weight-loss

3 Weight Loss Drugs Make Second Bid For Approval

by AP on February 27, 2012

Huffington Post…

— The Food and Drug Administration has rejected three prescription diet pills in the last three years, raising questions of whether any weight loss drug can win approval in the U.S. The agency has not approved a new prescription weight loss drug in 13 years. Historically, medications that attempt to burn fat or suppress appetite have been plagued by safety issues. Despite the latest rejections, all three drugmakers are resubmitting their products for a second review. Here’s a look at the contenders and where they are in the review process: _ Qnexa is a combination of two older drugs: the amphetamine phentermine, which is approved for short-term weight loss, and topiramate, an anti-convulsant drug sold by Johnson & Johnson as Topamax. Phentermine helps suppress appetite, while topiramate is believed to make patients feel more satiated Many experts view the combination pill as the most promising of the new weight loss drugs, due to studies showing most patients lost nearly 10 percent of their weight – the highest reduction reported with any recent diet pill. But the FDA rejected the drug in October 2010, raising a number of safety concerns, including higher heart rate and birth defects in women who become pregnant. This week a panel of advisers to the FDA overwhelmingly recommended approval for Qnexa, on the condition Vivus Inc. conduct a follow-up study to make sure the drug doesn’t cause heart problems. The FDA is expected to make its second ruling on the drug by April 17. _ Orexigen Therapeutics Inc.’s Contrave is another combination pill aimed at curbing appetite, mixing the antidepressant ingredient in Wellbutrin with the anti-smoking drug bupropion. The company’s results have been lackluster, with about 40 percent of patients taking Contrave losing 5 percent of their body weight. Those figures narrowly achieved FDA’s minimum requirements for an effective weight loss pill. But Contrave has also been plagued by the heart safety concerns associated with past diet pills. The FDA is requiring the company to conduct a 10,000-patient study of cardiovascular health. That study is slated for completion by 2014. _ Arena Pharmaceutical Inc.’s lorcaserin is the only first-of-a-kind diet drug currently before the FDA. It uses a new type of ingredient to stimulate serotonin receptors in the brain linked with feelings of satiety. But lorcaserin has faced the most severe safety questions from FDA, which rejected the drug in 2010 after raising concerns about cancerous tumors seen in rats who received the drug. Early this year Arena submitted new information evaluating the link between its drug and cancer. The FDA is scheduled to make a new ruling on the drug by June 27.

Read more:
3 Weight Loss Drugs Make Second Bid For Approval

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

Brett King: What the Occupy Movement and Mobile Means for Banking

by on November 18, 2011

Huffington Post…

The Occupy Movement has emphasized our changing ‘trust’ in the big banks. Mobile is changing the way we interact day-to-day. But how are these two elements going to intersect in a far more dramatic change in the way we choose and work with a bank in the future? What was our instinct in banking? The earliest instincts around banking were that it was a safe place to store your assets and, in many ways, that is still the case. However, banking in its infancy didn’t necessarily involve a bank or money at all. The earliest forms of banking involved the deposit of commodities or valuables that were traded, and often they were deposited in temples or palaces, the safest physical locations. It wasn’t until the 16th and 17th centuries that organized banking started to emerge globally, particularly as the wealthy tried to keep their assets safe during the dark ages. Even then, banking was still exclusive. It really wasn’t until the 20th century that banking became more mainstream and people started considering storing their savings in a bank. Since then, banking has been an instinctive part of the lives of most people in the developed world. It wasn’t long before it became instinctive to pull out our checkbook to pay for a large ticket item. Some would also use lay-away or lay-buy plans, but these largely disappeared over the last decade or so. Over time those instincts changed to use credit cards and, more recently, debit cards at the point of sale. In the past our instinct when we needed cash was to think about where the nearest branch was and figure out when we would need to go to withdraw cash. Over time, that instinct changed to using an ATM machine and we went from planning when we’d withdraw cash to just picking the nearest ATM when the cash in our wallet was getting low. In the past, our instinct when paying a bill was to write a check and send it in the mail, or to go down to a post office or office of the utility company and pay the bill in person. Today, that instinct has changed to where we pay online in an instant. It’s ironic that we think of banking as a slow and steady institution that doesn’t really change, but in reality the utility of our money means that our behavior in respect to banking has always been changing. The future instincts of banking So what will your instincts for banking be in the next decade? Not a place you go, something you do… Firstly, we won’t instinctively think of banking as a place you go. The concept that a branch is at the center of our banking relationship has been central to retail banking for over 800 years. This is the primary instinctual shift that will occur in the next few years. Instead of looking for a place to store your money, we’ll look for a trusted brand that is safe to store our money but, equally important, will be a brand that offers strong utility and a seamless connection to the things we do with our money. A safe and trusted banking partner will be a bank that offers me access to my money and access to financial services when and where I need them. A bank that demands or prefers a physical interaction will increasingly be avoided instinctively as too hard to work with, as irrelevant to my daily life and as slow and unwieldy. On rare occasions for the minority of us that have complex asset allocations, trust structures and so forth, we’ll look for a physical place to go where we aspire to get the high-touch service of a personal banker who recognizes our status as a special class of banking customer — but this will not be an overriding instinct day-to-day, it will be incidental to our general banking experience. The majority of the time, even for the high net-worth client, instinct will simply dictate a much more efficient engagement of the ‘bank’. Move and Pay, Safely and Efficiently When it comes to day-to-day interactions, the emphasis on the movement of our money will be speed and security. Inevitably in the short-term our instinct will be to pull out our phone at the point-of-sale to pay for goods and services. We’ll do this not only because it is much faster than using cash or a card, but because our money management will be articulated through this personal device — we’ll see our balance, what our monthly expenditure is, what upcoming expenses we have and will be able to understand the context of this payment on our financial life in an instant. The same would have taken much more effort with cash, our checkbook or our card. Your instinct for payments is changing again Security of our cash will be also a primary reason for the shift to digital money. Increasingly we’ll look to the technology of encryption, geo-location tagging, biometrics and active identity management to secure the flow of our funds. We won’t trust a piece of plastic or a piece of paper that can be easily corrupted or stolen, and the technology of ‘hacking’ our cash from a secure device will require a level of expertise and high-performance computing that make it far less frequent than the compromise of traditional physical ‘payment’ artifacts. At the point that it is simply no longer safe to do things with cash and plastic, our instincts will quickly change to keep our finances safe once again. Being able to see what has been happening with our money over time will also drive us to increasing digital management of our money. Core instincts are at the heart of the change in bank modality First and foremost our instinct for banking is keeping our money safe, secondly is the need for the utility of our money. Neither of these core instincts will lend us to continue to support the physical elements of banking and payments that we’ve been used to in the last 100 years. We will measure ‘safety’ in the trust of a brand, not in the bricks and mortar of branches. We will measure ‘utility’ in the seamless access to our cash, and the availability of the bank in our life when and where we need it. Our instincts are rapidly changing. We don’t store grain and gold in temples or palaces anymore. Already most of the world doesn’t use checks anymore. If you’re heavily invested in branches and the physical, you don’t understand the core instinct that banking is.

View post:
Brett King: What the Occupy Movement and Mobile Means for Banking

Find our Weekly Commercial Real Estate, Private Equity and Fund Newsletters at www.WeeklyBrief.net

Facebook Employees Go Nuts As Zuckerberg Tells Them The IPO Is Coming

November 18, 2011

A source close to Facebook employees emailed us yesterday to say that the rumor flitting from employee to employee is that “a Facebook S1 filing is coming really soon. Possibly as soon as next month.”

Read the full article →

Iraq’s ‘Frontier Investors’ Unlikely To Be Scared Off By U.S. Exit

October 23, 2011

BAGHDAD (Serena Chaudhry) – Foreign investors eager to snap up development projects in key oil producer Iraq are unlikely to balk after the United States withdraws all its troops at the end of the year as long as security does not deteriorate. U.S. President Barack Obama said on Friday all U.S. forces would leave Iraq at the end of 2011 as scheduled, almost nine years after the 2003 U.S.-led invasion that toppled dictator Saddam Hussein. Iraq is trying to rebuild after decades of war and economic sanctions and needs investment in every sector. The OPEC member country has signed a series of deals with international firms to develop its oil fields, the fourth-biggest in the world. Foreign investors like oil majors Royal Dutch Shell and BP and bank HSBC are already pouring billions of dollars into Iraq and a U.S. pullout will likely not thwart foreign firms for an extended period, especially those with long-standing interests in the country. “Any impact on investment will be short-term and quite muted, assuming the security situation doesn’t deteriorate drastically,” said Economist Intelligence Unit’sAli al-Saffar. “This is primarily because Iraq has only really managed to attract (beyond the oil sector), frontier investors who have some level of appetite for risk so far. These more adventurous investors know the risks associated with doing business in the country, and have become quite adept at dealing with them.” Iraqi security forces continue to battle a stubborn Sunni insurgency and Shi’ite militias, and bombings and killings still occur on a daily basis despite a sharp drop in violence from the height of sectarian fighting in 2006-07. For investors on the ground, primary concerns center around kidnapping threats and attacks on development sites. Oil pipelines are targeted by insurgents in the north and south. Some production at the southern Rumaila oilfield was stopped this month when two bombs hit pipelines. Most foreign companies with a footprint in Iraq hire personal security guards for their protection and analysts say it is unlikely the departure of U.S. troops by year-end will raise extensive concern. “For quite some time, investors have been operating in Iraq without very much in the way of assistance from the U.S. military so they may not notice a big difference following the withdrawal,” said AKE Group senior risk consultant John Drake. MORE CONFIDENCE Iraq’s government aims to attract $86 billion in investment by 2014 under a five-year economic development plan. Rehabilitation of the oil, housing, agriculture and power sectors are seen as most pressing. The head of Iraq’s National Investment Commission, Sami al-Araji, said in July the country had secured around $6 billion in investment for licensed projects so far this year. Examples of deals include a $472 million contract with Italy’s Saipem for an oil export facility expansion and sub-sea pipeline and a 100,000-unit housing project with South Korea’s Hanwha Engineering & Construction. Foreign investors have also been net buyers on the Iraq Stock Exchange (ISX) so far this year, buying 66 billion shares to end-September with a volume of $110 million, according to ISX chief executive Taha Abdulsalam. “The complete pullout will probably slow down flows to ISX in the short-term, but overall this news is priced into the market by serious investors,” said Carl Wahlquist Ortiz, investment manager at City of London Investment Management in Dubai. “Typically, if you’re looking at Iraq, you’re looking for something a bit more risky, generally speaking.” Iraq’s stock market is still relatively small compared to international exchanges and its regional counterparts, but volume on the local bourse is expected to rise as more companies, particularly the local mobile phone firms, list. “It (the withdrawal) has to bring more confidence in the political and economic management of Iraq and confidence in the capability of enforcing security,” saidAmar Essa al-Jawahiri, an independent industrial and investment consultant in Baghdad. Iraq’s northern Kurdish region is a prime example of a part of Iraq where foreign investment and construction is booming. The area has been a place of relative calm since becoming a semi-autonomous zone under Western protection in 1991 and is widely regarded as a safe haven. (Editing by Jim Loney and Mike Nesbit) Copyright 2011 Thomson Reuters. Click for Restrictions .

Read the full article →

Your Neighborhood Could Affect Your Health

October 19, 2011

ATLANTA — Back in the 1990s, the federal government tried an unusual social experiment: It offered thousands of poor women in big-city public housing a chance to live in more affluent neighborhoods. A decade later, the women who relocated had lower rates of diabetes and extreme obesity – differences that are being hailed as compelling evidence that where you live can determine your health. The experiment was initially aimed at researching whether moving impoverished families to more prosperous areas could improve employment or schooling. But according to a study released Wednesday, the most interesting effect may have been on the women’s physical condition. About 16 percent of the women who moved had diabetes, compared with about 20 percent of women who stayed in public housing. And about 14 percent of those who left the projects were extremely obese, compared with nearly 18 percent of the other women. The small-but-significant differences offered some of the strongest support yet for the idea that where you live can significantly affect your overall health, especially if your home is in a low-income area with few safe places to exercise, limited food options and meager medical services. “This study proves that concentrated poverty is not only bad policy, it’s bad for your health,” Shaun Donovan, secretary of the Department of Housing and Urban Development. But no one believes the deficit-plagued federal government is going to expand the program and start moving low-income women to better neighborhoods en masse. “It’s not enough to simply move families into different neighborhoods,” Donovan said. Instead, new ways must be found to help families “break the cycle of poverty that can quite literally make them sick.” He did not mention specific proposals. Public health experts have long thought that living in poor neighborhoods could ruin a person’s health, but this study put the idea to a rigorous test. Here’s how it worked: Women believed to be about the same in most respects were randomly assigned to one group or another and then followed through time, in a model customarily seen in pharmaceutical studies. That makes it more scientifically rigorous than most research linking health problems to a social environment. The study’s good design “provides a basis to infer cause and effect” between poverty and bad health, said Dr. Robert Califf, a noted Duke University cardiologist who is leading a massive study on neighborhoods and health outcomes. The research was led by Jens Ludwig, a University of Chicago professor of public policy. It was published in Wednesday’s New England Journal of Medicine. The experiment started as a $70 million HUD project in Baltimore, Boston, Chicago, Los Angeles and New York. It morphed into a health study after a variety of other government agencies and private foundations pitched in with an additional $17 million more. “In terms of scale, it’s not soon or ever to be repeated,” said Dr. Robert Whitaker, a Temple University pediatrician who was a study co-author. The study involved women living in public housing in neighborhoods where 40 percent or more of residents were poor – areas like many of those on the South Side of Chicago or in the Bronx in New York City. The women all had children and were considered heads of households. From 1994 to 1998, nearly 1,800 of them were offered vouchers to subsidize private housing, but the vouchers were only good in higher-income neighborhoods where fewer than 10 percent of the people were considered poor. They were required to live there at least a year. The rest of the women were divided into two groups. One group got vouchers they could use in any neighborhood. The other women did not receive vouchers, with the expectation that they would stay put. Ten years later, women in the study were weighed and gave a blood sample to check for diabetes. The women who moved to richer areas had the lowest rates of extreme obesity and diabetes. The difference suggests that moving to a better neighborhood could help at least 1 in 25 women. Or, in other terms, a person’s risk of diabetes or extreme obesity dropped by about 20 percent by moving to a higher-income neighborhood. (However, even the women who moved were not exactly models of health. About 14 percent of them were extremely obese, which is twice the national average for women.) The study has some notable flaws. Because it did not start out looking at health, the women’s medical condition and weight were not checked at the outset. The researchers believe the women in the different groups were about the same, because they matched up on more than 50 other indicators, such as age, race, employment and education. But that is an assumption. Also, only about half the women offered a chance to move to a more prosperous zip code did so. And many who did move left after a year. What’s more, the study was not designed to answer what it is about more affluent neighborhoods that would cause someone to be healthier. But the authors listed four theories: _ The availability of healthier food is worse in lower-income neighborhoods. _ Opportunities for physical exercise are scarcer, and fear of crime can make people afraid to jog or play in parks. _ There may be fewer doctors’ offices and other medical services. _ The long-term stress of living in such an environment may alter the hormones that control weight. Some of those theories were supported by some women who live in the kind of situation targeted in the study. Vickie Webb lived in the projects in Durham, N.C., for several years before a housing agency helped relocate her and her husband to a better neighborhood. “There was too much violence, too much going on in the `hood. It wasn’t safe,” said Webb, who was not part of the study. Annie Ricks, who lives with her 14-year-old son and two grandchildren in a public housing unit on Chicago’s South Side, was not involved in the study either. But she said efforts like the HUD experiment should be expanded. Local housing authorities paid for her to relocate to the South Side last year as part of its demolition plans for high-rise tenements. But Ricks lost her child-care job after the move, and says her new neighborhood is worse. At her old building, Ricks could walk across the street to a supermarket. In her new neighborhood, without a car, she has to take public transportation to get groceries or go to the doctor, and Ricks says there’s more crime. “I feel like it would be a blessing” to be able to move to a wealthier area, she said. ___ Associated Press writers Alicia Chang in Los Angeles and Lindsey Tanner in Chicago contributed to this report.

Read the full article →

FDA Panel Unanimously Votes Down Parkinson’s Drug Azilect

October 17, 2011

WASHINGTON — A federal health panel unanimously voted Monday that a drug for Parkinson’s disease from Teva Pharmaceuticals has not been shown to slow progress of the debilitating neurological disease. Teva’s drug Azilect is already approved to treat symptoms of Parkinson’s, which causes tremors, muscle stiffness and a host of other movement problems. The Israeli drugmaker has asked the Food and Drug Administration to expand approval so that Azilect can be prescribed to slow the underlying disease. Currently no treatments are approved for that use. But the FDA’s panel of outside experts voted 17-0 against recommending approval for that use, saying the company’s clinical study results were not convincing. “I believe the drug shows signs of effectiveness for symptomatic use, for which it is already approved. But the higher bar is whether it does anything for disease modification, and it did not meet that standard,” said Dr. Justin Zivin of the University of California, San Diego. Much of the panel discussion revolved around the limitations of Teva’s trial design and the difficulty of distinguishing between improved symptoms and actually slowing the disease itself. Teva studied Azilect in 1,176 patients with very early Parkinson’s disease, who had not been treated previously. Patients were randomly assigned to receive either Azilect or a placebo for nine months, after which those taking placebo were switched to the drug for another nine months. The patients originally on Azilect continued taking the drug for the entire study. The trial was designed to test whether those taking Azilect for the longer period showed more improvement, suggesting the drug slowed progression of their disease. A 1 milligram dose of the drug appeared to slow patients’ disease based on a rating scale that measures symptoms and disease progression, including its effects on mental state, motor skills and daily activities. But the results were plagued by statistical inconsistencies, and a 2 milligram dose of the drug failed to show similar results. “In medical science, things have to make sense, and they have to be consistent,” said Dr. Eric Ahlskog of the Mayo Clinic, explaining his vote against the drug. More than 5 million people worldwide, including more than a million in North America, have Parkinson’s, according to the National Institutes of Health. The disease is characterized by increasingly severe tremors and periodically stiff or frozen limbs. Patients gradually lose brain cells that produce dopamine, a chemical key to the circuitry that controls muscle movement. There is no cure, although dopamine-boosting medication and an implanted device called deep brain stimulation can reduce some symptoms. The cause of the disease is unknown. Earlier in the day, advocates for Parkinson’s patients expressed frustration over the lack of clear markers for evaluating drugs’ effectiveness for slowing the disease. Some researchers have suggested that brain imaging scans could be used to track disease progression, but so far no consensus has been reached. “We need a path forward. If this isn’t it, what is?” asked James Langston, CEO of the Parkinson’s Institute and Clinical Center in Sunnyvale, Calif. “We need guidance if we’re going to stay in this field.” Shares of Teva Pharmaceuticals Industries Limited rose 21 cents to $39.50 in afterhours trading.

Read the full article →

Obama To Propose Millionaire’s Tax

September 17, 2011

By JIM KUHNHENN, Associated Press WASHINGTON — President Barack Obama is expected to seek a new base tax rate for the wealthy to ensure that millionaires pay at least at the same percentage as middle income taxpayers. A White House official said the proposal would be included in the president’s proposal for long term deficit reduction that he will announce Monday. The official spoke anonymously because the plan has not been officially announced. Obama is going to call it the “Buffett Rule” for Warren Buffett, the billionaire investor who has complained that rich people like him pay a smaller share of their income in federal taxes than middle-class taxpayers. Buffett wrote in a New York Times op-ed piece last month that he and his rich friends “have been coddled long enough by a billionaire-friendly Congress.” The measure would be in addition to $447 billion in new tax revenue that Obama is seeking to pay for his short-term spending and tax cutting plan to jump start the economy. House Speaker John Boehner said Thursday he would oppose tax increases to reduce the deficit. Boehner has urged Congress’ deficit “supercommittee” to lay the groundwork for a broad overhaul of the U.S. tax code. The panel has almost unlimited authority to recommend changes in federal spending and taxes and is working against a deadline of Nov. 23. Boehner said the panel has “only one option, spending cuts and entitlement reforms,” a reference to government benefit programs such as Social Security, Medicare and Medicaid. Any broad compromise that clears the bipartisan committee is almost certain to require Democratic agreement to savings from programs such as Social Security and Medicare, along with Republican acquiescence to additional revenues, although any such trade-offs are rarely discussed openly until the last possible moment in negotiations. Obama’s new tax proposal was first reported by The New York Times .

Read the full article →

Malcolm Levene: 9 Ways To Be A Self Leader

September 17, 2011

Over a number of years, I’ve worked with and for male and female business leaders. The individuals I both respect and admire tend to lead with humility, a reined-in ego, a healthy dose of self belief and passion. They also self-lead by making difficult decisions, taking risks and owning everything they do. In essence, they take full responsibility for their actions and the impact they may have. This type of person began their journey into leadership long before the role seemed possible. They led themselves carefully into the position they have attained. Self leadership entails being the person you envision being, long before you think it likely. In my coaching practice, I work with numerous men and women who are hoping to find a purpose in their lives. One way to access this aspiration is to contemplate specifically what it is we want. A recent female client, after three telephone coaching sessions, told me she realized her goal was to be happy. She said this, yet was uncomfortable admitting it, as it might show her in a “fluffy” light. I believe that a desire to being happy is a very worthy aspiration. Knowing that you want to be happy gives you clarity and purpose, two very valuable commodities. When we have discovered our purpose, be that commercially minded or otherwise, we have the opportunity to lead ourselves to the outcomes we require. I’m reminded of shopping and customer service. Customer service here in the U.K, generally speaking, is not as good as we would like it to be. My former retail establishment garnered a reputation for providing the gold standard in customer service for a large number of years. Each member of my sales team ‘owned’ their responsibility. They took care of my business as if it were their own. They chose to lead themselves to being the best they could be. Today, for the most part, leading yourself to the future you want, rather than being led to the future someone else sees for you, is less common. When you are not being seen to self-lead, the message you send is that you need guidance, help and direction. The people I’m talking about never send that message, although they are willing to ask for help, when and if they need it. They tend to be highly aware of the impact they make, both to customers, co-workers, their boss and anyone who will see them in action. Their reputation is all-important to them — and this is the mark of a good leader. They care deeply about how they are perceived, thereby taking full responsibility for their behaviours and actions. Whether you work in a retail establishment, run a charity or sit behind a computer all day, you’ll either be seen as someone who has leadership potential or not. You’ll be noticed in ways that can serve you and your purpose. The effort you make to go the extra mile is vital, as it will enable you to stand out from the crowd. Customers want the person who is offering a service or a product, be that a doctor or a flight attendant, to provide them with the kind of attention that ‘knocks their socks off.’ Giving your all to establish yourself and leave your mark in the best way possible will entail effort, sacrifice and an ability to let go of anything that doesn’t serve your purpose. Here are nine tips to help you to self-lead: 1. Establish your purpose. 2. Focus on what makes you happy. 3. Take full responsibility for all your actions. 4. Be passionate, optimistic and brave. 5. Make efforts to continually improve yourself. 6. Envision your future as specifically as you can. 7. Be enthusiastic, even when you don’t really feel it. 8. Never, ever give up. 9. Carry a healthy self belief. To learn more about Malcolm Levene, visit www.malcolmlevene.com .

Read the full article →

Trichet emotional as end of ECB stint nears

September 17, 2011

WROCLAW, Poland (Reuters) – A “moved” Jean-Claude Trichet neared the end of 24 years of policymaking on Saturday after attending his last informal meeting of European finance ministers as head of the European Central Bank. The Frenchman will turn over the reins of the ECB to Bank of Italy Governor Mario Draghi at the end of October as the 17-nation euro zone struggles to contain a flaring debt crisis that some economists say threatens its very existence. “I’m a quite moved,” a visibly emotional Trichet told several journalists after the two-day informal meeting of the ‘EcoFin’ in the Polish city of Wroclaw. “I just did the tally and I’ve attended these informal meetings for 24 consecutive years as director of the (French) treasury, then as governor of the Bank of France and then ECB president,” Trichet said. “A lot has happened during this time.” Asked if he might put in an appearance at future meetings of EU finance chiefs, he insisted he would not and added: “They are going to do the work.” The Frenchman staunchly defended the ECB’s mandate of keeping inflation under control and played a key role in crafting Europe’s response to the 2008-2009 financial crisis. But he has also taken hits for the ECB’s attempts to calm tensions on debt markets by buying bonds of euro zone states with the weakest public finances. (Reporting by Leigh Thomas; Editing by Ruth Pitchford)

Read the full article →

Bernanke, Europe hold key to aiding rally

September 17, 2011

By Chuck Mikolajczak NEW YORK (Reuters) – Wall Street hopes for more Fed action and clear signs European leaders will follow through on their new urgency to tackle the euro zone debt crisis if U.S. stocks are to build on their best week since early July. Investors expect the Federal Reserve to take steps to pull down long-term interest rates when policymakers meet on Tuesday and Wednesday to help revive the persistently weak U.S. economy. Fed Chairman Ben Bernanke, speaking in Jackson Hole, Wyoming, on August 26, said the Fed’s Open Market Committee would meet for two days in September instead of the scheduled one day to discuss ways to boost the recovery. But even with expectations of more intervention to boost the economy, investors will keep a close eye on developments in Europe. Any lack of progress or backsliding on efforts to get the currency bloc’s fiscal house in order will renew worries the crisis could seriously damage the world financial system and major economies. “The Fed is really going to dominate next week,” said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont. “But the market has been trying to work its way higher here, trying to feel if maybe the European thing won’t cascade out of control.” Treasury Secretary Timothy Geithner, at a meeting of euro zone finance ministers in Poland on Friday, urged them to leverage their bailout fund to better tackle the debt crisis, but there was no agreement on what steps to take. While the Standard & Poor’s 500 has been moving upward over the past week, the benchmark index has been stuck in roughly a 100-point range over the last six weeks. It is likely to run into resistance near the 50-day moving average of about 1,228, with analysts also pointing to the 1,250 level as the next significant hurdle. “This is really a consolidation phase, which is normal after the kind of early August swoon that we had. So far this trading range is developing in a very positive and healthy way,” said Gail Dudack, chief investment strategist at Dudack Research Group in New York. “Longer term, the market is looking better but we are getting very close to that resistance at 1,250 which would be pretty surprising if we can break above that at this early juncture. It could take a little more time, people shouldn’t be disappointed.” The week’s economic calendar includes reports on the beleaguered housing market along with weekly initial jobless benefits claims. Housing “is dead and it will stay dead, and I don’t expect anything out of unemployment either,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey. “The biggest event is Bernanke.” Companies due to post earnings next week include homebuilder Lennar Corp , Nike Inc , General Mills Inc as well as technology companies Adobe Systems , Red Hat Inc and Oracle Corp . FedEx Corp , the No. 2 U.S. package delivery company, which is seen as a proxy for how the economy is performing, is also scheduled to report quarterly results. Though earnings have managed to hold up in the face of a lackluster recovery, analysts worry this might not last if the financial system suffered the shock of a Greek debt default. But while many feel Bernanke has telegraphed the plans for the Fed meeting, the euro zone debt crisis remains an uncertainty that could knock the market lower. “It’s absolutely the wild card because Europe’s problems may be similar to what we saw in 2008, but they are much more difficult to deal with because country debt is far more difficult to deal with than mortgage debt,” Dudack said. She added that having so many countries that are part of a committee trying to solve the problem only added to the complications. (Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)

Read the full article →

NOT AGAIN: California’s Unemployment Rate Rises For Second Month In A Row

September 17, 2011

By Don Thompson, Associated Press SACRAMENTO, Calif. (AP) — California’s jobless rate grew for the second straight month in August to 12.1 percent, led by continued sluggishness in the construction industry, the state Employment Development Department said Friday. The unemployment rate had been declining since March until it spiked back to 12 percent in July. California’s rate is the second highest in the nation, behind Nevada’s 13.4. “I would say it’s a flat market,” said Brad Kemp, director of regional research with Beacon Economics in Los Angeles. “I just think we have to get used to the fact that slow growth is the path that we’re on, and I don’t think that’s going to change anytime soon.” Nonfarm payroll jobs fell by 8,400 during the month, with the construction industry suffering the biggest decrease, down 7,200 jobs. The unemployment rate was a slight improvement from a year ago, when it was 12.4 percent. During the 12-month period that ended in August, California gained 171,000 jobs, even as nearly 2.2 million residents remained jobless. Kemp said the uptick in last month’s unemployment rate shows the state should not expect any dramatic improvement for at least the next year. Two factors are contributing to the slow recovery, he said. First, employers began adding jobs last year when it looked as if the economy was rebounding. With uncertainty prevailing, they are absorbing those jobs before hiring again. Also, any growth in private industry jobs is being offset by public sector layoffs, as state and local governments adjust to lower revenue. The state reported that six categories lost 17,500 jobs in August: construction; information; financial activities; educational and health services; other services; and government. Five categories added 9,100 jobs last month. They were mining and logging; manufacturing; trade, transportation and utilities; professional and business services; and leisure and hospitality. “You’ve got to have a long-term vision of the economy getting better before you see employers making any significant moves,” Kemp said. Aside from California and Nevada, Florida, Georgia, Michigan, Mississippi, North Carolina, Rhode Island and South Carolina all had unemployment rates of greater than 10 percent. The national unemployment rate remained at 9.1 percent for a second month. While construction firms and governments have been dropping jobs, retail hiring was up last month for only the second time since January, said Kevin Callori, a spokesman for the state’s Employment Development Department. Moreover, manufacturing jobs have increased in nine of the past 11 months, adding 22,000 jobs over that 11-month period. That reverses a trend that saw a loss in manufacturing jobs in 34 of the 38 months ending Sept. 2010. “Over the year, we’re still doing pretty well,” Callori said.

Read the full article →

China central banker warns global economic risks increasing

September 2, 2011

BEIJING (Reuters) – The global economy faces risks from both slowed growth and persistent inflationary pressure, which is spilling over from emerging to advanced economies, Ma Delun, a vice-governor at China’s central bank, said in comments reported on Friday. The People’s Bank of China vice-governor’s gloom about world economic prospects echoed earlier comments from Chinese Premier Wen Jiabao, underscoring that Beijing policy-makers are not counting on major foreign markets to recover quickly. Ma told a financial forum in far western China on Thursday that slower growth in the United States, Europe’s debt problems, and Japan’s poor economic performance were adding to those global risks, the China News Service reported. “The long-term fiscal sustainability of the United States faces challenges, the European sovereign debt crisis continues to fester, and the Japanese fiscal deficit is growing,” the report cited Ma as saying. “Government debt risks have become a major challenge affecting the global economic recovery,” he added. Ma also warned that “some emerging economies are feeling the consequences of policy contraction, and their rates (of growth) are slowing, and downstream risks to the global economy are increasing,” the report said. Ma said those growth risks co-existed with persistent inflationary pressure, which he blamed on excessive global liquidity. “Inflationary pressures have spread from emerging economies to advanced economies,” he said. Ma’s published comments did not directly address how those pressures are affecting China. But in comments published on Thursday, China’s Premier Wen also focused on the mix of sluggish global growth and inflationary pressures, and said fighting inflation remained his policy priority. Wen said the global economy is still fragile and sovereign debt problems in the United States and Europe are set to put a “drag” on world economic growth. He said China’s exporters would suffer from softer external demand and rising costs. China’s inflation ran at 6.5 percent in July, outstripping the government’s full-year inflation target of 4 percent. Chinese factory activity data issued on Thursday indicated that the pace of inflation is quickening, and manufacturers have experienced a sharp drop in export orders partly caused by sovereign debt problems in rich nations. (Reporting by Chris Buckley; Editing by Ken Wills)

Read the full article →

Ted Kaufman: Critical Imbalances in Our Stock Market

September 1, 2011

The record-setting volatility in U.S. stock markets over the past two weeks is a clear distress signal. Our historically free, fair and credible markets are in danger of losing the support of individual American investors and investors from the rest of the world. With the advent of new technologies and regulatory improvements in the markets of other countries, investors of all kinds are questioning just how fair and transparent U.S. markets really are, and are actively exploring their alternatives. Although this recent market rollercoaster has been largely attributed to Washington’s partisan gridlock, the truth is not that simple. Several adverse developments in recent years have created critical imbalances in our stock markets. First among them is the explosion of unregulated High Frequency Trading (HFT). Second is our evolution from very few stock exchanges to a fragmented structure of many markets and “dark pools,” where trading is done outside any exchange. Third is the removal of historically-proven controls on predatory bears. HFT got its start in 2001 when the SEC ruled that stock prices, instead of rising or falling by 1/16 of a point as they had in the past, would henceforth be decimalized and denominated in pennies — 1/100 of a point. Over the next few years, aided by advances in computer technology, HFT took off. Sophisticated traders now use computer algorithms to execute thousands of trades in less than a second. In fact, over 50 percent of all trades in our markets are now done using HFT . This isn’t your father’s stock market. Working to get the SEC and the Commodities Future Trading Commission to rein in HFT was one of my highest priorities when I was in the Senate. Because of HFT’s speed and complexity and the growth of unregulated markets, the SEC and CFTC know very little about its effects. This lack of meaningful oversight is a frightening parallel to what happened with derivatives during the financial meltdown of 2008. I asked for a number of safeguards, including monitoring conflicts of interest to ensure that retail investors were being treated fairly and creating a consolidated audit trail to make it easier for regulators to investigate unusual securities trading activity. An audit trail could have prevented the “flash crash” on May 6, 2009, when the market fell 900 points in minutes. The commissions took five months to come out with a report on that event, and still left many questions unanswered. The second change that exacerbates volatility is the fragmentation of U.S. markets. The SEC had some good reasons to approve of “Alternative Trading Systems,” which allowed non-exchange trading venues that matched buyers and sellers of large blocks of shares, but that approval had unintended consequences. Trading that was once transparently done on the floor of an exchange can now be done in a “dark pool.” The SEC encouraged our current National Market System as a way to increase competition among exchanges. Again, there were unintended consequences. Trading venues have increased from two to over 50, and the fight for market share has led to questionable practices, including liquidity rebates (paid by exchanges to cooperating traders), flash orders (some traders get to see them before others) and other inducement arrangements with broker-dealers and other market participants. Anyone who says the average investor is getting the same deals as big traders is living in fantasyland. The third problem not only increases volatility but also is responsible for large losses. Short selling is when you sell a security you do not own, hoping it will decline in price so that you can make a profit. Until 2007, a trader could sell a stock short only on an uptick in its price. Unwisely, that year the SEC discarded the uptick rule. It also watered down a rule that said that if you did not own the stock you sold, you had to borrow an equivalent amount. Many believe that manipulative “naked” short sellers (traders who sold short without any borrowed stock) helped drive Bear Stearns and Lehman Brothers into the ground. I led a bipartisan group in the Senate that called on the SEC to reinstate the uptick rule and banish naked short selling. To date, the agency has done nothing to reinstate the old rules, and regulators are years away from establishing a consolidated audit trail. They have made little effort even to understand HFT, much less impose new rules. As for what happens in dark pools, they — and any investor outside of them — don’t have a clue. Before we lose our position as the world’s leading financial center, we must restore confidence in our markets. The only way to do that is to reinstitute time-tested rules on short selling and make certain that the new market structures and trading mechanisms are understood, properly regulated and working for the benefit of all investors.

Read the full article →

U.S. Worker Productivity Falls More Than Anticipated As Labor Costs Rise

September 1, 2011

WASHINGTON — Worker productivity fell this spring more quickly than previously estimated and labor costs rose at a faster clip. The decline in worker output could mean that some companies need to hire if they want to meet growing demand. The Labor Department reported Thursday that productivity declined at an annual rate of 0.7 percent in the April-June period. That was a downward revision from the 0.3 percent decline first estimated a month ago and the second straight quarterly decline. Labor costs rose at an annual rate of 3.3 percent, faster than the 2.4 percent increase originally reported. The changes reflected downward revisions made last week to overall economic growth. Productivity measures the amount of output per hour worked. Higher productivity is generally a good thing because it can raise standards of living by enabling companies to pay workers more without raising their prices and increasing inflation. A slowdown in productivity growth is bad for the economy if it persists for a long period. But it can be good in the short term when unemployment is high, if it means companies are reaching the limits on how much extra output they can get from their existing work forces. It can signal that companies need to increase hiring. Joshua Shapiro, chief U.S. economist at MFR, Inc., said many businesses are in a tough position because they cut so many workers during the recession and have little leeway to reduce staffs further unless demand “nosedives.” “Therefore, the gap between growth in output and the rate of expansion in total hours worked has narrowed, which by definition means slower productivity growth and therefore a more difficult environment for profit margins,” Shapiro said. Economists expect productivity to slow over the next couple of years while labor costs rise. However, they don’t see these developments as worrisome during the current period of high unemployment and weak income growth. Economists at JPMorgan Chase are forecasting that productivity this year will grow by just 0.7 percent. The drop in productivity in the April-June quarter followed a 0.6 percent productivity decline in the first quarter. The rise in unit labor costs in the second quarter followed a 6.2 percent increase in the January-March period.

Read the full article →

Andrew Pyle: Golden Opportunity, or Just for Fools?

August 13, 2011

Nothing like a good old fashioned panic in global stock markets to give the gold bulls yet another second wind. Just over a month after the yellow metal punctured the $1600/oz level, and only a week after taking out $1700, spot gold prices broke above $1800 this past week at the worst point of the equity shake-out. This represents about a $400 move since the start of the year and $500 from the January lows. What was different in the past few weeks is how vertical the climb in gold has been — so extreme, in fact, that the Chicago Mercantile Exchange (CME) raised its cash margin requirements on gold futures by 22 per cent, which covers initial and maintenance requirements. Speculators will now have to increase the cash on deposit from $6,075 to $7,425 per contract (one contract equals 100 ounces); while hedgers will need lift cash on deposit to $5,500 from $4,500. For those of you that watch silver, you’ll remember that the CME increased margins five times earlier in the year as the cheaper cousin to gold experienced a speculative surge in price. These actions ultimately sapped the market of strength and sparked a hefty correction. The risk now would be if the CME delivers multiple margin increases on gold which is possible given that prices have quickly stabilized after Thursday’s announcement. I would argue that, while this risk is real, there is a greater threat to gold from simply a sustained recovery in equities on improved sentiment regarding the U.S. and European political initiatives. A 10 per cent pullback from the recent high would take spot gold back to the low $1600s, which also coincides with the 38.2 per cent retracement of the rally from the lows in January. Given the levels we’re dealing with, the dollar swings could look incredibly large to many investors, but this is the kind of volatility one should expect from a commodity. For example, the 10-day historical volatility for gold hit 30 this past week — the highest since February 2010 — and, while this is still less than half the volatility seen during the 2008 credit crisis and equity sell-off, it’s still high. That said, it’s not as volatile as the overall stock market. The same 10-day measure for the TSX broke above 40 this week, and reached close to 100 back in 2008. Should investors infer from this that gold is less risky than buying a diversified basket of Canadian stocks? The short answer is no. First of all, when we invest in a risky asset we expect to get a return. In the case of gold, we are betting strictly on price appreciation. If the world remains in a chaotic state, then that might keep gold going higher, but if things stabilize gold could tumble or simply move sideways. There will not be any interest or dividends earned, unlike stock holdings. It’s for that reason that gold remains part of an overall investment strategy — not the whole enchilada. A prudent allocation would be about 5 per cent of your total portfolio, which might come from direct investment or through gold stocks. To go beyond that weighting, one is venturing into speculative territory — and the higher we grind, the more speculative that decision is. Unfortunately, there are firms out there who would like us to believe that we should collapse our nicely diversified accounts and move it all into gold. The end result could give us another definition for ‘fool’s gold.’

Read the full article →

Who’s On Top And Who’s Flopped: Art Auction Round-Up

August 13, 2011

Via Mutual Art As global markets dropped sharply on Monday over fears from the US’s new credit rating, the art market could not escape the plummet unscathed; Sotheby’s shares alone reportedly dived as much as 20% during the day, closing 13% down. Yet despite the recent stock market tumble, the first half of 2011 has continued to bolster art market confidence that the auction floor has managed to recover following the global financial meltdown of 2008. During a recent conference call, Sotheby’s CEO William Rupert announced “the best quarter in Sotheby’s history” and said he believes “market volatility” around the world “in other arenas” has further encouraged art market investment. Last week Sotheby’s reported consolidated sales of a record $3.4 billion in the first half of 2011, up 54% from last year in the 2nd quarter. Christie’s previously released its six-month total of $3.2 billion, up 15% from last year. As the art world now anxiously awaits to see how severely the global market downturn will affect its recent re-stabilization, MutualArt took the chance to look back and get caught up for the fall auction season. Gear up for September with a review of the top lots, steepest flops and biggest shocks so far of the year. Top 10 Best Selling Lots Francesco Guardi managed to overcome the supremacy of Picasso and capture the top slot, achieving the highest hammer price so far this year. Picasso’s buying power held strong though in second place and with two lots in the top ten. The only other artist with more than one lot here is Francis Bacon, whose work enjoyed a remarkable market comeback this year. 1) £26,697,250 – Francesco Guardi, Venice, a view of the Rialto Bridge, Looking North, from the Fondamenta del Carbon, (pictured below) oil on canvas, executed in the late 1760s. World auction record for Venetian view painting; World auction record for the artist; Highest price paid at an international auction house in 2011; Second highest price paid ever for an Old Master painting. (Sotheby’s London, 7/6/2011) 2) £25,241,250 – Pablo Picasso, La Lecture, oil on panel, 1932. (Sotheby’s London, 2/8/2011) 3) £24,681,250 – Egon Schiele, HÄUSER MIT BUNTER WÄSCHE (VORSTADT II), oil on canvas, 1914. World auction record for the artist. (Sotheby’s London, 6/22/2011) 4) $38,442,500 – Andy Warhol, Self-Portrait, in four parts, acrylic and silkscreen on canvas, 1963-64. Highest price ever paid for a portrait by the artist. (Christie’s NY, 5/11/2011) 5) £23,001,250 – Francis Bacon, Three Studies for Portrait of Lucian Freud, oil on canvas, 1964. (Sotheby’s London, 2/10/2011) 6) £22,441,250 – George Stubbs, Gimcrack on Newmarket Heath, with a trainer, a jockey and a stable lad, oil on canvas, circa 1765. World auction record for the artist. (Christie’s King Street, 7/5/2011) 7) $33,682,500 – Mark Rothko, Untitled No. 17, oil on canvas, 1961. (Christie’s New York, 5/11/2011) 8) $29,202,500 – Sir Lawrence Alma-Tadema, The Meeting of Antony and Cleopatra: 41 BC, oil on panel, 1883. (Sotheby’s New York, 5/5/2011) 9) £17,961,250 – Pablo Picasso, Femme assise, robe bleue, oil on canvas, 1939. (Christie’s King Street, 6/21/2011) 10) £17,961,250 – Francis Bacon, Study for a Portrait, (auction video below) oil on canvas, 1953. Second-highest price for any work in this category at Christie’s London. (Christie’s King Street, 6/28/2011) Honorable Mention for Phillips de Pury & Co: 12) $26,962,500 – Andy Warhol, Liz #5 (Early Colored Liz), silkscreen ink and acrylic on linen, 1963. (Phillips NY, Upper East Side, 5/12/2011) Top 10 Most Disappointing Lots Monet was noticeably absent from the best-selling list, and unfortunately appears here twice for unsold lots. Other lots by blue-chips artists failed to sell or sold below their low estimates as buyers remained cautious, ignoring often over-enthusiastic auction house catalogs and paying close attention to the artworks’ condition. 1) Andy Warhol’s Self-Portrait, (above left) sold below the $30,000,000-40,000,000 estimate for $27,522,500 (Christie’s New York, 5/11/2011) 2) Claude Monet’s Nymphéas, Not sold against an estimate of £17,000,000-24,000,000 (Christie’s King Street, 6/21/2011) 3) Pablo Picasso’s Femmes lisant (Deux personnages), sold below the $25,000,000-35,000,000 estimate for $21,362,500 (Sotheby’s New York, 5/3/2011) 4) Jeff Koon’s Pink Panther, (above middle) sold below the $20,000,000-30,000,000 estimate for $16,882,500 (Sotheby’s New York, 5/10/2011) 5) Claude Monet’s Iris mauves, Not sold against an estimate of $15,000,000-20,000,000 (Christie’s New York, 5/4/2011) 6) Robert Rauschenberg’s The Tower, Not sold against an estimate of $12,000,000-18,000,000 (Christie’s New York, 5/11/2011) 7) Pablo Picasso’s Couple à la guitare, sold below the $10,000,000-15,000,000 estimate for $9,602,500 (Sotheby’s New York, 5/3/2011) 8) Francis Bacon’s Untitled (Crouching Nude on Rail), sold below the $10,000,000-15,000,000 estimate for $9,602,500 (Christie’s New York, 5/11/2011) 9) Paul Gauguin’s Nature morte à “L’Espérance”, Not sold against an estimate of £7,000,000-10,000,000 (Christie’s King Street, 2/9/2011) 10) Thomas Gainsborough’s Portrait of Colonel John Bullock, (above right) Not sold against an estimate of £3,500,000-5,000,000 (Chrsitie’s King Street, 7/5/2011) Top 10 Most Surprising Lots Old Master and Asian artists enjoyed relative success these six months, fetching enthusiastic bidding in their categories. At Christie’s alone, sales in Asia totalled £296 million ($482.5 million), up 48% while sales in America remained down. The trend towards Asian art and increasing buying power from Asian collectors is clearly evident from this list. 1) Rome, The Castel Sant’Angelo and the river Tiber from the south by Gaspar van Wittel. Sold for £718,850 – 3,494% above estimate (Sotheby’s London, 7/7/2011) 2) 1985-4 by Yu Youhan. Sold for HK$14,100,000 – 2,720% above estimate (Sotheby’s Hong Kong, 4/3/2011) 3) Appearance of Crosses 90-6 by Ding Yi. Sold for HK$17,460,000 – 2,394% above estimate (Sotheby’s Hong Kong, 4/3/2011) 4) GRAYGROUND by Ronald Ventura. Sold for HK$8,420,000 – 2,306% above estimate (Sotheby’s Hong Kong, 4/4/2011) 5) Spring Calling by Wu Guanzhong. Sold for HK$17,460,000 – 1,646% above estimate (Christie’s Hong Kong, 5/31/2011) 6) Sans Titre by Wols. Sold for £2,617,250 – 1,645% above estimate (Sotheby’s London, 2/10/2011) 7) Autumn in the Village by Lin Fengmian. Sold for HK$23,060,000 – 1,318% above estimate (Christie’s Hong Kong, 5/31/2011) 8) Series “X”? No. 3 by Zhang Peili. Sold for HK$23,060,000 – 1,153% above estimate (Sotheby’s Hong Kong, 4/3/2011) 9) Lotus and Landscape along Highway Hengguan by Zhang Daqian. Sold for HK$56,660,000 and HK$52,180,000, respectively – 809% and 745% above estimate (Christie’s Hong Kong, 5/31/2011) 10) The Meeting of Antony and Cleopatra: 41 BC by Sir Lawrence Alma-Tadema (pictured below). Sold for $29,202,500 – 484% above estimate (Sotheby’s New York, 5/5/2011) Written and Compiled by MutualArt.com Staff

Read the full article →

David Nichtern: Is Karma To Blame?

July 28, 2011

What is the law of karma? In Buddhism, the law of karma describes how causes and effects interact in our world. The point of understanding how karma works is to see the nature of things as they are, beyond any kind of delusion or wishful thinking. What does the law of karma have to do with the current economic crisis? Maybe our national economic policy could use a good healthy dose of seeing “things as they are”. In our individual meditation practice, there is no magic bullet, no fantasy transformation, no gimmicks — we have to work through our karma, brick by brick — it is manual labor. With meditation practice, we can see how our mind works — what creates positive karma (compassion and wisdom), and what creates negative karma (aggression, attachment and ignorance). That is how we get clarity about how certain causes create certain conditions — how did we get where we are and what we can do about it. With the same approach, with real scrutiny, perhaps our current debt ceiling crisis can be seen to be nothing other than our national money karma coming to fruition. There are some basic principles at work here, immune from any kind of fancy talk or manipulation. Certain basic causes and conditions have created the current situation: 1. We have borrowed too much money. Just as many of us have done as individuals, as a nation we have simply borrowed too much money, and now our creditors are knocking at the door. I don’t think you need an advanced degree in economics to figure this out. Sometimes common sense is more valuable than intricate theories. It’s time to pay some of this debt down, just as we would (and as some of us have) if this were our individual problem only. 2. We have been too greedy. As a nation (and many of us as individuals) we have been willing to sacrifice long-term prosperity for short-term gain, over and over again. Many of us are addicted to a hyper-extended materialistic lifestyle (certainly by global standards) and have been willing to go deeply into debt to maintain it. Additionally, a tiny percentage of extremely wealthy people are now in a position to manipulate our entire economy to further their own self-centered, limited agenda, which they are now doing on a global level. Gordon Gekko said “greed is good,” but now we will get to see if that will be his “final answer.” 3. Our national political arena has become overrun with personalized agendas and bad manners. We seem to have a chasmic divide amongst our so-called “leadership.” Creative friction can sometimes be very effective in flushing out different points of view and perhaps reaching a higher fusion. But we seem to have gone well beyond that kind of creative friction in our national politics to the level of some kind of permanently feuding mentality. Like the Hatfields and the McCoys, we now see our two “parties” immersed in an ongoing tit for tat, with nobody being very clear about the origin or the point of it all. There seems to be a crescendo of personalized agendas in the public sector. Temporal leaders, just like good spiritual teachers, could be invited to check their ego at the door. Wouldn’t that be refreshing? The solution? We need bigger vision. Let’s think about what would be good for ourselves and others. Are these really two completely different things? Perhaps we bring out the best in each of us and are also happier individuals when we have a feeling of contributing to a common cause beyond self-aggrandizement. If we are arguing about what would be the best outcome for the larger good, that could be a healthy argument to have. If we’re going to keep playing the “me, me, me” game, we might be spinning on this particular wheel of karma forever — like a giant Ferris Wheel with all of us on it. Follow David on his website ( www.davidnichtern.com ), facebook ( facebook.com/davidnichtern ), twitter ( twitter.com/davidnichtern ), or youtube ( youtube.com/davidnichtern )

Read the full article →

States Cut Programs Helping Families Pay Electric Bills

July 21, 2011

SOUTH BEND, Ind. — Many states hit hardest by this week’s searing heat wave have drastically cut or entirely eliminated programs that help poor people pay their electric bills, forcing thousands to go without air conditioning when they need it most. Oklahoma ran out of money in just three days. Illinois cut its program to focus on offering heating money for the winter ahead. And Indiana isn’t taking any new applicants. When weighed against education and other budget needs, cooling assistance has been among the first items cut, and advocates for the poor say that could make this heat wave even more dangerous. “I’ve never seen it this bad,” said Timothy Bruer, executive of Energy Services Inc., which administers the federal Low Income Home Energy Assistance Program in 14 Wisconsin counties. The group has turned away about 80 percent of applicants seeking cooling assistance. The sizzling summer heat comes after a bitterly cold, snowy winter in many places and at a time when unemployment remains stubbornly high. The cuts began after Congress eliminated millions of dollars in potential aid, forcing state lawmakers to scale back energy assistance programs. The agencies that distribute the money are worried that the situation could get even worse next year because the White House is considering cutting the program in half. Joyce Agee, a retired secretary from South Beloit, Ill., said she typically receives about $300 in utility assistance each summer and up to $600 for the winter to supplement her Social Security income. After running her air conditioner constantly, she’s worried about her next electric bill. “I’ve cut back on what I eat so that I can pay my light bills and everything else,” she said. The government provided $4.7 billion for low-income energy assistance for the fiscal year that ends Sept. 30, down $400 million from the year before. The money is primarily used by states to help with heating bills in winter, which lasts longer and generates higher utility bills. But dozens of states, particularly those in the South and Midwest, have traditionally used a portion of the money to provide help during the summer – especially for elderly people and those with medical conditions that could be fatal in high heat. “Energy assistance helps vulnerable people. If they can’t turn their air conditioner on because they’re afraid to pay the bill, there’s documented cases of people dying over time. It’s totally preventable,” said Mark Wolfe, executive director of the National Energy Assistance Directors’ Association, which is made up of state officials who give out the federal money. The hot air mass that has plagued the Plains for days began spreading eastward Thursday, roasting residents of the Ohio Valley and the East Coast under a sizzling sun that made people sick, closed schools and prompted cities to offer cooling centers and free swimming. Forecasters issued excessive heat warnings for a huge section of the country, from Kansas to Massachusetts. The temperature surpassed 100 degrees in Toledo, Ohio – just a few degrees shy of a record set in 1930. Combined with 69 percent humidity, it felt as hot as 107. The weather is suspected of contributing to a number of deaths across the nation. At least six more fatalities were reported Thursday, including a Michigan restaurant cook who suffered a heart attack after being sent home from his job and a teenage boy who drowned while swimming at summer camp in the same state. Missouri officials confirmed five heat-related deaths since June. Kansas City authorities were investigating at least 13 others in which heat was suspected. Emergency room visits were way up, according to public health officials, mainly because of people suffering from heat exhaustion and heat stroke. Since the recession began, requests for heating and cooling assistance have skyrocketed, with 8.9 million households nationwide receiving federal help this year. That’s up from 5.8 million in 2008-09. Some states scaled back or canceled cooling assistance programs because they feared the government money would be cut further or would not arrive in time to help with winter heating bills. The program was never meant to be the sole source of aid, but, Wolfe said, states are now “broke” and have few other options. Donations to social service groups that offer help have also dropped. In Indiana, only those applicants who sought winter assistance were permitted to apply for help this summer. Federal funding arrived so late that state officials gave $100 to people who received winter utility money. That was double the normal amount, but it left nothing for new applicants in many places. Illinois canceled its entire summer utility program because the money was already spent. About 70,000 households received aid in 2010, compared with 421,000 for the winter program. Oklahoma officials doled out the entire $22 million for the summer program in just three days earlier this month. “There’s always more need than we have money,” said Jeff DeGraff, a Louisiana Housing Finance Agency spokesman. Michigan saw the biggest drop in its federal funding, which tumbled from $238 million to $38 million. Texas’ funding fell by $28.6 million. The situation could get worse next year. President Barack Obama has proposed cutting funding for the program to $2.5 billion. States are worried. A group of governors plans to send a letter to Congress asking lawmakers to maintain the federal funding at current levels next year. “It seems like the wrong time to be cutting energy assistance,” Wolfe said. “People need help getting by. There are a lot of people right on the edge. To cut them now is cruel.” In the area around Rockford, Ill., which was especially hard hit by the economic downturn, 2,000 households that typically receive help to keep their electricity on must do without. City officials have been steering residents to cooling centers and trying to spread the word about how to avoid overexposure, said George Davis, executive director of Rockford’s human services department. “We don’t have a lot of other options,” he said. Mary Ware, a 62-year-old Chicago woman who suffers from high blood pressure and diabetes and requires dialysis three times a week, lives in a basement apartment with her son and daughter. She receives disability income but can’t afford air-conditioning. She described her apartment as “miserable.” “It’s very hot, and all I got is a box fan,” Ware said. Officials in many states say they sympathize with those struggling against the heat, but they insist helping the poor in the winter has to be a priority because heating costs are higher, the season is longer and the demand for aid is greater. That reasoning offered little comfort to the 30 people who had signed up Thursday morning to get energy assistance in Milwaukee, where applications have risen 20 percent since this week’s heat wave began. “We’ve been making far more exceptions than we normally would for safety reasons,” energy assistance supervisor Sonya Eddie said. Koyama Stokes, 31, of Milwaukee, received $300 to put toward the $600 she owes to keep her electricity on. She said she had to attend two funerals over the last month in Mississippi, and the trips broke her budget. She provides for her two disabled children and a niece and nephew using $1,500 in monthly Social Security payments. She was thankful for the help she received Thursday but said deeper cuts in energy assistance would devastate her. “I don’t think I could survive,” she said. “I can’t see my kids looking at me hungry.” ___ Associated Press writers Karen Hawkins in Chicago; Andrew Miga in Washington; David Mercer in Champaign, Ill., Sean Murphy in Oklahoma City; Carrie Antlfinger in Milwaukee; Melinda Deslatte in Baton Rouge, La.; and Jeni O’Malley in Indianapolis contributed to this report.

Read the full article →

On Debt, Obama Team Pleaded With Credit Rating Firms Before Downgrade Warnings

July 16, 2011

The Obama administration has mounted an intense behind-the-scenes campaign to keep the nation’s major credit rating companies from issuing threats that they might downgrade the United States over the swelling size of the federal debt.

Read the full article →

Starving SEC Helps No One But Wall Street

July 16, 2011

The economy is still suffering from the worst financial crisis since the Depression, and widespread anger persists that financial institutions that caused it received bailouts of billions of taxpayer dollars and haven’t been held accountable for any wrongdoing. Yet the House Appropriations Committee has responded by starving the agency responsible for bringing financial wrongdoers to justice — while putting over $200 million that could otherwise have been spent on investigations and enforcement actions back into the pockets of Wall Street.

Read the full article →

Greece’s Prime Minister: ‘It Is Time For Europe To Wake Up’

July 16, 2011

ATHENS, July 16 (Reuters) – Greece’s Prime Minister George Papandreou ruled out bankruptcy for his debt-choked country and said it was time for Europe to wake up and take brave decisions, according to a newspaper interview to be published on Sunday. Ahead of a summit of euro zone leaders on July 21 to discuss a second bailout for Greece, Papandreou said his government had taken the necessary decisions, however difficult they were, to deal with the crisis, and it was Europe’s turn to do the same. “We managed not to let Greece go bankrupt, and neither will it go bankrupt,” Papandreou was quoted as saying by Greek newspaper Kathimerini, referring to whether credit rating agencies could find Greek debt to be in “selective default.” “For a year and a half now, I’ve been continuously reiterating to our partners that we must collectively take brave decisions, not just for the future of Greece but of Europe as a whole. It is time for Europe to wake up,” he added. With sovereign debt jitters having reached Italy, the euro zone’s third-largest economy, Europe’s leaders are struggling to agree on how to provide new aid for Greece to prevent contagion from spreading further in financial markets. Papandreou said that several of the options that he had suggested and were rejected a year and a half ago, such as buying back debt, issuing common euro zone bonds and keeping credit rating agencies in check, were now on Europe’s negotiating table. “In an ultraconservative Europe, I would even say phobic, the truth is it took time for these thoughts to mature with our partners and for them to be convinced that these proposals are not an alibi in order to avoid our own responsibilities,” Papandreou said in the interview. Greece’s total outstanding debt is around 370 billion euros ($523 billion). Most economists regard the debt burden, at around 160 percent of gross domestic product, to be unsustainable as it stifles growth, with the economy seen contracting by nearly 4 percent this year after a 4.5 percent slump last year. “Now everybody understands that Greece needs to be helped to exit recession as soon as possible. The relevant negotiations are making progress, and I hope they are completed as soon as possible,” Papandreou said. A bond buyback is more likely than the other options that euro zone finance ministers have discussed and would allow Greece to cut its public debt by 20 billion euros if purchases were made at market prices, German magazine der Spiegel said on Saturday. (Reporting by Greg Roumeliotis, editing by Jane Baird) Copyright 2011 Thomson Reuters. Click for Restrictions .

Read the full article →

Key Issue Has GOP Voters As Divided As Candidates

July 16, 2011

PELLA, Iowa — The presidential candidates aren’t the only Republicans divided about letting the government borrow even more money to pay its bills. So, too, are the voters they’re courting. Fiscal hard-liners in early voting states say the issue is a major test for any would-be challenger to President Barack Obama, a Democrat. They’re refusing to consider backing someone who leaves open the door to raising the debt ceiling. As Len Gosselink, an Iowa Republican, put it after listening to former U.S. House Speaker Newt Gingrich last week: “It’s unthinkable in my mind to support a candidate who would allow it.” Others say the borrowing limit must rise as part of a broader deficit-reduction strategy that includes other actions such as a balanced budget amendment. They’re betting that by next winter, when the Iowa caucuses begin the 2012 nominating race, the summer debate over the credit limit will have faded. “Most caucus-goers are open to options,” said Mark Greenfield, a county GOP chairman in central Iowa. “Realistically, we’re going to have to raise it. People are just tired of government spending and this is how they are showing it.” From Iowa to New Hampshire and South Carolina, the debate in Washington has spilled over into the White House race. Candidates are stepping carefully as they maneuver for political advantage and voters are paying close attention to what they’re saying on the issue. In the nation’s capital, Obama and Congress are struggling to get a deal that would avoid a potentially catastrophic default on Aug. 2. Two members of Congress seeking the nomination, Minnesota Rep. Michele Bachmann and Texas Rep. Ron Paul, have said they won’t vote to raise the debt limit. But most of their rivals, who don’t work on Capitol Hill and won’t have to vote on the issue, are more nuanced when they discuss it, grudgingly backing an increase with conditions, such as spending cuts commensurate with the higher limit, as well as a balanced budget amendment. The mix of positions reflects both the near universal anxiety in the GOP base about spending and the range of voter sentiment about the best course to deal with a complex subject. The issue is clearly salient within the party. A national Gallup Poll published Wednesday found that 60 percent of Republicans oppose raising the debt limit, compared with 42 percent of all those surveyed. The conversations on the campaign trail between candidates and voters illustrate the tricky politics. The first question asked of former Minnesota Gov. Tim Pawlenty at an event in northern Iowa last week was about the GOP’s resolve against raising the debt ceiling. “I hope and pray they don’t do it,” Pawlenty said. He then said if they do raise it, they should “at a minimum” also get a constitutional amendment to balance the budget “to make sure we don’t have to rely on the good will and false promises of politicians to get the budget balanced in the future.” Elsewhere in the state, Gingrich earned applause when he said he would refuse to support an increase without equal spending cuts. Just as quickly, Gingrich lost some support, including Gosselink’s, by saying that increasing the borrowing authority was inevitable without a balanced budget. South Carolina Republican Marian Barbary is among those who take the position that the potential economic impact of not acting has been exaggerated. “They have to make us think that everything will go to pot. It’s not going to happen,” Barbary said after listening to former Utah Gov. Jon Huntsman leave the door open to raising the debt ceiling if accompanied by spending cuts and a balanced budget amendment. “If they don’t increase the debt ceiling, the world’s not going to fall apart,” Barbary said. Becky Kepler, an Iowa GOP activist, is among those looking for a candidate who won’t bend on the debt limit. She is leaning toward supporting Bachmann. “The more you give in every time, your credibility in saying no becomes zilch,” said Kepler, a county-level organizer in west-central Iowa. But voting doesn’t begin for six months and by then the debt crisis may have passed as the issue of the moment. ___ Associated Press writer Jim Davenport in Columbia, S.C., contributed to this report. ___ Follow AP reporter Thomas Beaumont on Twitter (at)TomBeaumont

Read the full article →

Beyond A Default: Catastrophic Calculations

July 16, 2011

It’s easy to understand why the government will have more trouble borrowing if it fails to pay its debts. It’s a bit harder to see why ordinary Americans, the city of Pittsburgh, hospitals in Iowa, or medium-size corporations will have more trouble borrowing. But they will.

Read the full article →

Linda Bergthold: Health Independence Day

July 3, 2011

July 4th is a day to celebrate our many freedoms. One of our most important freedoms is freedom from fear, including fear of financial ruin because of medical bills. You may not know that almost half of all bankruptcies in the United States are related to costly illnesses and failure to pay medical bills. And to me, that is just wrong. A friend of mine recently faced bankruptcy over an enormous hospital bill incurred by the emergency hospitalization of his four-year-old son. Even though he had insurance, the amount he would have been required to pay was far more than his limited resources could handle. He and his wife were literally sick with anxiety. He was panicked that his inability to pay the bill would result in a collection agency garnishing his salary or ruining his credit record. I encouraged him to question the bill and talk to the billing department at the hospital. There is almost always a discount or way to settle these bills in a way that fits your budget. In addition to sitting down with the billing department and discussing what he could pay, I suggested he also ask about the hospital’s ” charity policy ” and whether he might be eligible for it. He and his wife both work and he figured their combined income would be too high. To his surprise and great relief, after submitting all the paperwork, he did qualify and the hospital wrote off his bill! As relieved as we all were by my friend’s good fortune, unfortunately he is one of the few lucky ones. So this July 4th, my hope for families and individuals who face medical bankruptcy or high medical bills, is that some day soon, they will experience some freedom from that fear because of some new laws and programs. The Affordable Care Act (aka health reform) is already helping families faced with large medical bills in a number of ways. The ACA has removed lifetime maximum limits on health insurance, meaning that insurance companies can no longer limit what they cover over your lifetime. (It has been common to put million dollar limits on lifetime coverage and sometimes even less.) The companies also cannot put “unreasonable” annual limits on your coverage. Because the term “unreasonable” is a little vague, the decision about these rate increases is regulated at the state level. Reform allows states to regulate increases in the premiums you are charged. In some states, they can actually deny unreasonable premium hikes; in other states, they must use the bully pulpit and public shaming to get insurance companies to back down. Individuals who have no insurance but are ill, often face medical bills they cannot pay. States have now established insurance pools (sometimes called “high risk pools” or “pre-existing condition pools”) for people who face high costs but have previously been uninsurable. In a post I wrote a few weeks ago, I described these pools as one of the best kept secrets of health reform. It’s not really a secret, of course, but surprisingly few people know about this program or have taken advantage of it. If you have been uninsured for at least six months, you should check out the program in your state. This program could prevent you from having to declare medical bankruptcy. While we are not yet free of all fear of medical bankruptcy, the Affordable Care Act has helped many families already, and it will continue to help us all as it is fully implemented in 2014 and beyond. July 4th can be a kind of Health Independence Day for us all.

Read the full article →

ICANN Opens Domain Naming: Is the ‘Dot Com’ Boom Over?

June 21, 2011

The Internet Corporation for Assigned Names and Numbers announced on Monday one of the most significant changes to Internet naming since “dot com” was first uttered. ICANN will dramatically increase the number of domain name endings — known in the industry as “generic top-level domains,” they currently include .com, .net and .gov — opening up the relatively limited set currently available to website owners. According to the organization , addresses will be able to end in almost any word in any language. Companies, places and individuals will be given the opportunity to register their names, and category domains — such as .cars, .sports and .news — will be up for registration come January 2012. Given the mere 22 possible endings available now, the decision has potentially far-ranging implications as to how corporations, non-profits and individuals choose to exist online. As part of a 305 page Applicant Guidebook , ICANN stipulates that companies registering certain brand names will be subject to thorough vetting to determine that they can legally hold a brand name domain. “The issue is about having control over your internet presence as much as possible,” said Jeff Ernst, a principal analyst at Forrester Research. Ernst explained that as it stands right now, many companies “have put their brand presence secondary to .com” — the most popular domain ending. With the new domains, “companies can better control their brand.” Consumers, meanwhile, will be able to differentiate between official brand sites and imposters. “When you go to .Gucci, consumers will know it’s not the knockoff,” said Ernst. The thorniest question surrounds category names and who controls the rights to them. Ernst says that “preference will be given to those groups that want to run an open community” and foresees industry associations and larger groups making collective bids, but with “strict guidelines as to who can participate.” Jeremiah Johnston, the chief operating officer for domain name registration company Sedo , cautioned that “these are words,” — not trademarked names — and warned that concerns will inevitably arise as to “who is the true custodian of them.” “This is a question of fair use rules — it’s going to be interesting,” he added. Anthony Falzone , a lecturer in Law affiliated with the Stanford Center on Internet and Society, said he thought the category domains “will strike off a huge bidding war.” But he also questioned how effective — or necessary — they would be in the long run. “In the early days of the internet, there was that first gold rush for domain names, because domain was quite important to finding things. Search capability was essential,” Falzone explained. But these days, he posited, users are just as likely to use search engines like Google to find an individual or company, making domain names less important. Others in the industry said the traditional domain name endings show little sign of going away. Kurt Gastroch, senior vice president of product at Network Solutions , a domain name registry and web hosting service, said that “the landscape has been dominated by .com extension since the existence of the commercial internet. And it still makes up half of the registrations.” Gastroch says that certain “behavioral conditioning” needed to take place to push users (and companies) to embrace the new domain name endings. But he also noted the success of certain country domain names that have been licensed for broader, unrelated uses. The domain .co was originally meant for Columbia, but has since been appropriated as an alternative to .com, while .tv was initially meant to represent the country of Tuvalu but has since become popular given its implication of broadcast media. “These GTLDs have multiple meanings and interpretations and are marketed in different ways,” explained Gastroch. Johnston said that the .co representatives, “went to trademark and branding conventions, and made sure everybody knew it was an alternative to .com.” He added that the .co team recognized that it was essential for “consumers to have a relationship to the extension and to assume what kind of content it represents. Marketing is key.” In the end, the net effect of ICANN’s domain name expansion is anyone’s guess. “We’re still in the infancy of the internet,” said Gastroch. “These things can change in ways we can imagine and ways we cannot.”

Read the full article →

Labor Regulators Set To Propose New Rules To Speed Up Union Elections

June 21, 2011

(AP) WASHINGTON – Labor regulators are set to propose sweeping new rules Tuesday that would dramatically speed up the time frame for union elections, a move that could make it easier for struggling unions to organize new members, and cut the time businesses have to mount anti-union campaigns. A copy of the planned rules, to be announced by the National Labor Relations Board, was obtained by The Associated Press. The proposal is expected to irritate Republicans and business groups who have complained about the board’s pro-labor actions. Most labor elections currently take place within 45-60 days after a union gathers enough signatures to file a petition, a time many companies use to discourage workers from unionizing. The new plan could cut that time by days or even weeks — depending on the case — by simplifying procedures, deferring litigation and setting shorter deadlines for hearings and filings. But it does not impose a specific deadline for elections, as many labor leaders had hoped for. Canada, for example, requires such elections to take place in as little as 5 to 10 days. The plan would “better insure that employees’ votes may be recorded accurately, efficiently and speedily,” said the board’s majority, led 3-1 by Democrats. Passage would be a victory for labor unions that have long complained about employers using procedural delays and litigation to hold up elections and intimidate workers. Some employers hire so-called “union busting” consulting firms to produce videotapes, draft talking points or create brochures to deter unionizing. Lynn Rhinehart, general counsel of the AFL-CIO, has called current union election procedures “a very cumbersome process that gets bogged down in litigation.” “If the board is going to try to address some of the reasons for delay in the election process, that would be a positive thing,” she said in an interview before the proposed rule was announced. “Delay in the process has been a perennial problem.” The board’s lone Republican, Brian Hayes, issued a vigorous dissent, saying the proposal would result in the type of “quickie elections” union leaders have long sought. Hayes claimed elections could be held in as little as 10 to 21 days from the filing of a petition, giving employers less of a chance to make their case. “Make no mistake, the principal purpose for this radical manipulation of our election process is to minimize or, rather, to effectively eviscerate an employer’s legitimate opportunity to express its views about collective bargaining,” Hayes wrote. The board will take 75 days to review comments and replies before making a decision on whether the rule should become final. Union membership has steadily declined from its peak of about 20 percent in the 1980s to just to 11.9 percent of all workers, and just 6.9 percent of the private sector. Many members blame increasingly aggressive anti-union tactics, but they have tried without success to beef up federal penalties for what they say are growing instances of intimidation and threats against workers. Labor leaders made a major push in 2009 for Congress to pass so-called “card check” legislation that would have increased penalties for such violations and made it easier for unions to organize workers by signing cards instead of holding secret-ballot elections. But the measure failed to garner a filibuster-proof majority in the Senate. Since then, labor has pinned its hopes for a revival on action at the NLRB, the Labor Department and other sympathetic administrative agencies. The board has not disappointed. It has cracked down on businesses that fire employees during union organizing drives and proposed rules that would require all business to display posters explaining union rights. In perhaps the most prominent case, the NRLB’s acting general counsel filed a controversial lawsuit earlier this year that accused Boeing Co. of retaliating against union workers in Washington state by placing a new assembly line for the Dreamliner 787 in South Carolina, a right-to-work state. The proposed rule to be announced Tuesday could be another step in helping unions halt the membership decline and organize more workers. It would: • Allow electronic filing of petitions and other documents to speed up processing. • Set pre-election hearings to begin 7 days after a petition is filed. • Defer litigation of eligibility issues involving less than 20 percent of the bargaining unit until after the election. • Eliminate pre-election appeals of rulings by an NLRB regional director. • Reduce from 7 to 2 days the time for an employer to provide an electronic list of eligible voters.

Read the full article →

Man Fired After Disclosing Wife’s Cancer To Employer

June 15, 2011

Cancer is an awful thing for any family to deal with. It’s even more of a problem when it gets you fired. When Carl Sorabella, of Massachusetts, told his employer that he would need to take some medical leave in order to deal with his wife’s cancer, he thought it was a reasonable request. But according to ABC News , when he walked into work on Monday, he found a note on his desk saying that he had been fired. “When I told my boss, she said ‘We were thinking about laying you off.’ I thought, ‘You can’t do that,’” Sorabella told WCVB 5 in Boston. Sorbella’s wife of 23 years, Kathy, had learned she had stage 4 untreatable cancer in April. But according to the report, the request for a modified schedule in order to deal with the problem was too much for his employer, Haynes Management, a real estate company in Wellesley Hills, Mass. According to ABC , Sorbella feels he was wrongfully terminated: “Ultimately she said don’t worry about it and come in on Monday, and when I came in on Monday I got a letter that I would be laid off,” he said. Sorabella said the letter stated he was being laid off due to “workforce modifications.” But one week after he was fired, he says he saw a listing for his job on the company website. “She said, ‘It’s business. I’m running a company here, and I need to make sure the department runs.’ And I argued that I would make sure the company runs,” Sorabella said. While there are laws in place to protect employees from this sort of thing, The Family and Medical Leave Act only applies to companies with 50 or more employees. As a result, many small business employees are left with few legal options. For video, click here for more from ABC.

Read the full article →

Pensions Set To Be Next Battleground For State Employees

June 15, 2011

First came the pay freezes and unpaid furloughs. Then came the higher contributions for health insurance. Now, in the most definitive sign yet that the era of generous compensation for public-sector employees is ending, workers in more than half the states face the prospect of paying more of their salary toward their pensions.

Read the full article →

15 Amazing Apple Store Facts

June 15, 2011

Apple’s retail guru Ron Johnson is leaving the company to become CEO of J.C. Penney. In light of his departure, we thought we’d highlight what Johnson built over the last decade — a feature we first published last month for the 10th anniversary of Apple’s first store opening. Apple has more than 300 stores in 11 countries, and its retail division has become a hugely important part of the company’s business, selling millions of iPods, Macs, iPhones, and iPads.

Read the full article →

Bonnaroo Reports Tenth Death Since 2002

June 14, 2011

The Bonnaroo Music Festival in Manchester, Tenn., one of the most popular music festivals in America, was held from June 9-12 of this year. Rapper Eminem headlined a bill that included some of the biggest names in music, among them The Black Keys, Arcade Fire, My Morning Jacket, Lil Wayne, and The Strokes. In the past few days, however, two tragedies have surfaced out of the festival, bringing to the forefront the obvious dangers of cramming some 80,000 concertgoers together in 90-degree heat with an endless supply of drugs and alcohol. The Coffee County Sheriff Stephen M. Graves said Monday that 24-year-old Christopher Yoder of Raleigh, N.C., died of hyperthermia after being airlifted from the Bonnaroo grounds to Erlanger Hospital in nearby Chattanooga. Festival organizers released a statement: “The safety of our patrons is our no. 1 concern, and we are deeply saddened by this.” The announcement came after the body of 32-year-old Beth Myers was found in one of the Bonnaroo tents on the evening of June 9. Organizers say that Myers’ death was heat-related, but in both cases, the toxicology- and autopsy-test results have still not been officially released. Since the festival’s launch in 2002, ten people have died at Bonnaroo. The first reported deaths in the its history, of a 22-year-old Kentucky woman and 20-year-old Michigan man, occurred in 2004 when temperatures reached nearly 100 degrees. Toxicology reports indicated that both had cocaine and marijuana in their systems. That year, a spokesman for the Bonnaroo production organization Superfly Entertainment, Rick Farman, told the Middle State Tennessee University student newspaper that the deaths were unfortunate, but the concert was a success overall. “Both [deaths] are sad occurrences,” he said in June 2004. “Our goal is to provide a safe and fun environment for everybody out here, and I think that we have the proper policies and procedures in place, and you know, like anything else, we’ll review those.” Thousands of others have been treated for heat exhaustion since then. Carl Monzo, director of Bonnaroo’s Emergency Medical Services, reported to the Tennessean that in 2010, air-conditioned medical tents were taking in about 25 percent more people than in past years. Bonnaro provides air-conditioned “movie-tents” with free screenings on festival grounds, but unofficial showers located on Bonnaroo campgrounds cost about $10 for festival-goers. The Bonnaroo Festival has frequently been referred to as America’s version of Glastonbury, the popular music festival that takes place in South West England at the end of June every year. In 1994, that festival reported its first death in its 24-year-history, when a man died of a reported drug overdose. Coachella, an equally popular music festival near Palm Springs, Ca., also reports temperatures in the triple-digits. But 21-year-old Benjamin Muller is the only concertgoer to die at festival since it began in 1999. So is it something about the Tennessee heat? Certainly holding the festival in June, rather than a cooler month increases the risks the predominantly boozed-up and drugged-out crowd faces. Representatives for Bonnaroo and its producing organizations did not immediately return requests for comment. “I couldn’t make that statement, that we should blame the Tennessee heat,” said Dr. David Claypool, an emergency medicine physician with the Mayo Clinic. “Heat is heat. California might be a little drier, but any heat is going to be difficult for people.” Ken Wilkerson, the chief of Hamilton County Emergency Medical Services, points to differences between Bonnaroo and the nearby Riverbend Festival in Chatanooga, a nine-day music event featuring over 100 bands and a daily attendance of 60-90,000 people. “The difference is that people [at Bonnaroo] are enduring the heat and humidity problems twenty-four seven,” he said. “People coming to Riverbend are coming from home. They’re well-hydrated before they get here.” Wilkerson also notes the distance from Bonnaroo’s location in Manchester to the nearest medical facility in Chatanooga. If someone is injured at the Bonnaroo festival, they need to be flown off the grounds. “From time of [injury], you’re looking at minimum of an hour, an hour and a half — maybe two hours,” said Wilkerson. “Whereas here at Riverbend, something happens you can get to it in 10 minutes.” Of course, Wilkerson added, the rampant alcohol consumption and drug use doesn’t help anything either. “Alcohol is the worst dehydrator of any fluids you can put in,” he said.

Read the full article →

Delta Charges U.S. Troops Returning From Afghanistan $2,800 In Baggage Fees

June 8, 2011

WASHINGTON — Delta Air Lines is facing intense criticism after charging 34 U.S. soldiers returning from Afghanistan $2,800 in baggage fees. The incident came to light on Tuesday after a couple of the new-media savvy soldiers recorded a video about their ordeal and posted it on YouTube. “We showed up and found out we had too many bags,” said Army Staff Sgt. Robert O’Hair in the video, which was shot on their flight. “We had four bags, and Delta Air Lines only allows three bags. Anything over three bags you have to pay for, even though there’s a contract between the United States government and Delta Air Lines when returning from Afghanistan on military orders, you’re authorized up to four bags.” O’Hair added that all the soldiers with a fourth bag had to pay $200 out-of-pocket. The total for the 34 soldiers was more than $2,800. O’Hair’s fourth piece of luggage was his weapons case, carrying the tools he used, in his words, to “protect myself and Afghan citizens while I was deployed in the country.” WATCH: A Delta social media manager identified as Rachael R. responded in a blog post on the company’s website on Tuesday, clarifying the airline’s policy: “Currently, Active Duty U.S. Military Personnel traveling on orders may check up to 4 bags in First/Business class and 3 bags in Coach for free both domestically and internationally. Additionally, to help with the travel process, we allow each bag to weight an extra 20 pounds over the standard allowance.” She apologized to the Army unit on behalf of Delta and said the airline would be reaching out to each of them personally “to address their concerns and work to correct any issues they have faced.” Rachel R. did not say whether the soldiers would be reimbursed. “A $200 bill for extra baggage by a government-contracted airline is the worst welcome home any soldier could receive,” said Joe Davis, director of public affairs for the Veterans of Foreign Wars. “We know this is a business issue and that the troops will be reimbursed if they are authorized additional baggage in their orders, but the shock of even being charged is enough to make most servicemen and women simply shake their heads and wonder who or what it is they are protecting.” The overwhelming majority of the comments on the Delta blog post were not on the company’s side. “Having been deployed three times in eight years, I have never had to pay out of pocket for bags on other airlines,” wrote a user identifying themselves as brianmcgovern. “Flying with Delta has always been a crap shoot. We can never tell when there will be an issue with baggage, especially once the major airlines got together and started soaking all passengers for baggage fees.” A user named hotberry simply said, “You people should be ashamed of yourselves.” Delta made $3.7 billion in 2010 off of ancillary revenue — charging passengers for food, drinks and extra baggage. According to Stars and Stripes , the men in the video are deployed with the 95th Infantry Division , a Reserve unit in Georgia. In the video, they say they were bound for Fort Polk, La.

Read the full article →

Michael Moynihan: End OPEC Now!

June 8, 2011

The OPEC cartel that meets in Vienna today has thrived in its 50-year history. First ignored, then despised for using the “oil weapon” on the West, and ultimately granted a strange legitimacy due to age, it has assumed all the trappings of an international organization. This week’s meeting of Mahmoud Ahmadinejad ‘s Iran, Muammar Gaddafi’s Libya and Hugo Chavez’ Venezuela to fix quotas, for example, will take place not in Gaddafi’s tent but in a sumptuous building on the Helferstorferstrase in Vienna. Press is likely to report not on why oil prices are set by a cartel of the world’s worst leaders but rather on whether oil quotas are modestly adjusted to cover wells out of order since the Libyan revolt Unfortunately, the cartel’s victims have not fared as well. OPEC has over the last century engineered a massive transfer of wealth from the rest of the world to its rulers. At key junctures, it has used the “oil weapon” to destabilize the global economy as with the 1970s oil shocks, the 1980s debt crisis triggered by soaring oil bills and the 2008 financial collapse (when it cut quotas with prices over $100). Less well known is the role of oil price spikes in stoking misery and instability in developing countries. The final victims have been the people of the oil states themselves who have not shared in the wealth enjoyed by a few while seeing democracy pushed indefinitely into the future. Adam Smith famously observed “Seldom do businessmen of the same trade get together but that it results in some detriment to the general public.” Based on a long history of economic study, today cartels are illegal in virtually all developed countries. The question with OPEC, therefore, is not why it is bad but why has it survived. During the first Gulf war in 1991, the US and its allies saved Saudi Arabia, liberated Kuwait and dictated peace terms to Iraq. Yet after the war, all three countries continued as prominent OPEC members. In 2002 we invaded Iraq again, this time overthrowing Saddam Hussein. But rather than insisting that Iraq leave OPEC, the United States actually became a de facto OPEC member through the provisional Iraq authority. The superficial answer to this question of why OPEC has persisted is it has successfully claimed sovereign immunity. Unlike a private cartel — hundreds of which have been prosecuted by the Justice Department since 1990, OPEC is comprised of governments that happen to set quotas for oil. But this argument is weak. The 1976 Foreign Sovereign Immunity Act contains an exception to immunity in the case of governments engaging in commercial activities. The real reason that OPEC has survived is a lack of US resolve to break it up. In 2007 and 2008, the House and Senate passed legislation that would have forced the Justice Department to go after OPEC. However, a veto threat from President Bush prevented final passage of the legislation. There is an equally strong case for trade action against OPEC, made compelling by Senator Frank Lautenberg. The WTO unequivocally prohibits quota-based cartels except in the rare case of conserving resources or national security and of the 12 OPEC members, five are WTO members and 3, observers. Yet to date, the US Trade Representative has not filed an action. These tools alone might suffice to end OPEC. But the ratcheting up of US engagement in the region recently creates a new opportunity to break the cartel. The Middle East — the geographic center of OPEC — is clearly undergoing fundamental change. Not only, of course, did the US midwife democracy in Iraq, we remain the guarantor of security of Saudi Arabia, Kuwait and the UAE, and are now also supporting the rebels in Libya. The expanded US and EU role in the region provides an opportunity to make a simple case to all parties. US and more broadly EU support must be contingent on a timeline for withdrawal from OPEC. In short, the conditions exist to end OPEC. We only need resolve. Here is a plan forward. By July 4th, Congress should pass legislation revising the FSIA to strip OPEC of any hint of sovereign immunity. The US Trade Representative should immediately begin studying action against the OPEC countries in the WTO. The Obama Administration should make it clear to parties we aid in the Middle East they need to plan to transition out of OPEC. We can end OPEC but only if we act. Time is of the essence due to the tenuous state of the global recovery.

Read the full article →

Robert Lenzner: Making Banks Too Big to Not Fail, Maybe

June 8, 2011

The partial meltdown in bank stocks was a surprise and a warning. The market seemed to know that the powers-that-be were going to order more capital — a great deal more capital — according to the declaration today that a surcharge will raise bank capital to at least 10% of all their footings. This is proper revenge for being Too Big to Fail and almost destroying the global economy in 2008. No wonder the shares of Bank of America, Citigroup, Wells Fargo and other national and regional banks were battered. As the Hank Paulson character in the HBO movie of Too Big To Fail , was reported as saying: “Wall Street has a gambling problem… Why would we bail out someone whose sole purpose is to make money?” This is a major challenge to bank earnings and bank shares in the market. The major banks will have to sell on average another 60 or 70 million shares to raise that capital. Selling those additional shares will put massive pressure on the shares outstanding now. And with vastly more shares outstanding, the earnings available to those shares will be far less than at present. No wonder the banks are selling near their tangible book value — that is if you can trust the tangible book value in light of the mortgage loans that might still have to be written down in value. No wonder Bank of America (BAC) did not become a $30 stock as big-time hedge fund managers like John Paulson thought they would. The stock has been under liquidation and is selling just over $10 a share. Even JP Morgan is suffering at $40 a share, though Keefe Bruyette & Woods reckons its eventually worth $58 a share. Another solution: those too big to fail institutions could become smaller by unwinding positions and liquidating assets and reduce their dangerous level of leverage in this manner. Bank executives will wail about less profits, lower share prices, smaller bonuses, unhappy shareholders. Oh, woe is me! In Too Big Too Fail Treasury Secretary Paulson confesses to one of his aides: “We’re late. We’ve been late on everything.” Maybe, with this tough demand to increase statutory capital far beyond what the banks were willing to do, there will be a banking system that is more protective of itself. On the basis of past practice, though, we have learned they will find some way to gamble again with our and their future — and cause even more need for costly bailouts.

Read the full article →

China: GOP Lawmakers Are ‘Playing With Fire’ By Contemplating Default

June 8, 2011

Republican lawmakers are “playing with fire” by contemplating even a brief debt default as a means to force deeper government spending cuts, an adviser to China’s central bank said on Wednesday. The idea of a technical default — essentially delaying interest payments for a few days — has gained backing from a growing number of mainstream Republicans who see it as a price worth paying if it forces the White House to slash spending, Reuters reported on Tuesday. But any form of default could destabilize the global economy and sour already tense relations with big U.S. creditors such as China, government officials and investors warn. Li Daokui, an adviser to the People’s Bank of China, said a default could undermine the U.S. dollar, and Beijing needed to dissuade Washington from pursuing this course of action. “I think there is a risk that the U.S. debt default may happen,” Li told reporters on the sidelines of a forum in Beijing. “The result will be very serious and I really hope that they would stop playing with fire.” China is the largest foreign creditor to the United States, holding more than $1 trillion in Treasury debt as of March, U.S. data shows, so its concerns carry considerable weight in Washington. “I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar’s value,” Li said. Congress has balked at increasing a statutory limit on government spending as lawmakers argue over how to curb a deficit which is projected to reach $1.4 trillion this fiscal year. The U.S. Treasury Department has said it will run out of borrowing room by August 2. If the United States cannot make interest payments on its debt, the Obama administration has warned of “catastrophic” consequences that could push the still-fragile economy back into recession. “It has dire implications for the economy at a time when the macro data is softening,” said Ben Westmore, a commodities economist at National Australia Bank. “It’s just a horrible idea,” he said. Financial markets are following the U.S. debate but see little risk of a default. U.S. Treasury prices were firm in Europe on Wednesday, supported by a flight to their perceived safety on the back of the Greek debt crisis and worries about a slowdown in U.S. economic growth. Marc Ostwald, a strategist with Monument Securities in London, said markets were working on the assumption that the U.S. debt story “will go away.” But nervousness would grow if a resolution was not reached in the next five to six weeks. ‘WOULDN’T HAPPEN’ The Republicans’ theory is that bondholders would accept a brief delay in interest payments if it meant Washington finally addressed its long-term fiscal problems, putting the country in a stronger position to meet its debt obligations later on. But interviews with government officials and investors show they consider a default such a grim — and remote — possibility that it was nearly impossible to imagine. “How can the U.S. be allowed to default?” said an official at India’s central bank. “We don’t think this is a possibility because this could then create huge panic globally.” Indian officials say they have little choice but to buy U.S. Treasury debt because it is still among the world’s safest and most liquid investments. It held $39.8 billion in U.S. Treasuries as of March, U.S. data shows. The officials declined to be identified because they are not authorized to speak to the media. Oman is concerned about the impact of a default on the currency reserves of the sultanate and its Gulf neighbors. “Our economies are substantially tied up with the U.S. financial developments,” said a senior central bank official, who spoke on condition of anonymity. “It just wouldn’t happen,” said Barry Evans, who oversees $83 billion in fixed income assets at Manulife Asset Management. “They would pay their Treasury bills first instead of other bills. It’s as simple as that.” Monument’s Ostwald called the default scenario “frightening” and said bondholders’ patience would wear thin if lawmakers persisted in pitching this strategy in the coming weeks. “This isn’t a debate, this is like a Mexican standoff and that is where the problem lies,” he said. Yuan Gangming, a researcher with the Chinese Academy of Social Sciences, a government think tank, smelled some political wrangling behind the U.S. debt debate as the 2012 presidential election draws nearer and said Republicans “want to make things difficult for Obama.” But with time running short before the U.S. Treasury exhausts its borrowing room, Yuan said default was a real risk. “The possibility is quite high to see a default of the U.S. debt, which would harm many countries in the world, and China in particular,” he said. (Reporting by Kevin Lim and Jong Woo Cheon in Singapore, Suvashree Dey Choudhury in Mumbai, Aileen Wang and Kevin Yao in Beijing, Abhijit Neogy in Delhi, Marius Zaharia in London and Umesh Desai in Hong Kong; Editing by Dean Yates and Neil Fullick) Copyright 2011 Thomson Reuters. Click for Restrictions .

Read the full article →

Under Pressure, OPEC Hammers Out Deal to Raise Oil Supply

June 8, 2011

VIENNA (Ramin Mostafavi and Alex Lawler) – OPEC producers on Wednesday hammered out a deal to raise oil supplies for the first time in four years to support the fragile world economy. Under pressure from consumer countries to contain fuel inflation, Saudi Arabia hopes to convince the Organization of Petroleum Exporting Countries to lift production by as much as 1.5 million barrels a day, Gulf delegates said. They said that one option could be an initial one million bpd increase with a promise of another 500,000 bpd to come in three months time. Iran offered to host an emergency meeting within three months to review policy, an Iranian source told Reuters. Initial opposition to an increase from Iran shifted to a proposal for a modest 700,000-one million bpd increase during a closed session of ministers, the Iranian source said. Iran’s acting oil minister Mohammad Aliabadi struck a conciliatory note at the start of the meeting. “Iran is a member of OPEC and will go with the decision of the majority,” Aliabadi told reporters. As OPEC’s biggest producer and the only one with any significant spare capacity, Saudi usually gets its way. But long-time price hawks Iran and Venezuela plus Ecuador, Iraq and Angola all want to keep oil prices above $100 a barrel. Brent crude traded near $116 a barrel. BASELINE? Also at issue is the baseline for any increase. As the meeting started it was not clear whether an increase would come on top of current output or from OPEC’s out-of-date production target, which is much lower. Delegates said Saudi would prefer to use April OPEC output of 26.33 million bpd as the baseline rather than the old official target of 24.84 million set in December 2008. If Riyadh gets its way, OPEC would be committing to a real increase rather than a cosmetic deal that leaves Saudi to pump more unilaterally outside the official agreement. An increment of, say, 1 million bpd on top of April output would lift OPEC’s official target for 11 members by 2.51 million bpd to 27.35 million. Iraq, not bound by a quota, is pumping an additional 2.7 million. Venezuela is holding to a tough line. “We do not agree with production being increased now, we must continue to consolidate balance in the market and we have to defend fair prices,” Venezuelan President Hugo Chavez said on Tuesday in Ecuador. Apparently backing Gulf Arab producers are Nigeria and Algeria who sit on a committee that on Tuesday recommended a one-million-bpd increment. SAUDI PUMPING MORE REGARDLESS Regardless of the policy decision, Riyadh will pump more. A Gulf official said Saudi was already raising output by at least 500,000 bpd in June to 9.5-9.7 million bpd. Saudi output was last as high in the middle of 2008 after oil prices set a record $147 a barrel, shortly before recession sent prices crashing. Forecasts suggest more oil is required to stop oil prices rising again. OPEC’s Vienna secretariat sees demand in the second half of the year 1.7 million bpd higher than current cartel output. Copyright 2011 Thomson Reuters. Click for Restrictions .

Read the full article →

Don Tapscott: Macrowikinomics: Time to Stop Tinkering, Time for Collaborative Health Care

November 8, 2010

This article is the second in a series of 12 over the next 3 weeks written by Don Tapscott and Anthony D. Williams authors of the newly released book Macrowikinomics: Rebooting Business and the World. The book is receiving a lot of buzz. Mark Parker, the CEO of Nike calls it “A Masterpiece. An iconic and defining book for our times.” The Economist says it’s a Schumpeterian story of creative Destruction.” The book argues that many of the institutions of the industrial age have finally come to the end of their lifecycle, and now being reinvented around a new set of principles and a networked model. Today’s blog is about rethinking health care. ***** Now that Republicans control the House, they will try to roll back ObamaCare. The president has said, understandably, that he will resist vigorously. But for all its sound and fury, the debate over ObamaCare is distracting us from a more important discussion: the basic model of health care is no longer viable. Indeed, both parties have different views about funding models, when evidence suggests that only much deeper changes in how we manage our own health and well-being can prevent spending from spiraling out of control. Despite the advancements of modern medicine, health care’s business model has remained unchanged for centuries. It assumes that, medically speaking, physicians are smart and patients aren’t. Doctors wait in their office or hospital for sick people to come to them, and doctors treat their patients and tell them what to do, one-on-one, face-to-face. If patients didn’t like what their doctor told them, they could shop around for other opinions if they could afford it. Patients play little or no role in deciding their own treatments plans. As one physician puts it: “Today’s healthcare institutions are like the old media: centralized, one way, immutable and controlled by the people who created and delivered it. Patients are passive recipients.” So it is no surprise that a growing number of physicians and patients want a better model of health care. They envision a system in which everyone involved, including patients, use the Web as a platform to share information, deliver care and build communities around medical interests and health goals. A main benefit, as studies show, is that when patients are more engaged in managing their own health, they are more committed to being healthy. Users of MedHelp, a popular online health community, are able to track over 1500 symptoms and treatments on a daily basis using iPhone apps covering both general health conditions, such as weight loss and allergies, and very specific disorders, such as infertility and diabetes. If patients so choose, this information can be shared on an ongoing basis via the Internet with their doctors or caregivers. This information continuum is much more useful than the readings taken during a visit to the doctor every one or two years. Studies show that constant attention to key indices can help motivate people to change their behavior. People who weigh themselves daily are more successful at weight loss and maintenance than those who weigh in weekly. People on the Weight Watchers diet who attend meetings and use digital tools, such as an iPhone app, to follow their points are 50 percent more successful in reaching their weight loss goals than those who don’t. Several pilot studies aimed at reducing the cost of chronic care confirm that such self-monitoring technology reduces errors, improves communication with doctors and helps patients better manage their illnesses. These advances, in turn, decrease emergency department trips, unnecessary doctor’s office appointments and costly home nurse visits. Since patients with chronic conditions absorb nearly 70% of Medicare spending according to the Center for Medicare and Medicaid Studies, equipping patients with tools for self-management would not only improve health outcomes, but also reduce costs. We also know that loneliness and isolation can be a medical risk factor, another area where the Internet can potentially help. Lonely people get sicker than the population as a whole. They suffer from a wide variety of ailments, ranging from colds to heart attacks. Lonely people with HIV respond less well to antiretroviral drugs. People who are lonely in their old age are twice as likely to develop Alzheimer’s than other seniors who are socially active. Socially isolated women have a greater risk of dying once they have been diagnosed with breast cancer. In the most exhaustive study on social ties and health to date, researchers at Brigham Young University and the University of North Carolina at Chapel Hill pooled data from 148 studies on health outcomes and social relationships — every research paper on the topic they could find, involving more than 300,000 men and women across the developed world — and found that those with poor social connections had on average 50 percent higher odds of death in the study’s follow-up period (an average of 7.5 years) than people with more robust social ties. The overall boost in longevity is about as large as the mortality difference observed between smokers and nonsmokers, according to the authors. And it’s larger than differences in the risk of death associated with many other well-known lifestyle factors, including lack of exercise and obesity. Of course, you can’t legislate social relationships. But according to Dr. Michael Evans at St. Michaels Hospital in Toronto, doctors could do more to encourage patients to seek social support in online health care communities. What’s more, he suggests that patients with chronic conditions represent an untapped workforce that is not currently engaged in improving health care. An estimated 30 percent of the American population has a chronic disease and a further 29 percent of the population knows or cares for someone who has one. Bringing these communities together over the Internet to share health care experiences and outcomes, says Evans, can help speed up research and allow superior medical techniques and treatments to spread faster. Take PatientsLikeMe, a vibrant health care community whose members — 60,000 and growing – suffer from debilitating chronic conditions such as ALS, Parkinson’s and bipolar disorder. Members can share details of their medical history, which many do. They don’t mind the loss of privacy when the alternative is to struggle in isolation with the helplessness, lack of control and fear associated with illness. Exchanging information gives them an invaluable source of support and helps them make smarter decisions. Members participate for free, but the data they contribute is rendered anonymous and then aggregated to inform research conducted by doctors, pharmaceutical and medical device companies. This openness ultimately benefits everyone. New treatments can be evaluated and brought to market more quickly. Patients can learn about what’s working and, in consultation with their doctors, make adjustments to their own treatment plans. “People think we are a social networking site,” says co-founder Ben Heywood. “But we’re an open medical framework. This is a large scale research project.” As the benefits of online engagement become clear, we think the time has come for every American to have their own Personal Health Pages on the Internet, including children and infants. Think of it as the patient’s personal window into his or her own health and the basis for participation in a broader health social network. Adults would own and control their own data, but health care professionals (and perhaps family members) could access it as required with appropriate levels of privacy and security. It would serve as each person’s portal to health care information, link them to organizations such as Weight Watchers or a local health club, and track relevant medical advancements. Much like Facebook, a patient could create a community or join medical “causes”. And just like the App store, low-cost or free applications could help individuals measure their own health, do pre-diagnosis of a sick child or test for possible drug interactions. In the Internet-centric business model, patients become more like partners — they self-organize, contribute to the total sum of knowledge, share information, support each other, and become active in managing their own health. This goes beyond the current catchphrase of health care being “patient centric.” Not only is collaborative health care focused on the patient; the patient co-creates health care and wellness, producing an outcome that is a more evidence-based and cost-effective, i.e., safer, better and cheaper. Of course, without the buy-in of the biggest players — namely government and insurers — we won’t be able to maximize this opportunity and more people will get needlessly sick. Harness these new capabilities, on the other hand, and the medical establishment can join with patients and other stakeholders in making the health care system work for everyone. Follow Anthony Williams on Twitter: www.twitter.com/adw_tweets

Read the full article →

Video: Greece’s Papandreou Plans Export of `Mediterranean Diet’: Video

September 23, 2010

Sept. 23 (Bloomberg) — Greek Prime Minister George Papandreou discusses his plan to export the Greek “Mediterranean Diet” as a weight loss product to help ease the Greek dept crisis. Papandreou spoke yesterday to the Economic Club of New York. Bloomberg’s Deirdre Bolton reports. (Source: Bloomberg)

Read the full article →

Child Obesity Rate Doubled in U.S. Before Showing Signs of Easing Off

February 16, 2010

By Molly Peterson Feb. 16 (Bloomberg) — The rate of childhood obesity and chronic health problems doubled in the U.S. from 1988 to 2006 with fewer cases toward the end of the study consistent with a recent leveling off, researchers found. Children ages 8 to 14 showed an obesity rate of 15.8 percent at the end of 2006, compared with 8.3 percent in a similar period that ended in 1994, according to a study published online today in the Journal of the American Medical Association . The overall rate of chronic childhood health conditions including obesity, asthma and behavioral or learning problems increased to 26.6 percent from 12.8 percent during the same years. The report comes a week after first lady Michelle Obama began a nationwide campaign against childhood obesity, urging American youths to get more exercise and develop healthier eating habits. Another study published by the U.S. Centers for Disease Control and Prevention in January reported the rise in U.S. obesity levels for children, while high, may have leveled off in the decade ended in 2008 at about 17 percent. “We can speculate that because of the increased attention to obesity in recent years, children may actually be making better food choices, have better nutrition, exercise more and spend less time in front of the television and the computer with video games,” said Jeanne Van Cleave, the report’s lead author. Not Permanent For most of the 5,001 children tracked in today’s research, the chronic health conditions weren’t permanent, Van Cleave, a pediatrician at MassGeneral Hospital for Children in Boston and Harvard Medical School, said in an interview. “Half of all children in the U.S. will have a chronic condition during childhood,” she said Feb. 12 in a telephone interview. “But a lot of these conditions resolve over time.” Today’s study analyzed data collected during six-year periods from three consecutive groups of children who participated in a U.S. Bureau of Labor Statistics survey that began in 1979. The study began tracking the first group in 1988, the second in 1994 and the third in 2000. For all of the groups combined, less than 38 percent of the children who had chronic conditions at the beginning of the observation period still had them after six years. “Many conditions in children tend to wax and wane,” Neal Halfon, director of the University of California at Los Angeles’ Center for Healthier Children, Families and Communities, said in an interview. “Even those that get better can, down the line, end up having problems because of the nature of the issues.” Plateau Another study from CDC found U.S. obesity rates may have hit a plateau toward the end of the decade ended in 2008. That study found about 17 percent of children ages 2 to 19 were obese, with the heaviest boys ages 6 to 19 continuing to gain weight over the decade while others leveled off. “The leveling off really speaks to increased attention to childhood obesity recently,” Van Cleave said. President Barack Obama signed an executive order Feb. 9 directing federal departments to come up with a plan within 90 days on how to make federal nutritional and health data more accessible to the public. The same day, Michelle Obama announced a new federal Web site, www.LetsMove.gov , that emphasizes physical activity and more healthful meals in schools. The site also offers tips to help parents choose more nutritional foods for their children. Highlight “I think she’s trying to highlight that it’s not just all about eating or exercise,” Halfon, who co-authored an editorial that accompanied the study in the journal, said of the first lady’s initiative. “It’s about having places where people can exercise. It’s not just about individual behaviors, but about the systems we have in place — the health system, the education system, the nutrition system.” Companies such as Orexigen Therapeutics Inc. of La Jolla, California, Vivus Inc. of Mountain View, California, and San Diego-based Arena Pharmaceuticals Inc. are developing weight- loss drugs. Orexigen has said it plans to seek U.S. approval of its Contrave medicine in the first half of 2010. In December, Arena Pharmaceuticals submitted an application for its obesity drug lorcaserin and Vivus submitted an application for its treatment Qnexa. Japanese-based Shionogi & Co. is also developing a weight loss drug. Today’s study was funded by the Robert Wood Johnson Foundation and the CDC. To contact the reporter on this story: Molly Peterson in Washington at mpeterson9@bloomberg.net

Read the full article →

Weight-Loss Surgery May Help Severely Obese Teens, Study Finds

February 9, 2010

By Jason Gale Feb. 10 (Bloomberg) — Weight-loss surgery was more effective at slimming severely obese teens and improving their health than two years of diet and exercise, a study found. Adolescents fitted with Allergan Inc. ’s Lap-Band device lost about 11 times more weight compared with a group following so-called lifestyle approaches, researchers in Melbourne said. The results reported today in the Journal of the American Medical Association suggest bariatric surgery is an effective treatment for younger obese patients, the authors said. Weight-loss surgery has soared in popularity among U.S. adults in response to rising rates of obesity. The procedure has been controversial because the quality of evidence to support it is poor, said Edward H. Livingston , professor of surgery at the University of Texas Southwestern Medical Center in Dallas and a contributing editor to the journal. The study’s findings “go a long way toward providing the evidence necessary to evaluate the benefits and risks of bariatric surgery,” Livingston wrote in an accompanying editorial. “Many insurance companies in the United States will not pay for bariatric surgeries, and their decision to not cover this treatment is based on the lack of compelling, universally accepted evidence in its favor.” Obesity Rate Doubled At least one U.S. adolescent in six — more than 5 million people — was obese in 2004, according to the study. The number of obese Americans has more than doubled over 30 years to 72 million, according to the U.S. Centers for Disease Control and Prevention. People who are overweight or obese have a greater risk of diabetes, heart attacks and strokes, the Atlanta-based agency said last month. Allergan had 2009 revenue of $238 million for products designed to treat obesity and most of it was from sales of the Lap-Band, said company spokeswoman Cathy Taylor in an e-mail today. The Irvine, California, company is testing the device in severely obese adolescents ages 14 to 17 and submitted an application to the U.S. Food and Drug Administration last year for approval in that age group, she said. For the study, researchers at Melbourne’s Monash University followed 50 adolescents ages 14 to 18 over two years. All participants were deemed severely obese, having a body mass index , or BMI, greater than 35. Half were randomly selected for gastric banding and the remainder was asked to follow an individualized diet and exercise plan. Reversible Procedure Gastric banding is done when a surgeon places a band around the upper portion of the stomach to create a pouch to hold food, which limits the amount a person can eat. The reversible procedure is one of the two most common for weight loss, with the other being gastric bypass . In today’s study, two years after the start the gastric banding group had lost an average of 34 kilograms (76 pounds), representing an overall average loss of 28 percent of total body weight and 79 percent of excess weight, the researchers said. In comparison, the lifestyle group lost an average of 3 kilograms (6.6 pounds), or an average of 3.1 percent total weight loss and 13 percent excess weight loss. “Despite a comprehensive, behaviorally focused intervention, those in the lifestyle group were not able to achieve substantial weight loss,” wrote the study’s authors led by Paul E. O’Brien , director of Monash’s Centre for Obesity Research and Education. “Indeed, keeping adolescents and their parents involved in the trial for its two-year duration proved challenging.” Allergan supplied the Lap-Band Adjustable Gastric Banding system used in the research, the study said. Lower Risk Although the study wasn’t designed to measure improvements in specific health problems, it did demonstrate a reduction in a group of conditions associated with increased risk for cardiovascular disease and diabetes, the authors said. At enrollment, 9 study participants in the gastric banding arm and 10 in the lifestyle group suffered from so-called metabolic syndrome , as the group is known. After 24 months, none of the gastric banding group had the problem, compared with 4 of the 18 teens in the lifestyle group who completed the study. “Gastric banding proved to be an effective intervention leading to a substantial and durable reduction in obesity and to better health,” the authors said. The gastric banding group experienced no adverse events in the period shortly after surgery, the authors said. Eight operations to adjust the band or repair tubing connected to the band were required in seven patients in the surgery group. “The gastric banding approach to weight loss is not a quick fix,” the researchers wrote. Lifestyle treatments may achieve weight loss and improved health for some individuals and should remain the first option for obese adolescents, they said. The study was funded by the National Health and Medical Research Council. One of the study’s authors, John Dixon of Monash University, reported consulting agreements with Allergan and other companies. To contact the reporter on this story: Jason Gale at j.gale@bloomberg.net

Read the full article →

Obesity Epidemic May Have Hit Plateau in U.S., Researchers Find

January 13, 2010

By Nicole Ostrow Jan. 13 (Bloomberg) — The number of U.S. adults and children who are considered obese may have leveled off over the past decade particularly among women, even if millions of Americans are still overweight, researchers found. About 36 percent of women were obese in 2008, little changed from 1999, according to a study published today by the Journal of the American Medical Association . About 32 percent of men were classified as obese in 2008, compared with 28 percent in 1999, with most of the increase occurring in the early part of the decade. The number of people who are obese has more than doubled in the past 30 years to 72 million, according to the U.S. Centers for Disease Control and Prevention. People who are overweight or obese have a greater risk of diabetes, heart attacks and strokes, said the Atlanta-based CDC . “We may have halted the progress of the obesity epidemic,” said William Dietz , director of the CDC’s Division of Nutrition, Physical Activity and Obesity, in a telephone interview yesterday. “We haven’t reversed it.” “The challenge here is what do we need to implement to drive these numbers the other way,” said Dietz, who was not involved in the study. Obesity for adults is defined as having a body mass index greater than 30, which is equivalent to about 186 pounds for a person who is 5 feet, 6 inches tall. The index represents weight in kilograms divided by height in meters squared. Health Impact The surge in obesity has undermined progress made in other public health areas such as heart disease, according to a study presented in November by University of Texas researchers in November. The advances include cholesterol-lowering drugs called statins, introduced in the late 1980s, and programs that the CDC said have cut smoking rates to 21 percent in 2008 from 37 percent in 1970. Companies such as Orexigen Therapeutics Inc. of La Jolla, California, Vivus Inc. of Mountain View, California, and San Diego-based Arena Pharmaceuticals Inc. are developing weight loss drugs. Orexigen has said it plans to seek U.S. approval of its Contrave medicine in the first half of 2010. In December, Arena Pharmaceuticals submitted an application for its obesity drug lorcaserin and Vivus submitted an application for its obesity treatment Qnexa. Japanese-based Shionogi & Co. is also developing a weight loss drug. Adults and Children The researchers analyzed data from the National Health and Nutrition Examination Survey from 2007 and 2008 for two studies published today, one on adults and another on children. In the adult study, height and weight measurements were looked at from 5,555 men and women ages 20 and older. In the children’s study, heights and weights were analyzed on 3,281 children ages two through 19 and 719 infants and toddlers from birth through two years old. While obesity was considered to be a body mass index of more than 30, overweight for adults was defined as having a BMI of 25 to 30. The researchers in the adult study found that overall, 33.8 percent of Americans were obese in 2007-2008, while 68 percent were considered either overweight or obese. Somewhat more men, about 72 percent, were classified as either overweight or obese compared with about 64 percent of women, the study showed. “It appears that the rapid increases we saw in the 1980s and the 1990s are at the very least slowing down,” said Cynthia Ogden, an author on both studies and an epidemiologist at the CDC, in a Jan. 12 telephone interview. “The prevalence still remains very high and obesity still continues to be a significant health concern in the U.S. We still have work to do.” Children and Teens In the study on children, the researchers found that about 32 percent of children ages 2 to 19 were at risk for being overweight or obese, similar to the findings reported in 2008 by the CDC. About 17 percent of the children were considered obese and almost 12 percent were considered the heaviest kids. The heaviest boys ages six to 19 continued to gain weight over the decade, the only children’s group that didn’t level off during the study period, said Ogden, who was lead author on the children’s study. J. Michael Gaziano , a preventive cardiologist at the Veterans Administration Boston Health Care System and Brigham and Women’s Hospital in Boston, said today’s findings are “silver linings to the cloud, but the cloud is still large.” There isn’t a consensus on how to manage and lose weight, and the government needs to invest more heavily in developing strategies that help people lose weight over the long term, said Gaziano, who wrote an editorial accompanying the studies in the journal. Dietz, the CDC official, said the agency has targeted six behaviors to help reduce obesity: physical activity, breast feeding, fruit and vegetable intake, reduction in TV time, reduction in high-calorie foods and reduction in sweetened beverage intake. The agency is also working with states to combat the obesity epidemic, according to its Web site. The studies were sponsored by CDC. For Related News and Information: To contact the reporter on this story: Nicole Ostrow in New York at nostrow1@bloomberg.net .

Read the full article →

Quest for Elusive Obesity Pill May Yield Shionogi a Win Where Merck Failed

December 23, 2009

By Kanoko Matsuyama Dec. 22 (Bloomberg) — Persistence may pay off for Shionogi & Co. as it struggles to turn a promising scientific advance into a best-selling diet pill. The Japanese company, discoverer of the blockbuster cholesterol medicine Crestor, plans to stick with velneperit, an experimental obesity drug, after one of two key studies failed and Merck & Co. , Johnson & Johnson and GlaxoSmithKline Plc abandoned similar treatments. Shionogi is betting on a world market with the potential to expand 20-fold to $10.5 billion by 2018, according to estimates by London-based Datamonitor Plc. Even if it should eventually gain regulatory approval, velneperit may not be enough to offset the potential drop in annual sales when Crestor loses patent protection in 2016, said Gareth Powell , a fund manager in London. “I’ve not been impressed with the drug,” said Powell, who invests in health-care stocks for Polar Capital Partners Ltd., the manager of $2 billion of assets. “If they relied on this as the sole replacement of Crestor, I’d be pretty nervous.” Powell’s holdings don’t include Shionogi shares. Analysts at Barclays Plc in London and at Mitsubishi UFJ Securities Co. and Mizuho Securities Co. , both of Tokyo, are omitting the product from revenue estimates for Osaka-based Shionogi. The drugmaker needs velneperit and AIDS treatments it is developing with Glaxo to make up for the revenue plunge foreseen for Crestor, which now accounts for a quarter of Shionogi’s 223 billion yen ($2.5 billion) in annual sales, when the cholesterol drug loses patent protection in less than seven years. Side Effects Drugmakers have failed to find a weight-loss formula without side effects. Wyeth, now a unit of New York-based Pfizer Inc., pulled its fen-phen diet pill in 1997 and put aside $21 billion to settle a decade of litigation after the drug combination was linked to heart and lung damage. Paris-based Sanofi-Aventis SA dropped its weight-loss drug Acomplia, which the company had expected to generate $3 billion a year, in October 2008 after European regulators deemed that the risks of the pill outweighed its benefits. The drug had failed to win backing from a U.S. Food and Drug Administration panel in June 2007 over reports of suicide risks. Merck, of Whitehouse Station, New Jersey, and Pfizer stopped developing drugs similar to Acomplia. For drugmakers, the allure of the weight-loss market is hard to resist. The world had at least 400 million obese adults in 2005, a figure that may jump 75 percent to 700 million by 2015, according to the Geneva-based World Health Organization . Overweight and obese people face greater risk of heart attacks, strokes and diabetes than those with less body mass, according to the U.S. Centers for Disease Control and Prevention, based in Atlanta. Damped Sales Product withdrawals and failed treatments in the pipeline have hurt global sales of obesity drugs, which totaled $514 million last year, Datamonitor said. The number of obese adults in seven markets, including the U.S. and U.K., will climb at least 14 percent to 143 million in the decade to 2018, and assuming that a quarter of them will be treated for a year at $1 a day, the market could swell to $10.5 billion, the research company said. Velneperit is a gamble, as the latest tests showed that patients taking the drug shed 4.6 percent of their weight. While that compared with 1.2 percent for those given a placebo, medicines from Orexigen Therapeutics Inc. of La Jolla, California, and Vivus Inc. of Mountain View, California, have advanced further in development and yielded more weight loss. Without Velneperit Shionogi rose 1.1 percent to close at 1,949 yen in Tokyo trading. The stock has dropped 18 percent in 12 months, compared with a 6.4 percent gain for Japan’s benchmark Topix Index . For now, Shionogi is commanding growing sales and profit without help from its obesity drug, said Yasuhiro Nakazawa , an analyst at Mitsubishi UFJ Financial Group Inc. in Tokyo. The drugmaker’s operating profit will climb more than 20 percent annually through March 2013, Nakazawa said. He is one of 13 analysts, among 17 tracked by Bloomberg, who recommend buying Shionogi shares, citing sales led by Crestor . Shionogi, which discovered Crestor, sold rights to the drug to AstraZeneca Plc’s forerunner Zeneca Group in April 1998. In October, Shionogi halted its search for a partner to help develop velneperit outside Japan, as the company planned to carry out more studies to achieve a stronger result on the drug’s efficacy, President Isao Teshirogi said at an analysts’ briefing in November. Promising Test The company announced in February the outcome of two clinical tests, in the second of three stages required by regulators. One shows some promise: 35 percent of patients on a restricted diet who took velneperit for 54 weeks lost more than 5 percent of their weight, almost three times the proportion for those who were given a dummy pill. In the other test, there was little weight-loss difference between patients taking the drug and those on placebo. “The efficacy just wasn’t all that exciting,” Polar Capital’s Powell said. Shionogi is conducting new trials of velneperit in combination with an older medicine, Xenical from Basel, Switzerland-based Roche Holding AG. The Japanese company expects results around November 2010, pushing back by one year what had been its schedule to enter the final stage of development. The delay means the drug may not reach the market in time to help make up for Crestor’s patent expiration, said Hiroshi Tanaka , an analyst at Mizuho Securities in Tokyo. Advanced Drug Testing Besides the obesity pill, only one drug originating from Shionogi is in advanced stages of patient studies in the U.S., the world’s largest pharmaceutical market. The company is working with Glaxo on an HIV treatment that blocks an enzyme the virus uses to hijack healthy cells. Alpharetta, Georgia-based Sciele Pharma Inc., owned by Shionogi, has at least two drugs in advanced development: a spray to prevent premature ejaculation, and Adrenamate, a treatment for anaphylaxis, a potentially deadly allergic reaction. Shionogi said it is sticking with velneperit because the treatment shows more promise than Merck’s MK-0557. In one study involving dieting patients, Merck’s drug showed the test subjects regained some weight after finishing treatment. When combined with weight-loss medicines sold by Abbott Laboratories of Abbott Park, Illinois, and Roche, the drug didn’t show as much benefit as those products alone. Velneperit works by blocking a receptor called neuropeptide Y5, which plays a role in food cravings. ‘Can do Better’ “Merck tried everything it could and gave up,” Takuko Y. Sawada, Shionogi’s head of drug development, said in an interview from its laboratory in Osaka. The Japanese company “can do better” because of differences in the way velneperit shows its effect on weight management, Sawada said. Merck ended development of MK-0557 for obesity in 2005. The weight loss after one year of treatment wasn’t clinically meaningful, Ian McConnell , a Merck spokesman, said in an e-mail. Glaxo, Johnson & Johnson and Novartis also stopped testing drugs in the same class as MK-0557. “The human response to food is extremely complex,” McConnell said. “It appears that interfering with one pathway may not have a dramatic effect because there could be other pathways serving as backup systems that compensate for the change caused by the drug.” Terminated Project Melinda Stubbee, a spokeswoman for London-based Glaxo, said its project was no longer active. Ernie Knewitz , a spokesman for New Brunswick, New Jersey-based J&J, said development of its drug stopped several years ago. Eric Althoff , a spokesman at Basel, Switzerland-based Novartis, said its project was terminated. All three didn’t elaborate. Targeting Y5 alone probably can’t reduce body weight by much more than 5 percent because humans eat as a form of protection, said Herbert Herzog , head of the neuroscience research program at the Garvan Institute of Medical Research in Sydney. “As soon as you are starving and your body feels like your energy level is low, it’s driving you toward feeding,” Herzog said. “You are not programmed not to eat.” The U.S. FDA published guidance for the industry in February 2007 on developing medicines for weight loss. Products must meet at least one of two benchmarks. The first requires a minimum difference of 5 percentage points between weight loss from the drug and that from a placebo; otherwise, at least 35 percent of the group taking the drug must lose no less than 5 percent of body weight and the effect must be seen in twice as many patients as those on placebo. Rival Drugs Arena Pharmaceuticals Inc. , of San Diego, today said it submitted an application to the FDA for its obesity drug lorcaserin. Vivus plans to request FDA clearance for its treatment Qnexa this month. Orexigen has said it will present its medicine, Contrave, in the first half of 2010. Most of those drugs combine at least two proven treatments to get around the need to eat. Contrave mixes an antidepressant with a narcotic. “Appetite is a fundamental function that humans can’t survive without,” said Kazuhiko Tatemoto, who co-discovered neuropeptide Y. “There are many pathways that control appetite so if you deactivate one, others get activated.” To contact the reporter on this story: Kanoko Matsuyama in Tokyo at kmatsuyama2@bloomberg.net .

Read the full article →

Obesity Becomes Shionogi Gamble in Search for Another Crestor Blockbuster

December 22, 2009

By Kanoko Matsuyama Dec. 22 (Bloomberg) — Persistence may pay off for Shionogi & Co. as it struggles to turn a promising scientific advance into a best-selling diet pill. The Japanese company, discoverer of the blockbuster cholesterol medicine Crestor, plans to stick with velneperit, an experimental obesity drug, after one of two key studies failed and Merck & Co. , Johnson & Johnson and GlaxoSmithKline Plc abandoned similar treatments. Shionogi is betting on a world market with the potential to expand 20-fold to $10.5 billion by 2018, according to estimates by London-based Datamonitor Plc. Even if it should eventually gain regulatory approval, velneperit may not be enough to offset the potential drop in annual sales when Crestor loses patent protection in 2016, said Gareth Powell , a fund manager in London. “I’ve not been impressed with the drug,” said Powell, who invests in health-care stocks for Polar Capital Partners Ltd., the manager of $2 billion of assets. “If they relied on this as the sole replacement of Crestor, I’d be pretty nervous.” Powell’s holdings don’t include Shionogi shares. Analysts at Barclays Plc in London and at Mitsubishi UFJ Securities Co. and Mizuho Securities Co. , both of Tokyo, are omitting the product from revenue estimates for Osaka-based Shionogi. The drugmaker needs velneperit and AIDS treatments it is developing with Glaxo to make up for the revenue plunge foreseen for Crestor, which now accounts for a quarter of Shionogi’s 223 billion yen ($2.5 billion) in annual sales, when the cholesterol drug loses patent protection in less than seven years. Side Effects Drugmakers have failed to find a weight-loss formula without side effects. Wyeth, now a unit of New York-based Pfizer Inc., pulled its fen-phen diet pill in 1997 and put aside $21 billion to settle a decade of litigation after the drug combination was linked to heart and lung damage. Paris-based Sanofi-Aventis SA dropped its weight-loss drug Acomplia, which the company had expected to generate $3 billion a year, in October 2008 after European regulators deemed that the risks of the pill outweighed its benefits. The drug had failed to win backing from a U.S. Food and Drug Administration panel in June 2007 over reports of suicide risks. Merck, of Whitehouse Station, New Jersey, and Pfizer stopped developing drugs similar to Acomplia. For drugmakers, the allure of the weight-loss market is hard to resist. The world had at least 400 million obese adults in 2005, a figure that may jump 75 percent to 700 million by 2015, according to the Geneva-based World Health Organization . Overweight and obese people face greater risk of heart attacks, strokes and diabetes than those with less body mass, according to the U.S. Centers for Disease Control and Prevention, based in Atlanta. Damped Sales Product withdrawals and failed treatments in the pipeline have hurt global sales of obesity drugs, which totaled $514 million last year, Datamonitor said. The number of obese adults in seven markets, including the U.S. and U.K., will climb at least 14 percent to 143 million in the decade to 2018, and assuming that a quarter of them will be treated for a year at $1 a day, the market could swell to $10.5 billion, the research company said. Velneperit is a gamble, as the latest tests showed that patients taking the drug shed 4.6 percent of their weight. While that compared with 1.2 percent for those given a placebo, medicines from Orexigen Therapeutics Inc. of La Jolla, California, and Vivus Inc. of Mountain View, California, have advanced further in development and yielded more weight loss. Without Velneperit Shionogi rose 1.1 percent to close at 1,949 yen in Tokyo trading. The stock has dropped 18 percent in the past 12 months, compared with a 6.4 percent gain for Japan’s benchmark Topix Index . For now, Shionogi is commanding growing sales and profit without help from its obesity drug, said Yasuhiro Nakazawa , an analyst at Mitsubishi UFJ Financial Group Inc. in Tokyo. The drugmaker’s operating profit will climb more than 20 percent annually through March 2013, Nakazawa said. He is one of 13 analysts, among 17 tracked by Bloomberg, who recommend buying Shionogi shares, citing sales led by Crestor . Shionogi, which discovered Crestor, sold rights to the drug to AstraZeneca Plc’s forerunner Zeneca Group in April 1998. In October, Shionogi halted its search for a partner to help develop velneperit outside Japan, as the company planned to carry out more studies to achieve a stronger result on the drug’s efficacy, President Isao Teshirogi said at an analysts’ briefing in November. Promising Test The company announced in February the outcome of two clinical tests, in the second of three stages required by regulators. One shows some promise: 35 percent of patients on a restricted diet who took velneperit for 54 weeks lost more than 5 percent of their weight, almost three times the proportion for those who were given a dummy pill. In the other test, there was little weight-loss difference between patients taking the drug and those on placebo. “The efficacy just wasn’t all that exciting,” Polar Capital’s Powell said. Shionogi is conducting new trials of velneperit in combination with an older medicine, Xenical from Basel, Switzerland-based Roche Holding AG. The Japanese company expects results around November 2010, pushing back by one year what had been its schedule to enter the final stage of development. The delay means the drug may not reach the market in time to help make up for Crestor’s patent expiration, said Hiroshi Tanaka , an analyst at Mizuho Securities in Tokyo. Advanced Drug Testing Besides the obesity pill, only one drug originating from Shionogi is in advanced stages of patient studies in the U.S., the world’s largest pharmaceutical market. The company is working with Glaxo on an HIV treatment that blocks an enzyme the virus uses to hijack healthy cells. Alpharetta, Georgia-based Sciele Pharma Inc., owned by Shionogi, has at least two drugs in advanced development: a spray to prevent premature ejaculation, and Adrenamate, a treatment for anaphylaxis, a potentially deadly allergic reaction. Shionogi said it is sticking with velneperit because the treatment shows more promise than Merck’s MK-0557. In one study involving dieting patients, Merck’s drug showed the test subjects regained some weight after finishing treatment. When combined with weight-loss medicines sold by Abbott Laboratories of Abbott Park, Illinois, and Roche, the drug didn’t show as much benefit as those products alone. Velneperit works by blocking a receptor called neuropeptide Y5, which plays a role in food cravings. ‘Can do Better’ “Merck tried everything it could and gave up,” Takuko Y. Sawada, Shionogi’s head of drug development, said in an interview from its laboratory in Osaka. The Japanese company “can do better” because of differences in the way velneperit shows its effect on weight management, Sawada said. Merck ended development of MK-0557 for obesity in 2005. The weight loss after one year of treatment wasn’t clinically meaningful, Ian McConnell , a Merck spokesman, said in an e-mail. Glaxo, Johnson & Johnson and Novartis also stopped testing drugs in the same class as MK-0557. “The human response to food is extremely complex,” McConnell said. “It appears that interfering with one pathway may not have a dramatic effect because there could be other pathways serving as backup systems that compensate for the change caused by the drug.” Terminated Project Melinda Stubbee, a spokeswoman for London-based Glaxo, said its project was no longer active. Ernie Knewitz , a spokesman for New Brunswick, New Jersey-based J&J, said development of its drug stopped several years ago. Eric Althoff , a spokesman at Basel, Switzerland-based Novartis, said its project was terminated. All three didn’t elaborate. Targeting Y5 alone probably can’t reduce body weight by much more than 5 percent because humans eat as a form of protection, said Herbert Herzog , head of the neuroscience research program at the Garvan Institute of Medical Research in Sydney. “As soon as you are starving and your body feels like your energy level is low, it’s driving you toward feeding,” Herzog said. “You are not programmed not to eat.” The U.S. FDA published guidance for the industry in February 2007 on developing medicines for weight loss. Products must meet at least one of two benchmarks. The first requires a minimum difference of 5 percentage points between weight loss from the drug and that from a placebo; otherwise, at least 35 percent of the group taking the drug must lose no less than 5 percent of body weight and the effect must be seen in twice as many patients as those on placebo. Rival Drugs Arena Pharmaceuticals Inc. , of San Diego, and Vivus plan to submit their respective obesity treatments, lorcaserin and Qnexa, to the FDA this year. Orexigen has said it will present its medicine, Contrave, in the first half of 2010. Most of those drugs combine at least two proven treatments to get around the need to eat. Contrave mixes an antidepressant with a narcotic. “Appetite is a fundamental function that humans can’t survive without,” said Kazuhiko Tatemoto, who co-discovered neuropeptide Y. “There are many pathways that control appetite so if you deactivate one, others get activated.” To contact the reporter on this story: Kanoko Matsuyama in Tokyo at kmatsuyama2@bloomberg.net .

Read the full article →

Low-Fat Diet Makes People Less Angry, Depressed Than Low-Carb, Study Finds

November 9, 2009

By Simeon Bennett Nov. 10 (Bloomberg) — Dieters eating food high in carbohydrates and low on fat improved their mood longer than those on a low-carb, high-fat regime similar to the Atkins diet , researchers say. A study of 106 overweight or obese people in Australia found those on the low-fat diet, which included bread, pasta and rice, were less angry, depressed and confused after one year than those who ate fewer carbs and more meat and dairy products, according to the study published today in the journal Archives of Internal Medicine . Both diets were equally effective at reducing weight, the research showed. More than 72 million Americans , or one-third of U.S. adults, are obese, according to the U.S. Centers for Disease Control and Prevention. The findings by researchers from Australia’s Commonwealth Scientific and Industrial Research Organisation contradict earlier, smaller studies that showed no mood changes in people linked to different diets. More research is needed to explain the differences, they said. “This outcome suggests that some aspects of the low- carbohydrate diet may have had detrimental effects on mood that, over the term of one year, negated any positive effects of weight loss,” scientists led by Grant Brinkworth said in the latest study. Both diets contained the same amount of energy in terms of kilocalories. Participants in the high-carb, low-fat diet got their energy from foods with 10 times the carbohydrates, half the fat and less protein than those on the low-carb, high-fat diet, the researchers said. 30 Pounds Lighter The average weight loss for participants was 13.7 kilograms (30.2 pounds), with no significant difference between the two groups. The participants had an average body mass index , defined as weight in kilograms divided by height in meters squared, of 33.7 when the study began. An adult is considered overweight with a BMI of more than 25, and obese if the BMI is 30 or greater, according to the CDC . The researchers also found that both diet groups showed similar improvement in memory and no significant change in speed of mental processing. An earlier analysis found both groups were less angry, depressed and confused after eight weeks of dieting than when they started. Over the course of a year, those on the low-fat diet maintained their improved mood, while those on the low-carb plan moved back toward levels at the start of the study, Brinkworth and colleagues said. One possible explanation for the difference is that eliminating carbohydrates is such a dramatic change to the typical Western diet that volunteers may have suffered withdrawal symptoms over time, the authors said. Further studies are needed to validate that hypothesis, they said. The study was funded by Australia’s National Heart Foundation , the National Health and Medical Research Council, and four closely held Australian food companies, including nut growers. To contact the reporter on this story: Simeon Bennett in Singapore at sbennett9@bloomberg.net

Read the full article →

Novel Diabetes Pill From AstraZeneca, Bristol Also May Bring Novel Risk

October 1, 2009

By Trista Kelley Oct. 1 (Bloomberg) — AstraZeneca Plc and Bristol-Myers Squibb Co. will report that a novel diabetes pill the drugmakers are co-developing helped patients control blood sugar and lose weight in a 24-week study. Doctors say they are concerned about long-term risks. The drug, dapagliflozin, is the first in a new family of medicines known as SGLT2-inhibitors, which don’t tinker with the body’s own insulin, unlike other diabetes therapies. The medicine instead regulates blood sugar by helping the kidneys flush it from the body, an “ingenious” method of treating the disease, according to Michael Stumvoll , head of the diabetes division at the University of Leipzig in Germany. The approach has potential drawbacks, Stumvoll said. The treatment causes a steady flow of sugar through the kidneys, which may result in a higher risk of bacterial infections and long-term stress on the organs, he said. The companies will present full results of an advanced test in patients of dapagliflozin tomorrow at the European Association for the Study of Diabetes conference in Vienna. “It’s a brilliant idea; you don’t need to play with insulin,” Stumvoll said in an interview in Vienna. “But people will be flooded by glucose all the time, in every organ in the urinary tract. I find it difficult to believe it won’t have side effects. I’d be interested to see what happens after the urinary tract is essentially bathed in caramel for five years.” Blood Sugar Dapagliflozin helped control blood-sugar levels when used with metformin, a generic drug that is a standard diabetes treatment, in patients who didn’t benefit from metformin alone, according to the study, which is the third and last phase of trials generally needed for regulatory approval. A greater benefit was seen at higher doses. Patients on the drug also on average shed about 4 kilograms (8.82 pounds), the initial data released in July showed. “We have not seen any harmful effect on renal function in clinical trials to date,” Ken Dominski , a Bristol-Myers spokesman, said by e-mail. “Dapagliflozin is still being investigated in phase 3 trials, including controlled clinical trials of more than one year in duration, so the complete efficacy and safety profile, including genital and urinary tract infections, of dapagliflozin will continue to evolve as more trials read out.” The treatment may bring in $1.5 billion in peak annual sales for London-based AstraZeneca and New York-based Bristol- Myers, Jefferies International analysts wrote in a Sept. 28 note. The partners are likely to beat rivals in getting dapagliflozin to market, as they have said they plan to file for approval in late 2010. GlaxoSmithKline Plc scrapped development of its competing SGLT2-inhibitor product in June, while Sanofi- Aventis SA has a treatment in earlier stages of testing. Competitive Market The drug would compete in the increasingly crowded market for diabetes treatments, which is valued globally at $27.3 billion. AstraZeneca and Bristol-Myers also sell Onglyza, which belongs to a class of medicines called DPP-4 inhibitors that includes Januvia, Merck & Co. ’s drug with $1.4 billion in annual sales. Amylin Pharmaceuticals Inc. and Eli Lilly & Co. market Byetta, an injectable treatment in a class of drugs that imitate a hormone called GLP-1 and stimulate the pancreas to produce more insulin after meals. Dapagliflozin is “very interesting, because it’s a completely new therapeutic target,” said Marc Evans , an endocrinologist at the University of Wales, based at Llandough hospital in Cardiff, England. Initial Results “Doctors will be very excited about this, one because it’s a tablet and also because of its association with weight loss,” said Evans, who has received research support from AstraZeneca, in an interview in Vienna. The infection rates, along with other potential side effects, “are the questions everyone will be looking at.” Dapagliflozin’s initial results drew mixed reviews from analysts. The risk of infections was among the reasons Merrill Lynch analyst Graham Parry told investors on July 2 that dapagliflozin “will struggle to achieve the blockbuster sale potential that some anticipate.” Deutsche Bank analysts said the initial findings support the drug’s potential as a useful treatment. “The efficacy isn’t that differentiated from other products and from a market perspective it seems expectations are relatively low,” Deutsche analyst Alex Evans said in an interview from London on Sept. 30. “You can get about 4 to 5 kilos of weight loss, which if you’re a diabetic is quite significant, yet you’re much more prone to getting urinary or genital infections. So the question for a doctor would be how to balance all that up?” To contact the reporter on this story: Trista Kelley in London at tkelley2@bloomberg.net

Read the full article →

Don McNay: Like Lottery Winners, Pro Athletes Also Blow Big Money

September 21, 2009

” It ’s the same old story,

Read the full article →