July 2011

Keepign an Eye on Euro Pairs Ahead of the EU Summit

July 20, 2011

Keepign an Eye on Euro Pairs Ahead of the EU Summit

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SpaceCom Names Akhtar Ali Chief Technology Officer

July 20, 2011

Satellite Engineering and Sales Veteran to Lead Global Technology Strategy

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VMWare Q2 net income up to USD220m

July 20, 2011

VMWare Q2 net income up to USD220m

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Riverbed Q2 profit up 71% to USD11.3m

July 20, 2011

Riverbed Q2 profit up 71% to USD11.3m

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Iran, China sign USD4b metro deal

July 20, 2011

Iran, China sign USD4b metro deal

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OPEC exports up 18% to over USD1trl

July 20, 2011

OPEC exports up 18% to over USD1trl

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Yahoo’s revenues decline 4.6% in Q2

July 20, 2011

Yahoo’s revenues decline 4.6% in Q2

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Baidu to provide users with free downloaded music

July 20, 2011

Baidu to provide users with free downloaded music

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Coca-Cola profit up18% in Q2

July 20, 2011

Coca-Cola profit up18% in Q2

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Indonesia’s FDI up 17%: CB

July 20, 2011

Indonesia’s FDI up 17%: CB

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Cintas Corp Q4 net income up 28%

July 20, 2011

Cintas Corp Q4 net income up 28%

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Apple net income hikes 125% to USD7.31b in Q3

July 20, 2011

Apple net income hikes 125% to USD7.31b in Q3

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Chipotle Mexican Grill Q2 profit up 9%

July 20, 2011

Chipotle Mexican Grill Q2 profit up 9%

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Gernot Wagner: $75,000 Buys Happiness, Twice as Much Buys More

July 20, 2011

“Money doesn’t buy happiness.” Ask anyone who had been slaving away on his desk late last night. Happiness seems to stop going up at  $75,000 . Make more and you are no better off. This is only a third of the story. Double my income today and I’ll tell you tomorrow that I am happier for it — another piece of conventional wisdom. I might get used to my increased riches eventually, but for now let me enjoy the extra cash. There’s another, even more profound complication lurking in the background: Ask me how I evaluate my life overall, and the threshold goes away altogether. More money suddenly does buy more happiness , even for a household raking in more than $75,000 per year. $75,000 itself, of course, is already high. Two thirds of American households make less. Half make less than $50,000. And that’s Americans. Most of the world has a ways to go to hit any kind of plateau. Even if we moved from our obsession with money to maximizing “happiness,” we’ll be accumulating quite a bit more stuff for a while.

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Rep. Jim Moran: Don’t Sell Our Future Short

July 20, 2011

On Tuesday night, the House of Representatives passed H.R. 2560 , the “Cut, Cap and Balance Act.” I was proud to vote against it. The House Republicans have presented us with their vision for America’s future. This is a vision in which the country turns its back on the achievements of the last century and chooses not to invest in meeting the challenges of the next century. The Republicans aim to use a crisis of their own making to hamstring future Congresses, limiting their ability to make necessary infrastructure investments, to care for the poor, aged and disabled, and to respond to national and international crises. The 18 percent spending cap mandated by the bill would return the government to spending levels not seen since the establishment of Medicare and Medicaid. The impending retirement of 70 million baby boomers means that that these spending levels are woefully inadequate unless we condemn them to a severely diminished quality of life. The bill would enshrine constitutional protections for tax cuts and loopholes for wealthy individuals and corporations, requiring a two-thirds majority in both the House and the Senate for the government to increase the currently unsustainably low revenue levels of roughly 15 percent of GDP. This would necessarily result in unprecedented cuts in student loans and grants, transportation, education, environmental protection and enforcement, in other words, the physical and human infrastructure of our economy. With H.R. 2560, the Republican Majority is demanding that in return for avoiding an economically disastrous default on our debt, we make $111 billion in immediate spending cuts. These cuts seriously increase the likelihood of a double-dip recession. Last month, the economy added an anemic 18,000 jobs. In fact, the private sector added 57,000 jobs, but 39,000 public sector jobs were lost in addition to the 49,000 public sector jobs lost in the prior month. This is a continuing trend; half a million public sector employees have lost their jobs since 2008, 200,000 of them teachers (while student enrollment has increased by 750,000). Firing more government workers will only decrease aggregate demand, making it that much harder to sustain the recovery. We have witnessed this before. In 1937, President Roosevelt responded to similar pressure by significantly reducing federal spending before the Great Depression was fully in the rear-view mirror. The economy would not recover until the increased spending and hiring that accompanied the WWII armaments buildup got the country moving again. After the war, spending on education and housing for our GIs, the Marshall Plan for Europe and the construction of the Interstate Highway System established a permanent middle class and sustainable prosperity. As an appropriator I have learned that budgets are the firmest expression of our values. This is not the time for the Democratic Party to sacrifice our values, values held by a majority of the American people even in the face of opposition that has reached unprecedented levels of ideological radicalization. We must address our long-term deficits, but we must do so in a balanced manner, combining rational spending cuts and increased revenues. In the budget deals agreed to under Presidents Reagan, George H.W. Bush and Clinton, tax increases made were balanced with spending cuts. The experience of the 1990s shows us what a rationally balanced budget looks like, accomplished not by constitutional engineering, but by legislation and compromise. The tax rates that prevailed during that period allowed us to invest in our future and meet our obligations, and we enjoyed the greatest period of sustained economic growth in our history, with 20 million new jobs created. Those taxed at the top rate of 39.6 percent brought home more after tax income than at any prior time in American history. Now, however, we are being told that even one cent of increased revenue would be economically destructive. This strains credulity and is disproved by history. After the failure of the Articles of Confederation, the Constitution was designed to give Congress the freedom to both raise revenue and expend funds to meet the needs of a growing nation. In Federalist Number 30, Alexander Hamilton wrote that “a complete power… to procure a regular [supply of money] and adequate supply of it, as far as the resources of the community will permit may be regarded as an indispensable ingredient in every constitution.” Tuesday evening we were asked to amend the Constitution after two and a quarter centuries to permanently limit the ability of our government to foster competitiveness in a global economy, to generate greater equality of opportunity, to treat our seniors with dignity and respect and to defend and define this great nation as the ever shining beacon on the hill. Let’s not sell short our people or our future.

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House Passes Tea Party’s ‘Cut, Cap And Balance’ Fiscal Plan

July 20, 2011

WASHINGTON — House Republicans easily passed their “Cut, Cap and Balance” fiscal plan on Tuesday, a proposal that boosts their standing among Tea Party supporters but has no chance of becoming law. The bill passed, 234 to 190, on a largely partisan vote. Five Democrats, including Reps. Jim Cooper (Tenn.), Health Shuler (N.C.) and Dan Boren (Okla.), sided with Republicans in passing the measure. Nine Republicans opposed the bill, including Tea Party favorite and GOP presidential candidate Michele Bachmann (R-Minn.). In a statement issued after the vote, Bachmann said the bill “does not go far enough” and should have included provisions to defund health care reform. Other Republican defectors included Reps. Walter Jones (N.C.), Francisco Canseco (Texas), Scott DesJarlais (Tenn.), Connie Mack (Fla.) and Ron Paul (Texas). Paul said he has never voted for a debt ceiling increase and never will. In addition, he took issue with Republicans for not including defense cuts in the mix of discretionary cuts. “All spending must be deemed discretionary and reexamined by Congress each year,” Paul said in a statement . “To allow otherwise is pure cowardice.” Tuesday’s vote comes after weeks of Republicans touting the bill as proof of their commitment to conservative principles. It includes three provisions: substantial spending cuts, statutory spending caps, and a constitutional amendment to require the government to balance its books each year. Republicans say the proposal is just the kind of shot in the arm needed to address the nation’s staggering $14.4 trillion debt. Specifically, it calls for cutting more than $100 billion in fiscal 2012 and makes drastic spending cuts in areas that Democrats have prioritized as opportunities for investment: clean energy, infrastructure, education and job training. The biggest concern for Democrats, however, is the bill’s proposal to gut Medicaid funding by one-third over the next decade. Both parties know the bill has next to no chance of passing the Democratic-controlled Senate, and President Barack Obama has already threatened a veto. But Republicans have pushed for a record vote on it ahead of the 2012 elections. Democrats spent much of Tuesday’s four-hour debate bashing Republicans for wasting time on a political stunt. “This bill panders, even grovels, to Tea Party extremists,” Rep. Betty McCollum (D-Minn.) said. “Thank goodness this bill will never pass the United States Senate. Thank goodness this bill will never become law.” Republicans countered that their fiscal plan is better than nothing, which is what Democrats have put forward. Rep. Jason Chaffetz (R-Utah), the author of the GOP bill, said he would welcome debate on a Democratic alternative if there was one. “If you could slide it across the table to us, we’d love to see it,” Chaffetz said. Partisan tensions flared throughout the debate as both sides accused the other of leadership failure, sometimes with creative flair. “You guys are ruining this country’s fiscal future,” Rep. Sam Farr (D-Calif.) said to Republicans. “Shame on you for playing with fire on the United States Constitution. Shame on your ‘Cut, Cap and Ruin the United States.’” Rep. Todd Young (R-Ind.) said the debt debate reminded him of a scene from the book Alice in Wonderland , when Alice told the Cheshire Cat she didn’t really care where she went in her travels. “I get the sense my friends on the other side of the aisle don’t really much care where we go,” Young said. The measure now heads to the Senate. A senior GOP aide said Senate Republicans are pushing for a vote this week.

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BART To Get A Makeover From BMW

July 20, 2011

Does anyone know how BMW feels about interior carpeting? This is a serious question now that DesignworksUSA, a subsidiary of the German car manufacturer BMW, has won the contract to design the next generation of BART trains. In a press release , even BART admitted the union is a little odd: BART has worked for years to get folks out of their cars and onboard its trains. That’s why at first look, it might seem strange that BART is partnering with a subsidiary of one of the premier car companies in the world to create the Fleet of the Future, a new generation of train cars. BART currently has the oldest fleet of train cars currently in operation of any transit system in the county–most original trains from the when BART launched in 1972 are still in operation. “The rail system uses a broad gauge rather than the standard gauge of most rail in the U.S., so cars must be custom-designed,” CNET reported . The agency is in the process of conducting “Seat Labs,” where it solicits input from the public about what people would like to see in the new trains. One interesting finding from the sessions is that most riders would be willing to give up an inch or two of seat space in exchange for wider aisles. Data gathered from the labs will be folded into whatever concept the firm eventually settles on. DesignworksUSA specializes in sleek, modernist designs and has worked on everything from a private jet for Boeing to a tractor for John Deere . (For the latter, the company won a number of industry awards.) Most relevant for BART is the work the company did on the Deutsche Bahn: Innovation Train. It’s worth taking a look at these pictures of the company’s concept for the German train and applying it to BART. An investigation by the Bay Citizen earlier this year found the interiors of BART’s train cars to be teeming life. Disgusting, disgusting life: Fecal and skin-borne bacteria resistant to antibiotics were found in a seat on a train headed from Daly City to Dublin/Pleasanton. Further testing on the skin-borne bacteria showed characteristics of methicillin-resistant staphylococcus aureus, or MRSA, the drug-resistant bacterium that causes potentially lethal infections, although Franklin cautioned that the MRSA findings were preliminary. High concentrations of at least nine bacteria strains and several types of mold were found on the seat. Even after Franklin cleaned the cushion with an alcohol wipe, potentially harmful bacteria were found growing in the fabric. The new train cars are expected to go into service sometime in 2017.

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Fernando Espuelas: Why Republicans Can’t Say Yes to Obama

July 20, 2011

So it’s not about the deficit after all. For months we’ve heard the increasingly shrill alarms being sounded by supposedly sober-minded Republican Congressional leaders that America is the next Greece — balancing carefully over a debt precipice, destruction inevitable unless radical action is taken. These alarms have been so effective that the true nature of our national crisis — chronic unemployment at unacceptably high levels, overall slack economic demand — has been relegated to a secondary plane of importance. Some 20 million people unemployed or under employed are not just a human tragedy but a major contributor to our still under-performing economy. The GOP trope that the federal government deficit is somehow responsible for high unemployment defies common sense and basic economics. Yet this fallacy is repeated often and loudly as if it were a proven fact. Meanwhile, the chairman of the Federal Reserve recently told Congress that the Fed is ready to take even more aggressive action — read some massive stimulus — if the economy falters. So we come to the intransigence of Republican “negotiators” trying to hammer out some compromise to raise the debt ceiling with the Democrats. It would seem that these elected leaders’ responsibility to the country, their oaths of office, is seemingly trumped by their religious oath to Grover Norquist, the founder of special interest group Americans for Tax Reform and the godfather of the “all taxes are evil” movement, to never raise taxes regardless of the economic conditions This fetishistic oath, seemingly sworn and signed in blood, has kept the Republicans from saying “yes” to President Obama’s offer for raising the nation’s debt ceiling — a deal that would whack some $4 trillion dollars from the national deficit. Charlie Cook, one of America’s most respected non-partisan political analysts, is brutal on the Republican’s stance on the debt ceiling — and thinks that it may cost them the support of Independent voters in 2012.  Cook writes in the National Journal : …What has happened is that the New Republican Party has come to hate taxes a lot more than it hates deficits and the country’s growing indebtedness. It has rewritten history to omit any acknowledgment that President Reagan, when it was necessary, went along with tax increases. The memory of Reagan accepting tax increases, however reluctantly, has been supplanted by President George H.W. Bush’s fateful decision to go along with tax increases in the 1990 budget negotiations. What the New Republican Party remembers is Bush losing reelection, not the fact that those tax increases were pivotal in eliminating the federal budget deficit under President Clinton and in the resulting period of strong economic growth. Bush’s loss is remembered, and the period of fiscal responsibility is forgotten. At least history will treat Bush 41 with more gratitude than his own party does… Why did the Congressional Republicans walk away from the biggest deficit reduction pact in history?   Based on a several recently published polls, Americans everywhere outside of Washington are befuddled by their elected leaders’ stance in these negotiations. A new CBSNews poll found that “only 21 percent of the people surveyed said they approved of Republicans’ handling of the negotiations, while 71 percent disapprove.” Other recent polls point to a similarly stark divide between Republican voters and their elected representatives. So why walk away from a great deal to shrink the government deficit?  Could the “of the 1%, by the 1%, for the 1%” be the reason?  A recent  article in Vanity Fair by Nobel-winning economist Joseph Stiglitz is as cogent as it is alarming: Americans have been watching protests against oppressive regimes that concentrate massive wealth in the hands of an elite few. Yet in our own democracy, 1 percent of the people take nearly a quarter of the nation’s income — an inequality even the wealthy will come to regret. Stiglitz goes on to say that enlightened self-interest — the patriotic desire for the whole country to prosper, for the middle-class to thrive, so you too can be successful – should provoke the “1%” to support policies that improve the whole of society, not just those initiatives that dump tax benefits to the wealthiest Americans paid for by the middle class. Warren Buffett, the iconic self-made American man, is clear on this subject. No one has made a dime in this country without the unique advantages that America offers, he repeats and repeats. From an ethos of fairness, hard work and sacrifice, to a belief (at least in classical American mythology) that any kid can grow up to be president, the success of every American is tied to, as the U.S. Constitution states in its preamble “the general Welfare.” Stiglitz writes that the 1% no longer identify with the bottom 99% — and that this division is bad for all Americans, rich, middle class and poor. When the “1%” fund and elect elect representatives that are committed to the welfare of that “1%” at the expense of the 99%, we find ourselves in a dire situation with negatively profound implications to the future of America and our ability to remain the world’s leader. In fact, we find ourselves in a self-created, completely avoidable, national crisis that shatters Americans’ faith in their own government while also damaging America’s standing in the world.

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Gang of Six Plan On Charitable Deductions Would Follow Debt Commission Guidelines

July 19, 2011

WASHINGTON — Part of the debt-reduction plan unveiled Tuesday by the Gang of Six would “reform, not eliminate tax expenditures” for charitable giving. The plan says nothing more about charitable tax deductions, which it lumps in with reforms in health, home ownership and retirement. Asked what “reform” meant, Senate Budget Committee spokesman Stu Nagurka emailed The Huffington Post, “I don’t have any information that I can share with you.” That being said, an executive summary of the proposal gives a hint at the approach to reform, saying it is “consistent with the recommendations of the Bowles-Simpson fiscal commission .” The document called for simplifying the tax code while increasing or maintaining fairness. Under the current system, taxpayers who donate to charities are eligible for a deduction based on their marginal tax rate. Those in the top bracket currently are allowed to deduct a maximum of 35 percent of their taxable income. Those with more modest incomes get more modest deductions. The federal debt commission proposed late last year that all taxpayers be given a 12 percent, non-refundable tax credit as long as they contributed at least 2 percent of their adjusted gross income to charity. If they give less than that, they would get no deductions. Charitable deductions are estimated to cost the federal government about $237 billion between 2009 to 2013.

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Senate Dems Don’t Return Obama’s Embrace Of ‘Gang’ Plan

July 19, 2011

WASHINGTON — The Obama administration and congressional lawmakers appear to be at odds over whether they can attach a recently revived bipartisan proposal for deficit reduction to legislation raising the nation’s debt ceiling. An administration official told The Huffington Post on Tuesday that there was enough time before the Aug. 2 debt ceiling deadline for lawmakers to tinker with the so-called Gang of Six plan, which would reduce the deficit by $3.7 trillion over ten years, primarily through spending cuts and entitlement reforms. “We feel we have time to do a big deal, yeah,” the official said, pointing to comments made on Sunday by Office of Management and Budget Chairman Jack Lew that were similarly optimistic about the legislative timeframe. But if the goal was to wax optimistically about the prospects of going big, members of Congress apparently didn’t get the memo. Hope bloomed on Capitol Hill Tuesday that a renewed “Gang of Six” could offer a bipartisan cure for ailing debt talks, but cautious words from many senators suggested the deficit-slashing plan could end up cut to ribbons. The slice came from Senate Majority Leader Harry Reid (D-Nev.), who suggested there simply is not enough time to act on a package that would cut nearly $4 trillion over 10 years. “I’m happy to work and use anything in the Gang of Six that we can,” he said, suggesting the Senate might swipe parts in the short-term, but that moving the entire thing was too big a lift. “Remember, we only have 13 days — 13 days — and there’s a number of senators who have said they’ll do everything they can to stop the debt ceiling from being increased.” Even one of the Gang members, Sen. Mark Warner (D-Va.), was not sure what path the deficit-cutting plan could take, or if it would even wind up in the bargain to prevent a historic U.S. debt default. “There’s still a question of how these two intertwine at this point, or if they do,” Warner said. And other Democratic senators seemed far from convinced that the fresh proposal was a good idea at all, because it could require large sacrifices by the middle class. Sen. Dianne Feinstein (D-Calif.) took an especially cautious tone, saying she needed to study new proposal more carefully. “It’s huge, so you have to really take some time and go over,” Feinstein said. But she quickly pointed to a potential trip wire for Democrats, saying a plan to change the way inflation is adjusted is “one of the things I need to find out exactly what that means.” Altering the inflation index could be a way to cut benefits in Social Security because hikes in benefits are linked to inflation. Feinstein would prefer to toss the “Gang of Six” plan to a commission that would come back in six months. Sen. Ron Wyden (D-Ore.), who has been working on a tax-reform plan with Sen. Dan Coats (R-Ind.) and former Sen. Judd Gregg (R-N.H.), waved another large, red flag for middle-income Americans. He noted that the proposed plan slices individual tax rates more deeply than his own bipartisan group thought possible — which means more money has to come from somewhere to offset the breaks. “One of the questions will be, as you go forward in this, how is that going to affect key tax incentives that middle class people rely on — like the mortgage deduction, their health and their retirement? That’s where the bulk of the money is,” Wyden said. “There has to be a clear recognition that you would have to dramatically reduce some of the tax incentives that middle class people have felt very strongly about.” That means people would be able to write off less for their IRAs, mortgage interest and other things like charitable giving . Indeed, it seemed likely the deal would have little support from the left. Justin Ruben, executive director of the progressive advocacy group MoveOn.org, said the proposal appears to “ask seniors, the middle class and the poor to bear the burden of deficit reduction.” “We cannot allow a minority of Tea Party-led Republicans in the House to hold our nation’s economy hostage in order to protect tax breaks for the rich and corporations, while forcing cuts to programs families depend on,” Ruben said in a statement. Health Care for America Now, which fends off attacks on Obama’s health care bill, was similarly skeptical of the Gang of Six proposal. “A budget deal that devastates America’s seniors and middle-class families while letting big corporations and the wealthy off the hook is a bad deal for America, even if it’s bipartisan,” executive director Ethan Rome said in a statement. “America needs a budget agreement that keeps alive the promise of financial security and economic opportunity for the people who built this country and make it work.” The new plan’s ideas won their most enthusiastic support from conservative Democrats such as West Virginia Sen. Joe Manchin — who said hearing about the deal made Tuesday the best day of his Senate career — and Republicans. But several Senate Democrats wondered if their colleagues across the aisle could convince the Tea Party-steeped GOP in the House to go along. House Speaker John Boehner (R-Ohio) did not seem especially committed to the Gang of Six with his own members still pursuing an even more draconian cutting plan. “This plan shares many similarities with the framework the Speaker discussed with the president, but also appears to fall short in some important areas,” said Boehner spokesman Michael Steel. “The House is voting today on our ‘Cut, Cap, and Balance’ plan, and we hope the Senate will take it up soon. That remains our focus.” With additional reporting by Tyler Kingkade and Elise Foley

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Republicans Introduce Bill Aimed At Crippling Labor Board

July 19, 2011

WASHINGTON — House Republicans introduced a bill Tuesday afternoon aimed directly at scuttling a controversial complaint issued by the National Labor Relations Board (NLRB) against The Boeing Company. Called the Protecting Jobs from Government Interference Act, the bill would prohibit the labor board from ordering any company to “close, relocate, or transfer employment under any circumstance,” severely weakening the board’s ability to enforce labor law. The maneuver is just the latest development in an escalating spat between conservatives and the labor board, which conservatives and business groups have decried as having a pro-union tilt under President Obama. Earlier this year, the board’s general counsel, Lafe Solomon, issued a complaint alleging that Boeing broke labor law when it created a production line for its 787 Dreamliner in South Carolina. Solomon said the move was retaliation against Boeing’s unionized employees in Washington state for having gone on strike in the past. If Boeing is deemed to have broken the law, it could feasibly have to move the production line to Washington. “No government board should have the authority to tell a private employer where it can run a business,” Rep. John Kline (R-Minn.) said in a statement on the bill. “Yet as the Boeing dispute has made disturbingly clear, the National Labor Relations Board is empowered to override the business decisions of American employers.” The bill may be more theater than substance, since it would seem to conflict with the National Labor Relations Act. The act authorizes the agency to issue complaints like the one filed against Boeing. If passed, the law as introduced would effectively gut the board’s remedy process when labor law has been broken. The bill was introduced by Rep. Tim Scott (R-S.C.) and co-sponsored by Kline along with Reps. Phil Roe (R-Tenn.), Joe Wilson (R-S.C.), and Trey Gowdy (R-S.C.). South Carolina Republicans, in particular, were incensed over the Boeing complaint, claiming it could cost the state jobs. Unions and labor activists, however, hailed the decision as a victory for workers, as well as an indication that the board was enforcing labor law in a manner not seen in the Bush years. In a statement, Rep. George Miller (D-Calif.) said he was “disappointed” in the Republicans decision to push a “far-reaching” bill through the education and workforce committee so quickly without a hearing. The bill is scheduled for a vote on Thursday. “A quick first read indicates that the Republican bill will make it easier to play American workers against each other in a race to the bottom and even easier to ship American jobs overseas,” Miller said. “It would create an open season for CEOs to punish workers for exercising their rights.” The labor board, an inconspicuous agency not known to many Americans, has been assaulted by Republicans ever since the Boeing complaint was issued in April. Last month, Republicans called a special oversight hearing in South Carolina, where Solomon was largely castigated for his decision to issue the complaint against Boeing. For the last two days, the NLRB has hosted public hearings on new rules it plans to issue that will streamline the union election process. Republicans have publicly assailed that decision as well, calling it a gift to unions.

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House Republican Freshmen Caught Between Rock And A Hard Place

July 19, 2011

WASHINGTON — House Republican freshmen are caught between rock-solid fiscal conservatism and a political hard place. The class of 2010 that lifted the GOP to its comfortable House majority pushed the leadership to a vote Tuesday on legislation that would slash spending by trillions of dollars and require a balanced budget constitutional amendment in exchange for an increase in the nation’s borrowing limit. At least a dozen freshmen spoke out for the bill during hours of House debate Tuesday. “Washington has a spending addiction,” insisted Rep. Rich Nugent, R-Fla. Securing a vote was a hard-won victory consistent with the campaign promises that helped get the 87 GOP members elected in November. But the measure’s chances are poor in the Senate, setting the stage for a backup plan from congressional leaders that would allow the government to avoid an unprecedented default on Aug. 2. That would force freshmen to back an increase in the $14.3 trillion debt ceiling, and several constituents are telling them not to do it. “I’m actually being accused of selling out back home,” Rep. Mick Mulvaney, R-S.C., said in an interview. “Some folks don’t want to raise it under any circumstances. I tried to explain to them that this is the one chance to actually change Washington, so most folks will come around after we have that discussion.” The former state lawmaker who ousted the chairman of the House Budget Committee, Democrat John Spratt, said he was hearing from the “extreme right wing.” Solid backing of tea partyers helped propel several freshmen to Washington, boosting the candidacy of citizen-lawmakers such as car dealers, pizza shop owners, farmers and businessmen. The Tea Party Express on Tuesday made it clear they better stay in line, threatening GOP primary challenges to Republicans who support Senate Minority Leader Mitch McConnell’s alternative plan to give President Barack Obama the power to order an increase in the debt limit of up to $2.5 trillion over the coming year. Another tea party group warned about the “disease of Republican compromise” infecting Washington and ceding to Obama’s demands. On the other side, freshmen Republicans face pressure from McConnell’s sober assessment that failure to raise the debt ceiling could be blamed on Republicans and ensure another term for Obama in 2012. Separately, House Republicans are hearing from business owners who echo the dire warnings from economists and financial analysts about the ramifications of a government default. The votes in the coming days could have widespread implications for GOP freshmen next year, determining whether they get a challenge from within the party in a primary or have to answer for their decisions in the general election. A new CBS poll found the public had soured on both Obama and congressional Republicans in the debt talks, but the GOP got lower marks than the president. Frustrated with the president, about 20 freshmen took a bus to the White House on Tuesday to press Obama to detail his deficit-cutting plan. “We don’t care about re-election. We’re here to do the work and we’re asking the president, `Put it in writing, let’s debate it,’” said Rep. Tom Reed, R-N.Y. “We thought it was so important, we came here physically.” Scoffing at claims of economic calamity if the debt ceiling isn’t raised, Rep. Mo Brooks, R-Ala., said such statements are “absolutely wrong” and “misleading the American people.” Brooks argued that the government would still have enough revenue to pay its creditors. “This is Barack Obama’s debt, this is Barack Obama’s debt ceiling,” Brooks said, adding that Obama had been “AWOL” on the issue. Neither Obama nor a White House official met with the group and they returned to the Capitol. Rep. Vicky Hartzler, R-Mo., who owns an agriculture business with her husband, said business owners, bankers and others in her district are pushing for deep spending cuts. “They understand this overwhelming debt is hurting our economy and impeding job creation so we need to rein in this runaway spending, get control of our debt so that we can grow and create jobs,” Hartzler said in an interview. The Missouri congresswoman said she hasn’t heard specifically from tea partyers, but added, “My district was tea party before tea party was cool.” It’s unclear how freshman Republicans will vote in the coming days if faced with a possible compromise that includes raising the debt limit. Hartzler said she would vote “no, at this point.” Mulvaney pointed out that for lawmakers who backed the so-called cut, cap and balance bill in the House, “there’s a lot of latitude in some of those things.” The GOP freshmen are hardly monolithic on budget issues. In April, most of the 87 relented and voted for the compromise worked out by Obama and House Speaker John Boehner to keep the government running. Sixty of the 87 supported the package that included spending cuts of $38 billion, far less than the $61 billion many had pushed for, while 27 of the freshmen opposed it. In February, House Republican freshmen led the charge in voting to cancel $450 million for an alternative engine for the next-generation F-35 fighter plane, going against Boehner and other House GOP leaders. Whatever the spending cuts in any deal, Mulvaney offered an assessment of Washington after more than a half year in office. “There’s more smoke and mirrors in this town than a Barnum & Bailey circus when it comes to counting,” he said. ___ Associated Press writer Erica Werner contributed to this report.

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Steve Blank: The $10 Million Photo and Other VC Stories

July 19, 2011

While on vacation I had a phone interview with Kevin Ohannessian of Fast Company who wanted a few “funding stories.” Here are two of them. Apologies for the rambling stream of consciousness. The original interview in Fast Company can be seen here . Throw in the Photo and You Have a Deal When we were trying to raise money for E.piphany, my last startup, I was negotiating with a venture capital firm called Infinity Capital. They really wanted to invest, but it was the beginning of the bubble, and I wanted (what was then) an absurd valuation. All we had were six slides, and I wanted a $10 million post-money valuation. But it was my eighth startup and my partner Ben was even more experienced: ex VC, ex Harvard Computer Science professor, genius at building products and teams. I had sat on a board of an Electronic Design Automation company with this VC, and we had gotten to know each other. So when I wanted to start a company he wanted to fund us. We had gone back and forth with them on valuation, but this was a new firm and they wanted to close a deal with us. After about our fifth meeting I’m in their conference room. I say, “Why can’t you guys do a $10 million post money valuation?” Picking the biggest number I could think of for three founders without a product a semi-coherent idea and badly written slides. Finally they admitted, “Steve, we’re a new fund; everybody will think we are idiots if we do that.” I said, “All right. Can you do some other number close to my number?” So I stepped out of the room as they caucused, and they called me back in 10 minutes later and said, “So listen. We can do $9.99 million.” I’m trying to play poker with the deal, and one of the partners at the time was a great photographer-the firm had big prints of his on the walls. I was really in love with the one in the boardroom. So without thinking, when they made me that offer, trying to keep a straight face, I reached behind me, grabbed the photo off the wall and slammed it on the desk, and said, “If you throw this photo in, you got the deal!” The $10 Million Photo The look on their faces was utter astonishment. I was thinking it was because I was being creative by throwing the photo in, but then I noticed that this cloud of dust was settling around me. I turn around and looked at the wall and it turned out the photo had been bolted into the drywall. And there was now a hole — I literally ripped a part of their boardroom wall off as I was accepting the offer. Without missing a beat they said, “Yes, you can have the photo. But we’re going to have to deduct $500 to repair our wall.” And I said, “Deal.” And that’s how E.piphany got its Series A. Invest in the Team Before we closed our Series A with Infinity, I had called on Mohr, Davidow Ventures , the firm which had funded my last company, Rocket Science . The senior partner at the time was Bill Davidow , a marketing legend and a hero of mine who had also funded other Enterprise software companies. I went in and pitched Bill the idea about how to automate the marketing domain. He gave me 15 minutes, then as politely as he could do it, walked me out the door and said, “Stupidest idea I ever heard, Steve. Enterprise software means across the Enterprise. Marketing is just one very small department.” As he was walking me out, I remember as I physically crossed the threshold of the door that: A. He was right, and B. I figured out how to solve the problem of making our product useful across the entire enterprise. So E.piphany went from a bad idea to a good idea by being thrown out by a VC who gave me advice that made the company. He has reminded me since, “Sometimes you invest in the idea, but you should always be investing in the people. If I would’ve remembered who you were, I would’ve known you would figure it out.” (Kleiner Perkins would do the Series B round for E.piphany. After our IPO, Infinity’s and Kleiner Perkins’ investment in Epiphany would be worth $1 billion dollars to each of them.) I still have the photo. Back from vacation soon.

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Schuman: Can Sovereign Defaults Tank The Global Economy?

July 19, 2011

Investors are running for the hills these days, shaken to the core by fears that sovereign defaults will roil global markets and derail the shaky recovery. They have a lot to worry about. European leaders will gather for an emergency meeting on Thursday to try to finally hammer out an agreement on a second bailout of tottering Greece – a package very likely to include some sort of de facto default. Contagion threatens to drag other euro zone economies into a similar state.

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Warren Mosler: Mercy! Can’t They Get Anything Right?

July 19, 2011

Business doesn’t create jobs — consumers do! It is an article of faith by all parties involved that businesses are the job creators, particularly small businesses, and hence their every move is predicated on helping businesses create jobs. Mercy! Can’t they get anything right? Businesses hire to service consumers. A restaurant that’s full doesn’t layoff anyone, no matter how much he hates the government, and the same goes for department stores, engineering firms, etc. When stores are empty, there’s no way they will or should hire. It’s a waste of human endeavor. In fact, business serves public purpose best by producing and selling its output with as few employees as possible. That’s called productivity, which is what makes us rich in real terms. Labor is inherently a scarce resource. There are only so many of us to get all the work done. We lost eight million jobs in 2008. Why? Because eight million people all of a sudden decided they’d rather go on the dole than work? No. It’s because sales collapsed. In a heartbeat, car sales went from near 17 million/yr to just over 9 million/yr. And why did sales collapse? Because we all ‘lost our credit cards.’ The New York Times Sunday Review published a dramatic graph showing the collapse in sales — home sales down 24% since 2007, light car sales down 24%, washers and dryers down 26%, and stoves and ovens down 19%, as consumer borrowings to spend likewise declined. Overall consumer spending has slumped 6.9%, far exceeding the last big slump in consumer spending in the late seventies (when interest rates where around 18%) and consumer spending declined by 2.9%. How do we get back sales and all the lost jobs, and then some? How about we stop taking FICA (Social Security and Medicare taxes) out of the paychecks of people who work for a living, so sales can resume from income rather than from consumer debt? What’s wrong with that? How about suspending FICA for businesses as well, to lower their costs and help keep consumer prices from rising? That would also be a good thing. So why don’t our fearless leaders just do it? Because they think they need those taxed dollars for Social Security and Medicare. Can’t they get anything right? Federal taxes regulate demand (our spending); they don’t ‘bring in’ anything. The federal government ‘collects taxes’ simply by lowering the balance in our bank account. No gold coin drops into some government bucket. It’s just data entry, just the Federal Reserve changing numbers on their spreadsheets. Chairman Bernanke has told us repeatedly how the federal government actually spends, including Social Security and Medicare spending: they just use their computer to mark up the numbers in our bank accounts. They don’t call China for a loan and they don’t check with the IRS to see how collections are going. Federal government spending doesn’t ‘come from’ anywhere. Everyone inside the Federal Reserve knows it, and has always known it. They know that suspending FICA taxes does not alter their ability to make Social Security and Medicare payments. They all laugh off the idea that FICA actually funds anything — a ‘useful fiction’ as it’s been called since the program began in the 1930′s. That ‘useful fiction’ is no longer seems very useful, unless you’re trying to destroy the US economy. Even with sky-high unemployment, we can easily afford to both suspend FICA and truly strengthen Social Security and Medicare by increasing the minimum benefits and closing the donut holes. This is not ‘adding stimulus’. It’s removing drag by removing massively regressive and punishing taxes. It allows consumers to drive sales until they’ve created all the private sector jobs we need. I see no harm, along the way, in sustaining the public infrastructure that serves public purpose, and tossing the states a per capita payment to make up for what the federal government did to them in 2008. Furthermore, as should go without saying, there should be an $8/hour federally funded transition job for anyone willing and able to work, to facilitate the transition from unemployment to private sector employment. However, that’s not what’s going to happen. It looks to me like there are too many members of Congress who can’t vote for any package, due to prior pledges: Democrats who can’t vote for cuts in Social Security benefits or eligibility, Republicans pledged not to ever vote to raise taxes, and some pledged to never vote to raise the debt ceiling for any reason. The compromise packages lose votes from both sides from those who are pledged to never compromise. This means a partial federal shutdown is a high probability, with a sudden cut in spending cutting into sales and therefore jobs, as just described. Treasury rates will stay low and probably fall further, with the Fed rates presumed to stay low for a lot longer. Energy and commodities will deflate, the dollar will get stronger, stocks will fall as top line growth forecasts fall, Europe and Asian stocks will fall as their largest export market becomes at-risk. As sales fall and unemployment rises, the U.S. deficit will rise via the automatic stabilizers of falling tax revenues and increased transfer payments — if the government pays them. Alternatively, if a compromise package is reached, the deficit reduction plan will cause the same things to happen, only not as severely, and it’s back to death by a thousand cuts.

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Saftar Sarwar: Why We Should Learn From History

July 19, 2011

The current crisis in the Eurozone is not new news. It has being gone on for a while now. It will continue to progress until something is done. Greece is close to default, this crisis has spread to other Eurozone countries: Portugal and Italy being two key countries in serious economic trouble. Where will it end? Will Greece default, looks likely, should be likely. Should be inevitable. We need to remember that the Eurozone is an artificial construction undertaken and driven by political considerations ahead of economic considerations. Historically politics has driven the agenda here. Politics has been king. That will soon change. That needs to change. People are realizing that politics can only go so far and that economics and financial markets importantly are the key factors to consider, not only consider but to completely focus on. Any artificially constructed economic framework is bound to have its problems. I am surprised it has taken so long. We have regionally economic differences never mind across country divergences of economic growth, inflation, unemployment, employment and so forth. Why should the Eurozone be any different? Central banks and governments can only support such a controlled mechanism for so long: supporting large indebted nations. Sometimes change is required not for short term gain but long term growth and development. Change for the next generation. Greece and some other Eurozone countries are at that point now. We need to now move from the theory to the reality and allow some of the banks, and bond holders take the pain of the debt burden within some of the Eurozone countries. Greece should be allowed to default on its debts. Greece should be allowed to transition its economy away from the Eurozone and allowed (if it wants to) to take back its sovereignty in its economic affairs. If this means Greece needs to re-establish the Drachma again to regain slowly its economic credibility, so be it. It could (and would) be a price worth paying now for much better longer term economic growth, economic credibility. I always find it puzzling that people often do not take into account history when assessing market and financial conditions. History teaches us a lot about events. Humans are prone to repeating past mistakes and being over confident about their own abilities in certain situations. Some of the debacle of the European Exchange Rate Mechanism (ERM) should still even now be seen as a learning experience, with respect to stopping when economic and other conditions are so out of line with the reality that things need to change and need to change fast. Now it is the case that some of the Eurozone countries need to take a hard look at themselves and decide on their own self interest. It is time that policymakers took the hard and inevitable decisions now, while they still have some time. A default on Greece will send out the signal that people do learn from history, that no country is too big to fail and that policymakers now see the reality before their very own eyes. From this a stronger and more independent Eurozone would emerge. Don’t read about history, learn from it.

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Australian Dollar Softens as Bank Sees "More Time" for Inflation

July 19, 2011

Australian Dollar Softens as Bank Sees “More Time” for Inflation

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Mobile devices to lead consumer electronics growth: Report

July 19, 2011

Mobile devices to lead consumer electronics growth: Report

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Obama says he would veto "cut, cap and balance" plan

July 19, 2011

Obama says he would veto “cut, cap and balance” plan

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Halliburton’s Q2 profit up 54%

July 19, 2011

Halliburton’s Q2 profit up 54%

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Novartis Q2 net profit at USD2.73b

July 19, 2011

Novartis Q2 net profit at USD2.73b

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IBM Q2 revenue up 12%

July 19, 2011

IBM Q2 revenue up 12%

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Novartis profit rises by 12% in the second quarter

July 19, 2011

Novartis profit rises by 12% in the second quarter

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Black Range Minerals Limited (ASX:BLR) Jorc Resource Up 51% to 90.9 Million Pounds of Uranium at Hansen/Taylor Ranch Uranium Project

July 19, 2011

Black Range Minerals Limited (ASX:BLR) Jorc Resource Up 51% to 90.9 Million Pounds of Uranium at Hansen/Taylor Ranch Uranium Project

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Enerji Limited (ASX:ERJ) Carnarvon Powerbox Update and Carbon Tax

July 19, 2011

Enerji Limited (ASX:ERJ) Carnarvon Powerbox Update and Carbon Tax

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H&R Block Directors Len J. Lauer and L. Edward Shaw, Jr. Will Not Stand for Re-Election to the Board of Directors in September

July 19, 2011

KANSAS CITY, MO–(Marketwire – Jul 19, 2011) – H&R Block ( NYSE : HRB ) today announced that Len J. Lauer and L. Edward Shaw, Jr. have advised the board of directors that, after years of outstanding service, they will not seek reelection to the board at the company’s shareholder meeting in September. Both cited the demands of other business and professional obligations in advising H&R Block of their decisions.

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ZEW survey expected to confirm the faltering confidence status in Europe amid deepening debt woes

July 19, 2011

ZEW survey expected to confirm the faltering confidence status in Europe amid deepening debt woes

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Issey Miyake Continues To Lead The Way With Technology-Driven Designs and Ventures

July 19, 2011

Issey Miyake Continues To Lead The Way With Technology-Driven Designs and Ventures

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Mongolian Stock Exchange President Bill Gorman Speaks With Frontier Securities at Mongolia: Capital Raising and Investment Conference

July 19, 2011

Mongolian Stock Exchange President Bill Gorman Speaks With Frontier Securities at Mongolia: Capital Raising and Investment Conference

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Drillsearch Energy Limited (ASX:DLS) New Western Flank Oil Discovery at Arno-1

July 19, 2011

Drillsearch Energy Limited (ASX:DLS) New Western Flank Oil Discovery at Arno-1

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FOREX: Euro Likely to Look Past ZEW Data, Focus on Spain Debt Sale

July 19, 2011

FOREX: Euro Likely to Look Past ZEW Data, Focus on Spain Debt Sale

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German and euro-area investor confidence fell on escalating debt woes

July 19, 2011

German and euro-area investor confidence fell on escalating debt woes

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USDCAD: Another Long Entry Ahead?

July 19, 2011

USDCAD: Another Long Entry Ahead?

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Samsung to invest USD1.1b in medical equipments

July 19, 2011

Samsung to invest USD1.1b in medical equipments

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Cisco Systems slashes 6,500 jobs

July 19, 2011

Cisco Systems slashes 6,500 jobs

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BAA has to sell airports: Regulator

July 19, 2011

BAA has to sell airports: Regulator

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Global 2009 trade aid USD40b: WTO

July 19, 2011

Global 2009 trade aid USD40b: WTO

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Toyota to donate Prius systems as emergency power generators in Japan

July 19, 2011

Toyota to donate Prius systems as emergency power generators in Japan

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Qantas pilots to announce job security concerns to passengers

July 19, 2011

Qantas pilots to announce job security concerns to passengers

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New Zealand’s Fonterra to expand investments in China

July 19, 2011

New Zealand’s Fonterra to expand investments in China

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