax regulation of banks before the financial crisis and for bailouts of firms such as American International Group Inc.

"You have this populist surge out there that's been intensified and reinforced by the Massachusetts election," said Norm Ornstein, a political scientist at the American
Enterprise Institute in Washington, who said Bernanke is still likely to be confirmed.

Christopher Dodd, the Senate Banking Committee chairman who proposes stripping the Fed of banking supervision authority, renewed his support for the Fed chief. He said rejecting him would send the "worst signal to the markets right now" and produce an economic "tailspin."

Real Estate Outlook: Housing RecoveryNashville People in Business

Government union rolls grow as layoffs hit private sector

WASHINGTON — A majority of union members now work for the government, partly because of huge numbers of layoffs during the prolonged recession, which has accelerated the downward spiral of union dues-paying members in private business.
Local, state and government workers make up 51.5 percent of all union members, becoming the majority of organized labor for the first time, the Bureau of Labor Statistics reported Friday.

The recession battered two industries with high union density — manufacturing and construction — leading to a decline in private sector union membership from 7.6 percent to 7.2 percent of all workers. Private sector union membership plummeted by 10 percent last year, while government unions posted slight gains.

Overall, union membership declined by 771,000 workers, to 15.3 million. That's 12.3 percent among all workers, dropping from 12.4 percent in 2008. Government unions gained 64,000 members. Observers were split along pro-worker and pro-business lines when asked whether the trend was a good one.

The role of unions in the work force has waned along with the "broad social pact that existed in the 1950s and 1960s" between employees and companies, said Harley Shaiken, a labor-relations professor at the University of California at Berkeley. "It has been very difficult for workers to join unions," Shaiken said. "Employers play hardball, and joining a union becomes a sacrifice rather than a right."

J. Justin Wilson, managing director of a group called the Center for Union Facts, which opposes easier unionization, said the fresh data show that union membership is "an outdated concept" and a "relic of Depression-era labor-management relations."

A labor union leader said organizing more government workers is generally easier than trying to recruit union members in private business.

"Employers can retaliate against private-sector workers who want to form a union with impunity, and in the public sector it doesn't work that way," said Damon Silvers, policy director and special counsel at the AFL-CIO, the nation's largest labor federation.

Passing legislation in Congress to make it easier for private sector workers to unionize has been a top priority of organized labor. But that's unlikely to pass this year, now that a Republican victory in a special election in Massachusetts has cost Senate Democrats and their independent allies a 60-seat majority in that body of Congress.

Union membership has collapsed over the past three decades. Union members made up 16.8 percent of the private sector and 20.1 percent of the total work force in 1983 — the peak year based on the way that labor data are tracked.

Bloomberg News contributed to this story.

Real Estate Outlook: Strong Sales PredictedAT&T, union near deal; workers to begin paying health-care premiums

Long-term care insurance bill's prospects diminish

Barbara Holder, 63, bought a long-term care insurance policy for herself last year after seeing how much it helped pay the bills when her mother moved into a nursing home three years ago.
Her mother's policy from Genworth Financial paid $3,000 a month toward costs of a private room that today in the Nashville area averages $5,600 a month. Her mother's Social Security benefits covered the rest until she died last May.

"When you don't have to worry about where the payments for the nursing home are coming from, that eases that burden," said Holder, who works as a high school librarian. Holder is now among the 10 percent of individuals over age 50 who have bought private insurance coverage for long-term care, including nursing home or home health services.

But experts say it's questionable whether that percentage will rise very much or very quickly now that a health reform bill that could have boosted interest in long-term care enrollment has hit more snags in Congress.

Advocates for seniors and the disabled have been arguing in favor of parts of health reform that would have created a public program to let workers pay for long-term care insurance via payroll deduction at work. Supporters say promoting such a program would make the policies more accessible and affordable for millions more people.

"It's a step in the right direction," said Ron Taylor, executive director of the Tennessee Health Care Association, a trade association for nursing homes and assisted-living facilities, which would benefit from wider acceptance of long-term policies.

Critics, however, question the viability of a public program, saying it only would draw patients at higher risk of becoming disabled and would lead to future increases in premiums or reduced benefits to absorb all the costs.

"Even if it passes there'd be no teeth (in the bill) to make employers offer it. And if they offer it, employees can opt out, which in my opinion, many, if not most, will," said Phyllis Shelton, president of LTC Consultants in Hendersonville, which advises employers on such policies.

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Health bill’s potential costs worry some small buildersMortgage Modification Video Valuable for Distressed Homeowners

Friday, January 22, 2010

Nashville airport board approves rental-car facility

Plans for a new $70 million rental car facility for the Nashville International Airport are back on track after the economic downturn left the project on hold.
The Nashville Airport Authority board reinstated its support in the project. The three-story parking facility will be north of the current short-term parking garage. The facility will house about 10 rental car companies and 1,600 vehicles.

Rental car users will pay a $4.50 facility fee, which will be collected as the new funding source used to pay debt once bonds are sold for the project. Airport Authority spokeswoman Emily Richard said bonds for the project are being marketed to be sold.


Washington Report: FHA Condo RulesNashville People in Business

Nashville People in Business

Kimberly Martin is director of institutional effectiveness at Volunteer State Community College in Gallatin. Martin was at Bethel University.
Jon Hanson is a senior client manager in the Nashville office of Smith Seckman Reid, Inc. Hanson was a facility administrator/CEO for DaVita Inc. in Lone Tree, Colo.

Consumers Spend on Brands with Social Purpose - and Encourage Others TooNashville People in Business

Obama calls for bank limits

WASHINGTON — Trying to ride a wave of public anger at Wall Street, President Barack Obama on Thursday proposed tough new restrictions designed to limit the size of the nation's largest commercial banks and reduce the risks they take in complex and exotic investments.
The president stopped short of urging a return to the days when commercial banks just lent money and were locked out of investment activities. However, his proposal Thursday, likely to play well in the heartland, is designed to rein in what are viewed as Wall Street excesses.

Flanked by his economic team, congressional leaders and the towering former Federal Reserve Chairman Paul Volcker, who's long been urging much of what Obama announced, the president took aim at Wall Street, today's political pinata.

"While the financial system is far stronger today than it was one year ago, it is still operating under the exact same rules that led to its near collapse," Obama said.

"My resolve to reform the system is only strengthened when I see a return to old practices at some of the very firms fighting reform; and when I see record profits at some of the very firms claiming that they cannot lend more to small business, cannot keep credit card rates low and cannot refund taxpayers for the bailout. It is exactly this kind of irresponsibility that makes clear reform is necessary."

Financial markets didn't like what they heard. The Dow Jones industrial average cratered more than 224 points as the president concluded his speech. The Dow closed down 213.27 points to 10,389.88, its worst showing since Oct. 30.

But Wall Street critics welcomed Obama's proposal.

"The basic idea ... is a really, really good step," said Dean Baker, a co-director of the Center for Economic and Policy Research, a liberal research center.

It came just days after the Democrats lost a Senate seat in Massachusetts, as Obama strives to assure voters that he's siding with working people rather than the wealthy elite and searches for ways to redirect voters' anger away from him to others, such as big bankers.

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Investor Report: REO ListingsFDIC will seek input on pay plan for banks

Nashville business briefs: Nashville Bank names new chairman

Charles W. Cook Jr. has been named the chairman of Nashville Bank & Trust's board. He is one of the founding executives of the bank and was its original vice chairman, a post he held until 2007.
Cook has more than 40 years of experience in the local banking industry, having served as president and chairman of Third National Bank and chief executive officer of Third National Bank Corp. before its merger with SunTrust. After retiring from SunTrust Bank as executive vice president, he served as director of finance for Metro Government during the administration of Mayor Phil Bredesen. He then served as president and CEO, and later chairman, of Union Planters Bank of Middle Tennessee. He is a graduate of Yale University and Stonier Graduate School of Banking at Rutgers University and attended Harvard University School of Business. He serves as chairman of Nashville Public Television Corp.


2 TN companies make 'Fortune' list

Two Tennessee-based employers made Fortune magazine's 13th annual list of the "100 Best Companies to Work For."

Law firm Baker, Donelson, Bearman, Caldwell & Berkowitz PC was 77th. The magazine cited the regional law firm's commitment to diversity as evident by its numbers of minority and women lawyers.

FedEx was 91st. Among factors, Fortune said the package deliverer reinstated merit salary increases and half of the 401(k) match that was suspended a year ago amidst the economic slump.


Nashville Bank & Trust founder Donald Thurmond diesCreating A Business Model from the Current Distressed Asset Marketplace

Tuesday, January 19, 2010

Sweethearts candy to feature 'Tweet Me' message

"I love you" is so 2009.
The newest way to send an affectionate message this Valentine's Day comes with a social media twist: "Tweet Me."

Twitter and Sweethearts candy today will unveil plans to stamp Tweet Me on the familiar heart-shaped, fruity candy that has embraced short messages long before Twitter was even a glitter.

For Sweethearts, the move accelerates commercial tie-ins for the 145-year-old brand. For Twitter, it's a freebie public relations coup with serious mojo.

And for the nation's marketers, it's yet another savvy step into the virtual world and away from conventional advertising.

The not-so-subtle message within the message: You can't even bite into Valentine's Day candy any more without getting a commercial message.

"This is an indication of the new media yet to come," says Patricia Martin, cultural guru and author of Renaissance Generation: The Rise of the Cultural Consumer and What it Means to Your Business . "It's a new way of advertising when two brands get together to create cultural meaning. That's very different from creating a 30-second TV spot."

Your odds of landing a Sweetheart candy that actually says Tweet Me: about one in 80. That's because there are 79 other phrases in use this year.

"We've always been short and sweet," says Jackie Hague, vice president of marketing at New England Confectionery, maker of Sweethearts.

Hollywood puts big money behind productions for the WebInvestor Report: New Treasury Program

Iasis repurchases preferred stock with cash

Iasis Healthcare Corp. said it repurchased $120 million of the company’s outstanding preferred stock with excess cash on hand.
The transaction marked a return of capital to the holders of the Franklin-based hospital chain’s preferred stock including TPG, JLL Partners and Trimaran Fund Management.

David R. White, Iasis’ chief executive, said buying the preferred stock with extra cash on hand reflects the company’s financial strength and competitive positioning.

SunTrust building in downtown Nashville sold for $6 millionInvestor Report: REO Listings

Automakers start to hire again

LOS ANGELES — Even as they finish closing plants from their worst sales year in decades, beleaguered automakers are starting to hire again — almost 5,000 workers in the coming year.
The added jobs amount to just a fraction of the 40,000 that carmakers shed during their tailspin last year. But it is a sign that the big manufacturers expect business to improve this year.

Significantly, several automakers are making big investments in their lines of trucks as they anticipate that an improved outlook for housing and construction will encourage contractors and tradesmen to buy new vehicles.

Volkswagen of America is hiring 2,000 people as it gets ready to build a new sedan in Chattanooga.

Toyota Motor North America plans to add a second shift to its truck factory in San Antonio, a move that requires an additional 850 employees, and it could add several hundred more workers at other factories as it ramps up production from the depressed levels of last year.

South Korean manufacturer Kia Motors is recruiting at least 1,200 workers to assemble the newest generation of its Sorrento crossover vehicle at its factory in West Point, Ga.

Looking ahead, Ford Motor Co. said it expected to hire about 1,000 workers starting in late 2011 at a factory in Wayne, Mich., where it will build a next-generation hybrid and plug-in hybrid vehicle.

Chrysler Group has added about 400 designers and engineers, at least on a temporary basis, as it starts to rebuild a segment of its work force that Chief Executive Sergio Marchionne said was decimated by layoffs last year.

Although it has not announced a resumption in hiring, General Motors Co. plans to put $1 billion into developing new versions of its full-size pickups, the Chevrolet Silverado and the GMC Sierra, a vote of confidence in the idea that construction and housing starts are about to rebound.

"Pickup sales are unbelievably correlated with housing starts," said Mike DiGiovanni, GM's executive director of global market and industry analysis.

Sales of full-size pickups jumped to 13 percent of the vehicle market in December, more than a full percentage point higher than its share for all of 2009, DiGiovanni said.

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Millions in VW work approved for Chattanooga plantUncertainty in Housing Continues as Affordability Hits Record-High Yet Starts Decline

Monday, January 18, 2010

$30M to ease housing crisis in Nashville area

As foreclosure rates continue to rise in Nashville, $30.5 million in new federal stimulus money will go to shore up affordable housing options in areas where foreclosures threaten to undercut property values.
Half of the award, about $15 million, will buy a minimum of 205 homes in foreclosure and rehabilitate them, said Loretta Owens, executive director of The Housing Fund, one of the Nashville nonprofits that received the grant from the U.S. Department of Housing and Urban Development.

The money also will help 100 homeowners with down-payment assistance in a shared-equity program. The rest of the award will pay to develop 140 rental units on vacant property, officials said.

The money will go to neighborhoods in Antioch, in East Nashville on the west side of Gallatin Pike, in the Chestnut Hill area of South Nashville and in parts of North Nashville, Owens said.

In most of the targeted neighborhoods, about a quarter of homes in foreclosure were still on the market after a year, Owens said.

"What we found was, if we didn't intervene, we would see an increase in the supply of foreclosed homes, and as supply increases, values would really drop," she said.

The award makes possible the largest program of this kind ever in Nashville, said Phil Ryan, executive director of the Metropolitan Development and Housing Agency.

MDHA won the grant in a consortium with The Housing Fund, Urban Housing Solutions, the Woodbine Community Organization and Pinnacle Financial Partners, which has pledged $5 million in loans associated with the project.

"This was a very competitive process, and I'm delighted that Nashville's proposal was chosen," Mayor Karl Dean said. "This means new affordable housing, getting abandoned homes and neighborhoods reoccupied, and putting people to work."

Of 408 applications that were submitted to the federal Neighborhood Stabilization Program, Nashville was one of 56 winners.

No other application from Tennessee was funded.

In the Nashville area, the foreclosure rate in November was 1.36 percent, more than double the rate of November 2008.

As the Nashville consortium assembled its application, it found that the number of foreclosed homes in one neighborhood in North Nashville rose from 126 in 2007 to 256 after 18 months. In the targeted Antioch neighborhoods, the number of homes in foreclosure rose from 227 to 337 during that same time period.

Contact Bonna Johnson at 615-726-5990 or

Mortgage plan fails to live up to goalsUncertainty in Housing Continues as Affordability Hits Record-High Yet Starts Decline

Positive outlook helps entrepreneurs in hard times

Entrepreneurs are inundated with lots of troubling news. They are very worried about the challenges that the recession has created for their businesses.
Many also have been voicing concern about the potentially crippling effects that higher taxes, increased regulation and eroding property rights may have on their business prospects.

However, we must never lose sight of the fact that entrepreneurs continue to survive — and even thrive — in spite of all that seems to be working against them.

Entrepreneurs have an amazing capacity to look at the glass as "half full" even during the worst of times. Keeping a positive outlook can be a powerful force to stay on track.

A regular reader of my blog, Mary Anne Thomas from Black Mountain, N.C., sent me an opinion piece she wrote for the Black Mountain News . She and her husband, Bob Thomas, developed what they call a "Good News Board" to keep looking at the positive side of things. They are convinced that such positive thinking has real power.

Bob Thomas is a well-known golf author. Four years ago, he started a company to sell golf books as tournament gifts. When the economic crisis broke, his sales completely stopped. Their income was imperiled. They had to turn things around, and fast.

Their "Good News Board" — which is a dry-erase board hanging in the hallway leading into the break room — is a place where their workers list good news as it happens in their company.

"It's infectious," Mary Anne said. By keeping the focus on the good things, they have gotten their business on track once again.

Bill Evans, owner of Evans Glass Co. in Nashville, is another entrepreneur who has refused to let the bad economic news of the past two years get him down. "I know that my attitude is one of the very few things I can control," Evans said.

"A positive attitude is a choice, and I choose it," he said. "I have also found that having a defined, measurable goal keeps me focused. The more focused on a goal, the less I can be influenced by the things preventing me from reaching my goal."

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Nashville People in BusinessReal Estate Outlook: 2010 Stark Contrast to 2009

Very Light Car will be introduced at Detroit auto show

CHARLOTTESVILLE, Va. — George Mayo cast an appraising eye over the sleek and futuristic car in his auto body shop, where he would soon begin painting the vehicle a shiny silver.
"We paint a lot of cars here," said Mayo, owner of Premo Auto Body in Charlottesville. "But never anything that looks that way."

Mayo's paint job was one of the final stages in the assembly of the first Very Light Car prototype, which is being designed and built by a team of engineers, auto design specialists, aerodynamics experts, race industry professionals and others in Lynchburg, Va.

The team — led by Charlottesville commercial real estate developer Oliver Kuttner — anticipates that its extremely lightweight yet exceptionally strong gas-powered vehicle will be capable of exceeding 100 miles per gallon of fuel.

Kuttner has dubbed his team Edison*2 in a reference to the original Edison Labs, which invented the light bulb and other groundbreaking innovations.

Edison*2's first completed Very Light Car makes its debut at the North American International Auto Show in Detroit, which started Jan. 11 and ends Sunday.

The Very Light Car will be on display at the auto show's "Electric Avenue," which will feature nearly 20 vehicles powered by electricity and other alternative fuels. Kuttner's car will be just across from such electric cars as the Chevy Volt and the Nissan Leaf.

"I am a little nervous," Kuttner said. "It's two of us bringing up a car against the big corporations. It's, in a way, up against all odds."

Fuel-efficient, safe, strong, agile

Edison*2 is starting to pick up some buzz, Kuttner said, with Good Morning America and others setting up interviews about the Very Light Car at the auto show.

Some 650,000 people attended last year's auto show. It is the public's first real opportunity to see the vehicle that Kuttner believes has the potential to revolutionize transportation and drastically cut America's reliance on foreign oil.

Edison*2's car takes fuel efficiency to the extreme. It weighs a mere fraction of a conventional vehicle's weight, thereby requiring less fuel.

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Automakers lure frugal buyers with smaller, greener vehiclesWhere’s The Bail Out For Home-based Businesses?

Sunday, January 17, 2010

New owners restart 'Editor & Publisher'

Duncan McIntosh Co. Inc., an Irvine, Calif., magazine and newspaper publisher, bought media trade magazine Editor & Publisher from the Nielsen Co. late Thursday afternoon and quickly resumed reporting online.
"We're going to continue to be the main information source, the main idea source for the newspaper industry, with the realization of course that other media sources can provide inspiration and innovation for our industry during this time of transition for newspapers," said Mark Fitzgerald, who was named as E&P 's editor Thursday. "We're all very excited around here about the news."

A new print issue of the magazine will be available in February and continue monthly after that. Posting on its two blogs, Fitz & Jen Give You The Business at, and The E&P Pub at, restarted Friday, he said.

Fitzgerald previously was the magazine's editor at large and, in his new role, will replace Greg Mitchell who has left the publication. Charles McKeown will continue on as publisher, and the 5-person newsroom staff will remain in place, with the exception of Mitchell, Fitzgerald said.

Terms of the transaction were not disclosed to the newsroom staff or the public, he said.

Nielsen officially closed Editor & Publisher on New Year's Eve after announcing in early December that the magazine would cease publication. Duncan McIntosh Co. Inc. is also publisher of several boating magazines and newspapers.

Developments earn TN ‘State of the Year’ titleLayaway Plans Lure Vacation Rental Guests

Growth stocks are back on top

BOSTON — Growth is in; value is out. And it's likely to stay that way this year.
Investors who loaded their portfolios with growth stocks were rewarded in 2009. Those stocks gained an average 37 percent, nearly twice as much as value stocks.

Growth's notable performance was largely fueled by technology stocks, the biggest part of the growth category. Experts say those companies will continue to prosper as customers ramp up tech spending coming out of the recession. But experts caution a tech rally as big as last year's is unlikely.

There's no pat definition for growth stocks, but typically they generate revenue and earnings at an above-average rate. Examples are Apple and Google. Value stocks generally produce steady earnings, often pay out dividends and are considered cheap based on their price-to-earnings ratios. Companies like Bank of America, McDonald's and Wal-Mart fall into this category.

The leadership shift to growth from value marks a break from historical patterns. All told, the annual performance of growth stocks surpassed value stocks just twice in the last decade. Also, value stocks normally do much better coming out of a recession, as more economically sensitive stocks like banks and utilities rebound at the earliest signs that the economy is expanding.

"Typically, the bigger the contraction during a recession, the bigger the snapback when the economy turns," said Stephen Wood, chief market strategist of Russell Investments. "That hasn't happened this time."

This recovery has been tepid. The economy is growing about half as fast as it usually does exiting a recession, Wood said. Though the stock market has climbed 70 percent since last March, unemployment remains at 10 percent.

Still it's clear that growth stocks were hot in 2009. Growth stocks within the Russell 3000, a broad index covering 98 percent of the U.S. stock market, surged 37 percent last year. Value stocks ended with a more modest 20 percent gain.

That big gap was reminiscent of the late 1990s, when growth had its last big run. Of course, that fizzled in early 2000 as the dot-com bust pummeled technology companies.

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Real Estate Outlook: 2010 Stark Contrast to 2009Household wealth rises but still far below peak

U.S., Walmart's focus on green eases path

PHILADELPHIA — President Barack Obama is not expected to be there. Nor is the head of Walmart, Mike Duke.
But when Valley Forge, Pa., building-products manufacturer CertainTeed Corp. unveils its "very, very first baby step" into the world of photovoltaic roofing at the International Builders Show in Las Vegas, Obama and Duke presumably will be pleased.

In the fall, each took action to inspire greater commitment to protecting natural resources and working less wastefully, known in the green vernacular as sustainability.

Obama signed an executive order requiring federal agencies to practice what the administration is urging all Americans to do to aid the environment and help build a thriving clean-energy economy: Use less energy, recycle more, and build and buy in a way that doesn't waste resources and tax the planet.

Duke, Walmart's president and chief executive officer, announced a sustainability-index initiative to influence suppliers to produce and deliver their products more efficiently and with an environmental sensitivity.

Though Obama and Duke acted independently, what they did has the collective potential to significantly advance what has been a slowly evolving movement — one that draws skepticism from those who wonder whether the payoff is worth the expense.

"What you have is the 500-pound gorillas in the private sector and the public sector making these (sustainability) decisions ... and they're going to drive the rest of the market," said Joshua M. Kaplowitz, an environmental and commercial lawyer at Drinker, Biddle & Reath L.L.P. and head of an in-house task force charged with improving the firm's sustainability efforts.

The U.S. government is the nation's single largest user of energy. It owns nearly half a million buildings and more than 600,000 fleet vehicles, and it buys more than half a trillion dollars' worth of goods and services each year.

Walmart offers equally colossal credentials: It reported $401 billion in sales and 2.1 million employees worldwide last year.

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Exxon bets on natural gasWashington Report: Treasury Policy Change

Saturday, January 16, 2010

Johnson & Johnson accused of paying drug kickbacks

TRENTON, N.J. — Federal prosecutors said Friday that health-care giant Johnson & Johnson paid tens of millions of dollars in kickbacks so nursing homes would put more patients on its blockbuster schizophrenia medicine and other drugs.
In a complaint filed Friday, prosecutors said J&J paid rebates and other forms of kickbacks to Omnicare Inc., the country's biggest dispenser of prescription drugs in nursing homes. Prosecutors allege Omnicare pharmacists then recommended that nursing home patients with signs of Alzheimer's disease be put on the powerful schizophrenia drug Risperdal, which was later found to increase risk of death in the elderly.

The allegations are in a complaint filed by the U.S. Attorney in Boston, whose office has joined two whistle-blower cases. One was filed in 2003 by a former Omnicare pharmacist in Chicago, Bernard Lisitza, who alleges he was fired after he challenged the Risperdal kickbacks and other improper practices at the company. The other was filed by former Omnicare financial analyst David Kammerer in 2005, after he resigned from the company.

"Kickbacks in the nursing home pharmacy context are particularly nefarious because they can result in excessive prescribing of strong drugs to patients who have little or no control over the medical care they are receiving," U.S. Attorney Carmen Ortiz said in a statement. "Nursing home doctors should be able to rely on the integrity of the recommendations they receive from pharmacists, and those recommendations should not be a product of money that a drug company is paying to the pharmacy."

Johnson & Johnson, based in New Brunswick, N.J., said in a statement that it is reviewing the complaint and "will address the government's lawsuit in court. We believe airing the facts will confirm that our conduct, including rebating programs like those the government now challenges, was lawful and appropriate. We look forward to the opportunity to present our evidence in court."

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Real Estate Outlook: Housing Warmer Than WeatherBusiness gives a lift to seniors, cancer patients

Mortgage plan fails to live up to goals

WASHINGTON — President Barack Obama's plan to fix the foreclosure crisis has been a dud, putting the housing market recovery at risk.
Hopes were over-inflated when Obama unveiled the program before an adoring audience of Arizona high school students last February. Almost a year later, it appears only about 750,000 homeowners — a fraction of the 3 million to 4 million originally projected — might complete the application process, predicts Mark Zandi, chief economist at Moody's

The more borrowers who can't be helped, the more foreclosed properties will flood the market. And that means the nation's housing market, which appeared to recover last summer, could soon take another turn for the worse.

A record 2.8 million households were threatened with foreclosure last year, up more than 20 percent from a year earlier, RealtyTrac Inc. reported this week. The foreclosure listing firm expects another record this year.

Home prices, meanwhile, are down 30 percent nationally from the peak in mid-2006, and there is mounting evidence they will fall again over the winter as low-priced foreclosures make up a larger proportion of sales.

"It's a very serious threat to the housing market, and still one of the most significant risks to the broader recovery," Zandi said.

The Obama plan aims to help borrowers in financial trouble by making their payments more affordable. Modifications made under the program include a lower interest rate and often a longer repayment period. The average monthly payment has been cut by $500 on average.

The homeowners receive temporary modifications, which are supposed to become permanent after borrowers make three payments on time and complete the paperwork, including proof of income and a letter explaining the reason for their troubles.

However, just 66,500 borrowers, or 7 percent of those who signed up, have completed the program as of December, the Treasury Department said Friday.

An additional 49,000, or more than 5 percent, have dropped out of the program entirely — either because they missed payments or were found to be ineligible. Thousands more remain in limbo awaiting an answer.

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File taxes online and get refund in 10 days

WASHINGTON — Want a quick tax refund? File your federal return online and have the refund deposited directly into your bank account.
The Internal Revenue Service launched its online filing system Friday with a promise that people who do their taxes electronically will get refunds in as few as 10 days.

For those who file paper returns, refunds are expected to take four weeks to six weeks, said David R. Williams, the agency's director of electronic tax administration.

"We really encourage people to file electronically," Williams said, adding that it's fast, free and safe.

"We believe e-file is safe and secure and we work with the tax software industry to make sure it stays that way," Williams said.

One group still will need to file paper forms: those taking advantage of expanded homebuyer tax credits approved by Congress in November. Congress required documentation to claim the credits, so those returns must be done on paper, Williams said.

Under the program, buyers who have owned their current homes at least five years would be eligible, subject to income limits, for tax credits of up to $6,500. First-time homebuyers or people who haven't owned homes in the previous three years could get up to $8,000. To qualify, buyers have to sign purchase agreements before May 1 and close before July 1.

Tax season is approaching. Some workers already are starting to receive tax forms from employers and financial institutions. Individual income taxes for 2009 are due April 15.

For those who owe additional taxes, they can file electronically and pay later, as long as payments are received by April 15. Taxpayers can set a date to have tax payments automatically withdrawn from their bank accounts or they pay by credit card.

Last year, two-thirds of individual taxpayers filed their returns electronically. This year, Williams expects about 70 percent to file online.

Taxpayers can file their returns electronically whether they use a paid tax preparer or do it themselves. For families and individuals making less than $57,000, the IRS offers Free File computer software programs that help taxpayers prepare their returns at no charge. The software is similar to commercial programs that charge for their services, Williams said.

The software walks taxpayers through their returns by asking them a series of questions about their income, expenses and other financial transactions. Williams said the software is designed for taxpayers to get all the deductions and credits they are entitled to, as long as they accurately answer all the questions.

Those making more than $57,000 can still file their returns online at no cost, but they won't get the additional free help.

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Thursday, January 14, 2010

Nashville music labels involved in suit over song prices

A Manhattan federal appeals court has revived an antitrust lawsuit against major music labels, including some of the biggest operating in Nashville, and analysts warn that an eventual loss in the case could lead to hundreds of millions of dollars in penalties against the companies.
This latest legal threat comes as the music industry grapples with the meteoric rise of digital music sales balanced against a steep decline in total revenue of more than 40 percent in an eight-year period.

On Wednesday, the 2nd U.S. Circuit Court of Appeals in Manhattan said the lawsuit that accuses major record labels controlling most of the U.S. digital music sales of scheming together to set a floor of 70 cents for each downloaded song now will proceed before a federal judge in New York.

The lawsuit brought by music purchasers had been tossed out by a lower court judge in October 2008. It accused the major labels of conspiring to fix the prices and terms under which music would be sold over the Internet.

Defendants include the four major recording companies: Universal Music Group, Warner Music Group Corp., EMI Music North America, and Sony BMG Music Entertainment, a joint venture of Sony Corp. and Bertelsmann AG. Messages seeking comment left with lawyers for the companies were not immediately returned.

Sam Lipshie, a partner at Bradley Arant Boult Cummings LLP, a Nashville attorney who practices entertainment law, said if the plaintiffs can prove their case, it could result in "multi-hundred million dollar damages" against the major record labels.

"It would narrow their margin on their revenues from downloading," said Lipshie, who is not involved in this case. "It would also appear to open up the marketplace to competitors to iTunes."

The New York legal action, in effect, combines 28 lawsuits brought across the country from December 2005 through July 2006. The combined lawsuit was originally filed in Manhattan in April 2007.

The lawsuits accuse record companies of conspiring to charge at least
70 cents a song on the Internet, even though their costs were much lower.

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High court signals doubt NFL has antitrust protection

WASHINGTON — The Supreme Court justices signaled Wednesday that they are not inclined to shield the NFL and other pro sports leagues from the federal antitrust laws.
At issue was whether the NFL could be sued for giving a single company, Reebok, an exclusive license to market hats, T-shirts and other apparel carrying logos of the league's 32 teams.

Most of the justices seemed to doubt that the small Chicago-area company that lost its license to sell stocking caps with NFL logos would ultimately win its antitrust suit against the NFL. But most of them also seemed to think the company should be permitted to try. To win its suit, the small competitor would have to prove that consumers were hurt by the NFL's exclusive marketing deal.

The case of American Needle vs. NFL is being closely watched in the sports world because lawyers for the NFL sought a ruling that the league is a "single entity" and therefore shielded from antitrust claims. A single company cannot be accused of conspiring with itself.

If the high court were to deem the league a single entity, NFL players and coaches worry that the owners would conspire to restrict their salaries. Currently, players can sell their services as free agents and seek more money from competing teams.

But the NFL's single-entity argument ran into skeptical questions from most of the justices.

Gregg Levy, the NFL's lawyer, said the league operates as a single business.

"No NFL team can produce a product on its own," he said, and the selling of hats and T-shirts is intended to promote the league.

The teams "do this to make money," scoffed Justice Antonin Scalia. "They have an incentive to sell as many shirts as possible."

When Levy insisted that the NFL acts as a single business, Justice Sonia Sotomayor interrupted. "You are seeking in this ruling what you have not gotten from Congress: an absolute bar" to being sued under the antitrust laws, she said.

"Once you fix prices to make money, that is a Sherman Act violation," she said, referring to the landmark antitrust law.

Justice Stephen G. Breyer, one of the court's antitrust experts, said the NFL was entitled to say it operated as a joint venture. On that basis, it could set rules, such as for the scheduling of games and for competition on the field. But even so, its business decisions could be challenged if they unfairly restrained competition and hurt consumers.

American Needle, the hat maker, alleged that consumers were paying unfair, monopoly prices because of the exclusive licensing deal with Reebok. "Why shouldn't they have their shot" at proving the case in court? Breyer asked.

Last year, the U.S. 7th Circuit Court of Appeals in Chicago ruled for the NFL and threw out the suit.

A Justice Department lawyer also urged the justices to send the case back to Chicago and to permit the hat maker to try to prove its antitrust claim.

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TV ads against reform paid by health insurers

LOS ANGELES — The nation's biggest health insurers on Wednesday acknowledged funding TV ads designed to kill or water down the health-care overhaul measure, after a published report said the spots were paid for in secret to avoid a public-relations fiasco.
The trade group America's Health Insurance Plans said it put up funds at the behest of its members. AHIP represents the nation's largest insurers, including Aetna Inc., Cigna Corp., Humana Inc., UnitedHealth Group Inc. and Wellpoint Inc.

AHIP acknowledged paying for the ads after a story appeared in the National Journal's online editions late Tuesday.

"Reform needs to make health care more affordable, particularly for small businesses that struggle to provide coverage to their employees," AHIP spokesman Robert Zirkelbach said in an e-mailed statement.

"We share the very serious concerns employers have raised about provisions that will increase health-care costs, including new premium taxes that will hit small businesses hard. So when the employer community — our customers — asked us to contribute to their campaign, we readily agreed," Zirkelbach went on to say.

Citing health-care lobbyists, the National Journal said each insurer secretly put up at least $1 million and that the organization as a whole contributed $10 million to $20 million dating back to last summer.

The Journal reported that AHIP solicited the funds and funneled them to the U.S. Chamber of Commerce to underwrite the ads. Two business coalitions set up and subsidized by the chamber were responsible for the ads, the story said.

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