On Monday December 27, 2010, 6:23 pm EST
Winter storm could strand
air passengers for days
An East Coast blizzard that
has forced nearly 7,000 flight cancelations will leave many travelers stranded
through the end of the week.
Runways were expected to
reopen Monday evening at several major airports in the Northeast. But canceled
flights into and out of Philadelphia, New York and Boston left hundreds of
thousands of people scrambling for a way home. The storm and its aftermath
could end up costing the airlines $100 million, one analyst predicted.
NEW YORK (AP) -- Millions
of H&R Block Inc. customers who relied on short-term loans backed by their
expected tax refunds will not have that option this year, since Block's banking
partner was forced by federal regulators to stop offering the loans.
It's a blow to Block, the
nation's largest tax preparation company, which could lose tax customers to
competitors still offering the loans and has virtually no time to find a new
funding partner before tax season starts in January.
That means Block could lose
millions of dollars in revenue, since nearly 45 percent of its customers use a
refund anticipation loan or refund anticipation checks. The company made about
$146 million on the two products in 2010.
Insurance giant AIG gets
$3B in facilities
NEW YORK (AP) -- Insurance
giant AIG is taking yet another step on its road to recovery, obtaining $3
billion in credit facilities.
The news sent AIG shares
soaring 9 percent Monday.
The New-York based company
said it will be able to tap the facilities once it finishes paying back its
bailouts. American International Group Inc. received the biggest government
rescue of any financial company during the recent crisis. Its lifelines from
the Federal Reserve and Treasury were worth $182 billion.
The $3 billion in credit
facilities will be split evenly between a 364-day agreement and a three-year
agreement. AIG also said that Chartis has entered a one-year, $1.3 billion
letter of credit facility. There are 36 banks participating in the facilities.
Baby boomers near 65 with
retirements in jeopardy
CHICAGO (AP) -- Through a
combination of procrastination and bad timing, many baby boomers are facing a
personal finance disaster just as they're hoping to retire.
Starting in January, more
than 10,000 baby boomers a day will turn 65, a pattern that will continue for
the next 19 years.
The boomers, who in their
youth revolutionized everything from music to race relations, are set to
redefine retirement. But a generation that made its mark in the tumultuous
1960s now faces a crisis as it hits its own mid-60s.
That Santa feeling hasn't
quite left shoppers yet
NEW YORK (AP) -- Forget the
returns line. Americans hit the stores after Christmas to buy stuff, indulging
the rediscovered retail appetite that may have made 2010's holiday shopping
season the biggest ever.
Revenue for the holiday
season is on track to grow at its strongest rate since 2006. Total spending for
November and December could exceed 2007 sales -- the best season on record.
This despite an uncertain economy and a rise in thrifty habits.
Shoppers spent more on
their family and friends and for the first time since before the Great
Recession, treated themselves and even their pets. And after Christmas, even an
East Coast blizzard didn't kill the mood as they headed to stores armed with
gift cards and eyeing a new crop of discounts.
Mall of America's spokesman
Dan Jasper reported Monday that shoppers are doing more buying and less
returning this week than a year ago.
ECB steps up bond purchases
to $1.47 billion
BRUSSELS (AP) -- Data from
the European Central Bank shows it bought government bonds worth euro1.121
billion ($1.468 billion) in the week ended Dec. 24, as the ECB stepped up bond
purchases in its fight against Europe's debt crisis.
The previous week the
central banks only invested euro603 million in bonds from governments with
shaky finances such as Ireland, Greece and Portugal, disappointing traders who
had hoped the ECB would play a more active role as the region tries to keep the
debt crisis from pushing more states into international bailouts.
Buying bonds supports their
prices and keeps countries' borrowing costs in check.
Despite the increase,
Monday's data is still far below ECB bond purchases seen earlier this year.
Germany to create cyber
defense center
BERLIN (AP) -- Germany is
planning the creation of a national cyber defense center in 2011 in reaction to
a growing number of cyber attacks on government institutions that mostly
originate in China.
An interior ministry
spokesman said Monday that while in 2009 the government registered only 900
attacks, there were already 1,600 electronic attacks in the first half of 2010
as well as a high number of unreported cases.
For Japan, 2010 was a year
to forget
TOKYO (AP) -- Japan has been
overtaken by China as the world's No. 2 economy. Its flagship company, Toyota,
recalled more than 10 million vehicles in an embarrassing safety crisis. Its
fourth prime minister resigned in three years, and the government remains
unable to jolt an economy entering its third decade of stagnation.
For once-confident Japan,
2010 may well mark a symbolic milestone in its slide from economic giant to
what experts see as its likely destiny: a second-tier power with some standout
companies but limited global influence.
As Japanese drink up at
year-end parties known as "bonen-kai," or "forget-the-year
gatherings," this is one many will be happy to forget.
Problem is, there's little
to look forward to. With a rapidly aging population, bulging national debt,
political gridlock and a risk-averse culture slow to embrace change, Japan's
prospects aren't promising. And a tense, high-seas spat with China has
intensified fears of its neighbor as a military as well as economic threat.
By The Associated Press
The Dow Jones industrial
average ended the day down 18.46 points, or 0.2 percent, to 11,555.03. The
Standard and Poor's 500 index gained 0.8, or less than 0.1 percent, to
1,257.54. The Nasdaq composite index rose 1.7 points, also less than 0.1
percent, to 2,667.27. Monday's trading was particularly light after a massive
blizzard swept the Northeast, disrupting commutes for many people in New York's
financial industry. Activity was already expected to be slow in a week
sandwiched between the Christmas and New Year's holidays.
Benchmark oil for February
delivery fell 51 cents to settle at $91 per barrel on the New York Mercantile
Exchange. Analysts blamed the drop on China's decision over the weekend to
raise its benchmark lending rate. Higher interest rates will not only cool off
China's economy, they'll also cut the country's appetite for energy.
In trading for January
contracts, heating oil gave up 2.42 cents to settle at $2.5166 a gallon,
gasoline futures fell 2.17 cents to settle at $2.4209 a gallon and natural gas
added 2.9 cents to settle at $4.112 per 1,000 cubic feet.
In London, Brent crude
added 8 cents to settle at $93.85 a barrel on the ICE Futures exchange.