May 2008 Archives

After the pharmaceutical industry got egg in its face because of the Vioxx fiasco, this new cancer study is welcome news. Also welcome news for woman everywhere and the men who care about them.

Bone drug Zometa helps fight breast cancer spread

CHICAGO (AP) -- A drug to prevent bone loss during breast cancer treatment also substantially cut the risk that the cancer would return, results that left doctors excited about a possible new way to fight the disease.

It is the first large study to affirm wider anti-cancer hopes for Zometa and other bone-building drugs called bisphosphonates. Zometa, made by Novartis AG, is used now for cancers that have already spread to the bone.

The new study involved 1,800 premenopausal women taking hormone treatments for early-stage breast cancer. Zometa cut by one-third the chances that cancer would recur -- in their bones or anywhere else.

"This is an important finding. It may well change practice," said Dr. Claudine Isaacs, director of the clinical breast cancer program at Georgetown University's Lombardi Cancer Center.

The study was led by Dr. Michael Gnant of the Medical University of Vienna and reported Saturday at an American Society of Clinical Oncology conference in Chicago.

If a second, ongoing study also finds a benefit, doctors predict that Zometa will quickly be tested against other cancers that tend to spread, or metastasize, to bones, such as prostate and kidney cancer.

"Hugely important is whether this has to do with the fact that it just makes the bone hostile, somehow, to metastasis or if there is a more global anti-metastasis effect," said the oncology group's president, Dr. Nancy Davidson of Johns Hopkins University.

"Either of those would be good and would teach us a lot about what to do next."

Breast cancer is the most common cancer in women. About 184,450 cases and 40,930 deaths from the disease are expected in the United States this year.

Standard treatments are surgery, chemotherapy, radiation and hormone-blocking drugs if the tumors are like those in the study -- helped to grow by estrogen or progesterone.

The hormone-blockers often weaken bones, so bisphosphonates like the osteoporosis pill Fosamax have become increasingly popular to treat this side effect. However, using them to treat the cancer itself is a very different approach.

Lab studies hinted it would work, and Gnant's is the first to test it in a large group of breast cancer patients.

Killian's Pub to close its doors at Torrance location By Muhammed, El-Hasan, Staff Writer

Killian's Pub and Grill in Torrance will shutter its doors tonight, ending four years of selling corned beef and beer at its current location.

The Irish pub, located at 2533 Pacific Coast Highway in Rolling Hills Plaza, failed to secure a lease renewal with its landlord, Killian's manager Tad Dexter said.

The management company that owns the restaurant hopes to reopen by August in a location about half the size of the current site, said Rob MacDonald, a consultant for the restaurant who is married to one of the owners.

"Customers can look forward to us popping up in Torrance, Redondo Beach, somewhere in the South Bay," MacDonald said. "We want a smaller, more intimate place, about 2,000 square feet. (It would be) a little easier to manage. We want to get back the nice intimate pub experience."

On Thursday afternoon, regular customer Jeff Newland nursed a cold glass of Coors Light while sitting on a wooden stool at one end of the restaurant's bar area.

Read the full story.

Peerless is a strong company. It's unclear how big of a blow this is.

Peerless Systems terminates asset purchase pact with Prism Software

BOSTON (Thomson Financial) - Peerless Systems Corp. said Friday it has terminated its asset purchase agreement with Prism Software Corp.

The company said various closing conditions of the deal weren't satisfied, removing Peerless from its obligation to complete the transaction.

No termination fee is payable by Peerless from the termination of the agreement.

Peerless reached an agreement in February to acquire Prism Software, a document solutions software maker.

Read the full article.

The jury's still out on this verdict.

Incomes and spending both slow in April

WASHINGTON (AP) -- The first round of economic stimulus checks gave a boost to personal incomes in April but a huge question remains: Will people spend the checks quickly enough to keep the economy afloat?

The Commerce Department reported Friday that consumer spending barely budged in April, rising a tiny 0.2 percent, and income growth was just as weak, increasing a similar 0.2 percent.

The growth in incomes, held back by four straight months of jobs losses, would have been just 0.1 percent had it not been for the first wave of economic stimulus payments that the government started sending out April 28.

The impact on incomes should be even larger in the May and June reports, reflecting the bulk of the payments. The Treasury Department reported Friday that so far 57.4 million payments have been made totaling $50.04 billion, nearly half of the $106.7 billion that will be disbursed this year to 130 million households.

The checks are the centerpiece of a $169 billion stimulus package that Congress passed at President Bush's urging in February with the aim of jump-starting the stalled economy. Analysts said whether they keep the economy out of a recession will depend on how fast people spend the money.

"It will be impressive if consumers can manage to hold on given all the headwinds they are facing," said Mark Zandi, chief economist at Moody's Economy.com. "Nothing is going right. Jobs are down, the stock market is wobbly, home prices are plunging and gasoline prices are at record highs."

All the problems have pushed consumer confidence to recessionary levels. The Reuters/University of Michigan survey of consumer sentiment dropped for a fourth straight month in May, hitting a 28-year low of 59.8, down from a reading of 62.6 in April. The May level was the lowest since June 1980, when Jimmy Carter was in the White House and consumers were being battered by a recession and soaring gasoline prices.

Despite worries that consumers may end up using their stimulus checks to pay off credit card debt rather than spending the money to give the economy a boost, analysts said they believed that about two-thirds of the money will get spent this year, enough to keep the overall economy, as measured by the gross domestic product, in positive territory.

The government on Thursday revised its estimate of first quarter GDP growth up to a rate of 0.9 percent, slightly better than the 0.6 percent original forecast. While many economists had believed that the economy would slip into negative territory during the current April-June quarter, the modest growth in consumer spending in April and hopes of better figures going forward are causing analysts to revise their estimates upward.

"So far, the economy is proving more resilient than we gave it credit for," said David Wyss, chief economist at Standard & Poor's in New York, who said GDP growth could come in around 0.5 percent in the current quarter and then rebound to around 2 percent in the July-September quarter, as consumers spend their stimulus checks.

But Wyss and some other analysts cautioned that the boost in economic activity could be short-lived, only delaying a full-blown recession into early next year.

"There is considerable risk that the tax rebates will only put a Band-Aid over a large and growing wound to consumer sentiment with a rising possibility of a sharp pullback in spending later in 2008 or in early 2009," said Brian Bethune, chief U.S. financial economist at Global Insight.

The 0.2 percent rise in personal incomes in April was the weakest gain since a 0.2 percent rise in January.

Private wages and salaries fell at an annual rate of $18.2 billion in April, the biggest setback in a year. Businesses have been cutting jobs for four straight months, with analysts forecasting a fifth month of job declines when the government reports next Friday on labor market conditions in May.

The 0.2 percent rise in consumer spending followed a 0.4 percent increase in March. Increases in recent months have largely reflected the big surge in energy costs and, to a lesser extent, higher food prices. Excluding inflation, consumer spending would have been flat in April.

Consumer prices, measured by an inflation gauge tied to spending, rose by 0.2 percent, down from a 0.3 percent rise in March.

The personal savings rate, the amount of spending compared to after-tax incomes, held steady at 0.7 percent in April, the same level as in February and March.

Analysts don't give Boeing much chance.

Boeing hopeful on tanker, notes appeals often fail

WASHINGTON, May 29 (Reuters) - Boeing Co. hopes to win its challenge to a $35 billion U.S. aerial refueling deal that went to Northrop Grumman Corp., but notes such efforts fail more often than not, the chief executive said Thursday.

"We are hoping the GAO (Government Accountability Office) will confirm our view," CEO James McNerney said. "But we recognize that (these) protests are denied more often then they are sustained."

He made his remarks at a webcast conference for investors hosted by Sanford C. Bernstein & Co.

The U.S. Air Force said Feb. 29 it was skipping Boeing in favor of a team made up of Northrop Grumman Corp and Airbus parent EADS (EAD.PA: Quote, Profile, Research) to start a new fleet of tankers for mid-air warplane refueling.

Boeing filed a formal protest to the GAO, saying it believed its modified 767 tanker represented a better value than the larger Airbus A330 derivitive picked by the Air Force.

The Air Force plans to buy tankers in three phases, starting with a batch of 179 aircraft valued at up to $35 billion.

GAO is due to make its recommendations to the Air Force by June 19.

Like the Energizer Bunner, gas prices keep going and going and going (up).

Gas prices hit record for 22 straight days

(CNNMoney) Retail gas prices hit record highs for the 22nd day in a row, motorist group AAA's Web site showed Thursday.
The nationwide average for a gallon of regular unleaded rose eight-tenths of a cent to $3.952, marking the 23rd straight day that gas prices have increased.

The AAA survey shows gas prices are up nearly 10% from a month ago and almost 24% higher from year-ago levels.

The average price for gas has passed the $4 a gallon mark in 11 states, as well as in Washington, D.C.

The most expensive state for buying gas is Connecticut, where a gallon of regular unleaded costs on average $4.223, according to AAA. The second most expensive state is Alaska, where a gallon of gas costs $4.209.

Read the full story.

This is one person's perspective. It's a pretty thorough piece.

Why gas is so expensive

(Salon) I can't decide whether to frame or burn the receipt from a Chevron filling station in Berkeley, Calif., that documents how much I spent to fill the tank of my 12-year-old Nissan Quest minivan on Sunday morning. At $4.09 a gallon for regular unleaded, the total came to $65.68. That's the most I've ever paid for a tank of gas, so I feel inclined to treat the paper record with respect. But a couple of weeks from now, if recent trends hold true, my unwanted milestone will be eclipsed again, and the receipt transformed into a trigger for nostalgia. Four-dollar-a-gallon gasoline? Ah, those were the days.

High oil prices: Another reason to hope for world peace.

Oil rebounds on Nigeria threat, supply concerns

NEW YORK (AP) -- Oil futures rose back above $131 Wednesday, recovering from early losses as threats against Nigerian oil facilities led investors to at least temporarily set aside concerns about falling U.S. gas demand.

At the pump, meanwhile, gas prices rose to a new record over $3.94 a gallon.

Light, sweet crude for July delivery rose $2.18 to settle at $131.03 on the New York Mercantile Exchange, after spending the morning swinging between gains and losses. At its lows, oil was down nearly $3 a barrel, compounding a $3.34 drop in crude on Tuesday. It passed $135 for the first time last Thursday.

Although prices rebounded sharply Wednesday, investors are still contending with a growing belief that U.S. demand for gas is falling in response to prices that already average more than $4 in 11 states and the District of Columbia. The national average price of a gallon of regular gas rose 0.7 cent overnight to a new record of $3.944, according to AAA and the Oil Price Information Service.

Boeing got a boost in its PR war over a lucrative Air Force contract to build aerial refueling tankers. Northrop won the contract, but Boeing is contesting it.

The Center for Individual Freedom, a conservative political organization, is supporting Boeing based on Northrop's partnering with Europe's EADS defense firm on the project. Boeing would have based its model on a Boeing plane. The Northrop model is based on an Airbus aircraft. EADS is the parent company of Airbus.

Northrop's tanker project would be run out of the Integrated Systems headquarters in El Segundo.

Here's the website that supports Boeing's position.

Northrop issued this latest release to justify its win of a multibillion-dollar Air Force aerial refueling tanker earlier this year. Northrop beat out Boeing, which is contesting the contract award. Northrop's tanker will be based on a European aircraft model made by Airbus.

Here's Northrop's release:

WASHINGTON, May 27 /PRNewswire-FirstCall/ -- The U.S. Air Force found Northrop Grumman Corporation's (NYSE: NOC) bid to build the next generation of aerial refueling tankers superior to Boeing's in four of the five most important selection criteria. Despite this fact, the losing bidder wants the Government Accountability Office to overturn the Air Force decision to award the contract to Northrop Grumman even though the Air Force conducted what even Boeing described as a fair, open and transparent bidding process. Here is another reason Northrop Grumman won, drawn from a list of facts included in a redacted version of a protected Air Force selection document.

Fuel Offload

In publishing its Request For Proposal (RFP) for America's next generation of aerial refueling tankers, the Air Force made clear that it was placing a priority on superior refueling capacity, even as it was looking for a more versatile aircraft. In the document in which it explained to both companies why Northrop Grumman's aircraft was superior, the Air Force concluded that Northrop Grumman was better able to pump fuel onto other aircraft -- and receive fuel from another aircraft -- than Boeing, earning a clear win in this vital evaluation category.

"Northrop Grumman provides better fuel offload at all distances from bases," the document noted. "Benefit: A single [Northrop Grumman tanker] can refuel more receivers and/or provide more fuel per receiver than" Boeing's aircraft.

"Northrop Grumman offered a superior fuel offload and receive rate ... compared to Boeing's," the document notes.

The Air Force also made clear that it found Northrop Grumman's fuel offload capability to be more efficient than Boeing's.

"The [Northrop Grumman aircraft] also provides more pounds of fuel offload per pound of fuel used compared to the [Boeing aircraft] at all ranges."

In its written summary, the Air Force said Northrop Grumman's "aerial refueling capability was compelling" to its decision. "Northrop Grumman's offer was a superior solution to the air refueling requirement, which is a key performance parameter."

When Northrop Grumman's win was announced on Feb. 29, Sue Payton, the chief acquisition officer for the Air Force, said, "Overall, Northrop Grumman did have strong areas in aero-refueling."

About the KC-45

The KC-45 Tanker aircraft will be assembled in Mobile, Ala., and the KC-45 team will employ 48,000 American workers at 230 U.S. companies in 49 states. It will be built by a world-class industrial team led by Northrop Grumman, and includes EADS North America, General Electric Aviation and Sargent Fletcher.

Northrop Grumman Corporation is a global defense and technology company whose 120,000 employees provide innovative systems, products, and solutions in information and services, electronics, aerospace and shipbuilding to government and commercial customers worldwide.

Convenience is the key.

Agreement may mean end of cable set-top boxes

(AP) The set-top box, a necessary appendage for millions of cable television customers for decades, is moving toward extinction.

A leading television manufacturer, Sony Electronics Inc., and the National Cable and Telecommunications Association said Tuesday they signed an agreement that will allow viewers to rid themselves of set-top boxes, yet still receive advanced "two-way" cable services, such as pay-per-view movies.

In most cases, cable viewers also could dispose of another remote control since they could use their TV's control rather than one tied to the set-top box.

The agreement marks a significant meeting of the minds between cable companies and one of the world's dominant makers of consumer electronics. The two industries have been feuding for a decade about how best to deliver cable service to customers while allowing them to buy equipment of their own choosing.

Sony agreed to use the cable industry's technology in its sets as soon as possible but could not say when the first such televisions might be appear in stores.

The agreement is between Sony and the nation's six largest cable companies: Comcast Corp., Time Warner Cable Inc., Cox Communications Inc., Charter Communications Inc., Cablevision Systems Corp. and Bright House Networks. The six companies serve more than 82 percent of cable subscribers.

Cable subscribers are generally locked into renting a set-top box from their provider if they want more than the most basic cable TV service.

More than a decade ago, Congress ordered the cable industry to allow outside electronics makers to compete for the boxes. The industry responded by developing the "cable card." The cards are inserted into competing boxes, televisions or other devices and unscramble the cable signal.

The cards have been the source of frequent customer complaints and never proved popular. In addition, sets can only receive signals from their cable company, not vice versa. Subscribers were unable to enjoy "two-way" features such as video on demand, on-screen channel guides and cable company-provided digital video recorders.

Customers will still be able to attach their own devices -- like TiVo digital video recorders, according to the NCTA.

Under the new system, customers will still need to get a cable card from their provider, but the agreement means, hopefully, technical glitches will be eliminated, "two-way" services will be available and there will be no need for the clunky boxes.

The cable association said it was hopeful other electronics manufacturers will also agree to use the same technology.

The industry hopes to head off action by the Federal Communications Commission to impose a two-way standard on the industry.

"Every member of the FCC has encouraged the parties to resolve these highly technical issues in private-sector negotiations," said Kyle McSlarrow, president of NCTA. Tuesday's announcement means they have done so, he added.

The FCC declined to comment on the agreement Tuesday.

On Tuesday, Music Video Games, a music-based game company focused on melding music and video games for fans of both, announced its launch.

The new company is based in El Segundo.

MvG was founded by David Warhol, president of video game studio Realtime Associates, Inc., and Vincent Bitetti, a video game publishing executive and former CEO of TDK Mediactive, which was sold to Take Two Interactive in 2004.

I know I've lost mine.

May consumer confidence falls to near 16-year low

(AP) Soaring gas prices and weakening job prospects left shoppers gloomier about the economy in May, sending a key barometer of consumer sentiment to its lowest level in almost 16 years.

The New York-based Conference Board said Tuesday that its Consumer Confidence Index dropped to 57.2, down from a revised 62.8 in April. Economists surveyed by Thomson Financial/IFR had expected a reading of 60.

The May reading marks the fifth straight month of decline and is the lowest since the index registered 54.6 in October 1992 when the economy was coming out of a recession.

Economists closely watch sentiment readings since consumer spending accounts for more than two-thirds of the nation's economic activity.

"Weakening business and job conditions coupled with growing pessimism about the short-term future have further depleted consumers' confidence in the overall state of the economy," Lynn Franco, director of the Conference Board's Consumer Research Center, said in a statement.

The stakes are high since the toy industry is hurting from all the competition from video games.

Opening statements begin in suit involving Bratz dolls

(AP) RIVERSIDE--An attorney for El Segundo-based Mattel Inc. says a rival toy company stole the idea for the Bratz fashion doll line that has become a global darling among consumers.
Attorney John Quinn made the allegation Tuesday during his opening statement in the federal copyright infringement trial in Riverside that pits Mattel against MGA Entertainment Inc., the maker of the urban-themed Bratz dolls.

Quinn says Mattel owns the rights to the Bratz dolls because the designer created the dolls while employed at Mattel.

MGA has denied the allegations and countersued, saying Mattel changed the design of its own "My Scene" dolls to more closely resemble the Bratz line and used its leverage with retailers to stifle competition.

El Segundo-based Raytheon Space and Airborne Systems has won a $21 million Navy contract to make radar components for the F/A-18 Super Hornet fighter jet.

Work on the ATFLIR Radar System is expected to be completed by May 2010.

BTW, the center and aft fuselage of the Super Hornet is built by Northrop in El Segundo.

DaVita Inc., the El Segundo-based provider of kidney dialysis centers, has introduced an Internet tool designed to provide education about the different types if dialysis the company offers.

Called "Treatment Evaluator," the online tool also encourage patients to communicate with their nephrologist on treatment options to fit certain lifestyles.

You can reach the website by going to http://www.davita.com and clicking on
"Tools."

The screen walks patients through an 18-question quiz to find out which type of treatment is a potential fit based on their answers.

The online quiz asks questions about a patient's treatment preferences, home
and work responsibilities, and lifestyle choices. Treatment Evaluator then provides an
overview of three potentially compatible modalities, and how each may benefit a
patient's lifestyle.

Here's the story that appeared in Tuesday's Breeze.

Last holidays for PCH lot By Muhammed El-Hasan, Staff Writer

The strip of land that has housed the Cottone & Sons Christmas tree lot and pumpkin patch for the past decade has been sold to a developer who plans to construct retail and office space on the Torrance property.

The Cottone seasonal business, with its pony rides and petting zoo, will have one more October and December to operate at the site before work begins, according to the real estate broker who represented the sellers of the property at Pacific Coast Highway and Hawthorne Boulevard.

"They'll get one more season of pumpkins and Christmas trees," said Stephen Lampe, broker and executive vice president at Re/Max Commercial and Investment Realty in Torrance.

Read the full story.

This would be a relief.

Boeing expects oil bubble to burst in global slowdown

(The Dominion Post) Aircraft maker Boeing expects the price of oil to fall back to a long-term average of between US$70 and US$80 a barrel.

Boeing marketing director Drew Magill said airlines had reduced capacity, with the United States on the brink of a recession and the need to pass on the high cost of oil to passengers.

"But that will be a short-term impact," Mr Magill said.

As the US and the global economy slowed down, demand for oil had also reduced, which should lead to lower prices.

Oil moved back up yesterday towards last week's record peak of just over US$135 a barrel which sent shock waves through the airline industry, with warnings that more airlines would collapse.

Read the full story.

If not years away.

Plenty of 'For Sale' signs but actual sales lagging

WASHINGTON (AP) -- Like spring flowers, the "For Sale" signs are sprouting in front yards all over the country. But anxious sellers are facing the most brutal environment in decades, with a slumping economy, falling home prices and rising mortgage foreclosures.

And even the faint promise of better days ahead might not come true, given all the headwinds the housing industry is facing at the moment.

"This is going to be another difficult spring," said Mark Zandi, chief economist at Moody's Economy.com. "I think we are at the beginning of the end of the housing downturn, but it is going to be a long and painful end."

The devastation is certainly a far cry from the boom years from 2001 to 2005 when sales of new and existing homes were setting records for five straight years. During that time, home prices were soaring, luring thousands of investors into the market, hoping to buy homes and flip them for quick profit.

But since 2006, the country has been mired in a housing bust which, in many ways, is the worst since World War II.

Construction is expected to drop to the slowest pace since the 1940s and prices are expected to decline by the largest amount since the Great Depression.

Hardest hit are the states where sales boomed the most: California, Florida, Nevada, Arizona and parts of the Northeast. In the Midwest, the problem is shrinking jobs in the auto industry, making homes hard to sell. But virtually all of the country has felt the aftershocks of the housing slump, either through weaker home sales or the massive drag housing has imposed on the overall economy.

Housing has shaved more than a full percentage point off economic growth, trimming the gross domestic product for the past two quarters to a barely discernible 0.6 percent rate and raising the threat that the country could topple into a full-blown recession.

The National Association of Realtors reported that 46 states saw sales decline in the first three months of this year compared with the same period in 2007. Two-thirds of 149 metropolitan areas saw prices decline during the same period, the largest percentage of cities reporting price drops in the history of the NAR survey, which goes back to 1979.

The state with the biggest sales decline was Maryland, with sales down 38.6 percent in the first three months of this year compared with the same period in 2007. The drop nationwide was 22.2 percent.

The price decline nationally was 7.7 percent in the first quarter, with the biggest plunge a 29.2 percent decline in the Sacramento, Calif., area.

As the spring sales season got under way, the slump was continuing. The Realtors reported Friday that existing home sales fell 1 percent in April, the eighth drop in the past nine months, with the median home price falling 8 percent compared with a year ago, the second-biggest drop on record.

So just how much worse will things get?

Lawrence Yun, chief economist for the Realtors, sees some hopeful signs. Some parts of the country that have been hammered with sharp declines in sales and prices, such as San Diego, Calif., and Fort Myers, Fla., are now reporting sales increases, as buyers are being lured back into the market, looking for bargains.

"Lower prices and low interest rates are starting to generate results," Yun said, noting that 30-year fixed-rate mortgages averaged 5.92 percent in April, down from 6.18 percent in April 2007. That reflected an aggressive rate-cutting effort by the Federal Reserve to try to keep the country out of a recession.

Sales should also be helped in coming months, Yun predicted, by the reappearance of more mortgage products as lenders reopen the tap for certain loans. That supply had been closed following the credit crisis that hit last August, triggered by rising defaults in subprime mortgages.

Other economists are not so optimistic, noting that the Realtors' latest report showed the number of unsold single-family homes jumping to a 23-year high, reflecting, in part, a rising tide of mortgage foreclosures, which are dumping more homes on an already glutted market.

Adding to the foreclosure problem is the weak economy, which has resulted in four straight months of job layoffs, an indication to some analysts that the country has already fallen into a recession.

Rising job layoffs and higher gasoline and food prices have sent consumer confidence plunging -- not a great environment to mount a rebound in housing.

And then there is the problem of the huge overhang of unsold homes generating further declines in prices, which seem to be keeping more prospective buyers on the fence.

"Right now a lot of people are staying away because they don't want to buy an asset that might lose value right away," said Patrick Newport, an economist at Global Insight.

Newport predicted that prices, which by some measures have fallen by about 15 percent nationwide from their peak two years ago, will decline another 10 percent before bottoming out in the spring of 2009. A 25 percent fall in prices would be the biggest since home prices plunged by about one-third during the Great Depression of the 1930s.

David Seiders, chief economist for the National Association of Home Builders, said he believed sales will bottom out by the middle of this year and then start to move higher by the end of this year.

He said builders, trying to control inventories, will continue slashing production, with housing starts expected to drop by 39 percent this year following a 30 percent decline in 2007. That will push activity to the slowest annual pace since the end of World War II. Seiders predicted a gradual rebound in construction starting next year.

"This is stacking up as the most dramatic housing contraction in the post-World War II period," he said.

And while sales, construction and prices should all start to recover by next year, the rebound is not expected to be a rapid one. Some analysts are forecasting it will take a couple of years for housing to regain its footing.

"It is going to take some time first to restore confidence that housing is a reasonably OK investment, then to work off this inventory and then for the financial system to revive," Zandi predicted.

In today's paper.

Welcome to Fabulous Ultra Lux Salon
By Joanna Lin, Staff Writer

Posters of bouffants, poodle cuts and pin-curled waves line the walls. Classic vanities and vintage collectibles fill the room.

The window proclaims: "The higher the hair, the closer to God!!"

Though the decor of Ultra Lux Salon & Lounge might feel like a blast from the past, this Redondo Beach hair haven is anything but dated.

The vintage vibe is a nod to the hair goddesses of the 1940s and '50s, to the eras that inspired South Bay natives Deanna Serna and Tricia Delgado to open the salon six years ago.

"When it comes to fashion, it's all about history repeating itself," said Delgado, 34. "Just with a little twist."

For Ultra Lux, that twist comes in leopard print and polka dot chairs, punk rock and reggae on the stereo, and 21st century hairstyles and techniques.

Read the full story.

Will Boeing and its supporters agree? If the shoe were on the other foot, would Northrop agree?

Pentagon Tells Bidders To Stop Battling Over Lost Contracts

(AP) WASHINGTON - Quit complaining.

That's the message from the Pentagon and Congress to defense companies that cry foul when they don't win contracts.

Resolving the protests costs the government time and money. That means it can take longer to build needed combat gear or buy critical supplies, making U.S. troops and American taxpayers the real losers.

Far more often than not, the complainers don't win anyway, according to statistics from the Government Accountability Office.

It's become a big enough problem that the House Armed Services Committee has raised the possibility of fining companies that submit "frivolous or improper" protests to the GAO.

Determining a frivolous or vindictive protest from a legitimate one is tricky business, though. In February, the Air Force selected a European-led consortium for a $35 billion contract to build aerial refuelers. Lawmakers who backed the competing bid by the Boeing Co. cheered the Chicago-based company's move to challenge the choice.

Boeing has argued the Air Force changed its method for evaluating the tanker it wanted after asking for proposals. That allowed a larger tanker offered by the European Aeronautic Defence and Space Co. and its U.S. partner, Northrop Grumman Corp., to beat Boeing's offer, the company said.

A ruling from the GAO on Boeing's protest is expected next month.

How credible is the richest man on Earth?

Buffett sees "long, deep" U.S. recession

BERLIN (Reuters) - The United States is already in a recession and it will be longer as well as deeper than many people expect, U.S. investor Warren Buffett said in an interview published in German magazine Der Spiegel on Saturday.

He said the United States was "already in recession" and added: "Perhaps not in the sense that economists would define it" with two consecutive quarters of negative growth.

"But the people are already feeling the effects," said Buffett, the world's richest man. "It will be deeper and last longer than many think."

Read the full story.

It's in today's paper.

South Bay home prices still sliding
By Muhammed El-Hasan, Staff Writer

Home prices across the South Bay continued to slide in April, with every community cited in a report released Friday posting double-digit declines.

Carson was the area's biggest year-over-year loser, with a 25.9 percent drop in median home price to $389,000, according to a report by the Los Angeles-based California Association of Realtors.

Manhattan Beach experienced the second worst drop, of 25.8 percent, to $1,372,500.

Read the full article.

Whoever becomes our next president, they'll probably be richer than you and me. Note that Cindy McCain has not released her 2007 tax returns.

Cindy McCain had $6 million income in 2006

WASHINGTON (AP) -- Cindy McCain has released her 2006 tax returns, showing total income of more than $6 million. The wife of Republican presidential candidate John McCain paid more than $1.7 million in taxes.

McCain's campaign said she had received an extension on her 2007 tax returns and planned to make those public when they are filed.

Under a prenuptial agreement, the McCains have separate assets and file separate tax returns. John McCain made his tax returns public last month.

McCain's campaign only released the top two summary pages of Cindy McCain's 2006 return. In them, she listed itemized deductions totaling nearly $570,000. Mrs. McCain is the heiress of a large Arizona beer distributorship.

Read it for yourselves.

March driving down for 1st time since 1979: government

(AP) In a sign that Americans are curbing their driving in the face of record-high gasoline prices, data released on Friday showed highway miles driven in March fell 4.3 percent from a year earlier, the first March decline since the last major oil shock in the late 1970s.

According to the Department of Transportation, Americans drove 11 billion miles less in March 2008 than a year earlier, the first time estimated travel on public roads fell in March since 1979.

The data marks the sharpest year-on-year drop for any month in the history of the agency's reporting, which dates back to 1942.

U.S. average gasoline prices hit $3.79 a gallon over the past week, up 57 cents from a year ago, according to U.S. data.

Record-high oil prices above $135 a barrel are pushing average pump prices closer to the crucial $4 a gallon level. Pump prices in seven U.S. states, including California, Illinois and New York, already average above $4 a gallon.

Signs are mounting that U.S. consumers -- who use more oil than any other country -- are finally curbing their energy use in the face of a widening U.S. economic downturn.

The trend recalls the oil shocks of the 1970s, when oil prices doubled and Americans abandoned boxy, heavy automobiles in favor of smaller, more fuel-efficient models.

Since November 2006, vehicle miles traveled fell by a cumulative 17.3 billion miles, according to data from the Department of Transportation's Federal Highway Administration, which collects the information from 4,000 automatic traffic recorders operated round-the-clock by state highway agencies.

Travel over the upcoming Memorial Day holiday weekend will fall for the first time since 2002, auto and travel group AAA said this month.

Some 37.87 million Americans will travel 50 miles or more from home for the holiday, which falls this year on May 26. That would be down 0.9 percent from 38.23 million last year, according to AAA's survey, which was conducted among more than 2,000 Americans.

Crude oil prices -- which comprise more than 70 percent of the cost of gasoline -- have jumped about 30 percent since the start of 2008, driven by worries about tight stocks of refined products in the near term and mounting global demand over the longer term. Oil has risen sixfold since 2002.

Gasoline use already has slipped about 1 percent this year compared with last year, according to government and private reports. And the U.S. Energy Information Administration said last month it expected American gasoline demand to shrink this summer for first time since 1991.

In case you missed it in today's paper.

Famed architect moving to El Segundo
By Muhammed El-Hasan

World-renowned architect Frank Gehry, famous for his synthesis of architecture and art in such projects as the Walt Disney Concert Hall in downtown Los Angeles and the Guggenheim Museum in Bilbao, Spain, plans to move his firm to El Segundo, according to city officials.

Gehry will move Gehry Partners LLP from its Los Angeles headquarters to a pair of El Segundo buildings that share a property line, at 2352 Utah Ave. and 2345Alaska Ave.

The two buildings combine for about 60,000 square feet of space, enough to house Gehry's staff of 250 people, said Bill Crowe, El Segundo's assistant city manager.

"We expect him between the end of the year and early 2009," Crowe said of Gehry's move.

Read the whole story.

What's next? A price hike on the air we breathe?

Prices soar for Memorial Day fixins' for barbecues

(AP) Hamburgers and hot dogs? Check. Lighter fluid? Check. Beer? Check. More money?

Americans are about to fire up their barbecues for the start of the summer cookout season, and one thing has become painfully apparent: It's going to cost a lot more than it did last year to roast a burger, or just about any other barbecue favorite, on the grill.

Food inflation is the highest in almost two decades, driven by record prices for oil, gas and mounting global demand for staples such as wheat and corn, and for proteins such as chicken. And that's reaching into Americans' backyards.

The price of an average barbecue -- with burgers, hot dogs, beer, soda, condiments, salad, paper plates and lighter fluid -- could run families about 6 percent more than last year.

That's making shoppers pause as they fill their carts for the Memorial Day weekend, the unofficial start of the barbecue season.

"I'm finding myself questioning every purchase, wondering if it's gonna get eaten or if we really need it," said Tony Caballero, an advertising and marketing consultant, as he filled his cart with paper plates at a Food Emporium in New York City. "When you do your everyday shopping, you try to cut corners. But it's a shame to have to scale down when you're trying to throw a party."

The consumer price index for food rose 4 percent last year, compared with an average 2.5 percent annual rise for the last 15 years. On Monday, the U.S. Department of Agriculture raised its forecast for next year by half a percentage point, to a range of 4.5 to 5.5 percent.

Basic economics account for most of the increase: Bad weather has hurt crops, economic prosperity has driven up demand in developing countries, and surging fuel prices have raised transportation costs.

Economists and food scientists have argued that biofuel production is also a major factor in rising food costs, particularly corn, and that it should be scaled back. Meat and poultry executives have come out against federal ethanol mandates, which they say is driving the cost of corn higher.

Carol Tucker-Foreman, food policy expert at Consumer Federation of America, said high-fructose corn syrup can be found in just about anything you'd find at a cookout or picnic.

"The backyard barbecue is where you'll see the most impact from the government's decision to subsidize the use of food to put fuel in our cars," she said. "From the ketchup to the paper plates, these are the things that are going to cost you a lot more than they used to. And this is just the beginning. Next year, it'll be even more expensive just to stay home and make burgers."

But the debate is moot for many American families who are struggling to put gas in the car, pay the mortgage and put food on the picnic table.

This year, the price for a pack of hot dogs has climbed almost 7 percent to $4.29. A 2-liter bottle of soda and a 16-ounce bag of potato chips both jumped more than 10 percent to $1.33 and $3.89, respectively, while a package of eight hamburger buns costs $1.61, 17 percent more.

The surge in prices is forcing people to try to cut corners and find bargains where they can, such as buying store brands, which tend to cost less than name brands.

A recent study by the Food Marketing Institute found that about a third more shoppers are limiting themselves to frozen or boxed foods instead of fresh items this year, while nearly half said they bought fewer foods overall.

But 55-year-old Cherise Tilly, who lives with her mother in Cincinnati, said she still buys more expensive items like steak, ribs or chicken for grilling along with relatively cheaper meats like hamburgers and hot dogs.

"My mother keeps worrying and says we need to cut back more, but getting together with friends to eat is one of the pleasures in life," said Tilly while shopping at a suburban Cincinnati Kroger store.

Other shoppers may be more reluctant to indulge, and those paying close attention to prices in the aisles may worry they're being gouged by grocers, said National Retail Federation spokesman Scott Krugman.

"Consumers don't care why prices are increasing, they just want something to be done about it," Krugman said. "What they don't realize is how razor-thin profit margins are in terms of price increases on grocers as well."

While beef prices have been high, chicken and pork prices are expected to rise as producers are feeling the brunt of higher costs for feed and fuel.

Scott Faber, a lobbyist for the Grocery Manufacturers Association, which has been pushing Congress to increase ethanol research funding, said prices for meat will continue to rise in the next couple of years. Newly enacted federal ethanol mandates will drive the cost of corn higher, he said.

"We are just in the beginning of a period of significantly higher prices, and American families will continue to feel that impact as the cost for basic staples like milk, meat and eggs will grow drama

This will further solidify Toyota's image as a "green" automaker. As always, I'll remind you that Toyota's US sales and marketing headquarters is in Torrance.

Report: Toyota building green-car battery plants

TOKYO (AP) -- Toyota Motor Corp. plans to build two plants in Japan to produce batteries for environmentally friendly gas-electric hybrid vehicles, a news report said Friday.

The joint venture that Toyota has with Matsushita Electric Industrial Co., the electronics company that makes Panasonic brand products, will set up the battery plants, The Nikkei business daily reported without citing its sources.

One plant will produce nickel-metal hydride batteries while another will produce lithium-ion batteries, which are planned for future ecological cars, the report said.

Toyota spokesman Paul Nolasco did not have an immediate comment on the report.

Japan's top automaker, which leads the industry in gas-electric hybrids with its hit Prius, has said it will rev up hybrid sales to 1 million a year sometime after 2010.

Hybrids reduce pollution and emissions that are linked to global warming by switching between a gas engine and an electric motor to deliver better fuel efficiency than comparable standard cars. But they are still a relatively niche market.

Toyota's Prius, which has been on sale for more than a decade, recently reached cumulative sales of 1 million vehicles.

Lithium-ion batteries, now more common in laptops, produce more power and are smaller than nickel-metal hydride batteries, which are now used the Prius. Toyota has said the lithium-ion batteries may be used in plug-in hybrids, which can be recharged from a home electrical outlet.

The world's other major automakers are also working on environmentally friendly cars, and the race is on to produce the best batteries to power them.

Earlier this week, Honda Motor Co., Japan's second-biggest automaker, said it will boost hybrid sales to 500,000 a year by sometime after 2010. Honda said it will introduce a new model sold solely as a hybrid next year, so the Tokyo-based company will have four hybrids in its lineup.

Nissan Motor Co., which still hasn't developed its own hybrid system for commercial sale, said it will have its original hybrid by 2010. Nissan is focusing more on electric vehicles, promising them for the U.S. and Japanese markets by 2010.

Nissan said this week its joint venture with electronics maker NEC Corp. will start mass-producing lithium-ion batteries in 2009 at a plant in Japan.

Boeing's satellite business in El Segundo and Seal Beach announced Wednesday that they would lay off 750 employees. Here's a few items that were cut out of our original story because of space issues:

In an April interview, Craig Cooning said the integration of the former Hughes employees into Boeing's corporate structure was successful.

...

The layoffs and recent GPS contract loss to Lockheed come after Boeing's seemingly successful efforts to reconstitute itself as a premier satellite builder.

For example, in 2001, Boeing's reputation was hurt by the discovery of malfunctions in the solar arrays of its 702 satellites, the company's largest.

In 2005, the Department of National Intelligence stripped Boeing of part of a major spy satellite contract because of continued cost, schedule and technical problems. That cost Boeing hundreds of millions of dollars.

The setbacks were an embarrassment for Boeing, whose 1 million-square-foot El Segundo facility has built about 300 satellites, more than any other facility in the world.
Yet, Boeing seemed to put those problems behind it as it limited technical glitches and won new contracts.

Aerospace analyst Paul Nisbet said he saw no evidence that the GPS contract loss was due to technical problems. He noted that Boeing has built most GPS satellites.
"Over the years with the GPS, Lockheed had been building one-third and Boeing two-thirds, and this might just have been Lockheed's turn," Nisbet said.

Here's the original story.

Notice that California was one of the two states with the biggest declines.

Gov't home price index posts largest drop in 17-year history

(AP) U.S. home prices posted their sharpest first-quarter decline since the government began tracking the data 17 years ago.

The Washington-based Office of Federal Housing Enterprise Oversight said Thursday that home prices fell 3.1 percent in the first quarter compared with last year. The index also fell 1.7 percent from the fourth quarter of 2007 to the first quarter of 2008, the largest quarterly price drop on record.

"The large overhang of real estate inventory awaiting sale continues to force price declines in many areas, but particularly in places that had seen very sharp appreciation," Patrick Lawler, the agency's chief economist, said in a prepared statement.

Prices fell in 43 states, with California and Nevada showing the biggest declines. Home prices dropped by more than 8 percent in those states.

The government index is calculated by tracking mortgage loans of $417,000 or less that are bought or backed by the government-sponsored mortgage-finance companies Fannie Mae and Freddie Mac. Legislation enacted in February temporarily raised the limit to as much as $729,750 in high-cost areas.

The government index focuses on less expensive properties and includes fewer houses bought with risky home loans that have gone sour over the past year.

Another reading that includes such properties and focuses on major U.S. cities, the Standard & Poor's/Case-Shiller has shown larger declines.

Bikes anyone?

Oil prices pass $135 after report of supply drop

NEW YORK (AP) -- Runaway oil prices blew past $130 a barrel for the first time Wednesday and kept going, while gasoline prices persisted in their own relentless climb, rising above $3.80 a gallon. Supply worries, rising demand and a slumping dollar are conspiring to make filling up the car -- and paying for just about everything else -- a growing burden for Americans.
With gas and oil prices setting new records on a daily basis, many analysts are beginning to wonder whether anything can stop prices from rising. There are technical signals in the futures market, including price differences between near-term and longer-term contracts, that crude may soon fall. But with demand for oil growing in the developing world, and little end in sight to supply problems in producing countries such as Nigeria, few analysts are willing to call an end to crude's rally.

Oil's Wednesday rally was fed in part by a report from the Energy Department's Energy Information Administration, which said crude inventories fell by more than 5 million barrels last week. Analysts had expected a modest increase.

Light, sweet crude for July delivery rose $4.19 to settle at $133.17 a barrel on the New York Mercantile Exchange, but prices rose as high as $135.04, up $6.06, in after-hours electronic trading. The settlement price marked crude's largest one-day price advance since March 26.

Investors seized on the inventory report to boost prices Wednesday, but traders interested in pushing prices higher are increasingly picking and choosing which news they wish to pay attention to, analysts say.

"Even if this report was bearish, with the momentum the way it is right now, it wouldn't matter," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.

Crude prices first passed $130 overnight on concerns about demand and a weaker dollar. Analysts say crude has been boosted in recent days by especially strong demand for diesel in China, where power plants in some areas are running desperately short of coal and certain earthquake-hit regions are relying on diesel generators for power.

The dollar, meanwhile, weakened against the euro Wednesday. Investors see hard commodities such as oil as a hedge against inflation and a weak dollar and pour into the crude futures market when the greenback falls. A weak dollar also makes oil less expensive to buyers dealing in other currencies.

Many investors believe the dollar's protracted decline over the past year has been the most significant factor behind oil's rise from about $66 a barrel a year ago to today's highs.

At the pump, meanwhile, the average national price of a gallon of regular gas rose 0.7 cent overnight to a record $3.807 a gallon, according to a survey of stations by AAA and the Oil Price Information Service. Prices are 60 cents higher than a year ago, and many forecasters believe they'll hit $4 on a national basis at some point over the next month.

"That's a fait accompli at this point," said Linda Rafield, senior oil analyst at Platts, the energy research arm of McGraw-Hill Cos.

Prices are already that high in many parts of the country, and the number of stations charging $4 or more rises each day. Prices are nearing $5 a gallon in parts of Alaska.

Diesel fuel rose 1.9 cents to its own record of $4.558 a gallon Wednesday. Rising prices of diesel, used to transport most consumer and industrial goods, are sending prices of food and many other goods higher.

There are signs that high prices are cutting demand for gasoline, which fell slightly over the past four weeks and has been mostly lower since January, according to EIA data. Only serious "demand destruction," a jump in supplies from Nigeria or other oil producing nations or a jump in gasoline output by U.S. refiners could stop prices from continuing to rise, Rafield said. There is little sign that demand will fall anytime soon in fast-growing China, India and the Middle East, she said.

A move by the government to shore up the dollar, or an announcement that the Federal Reserve won't cut interest rates further, could also reverse the upward momentum, Flynn said; rate cuts tend to weaken the dollar. On Wednesday, the Fed released minutes of its most recent meeting that left the impression it's not inclined to cut interest rates further.

Still, the price differences between the current, July crude oil contract and contracts for delivery of oil in later months signal a possible correction, or sharp price downturn, at some point, Rafield said. Many analysts have long argued that prices have risen well beyond levels that can be justified by supply and demand fundamentals.

"It's very difficult to call when this is going to happen, but when it happens, it's going to be quick and ugly," Flynn said.

In other Nymex trading, June gasoline futures rose 9.21 cents to settle at $3.3965 a gallon after rising to a trading record of $3.4081, and June heating oil futures rose 13.34 cents to settle at $3.9084 a gallon after setting a new trading record of $3.9187.

June natural gas futures rose 27.5 cents to settle at $11.64 per 1,000 cubic feet.

The EIA said gasoline inventories also fell and took the market by surprise, while inventories of distillates, which include heating oil and diesel fuel, rose less than analysts surveyed by Platts had expected.

In London, July Brent crude rose $4.86 to settle at $132.70 a barrel on the ICE Futures exchange.

Associated Press writer Pablo Gorondi in Budapest and AP Business Writer Thomas Hogue in Bangkok, Thailand, contributed to this report.

While losing 750 jobs in El Segundo and Seal Beach is painful, the layoffs Boeing announced today are a far cry from aerospace job cuts of previous years.

Boeing's layoffs seem to be company specific. Boeing simply didn't get enough contracts to maintain its current workforce. It doesn't appear to be due to a new downturn in the satellite market or any other broader factors.

And that's good news on one level. It means that there's still business out there waiting for Boeing to bid on and, possibly, win. As the adage goes, what doesn't kill you makes you stronger. And Boeing's contract losses are forcing it to become more efficient and competitive for the next contract competition.

Remember that after Boeing bought the El Segundo operation from Hughes in 2000, the commercial satellite market fell out of the sky, leading to 3,000 job cuts in El Segundo. And after the Cold War ended, many more aerospace workers lost their jobs amid an enormous industry downturn and wave of consolidations.

So today's news of layoffs will sting. It will affect people on the most personal level. Some families will be unable to pay their bills. Some will be forced to say goodbye to friends and family in order to find work in other parts of California or out of state.

And of course, workers will be unable to sleep as they wonder if they'll be next to receive a layoff notice.

But for those who remain at Boeing in Southern California, these layoffs are not necessarily a harbinger of things to come.

Instead, this whole episode could be a sign of better days ahead.

Here's a link to today's story.

Honda is playing catch-up with Toyota on hybrids. BTW Honda's North American HQ is in Torrance.

Honda to sell new gas-electric hybrid next year

TOKYO (AP) -- Honda Motor Co. will sell a new, improved and affordable gas-electric hybrid in the U.S., Japan and Europe starting in early 2009, the company's president said Wednesday.

Takeo Fukui told reporters that "green" cars, especially hybrids, will be a pillar of Honda's strategy for the next three years, starting this fiscal year that began April 1.

He did not say what the price of the vehicle would be. But he said the new hybrid will be a five-door sedan seating five passengers, and it will feature new technology that reduces the size and weight of the hybrid system to increase fuel efficiency.

"Hybrids have drawn attention for their image, but time has come to go to the next step," he said, stressing that Honda was serious about selling hybrids in numbers.

Honda plans to sell 500,000 hybrids per year sometime after 2010, he said.

To expand hybrid sales, Honda will introduce a new sporty hybrid based on the CR-Z model, a Civic hybrid and a hybrid model of the Fit subcompact, which is sold as the Jazz in Europe, in addition to the new hybrid going on sale next year, Fukui said.

These types of lawsuits come with the territory in the creative world.

Jury selection starts in Mattel lawsuit over Bratz

(AP) Marketed as a group of girls with a passion for fashion, Bratz dolls have been nothing but a financial headache for Barbie-maker Mattel Inc.

Barbie sales have slumped since the pouty-lipped Bratz line hit shelves in 2001 and girls were drawn to their edgy, urban design themes.

A legal cat fight followed, with Mattel seeking a piece of Yasmin, Jade and friends in a lawsuit against rival MGA Entertainment Inc.

Jury selection began Tuesday in the federal copyright infringement case, with opening statements expected early next week in U.S. District Court in Riverside.

Mattel has alleged that it's entitled to some of the profits from the Bratz dolls because MGA stole the concept and other trade secrets by luring away a Mattel employee.

If jurors find that Mattel's rights were infringed, the world's biggest toy maker could collect hundreds of millions of dollars in licensing fees from MGA.

"The stakes really couldn't be higher for this kind of case," said Jack Lerner, a law professor at the University of Southern California. "The future of this brand is in the balance."

El Segundo-based Mattel filed the original lawsuit in 2004 against Carter Bryant, one of its former doll designers, accusing him of wrongfully selling his Bratz ideas to privately held MGA while he was under contract to Mattel.

Bryant has said he became inspired to create Bratz between two stints at Mattel, and it wasn't anything more than an idea until he left the company.

Mattel dropped the lawsuit against Bryant on Monday, the eve of jury selection, said John Quinn, a lawyer representing Mattel. He declined further comment.

The motion also called for the dismissal of counterclaims, according to a legal document posted online. Financial details were not released.

Bryant is expected to testify at the trial. His attorney John Keker has declined to comment.

In a prepared statement, Thomas J. Nolan, MGA's lead trial counsel, said he was not surprised that Mattel settled the case against Bryant.

"I am looking forward to the opportunity to cross-examine Mattel's witnesses to demonstrate that they cannot win in the courtroom what they failed to win in the marketplace," Nolan said.

He said Bratz dolls were inspired by Bryant and created by MGA and designers and engineers in late 2000 and 2001.

Mattel, which also sells the popular Tickle Me Elmo toys and the Matchbox cars line, also claims MGA has attempted to boost profits by pilfering other confidential and proprietary information.

"Emboldened by the success of its illegal conduct, MGA has repeated - even expanded - its pattern of theft on numerous occasions," the lawsuit said.

Los Angeles-based MGA has denied the allegations.

In a ruling last month, U.S. District Judge Stephen Larson said Mattel could claim rights to work done by Bryant.

"It comes down to what Bryant did in the time he was with Mattel," Lerner said.

MGA has countersued, claiming Mattel altered the design of its own "My Scene" dolls to more closely resemble the Bratz line and using its sway with retailers to stifle competition.

The lawsuit is going to trial during a difficult time for both companies. Mattel recalled millions of Chinese-made toys last year that were found to be tainted with lead. Last month, the company reported a $46.6 million loss in the first quarter with Barbie sales flat and a 13 percent drop in worldwide sales for its Fisher-Price brand.

Isaac Larian, MGA's chief executive officer, has pegged the value of the Bratz franchise at $2 billion, but industry analysts believe its market share has slipped in the past few years because new products such as Webkinz and the Hanna Montana craze have captured kids' attention.

"Unfortunately for Mattel and MGA, fashion dolls have fallen out of favor," said Gerrick Johnson, a toy industry analyst at BMO Capital Markets in New York. "The trend has been toward mini-dolls or animals. Bratz is actually struggling more than Barbie right now."

Johnson says MGA has more at stake in the lawsuit than Mattel because Bratz has been MGA's most profitable product.

"If they couldn't count on Bratz anymore it would be detrimental to their bottom line," he said. "It would definitely be a different company."

Don't get your hopes up too high. The US is not going to become the new China.

Toyota to export U.S.-made cars to emerging economies

TOKYO (MarketWatch) -- Toyota Motor Corp. plans to export large cars produced in the U.S. to the Middle East and other emerging economies around the world, the Asahi Shimbun reported Tuesday.

Toyota, which mostly sells its U.S.-made cars only in the U.S., now plans to export them as car sales are declining in the world's biggest economy due to the economic slowdown and the rise in crude prices. The plan is also motivated by the fall in production costs in the U.S. due to the dollar's weakening against the yen.

Read the full story.

DIRECTV, the El Segundo-based satellite TV service, scored higher for customer satisfaction than all major cable TV companies in the American Customer Satisfaction Index, the company said Tuesday.

It was the eighth straight year DIRECTV achieved this designation.

In this year's ACSI survey, DIRECTV posted an index score of 68, reflecting customers' overall satisfaction with the service. That was higher than the cable and satellite TV category, which scored a 64 overall.

Customers surveyed by the ACSI in the first quarter of 2008 were also asked about such issues as perceived quality, perceived value and their expectations prior to subscribing to the service. The ACSI also measures customer loyalty and retention.

DIRECTV is the nation's leading satellite TV service, with more than 17 million customers in the United States.

The story finally ran. Here it is in all its bronze glory.

Don't forget to check out the photos.

'Sunset Tan' opens in the South Bay By Muhammed El-Hasan Staff Writer

LA Sunset Tan's first weekend of business in Redondo Beach drew clients seeking a celebrity air as well as a bronze look.

The Beverly Hills-based tanning salon chain with its own reality TV show officially opened its Redondo Beach store Friday.

"On Sunday, it was crazy here," said Tony Trutanich Jr., who owns the store at 1020 S. Pacific Coast Highway, near Avenue B.

Two days earlier, valet parking, a red carpet entrance, blaring music and perfectly sculpted bronze bodies ushered Friday's opening of the South Bay's newest tanning salon.

A camera crew taped scenes of the opening for an upcoming episode of "Sunset Tan," a show on the E! Entertainment channel featuring the business and its gorgeous employees and clientele.

"I don't know anyone who throws a grand opening like this," said Trutanich, who noted the "glitz and glam" attached to the event.

Read the full story.

LA is on the list.

Five Cities With Biggest Decline in Home Values

(Yahoo Real Estate) With home values continuing to plummet across the country, it's become clear that the real estate meltdown is far from over.

Values for single-family homes in 14 major U.S. cities posted double-digit declines from their respective peaks, according to the Standard & Poor's/Case-Shiller Home Price Indices, which tracks prices of single-family homes. On a national level, home values are down 12% since December 2006. And according to Beth Ann Bovino, a senior economist at Standard & Poor's, they could drop another 10% by the end of the year.

"Things are accelerating downwards [and] in most cases the fall gets steeper and steeper every month," says David Blitzer, chairman of the index committee at Standard & Poor's.

Read the full story.

Gasoline is the top item teens buy on credit, surpassing clothes, which had been No. 1 in previous years, according to a new survey.

A poll from Junior Achievement and The Allstate Foundation shows that 68.6% of teens are using credit cards to buy gas, up from 51.9% in 2007 and 45.9% in 2006.

The 2008 poll found that 10.4% of teens use a credit card now, up from 8.5% last year.

In addition, the number of teens reporting their credit card bill is paid by parents increased rose to 13% from 11% last year -- "indicating that many teens are not learning for themselves the importance of paying bills on-time, and other sound financial practices," the survey said.

One interesting fact about him that didn't make the article is that he used to be a cheerleader in college.

RB owner has faith in Chick-fil-A
By Muhammed El-Hasan, Staff Writer

While his high school friends went out on weekends, Bob Sun worked at his father's two Chinese restaurants in Atlanta.

Today, Sun runs his own restaurant, a Chick-fil-A at the South Bay Galleria in Redondo Beach.

The 36-year-old La Palma resident took a winding path from father's helper to restaurateur.

Read the full story.

Valet parking, a red carpet entrance, blaring music and perfectly sculpted bronze bodies ushered the opening of the South Bay's newest tanning salon.

LA Sunset Tan, the Beverly Hills-based tanning salon chain with its own reality TV show, officially opened its Redondo Beach store Friday.

A camera crew taped scenes of the opening for an upcoming episode of "Sunset Tan," a show on the E! Entertainment network featuring the business and its gorgeous employees and clientèle.

The store, at 1020 S. Pacific Coast Highway, has 2,600 square feet of space with 10 tanning rooms.

... Keep your eye out for the full story on LA Sunset Tan, which will appear in the Daily Breeze within days.

At this rate, I wouldn't be surprised if oil hit $140 by the end of the year.

Oil sets record near $128; pump price at high, too

NEW YORK (AP) -- News that Saudi Arabia had boosted its oil output by 300,000 barrels a day was greeted as a non-event on oil markets -- the move wasn't anywhere near the kind of production increase needed to bring prices down on Friday.

And traders were equally unimpressed by the U.S. government's plan to stop adding to the Strategic Petroleum Reserve.

One day, two moves designed to allay concerns about an overheated oil market that's squeezing motorists and inflating the prices of all sorts of goods.

The response in the oil trading pits? Traders did what they've been doing for months now, and pushed crude oil and gasoline futures to new highs.

"All in all, we're seeing another strong move here on little fundamental news," said Jim Ritterbusch, president of Ritterbusch & Associates, an oil trading advisory firm in Galena, Ill.

The reason for the disconnect has little to do with political decisions in Washington or Riyadh, and everything to do with market expectations. The Saudi production increase was seen in the market as minuscule, and no one expected the suspension of shipments to the U.S. government's Strategic Petroleum Reserve to have much impact on supplies.

Even more important, the traders placing the bets expect prices to just keep moving higher.

Goldman Sachs, one of the world's most influential investment banks, underscored that sentiment Friday when it hiked its oil price forecast for the second half of the year to $141 a barrel, up from $107 previously. Analysts at the bank argue that the oil market is undergoing a "structural repricing" that will continue to play out for some time to come.

"We would view any pullback in oil, regardless of the size or duration -- although a correction could be as large as 15 percent -- as an opportunity to re-establish long positions in oil before the summer," Goldman Sachs advised traders.

Translation: Buy when barrels go on sale, because prices are bound to keep heading higher.

And buy they did Friday. The price for a barrel of benchmark light, sweet crude for June delivery jumped $2.17 to settle at record close of $126.29 on the New York Mercantile Exchange. Earlier in the session, prices surged to $127.82 a barrel, also a new high.

It was the eighth time in the past 10 sessions traders rewrote the record books, and the first time prices topped $127 a barrel.

Investors shrugged off the news from Saudi Oil Minister Ali al-Naimi that the world's largest oil producer had decided to increase production last week. The market also had little reaction to the Energy Department's announcement said it would cancel shipments into the Strategic Petroleum Reserve for six months beginning July 1.

"It's ridiculous because I don't think this is going to bring the price down," said Phil Flynn, an analyst at Alaron Trading Corp., of the Energy Department's move.

The effect of Saudi Arabia's decision was also not clear. The increase, which went into effect last Saturday, is relatively small, lifting total output from the world's leading producer to 9.45 million barrels per day by June.

The addition of "300,000 barrels won't make a lot of difference," said Mir Yousufuddin, who monitors crude prices for the U.S. Energy Information Administration.

The announcement came during a visit by Bush, who was in the kingdom to appeal for a more significant increase in production. Bernard Picchi, an energy analyst at research firm Wall Street Access, called the increase "a token amount" and said the effect on prices would have been different if Saudi Arabia had boosted production by 1 million or 1.5 million barrels a day.

Saudi Arabia often adjusts its output to meet demand, and the increase coincides with the start of the peak driving season in the U.S. The Middle Eastern nation has in the past acknowledged the ability to produce as much as 11 million barrels a day.

James Cordier, president of Liberty Trading Group in Tampa, Fla., agreed that the moves by both the U.S. and Saudi Arabia were "insignificant" and would do little to dent the rally in oil prices. Like a number of other analysts, he believes prices are rising not because of a speculative bubble, but simply reflect finite supply and soaring global demand.

Crude's latest surge comes a week before the Memorial Day holiday, the traditional start of the summer driving season, suggesting that retail gas prices still have further to rise. Motorists are now paying a national average of $3.787 a gallon for regular gasoline, up nearly a penny from the previous day, according to AAA and the Oil Price Information Service.

Diesel prices also have risen to record levels, meaning that even Americans who don't drive will likely face even higher prices on all sorts of goods because of increased shipping costs. A gallon of diesel now sells for $4.482 a gallon.

Oil prices could rise even higher as U.S. demand picks up during the summer months, when gasoline consumption is typically the heaviest. Traders are clearly betting gasoline prices have a way to go too: Gasoline futures jumped to a record $3.2438 a gallon on the Nymex before easing slightly to settle at $3.2235, up 5.777 cents.

In other Nymex trading, heating oil futures rose 8.04 cents to settle at $3.7028 a gallon. Natural gas futures fell 30.5 cents to settle at $11.094 per 1,000 cubic feet.

In London, July Brent crude surged $2.36 to settle at $124.99 a barrel on the ICE Futures exchange.

Toyota said that the third limited-production Scion for 2008, the xD Release Series 1.0 will be available at dealer showrooms beginning in June.

Only 2,000 of the vehicles, all painted with a Hot Lava exterior, will be built.

The xD RS 1.0 model will carry a manufacturer's suggested retail price (MSRP) of $1,999 over the base price of the xD. The manual transmission xD carries a base MSRP of $14,550, while the MSRP for the automatic transmission model is $15,350.

As you all know, Toyota's sales and marketing headquarters is in Torrance.

In today's paper.

El Segundo base welcomes a new leader By Muhammed El-Hasan, Staff Writer

The Air Force's El Segundo-based procurement arm for satellites, rockets and other space systems will welcome a new commander today.

Lt. Gen. Michael A. Hamel will relinquish command of the Los Angeles Air Force Base's Space and Missile Systems Center to Lt. Gen. John T. "Tom" Sheridan.

The change of command will occur at a ceremony this morning at Fort MacArthur in San Pedro, ending Hamel's three-year tenure at the center's helm.

In the afternoon, a retirement ceremony for Hamel will feature a battery of 15 firing howitzer cannons and an F-16 fighter jet flyover to salute the outgoing commander.

Read the full story.

I wouldn't be surprised if the US led the slowdown.

UN: World economy to grow by 1.8 percent in 2008

UNITED NATIONS (AP) -- The world economy is "teetering on the brink" of a severe downturn and is expected to grow only 1.8 percent in 2008, the United Nations said in its mid-year economic projections Thursday.

That's down from a global growth rate of 3.8 percent in 2007, and the downturn is expected to continue with only a slightly higher growth of 2.1 percent in 2009, the U.N. report said.

The mid-year update of the U.N. World Economic Situation and Prospects 2008 blamed the downturn on further deterioration in the U.S. housing and financial sectors in the first quarter, which is expected to "continue to be a major drag for the world economy extending into 2009."

But the U.N. said developing countries will suffer as badly: They should grow by 5 percent this year and 4.8 percent next year, compared to a robust 7.3 percent in 2007, the report said.

The U.N. economists said the deepening credit crisis in major market economies triggered by the U.S.-led slump in housing prices, the declining value of the U.S. dollar, persistent global imbalances and soaring oil and commodity prices pose considerable risks to economic growth in both developed and developing countries.

"The baseline forecast projects a pace for world economic growth of 1.8 percent in 2008," the U.N. report said.

However, it said the final figure will largely depend on developments in the United States.

Global growth this year could fall to 0.8 percent if the U.S. sub-prime mortgage market turmoil has a more serious impact on developing countries and countries in transition, the U.N. report said.

But if the monetary and fiscal measures the U.S. government has taken to stimulate the economy -- including tax refunds and lower interest rates -- boost consumer spending and restore confidence in the business and banking sector, the world economy could only slow to 2.8 percent growth this year and 2.9 percent in 2009, it said.

The report, prepared by the U.N. Department of Economic and Social Affairs, forecast that U.S. economic growth will decline from 2.2 percent in 2007 to -0.2 percent this year, with only slight recovery in 2009 to 0.2 percent growth.

"At issue is how deep and long this contraction will be," the report said. "As the housing slump continues and the credit crisis deepens, a broad array of ... indicators are already hinting at a recession."

It cited a decline in U.S. employment, consumer confidence at its lowest level in a decade, household spending growth slowing sharply and business equipment spending slowing alongside large inventories of housing and a 30 percent decline in residential investment.

This strongly suggests "that the implosion of housing activity will not stabilize until 2009," the report said.

As for other developed countries, the U.N. forecast that Japan's economic growth will decline from 2.1 percent in 2007 to 0.9 percent in 2008 and that Western Europe's growth rate will drop from 2.6 percent last year to 1.1 percent this year.

Despite the slowdown in global economic growth in 2008, the U.N. said global inflation is expected to accelerate this year to 3.7 percent.

The report said the recent sharp rise in commodity prices and the continued rise in oil prices are key factors spurring inflation along with higher wages.

The growth of world trade also slowed from 7.2 percent in 2007 to 4.7 percent in early 2008, largely due to weak U.S. demand for imported goods, it said.

Boeing issued a statement on its loss today to Lockheed Martin Corp. for a $1.46 billion Air Force contract to build a new network of navigation satellites for military and civilian use, known as GPS III.

Had it won, Boeing would have built the satellites in El Segundo.

Here's the statement: "Boeing is disappointed by this loss, for we assembled a great team that submitted a solid proposal for the GPS III program. We look forward (to) receiving the debrief from the United States Air Force."

Boeing's satellite factory is in El Segundo.

Lockheed Beats Boeing for $1.46 Billion GPS Satellite

(Bloomberg) -- Lockheed Martin Corp., the world's largest defense company, beat Boeing Co. for a $1.46 billion U.S. Air Force award to build a new network of navigation satellites for military and civilian use.

The contract covers development of the first two Global Positioning System III satellites, with options for 10 more, the Defense Department said in a statement today.

The current constellation of 33 GPS satellites lets the Air Force direct so-called smart bombs to targets and also helps civilian pilots, drivers and hikers pinpoint their locations. Boeing's ties date to the first award in 1974 and since then it has delivered almost twice as many satellites as Lockheed, which won its first order in 1989. Today's award cedes the next generation to Bethesda, Maryland-based Lockheed.

``Lockheed Martin is proud to be selected,'' Stephen Tatum, a company spokesman, said in an interview. ``This win represents an important achievement for the corporation.''

The loss is Boeing's fourth straight in three months on a U.S. defense contract valued at more than $500 million.

Read the full story.

Chevron Corp said that it was shutting down a unit at its 260,000-barrel-per day El Segundo refinery after it malfunctioned and triggered flaring on Wednesday afternoon, according to Reuters.

"The flaring was due to a failure of a gas compressor in one of the process units," Chevron spokesman Lloyd Avram told Reuters. "Process gas from the unit -- which is propane and butane -- is being sent to the safety flare."

Here's a link to Reuters.

Homeowners in LA County set a new foreclosure record in March, according to a Default Research, which collects such data.

LA County had 11,666 homes were entering some stage of foreclosure in April -- through a Notice of Defaults and Notice of Trustees Sale. That's up 230% from the same month last year.

"About 2.3 percent of L.A. households are facing foreclosure," said Serdar Bankaci, founder of Default Research. "Unfortunately families all over the region who watched their home appreciate for years are now seeing that the real estate pendulum does swing both ways."

The hardest hit cities in LA County were Los Angeles (with 2,137), Palmdale (960), Lancaster (896), Long Beach (524) and Santa Clarita (302).

But in Southern California, Riverside was the most distressed with a 450% year-over-year increase in foreclosure actions last month.

One of Toyota's Texas dealerships is the first in the nation to receive the US Green Buidling Council's gold certification for LEED, or Leadership in Energy and Environmental Design.

The designation further bolsters Toyota's image as an environmentally-friendly car maker.

According to the USGBC, 48% of the nation's energy is used by buildings, including 70% of the nation's electric use.

Just to remind you, Toyota US sales and marketing headquarters is in Torrance.

Will Obama's wife make divestments?

McCain's wife sells Sudan-related investments

By JIM KUHNHENN, Associated Press

Cindy McCain, whose husband has been a critic of the violence in Sudan, sold off more than $2 million in mutual funds whose holdings include companies that do business in the African nation.

The sale on Wednesday came after The Associated Press questioned the investments in light of calls by John McCain, the likely Republican presidential nominee, for international financial sanctions against the Sudanese leadership.

McCain, who was campaigning in Ohio, said neither he nor his wife were aware of the Sudan-related holdings.

Last year, at least four presidential candidates divested themselves of similar holdings involving companies doing business in Sudan.

According to McCain's personal financial disclosure, Cindy McCain's investments include two mutual funds -- American Funds Europacific Growth fund and American Funds Capital World Growth and Income fund -- that are listed by the Sudan Divestment Task Force as targets for divestment.

"Those have been sold as of today," said McCain spokesman Brian Rogers. Both funds have holdings in Oil & Natural Gas Corp., an India-based company that does business in Sudan. The American Funds Capital World Growth & Income Fund also has holdings in Petrochina, a Chinese government-owned oil company with vast investments in Sudan.

Last year, in a speech on energy policy to the Center for Strategic and International Studies in Washington, McCain cited China's investments in Sudan as an example of regimes that survive off free-flowing petro dollars.

"The politics of oil impede the global progress of our values, and restrains governments from acting on the most basic impulses of human decency," he said. "There is only one reason China has opposed sanctions to pressure Sudan to stop the killing in Darfur: China needs Sudan's oil."

On Wednesday, Rogers said: "Senator and Mrs. McCain remain committed to doing everything possible to end the genocide in Darfur."

After touring a waste-reprocessing plant near Columbus, Ohio, described the American Funds as "one of the country's largest mutual funds."

"Obviously, we didn't know about it and I didn't know anything about it until I saw the story, because I don't have anything to do with her finances," he said. "But they divested as soon as it was brought to us."

For the McCains, the Sudan-related investments are among scores of different investments listed in his financial disclosure documents. Cindy McCain is heiress to a Phoenix-based beer distributing company whose fortune is in the $100 million range.

Sen. McCain is regularly ranked among the richest lawmakers in Congress, but under the terms of a prenuptial agreement, much of the family's assets are in Cindy McCain's name. While the disclosure reports provide the identity of income and assets held by candidates and their spouses, they only offer a range of the amount of the holding. Indeed, the report lists Cindy McCain's investments in the two mutual funds as simply "over $1,000,0000."

In tax returns he released last month, the Arizona senator reported a total income of $405,409 in 2007.

But Cindy McCain files separate tax returns which she has not made public. Last week, she said she would never make her returns public even if her husband becomes president.

Later Wednesday, the Democratic National Committee reiterated its call for Cindy McCain to release her tax returns. "The fact the McCain family was holding Sudan-related investments even as John McCain was out on the campaign trail calling for sanctions is a reminder of why the American people expect and deserve full disclosure from their elected officials," said DNC spokesman Damien LaVera.

McCain aides pointed out that the Sudan investments were contained in publicly disclosed data. John McCain on Wednesday also defended his wife's decision not to release her tax returns.

"When we file our (financial disclosure) report in the Senate, there's quite a bit of information in there," he said.

The Sudan-related investments illustrate the hazards for wealthy candidates whose vast holdings undergo thorough scrutiny during a presidential campaign.

A year ago, several presidential candidates divested themselves of Sudan-related holdings. Among them were Democrats Barack Obama and John Edwards and Republicans Sam Brownback and Rudy Giuliani.

In 2006, Brownback was among members of Congress who wrote 44 governors to urge them to divest their employee pension funds from businesses linked to Sudan. He is now serving as a top adviser to McCain's campaign.

At the time, Obama placed the total value of his divestitures at $180,000. The sales of the investments were recorded in their financial disclosures.

According to Giuliani's financial disclosure, he invested between $500,000 and $1 million in a Vanguard Wellington Fund. Data compiled by the Sudan Divestment Task Force shows that Vanguard Wellington has a small percentage of stock in Schlumberger Ltd., a French oil field services company that does business in Sudan.

Edwards sold stock he and his wife owned in Schlumberger for between $40,000 and $100,000. He also invested $50,000 to $100,000 in Evergreen Equity Income Fund, another fund identified by the divestment task force as having stock in Sudan-related companies.

"Considering Democrat candidates, including Barack Obama, had the very same type of holdings, it is the height of hypocrisy to attack Senator McCain and his family," said Republican National Committee spokesman Danny Diaz said.

In case you missed it.

Torrance ranks 2nd for foreign businesses in Los Angeles County
By Muhammed El-Hasan, Staff Writer

With car companies, stereo manufacturers and a Japanese-themed mall, Torrance represented the county's second-most popular city for foreign- owned businesses last year, according to a report released today.

Last year, Torrance had 309 foreign-owned companies, including such major operations as Honda Motor Co.'s North American headquarters and Toyota Motor Corp.'s U.S. sales and marketing headquarters.

Only Los Angeles had more foreign-owned businesses at 1,633, according to the report on foreign direct investment by the Los Angeles County Economic Development Corp.

Read the full story.

Why not? The price of everything else is going up.

Honda May Boost U.S. Car Prices as Steel Costs Rise (Update1)

(Bloomberg) -- Honda Motor Co., Japan's second- largest automaker, may increase prices for its vehicles in North America and other markets to offset higher steel and other raw materials costs.

``We will definitely consider it,'' Yoichi Hojo, chief operating officer of Honda's business management operations, said in an interview on May 12 in Tokyo. ``It may be difficult to raise prices right away in Japan and North America, as market conditions are tough.''

Honda's North American headquarters is in Torrance.

Honda, which gets about 70 percent of its operating profit from North America, may follow Toyota Motor Corp. and Nissan Motor Co. in boosting prices in the region. Honda expects a 32 percent drop in operating profit this fiscal year as raw materials prices and a stronger yen erode earnings.

``The global automakers have to tackle some negative situations,'' Hirofumi Yokoi, an analyst at CSM Worldwide, said in an interview with Bloomberg Television yesterday in Tokyo. ``They have to consider all the things to achieve their goals.''

Read the full story.

Skechers USA Inc., the Manhattan Beach-based maker of trendy shoes, will use starlet Tori Spelling and her 13-month-old son, Liam, as the first celebrity pairing to promote the company's new family footwear brand "Nothing Compares to Family," Skechers said Tuesday.

Skechers is touting what is says is the brand's cross-generational appeal. The promotion, slated to run through next year, stars celebrity families and benefits children's charities with ads in celebrity weekly magazines and other fashion and lifestyle glossies.

Tori Spelling is best known for her starring role in the '90s show "Beverly Hills, 90210." Tori and her husband and their son currently star in the Oxygen reality series, "Tori
& Dean: Home Sweet Hollywood."

A lot of people will agree with this.

Economic 'misery' more widespread

(CNNMoney) Americans are feeling a lot more economic pain than the government's official statistics would lead you to believe, according to a growing number of experts.

They argue that figures for unemployment and inflation are being understated by the government.

Unemployment and inflation are typically added together to come up with a so-called "Misery Index."

The "Misery Index" was often cited during periods of high unemployment and inflation, such as the mid 1970s and late 1970s to early 1980s.

And some fear the economy may be approaching those levels again.

Read the full story.

In today's paper.

Port trade forecast is gloomy
By Muhammed El-Hasan, Staff Writer

The Los Angeles Customs District will see muted growth this year as shaky economic factors weigh on international trade, according to a study released today.

The total value of imports and exports through the customs district is forecast to reach $365.7 billion, up 4.7 percent from last year, according to the study by the Los Angeles County Economic Development Corp.

The largest portion of the customs district traffic goes through the ports of Los Angeles and Long Beach, as well as Los Angeles International Airport.

The two ports will see a 1percent annual increase in loaded container traffic this year, to a combined 15.8 million 20-foot equivalent containers, the study forecasts.

"We're used to 10-percent-a-year growth in container traffic," said Jack Kyser, chief economist at the LAEDC. "We didn't get that last year. We won't get that this year. The question is, will it recover next year?"

Read the full article.

See it for yourselves. Here's the video.

US Aerospace employment increased just slightly in March to 651,700, compared to the 2007 year-end average of 645,600, according to the Aerospace Industries Association.

Aerospace employment has climbed steadily since hitting a 2003 low of 587,100.

Employment is tied closely to industry sales, which reached a record $198.8 billion in 2007 and are expected to eclipse $210 billion in 2008, AIA said.

The industry is facing a potential workforce "crisis" as longtime employees retire. Almost six in 10 US aerospace workers was at least 45 years old last year.

AIA President and CEO Marion Blakey said in a statement: "As the workers that won the Space Race and the Cold War get ready to retire, there is a whole world of opportunity in this industry. We can't encourage the next generation of workers enough to study math and science so as to take advantage of the enormous number of exciting career opportunities."

California didn't do so hot.

Home prices continue sharp descent

(CNNMoney.com) Single-family home prices dropped 7.7% in the first quarter in the largest year-over-year decline since the National Association of Realtors began reporting prices in 1982.

The median sales price fell to $196,300, down 4.8% compared with the last three months of 2007.

Lawrence Yun, the chief economist of NAR, attributed much of the record decline to liquidity problems dragging down high-priced markets.

"These are highly unusual results because there were very few jumbo loan originations in the latest quarter," he said. "So sales are much slower in high-cost areas."

Sun-Belt cities were among the biggest losers. In California, Sacramento prices plummeted 29.2% to $258,500 compared with last year and Riverside prices fell 27.7% to $287,100. Prices in Las Vegas fell 20.2% to $247,600 and those in Phoenix dropped 15.4% to $222,200.

Read the full story.

The South Bay's first Fresh & Easy Neighborhood Market will open on July 2 in Manhattan Beach, the retailer said Monday.

The Manhattan Beach store will be located at 1700 Rosecrans Ave., along a busy upscale commercial area. The cross street is Douglas Street.

British retail giant Tesco is opening dozens of grocery stores across California, Arizona and Nevada. Each store is about 10,000 square feet, offering fresh, prepared meals and produce, as well as national and private-label household products.

Tesco 's US division is based in El Segundo.

The US Air Force has placed the first Boeing-built Wideband Global SATCOM satellite into operation over the Pacific region, Boeing said Monday.

Built in El Segundo, the satellite "transitioned to operations" on April 16 after extensive tests proved the systems worked.

Each so-called WGS satellite has the capacity to transmit information at rates of more than three gigabits per second, more than 10 times the capacity of the government's Defense Satellite Communications System.

WGS-1 was launched Oct. 10 from Cape Canaveral Air Force Base in Florida.

"WGS-1 is the highest capacity Department of Defense communications satellite on orbit," Craig Cooning, vice president and general manager of Boeing Space and Intelligence Systems, said in a statement. "WGS-1 is now providing essential support to military operations overseas, and Boeing looks forward to launching the second and third WGS satellites in the coming months."

Read a profile on Cooning.

It's not a conspiracy.

The Slump: It's a Guy Thing

(BusinessWeek) They eat from the same dishes and sleep in the same beds, but they seem to be operating in two different economies. From last November through this April, American women aged 20 and up gained nearly 300,000 jobs, according to the household survey of the Bureau of Labor Statistics (BLS). At the same time, American men lost nearly 700,000 jobs. You might even say American men are in recession, and American women are not.

What's going on? Simply put, men have the misfortune of being concentrated in the two sectors that are doing the worst: manufacturing and construction. Women are concentrated in sectors that are still growing, such as education and health care.

This situation is hardly good news for women, though. While they're getting more jobs, their pay is stagnant. Also, most share households--and bills--with the men who are losing jobs. And the "female" economy can't stay strong for long if the "male" economy weakens too much.

Read the full story.

I've interviewed a number of generals over the years, none of them as easy-going as Craig Cooning.

Boeing vice president has a Tab on success
By Muhammed El-Hasan Staff Writer

Retired Air Force Gen. Craig Cooning sits at a side table in his El Segundo office, an open can of Tab diet soda at his elbow.

Another of the distinctive pink Tab cans sits on Cooning's desk, 12 stories above the runways of LAX.

On a display case - amid mementoes that include an ink well from his grandparents and a toy dancing hamster - a model satellite made of Tab cans helps put Cooning's distinctive mark on his work space.

"I got hooked on Tab in the '70s," Cooning explained during a recent interview in his office.

On Feb. 1, this retired two-star general with the casual manner of someone hosting a backyard barbecue became vice president and general manager of Boeing Space and Intelligence Systems, Boeing Co.'s satellite development arm.

Cooning is responsible for 7,500 employees, with 5,500 in El Segundo.

Although the business is based in Seal Beach, Cooning spends about three days a week in El Segundo overseeing the Boeing Satellite Development Center, a million- square-foot facility that builds military and civilian satellites.

"Anytime you're closer to the factory where you can kick the tires, so to speak, it changes the tempo," Cooning, 57, said.

Read the full story.

The economic downturn is changing many things.

Carson OKs used-car lot
COMMERCIAL ZONE: City changes policy as market slumps and tax revenues fall.
By Muhammed El-Hasan, Staff Writer

A Carson city ordinance that has lasted at least three decades finally broke under the weight of the nation's slumping car market and resulting drop in municipal sales tax revenue.

Carson has given the green light for a used-car dealership to open in a commercial area, an exception to the city's zoning rules. Previously, dealerships were not allowed to sell used cars as the primary product in commercial zones.

Sonic Automotive Inc., a Charlotte, N.C.-based car retailer, plans to open the car lot this summer, possibly as early as June, according to Carson officials.

The used-car dealership will open at the former site of Don Kott Ford, which closed in December because of the sluggish vehicle market.

An adjacent lot, Don Kott Lincoln Mercury, also closed for the same reason. Both dealerships were owned by Sonic.

"We have to be somewhat pragmatic given the changes in the (car) market," Sheri Repp Loadsman, Carson's planning manager, said of the zoning exception. "We know that the manufacturers are struggling. We know there are only a limited amount of points of sale. What are our options?"

Read the full story.

Hopefully, this won't put newspapers out of business.

El Segundo advertisers see green on TV screens

By Muhammed El-Hasan
Staff Writer

At coffee shops, customers wait to order amid the intermingling scents of lattes and cappuccinos.

After ordering, the patrons wait some more as baristas prepare their drinks.

The founders of an El Segundo-based company see these customers as more than just coffee drinkers.

They are a captive audience - at least until they walk out the door.

Ripple, a small company with 40 employees, is trying to capitalize on this captive audience by selling advertisements on a network of monitors it has installed at coffee shops, juice bars, restaurants and other venues where people wait. Launched in 2006, Ripple has placed screens in about 1,000 locations nationwide, including more than half in Southern California.

"It's getting harder to reach people, with TiVo and the Web," said Ali Diab, 33, co-founder and president of products and technology at Ripple. "This is a chance to capture their attention where there's no other competing media at the time."

Powered by $15 million in venture capital, Ripple is found in the large media markets of Los Angeles, San Francisco, New York City and Boston. The company recently opened a sales office in New York.

Read the full story.

I hope you stocked up on the so-called "forever stamps."

(Bloomberg) The price of a first-class stamp will increase one penny to 42 cents tomorrow, the US Postal Service said on its Web site as a reminder.

Prices for other mailing services, including standard mail, periodicals, package services and special services, will also increase tomorrow, the Postal Service, an independent federal agency, said.

Forty-two-cent stamps will be required on first-class mail weighing an ounce (0.02 kilograms) or less, while first-class mail weighing as much as two ounces will increase 1 cent to 59 cents, the Postal Service said.

Watch Out Boeing and Airbus. I wonder if the Air Force will ever buy aerial refueling tankers from China.
Oh, yea. And happy Mother's Day.

China establishes company to make its own jumbo jets

BEIJING (AP) -- China has established a homegrown company to make passenger jumbo jets, state media reported Sunday -- a step forward in the country's quest to become less dependent on Boeing and Airbus.

China Commercial Aircraft Co. was established in Shanghai with registered capital of 19 billion yuan $2.7 billion, the official Xinhua News Agency said.

It said the central government and the Shanghai government are among the major shareholders, as are China's two main aircraft manufacturing and servicing companies, China Aviation Industry Corp. I and China Aviation Industry Corp. II, which were split off from state-owned China Aviation Industry Corp. in 1999.

Europe's Airbus has forecast that China's domestic market will increase fivefold by 2026. Airbus and Chicago-based rival Boeing dominate the market for commercial airplanes carrying 100 or more people.

Xinhua said Commercial Aircraft Co. will be able to make planes with more than 150 seats.

General manager Jin Zhuanglong said in a Xinhua interview that it was too early to say when a Chinese-developed jumbo jet would be taking off, as it would take a long time to develop homegrown talent and do research.

"According to the development history of Airbus and Boeing, the development and success of civil planes cannot be realized by relying on one or two generations," he said.

This article makes sense to me.

Analysis: Good economic news something of a mirage

WASHINGTON (AP) -- The unemployment rate drops. Productivity grows. The trade deficit shrinks. Sounds great, right? Not so fast.

Borrowing radio broadcaster Paul Harvey's signature saying: let's hear the rest of the story.

Some seemingly good economic numbers can be something of a mirage masking weaknesses in the national economy.

Let's take the unemployment rate, which dipped to 5 percent in April, from 5.1 percent in March. A closer look reveals that the decline in unemployment is not as good as it looks at first blush. The drop came as the number of people holding part-time jobs for economic reasons swelled to 5.2 million in April, up sharply from 4.4 million a year earlier.

The dip in the unemployment rate also occurred as employers cut jobs for the fourth month in a row, pushing up total losses beyond the quarter-million mark -- to 260,000. Wages barely grew and workers' hours were trimmed. Taken altogether, these things point to a tepid picture of employment conditions nationwide.

Federal Reserve Chairman Ben Bernanke and his colleagues recently used the word "softened" to describe the labor situation.

U.S. productivity -- an important ingredient to the country's long-term vitality -- grew solidly in the first three months of this year. That efficiency gain, however, came at the expense of workers.

"Productivity gains were due primarily to declines in hours worked," the Labor Department's Bureau of Labor Statistics explained. Those hours fell at a 1.8 percent pace, the biggest drop in five years. Employers also shed workers in the first quarter. Thus, companies were able to produce more with fewer workers, and that boosted productivity, the amount an employee produces for every hour of work.

"American workers, you just got to love them," said Joel Naroff, president of Naroff Economic Advisers. "They just seem to produce more and more and more. That was the case in the first quarter of the year as fewer workers working fewer hours managed to produce more," he said.

Still, healthy efficiency gains are important for the economy because they can blunt inflation; that's good for companies' profits and good for those earning paychecks.

Let's take a closer look at the nation's trade deficit. It shrank to $58.2 billion in March as the United States' appetite for imports fell faster than foreign demand for U.S. exports.

A drop in the United States' foreign oil bill -- reflecting less oil being imported -- played an important factor in the decline in imports. However, demand for foreign-made autos, furniture, toys, clothing and other goods also waned, underscoring the strains faced by U.S. consumers.

Consumers have turned cautious, battered by housing and credit problems and high food and energy prices. Many -- watching their single-biggest assets, their home, sink in value are less inclined to spend. High energy and food prices are leaving people with less cash to buy other things. And, harder-to-get credit has made financing big-ticket goods, like cars, appliances and of course, homes, more difficult.

In the first quarter of this year, consumer spending increased at the slowest pace -- a mere 1 percent growth rate -- since the last recession in 2001. Consumer spending accounts for the single-biggest chunk of U.S. economic activity. Thus, how consumers behave shapes whether the country will survive the blows of the housing, credit and financial debacles or fall victim to them as many fear.

U.S. exports, meanwhile, have been helped by the falling value of the U.S. dollar. That makes U.S.-made goods and services less expensive to foreign buyers. But that weaker dollar also makes imported goods more expensive in the United States. That contributes to the surging prices for oil, food and other commodities.

And, while falling interest rates in the United States help ordinary people and businesses, it also contributes to the dollar's decline. Add to that the perception of economic weakness in the United States and the U.S. dollar has fallen to record lows compared with the euro.

Still, export growth played an important role in keeping the economy growing -- albeit slowly -- during the first quarter. "Exports are booming and helped keep GDP in the black," said Commerce Secretary Carlos Gutierrez. Gross domestic product, or GDP, measures the value of all goods and services produced in the United States. It grew by a feeble 0.6 percent growth rate from January through March.

When exports and business' inventories are removed and imports are added in, economic activity actually contracted at a 0.4 percent pace in the first quarter. That figure shows that U.S. consumers have a dwindling appetite to spend.

Many economists -- and members of the public -- believe the economy is in a recession. Bernanke has said a recession is possible, while President Bush acknowledges the country is going through tough times. Both men hope the Fed's seven-month rate-cutting campaign and the government's stimulus package of rebates and tax breaks will lift the country out of its slump later this year.

Meanwhile, the mirage continues.

In another anomaly, consumer borrowing rose in March at the fastest clip in four months. It sounded like people were back in a buying groove, with credit card charges especially heavy. But building up the credit charge balances is another form of debt. Economists said people don't have a choice because their paychecks aren't going as far and they can't tap into their homes, as they did during the housing boom, for ready sources of cash.

So some silver linings are not so silver.

When you look closely, "you do see some dark economic clouds in the silver linings," said Mark Zandi, chief economist at Moody's Economy.com. "The darkness is much greater than any sunshine."

I attended Northrop's Friday rally and celebration over its win of the KC-45 aerial refueling tanker for the Air Force.

At $35 billion, its the second biggest Department of Defense contract ever.

This link will send you to the full story.

The event was held in a parking lot outside an design center where Northrop engineers develop some of the most technologically advanced military aircraft systems including for unmanned aircraft.

The mood was festive. It had the air of a political rally, with Northrop executives and local politicians insisting that Boeing's challenge to Northrop's contract win was basically ridiculous. Behind the the speakers' podium, employees waved small American flags like a presidential candidates rally, creating a patriotic image meant to impress anyone who sees the images from home.

Northrop says that it won the Air Force contract fair and square, and that Boeing is using politics to overturn the result. If that's true, then Northrop is also using politics to maintain its win. Northrop employees were asked to contact their Congress members to support the Northrop win.

The event reminded me of two clear memories I have.

One was at a Northrop dinner a few years ago where chairman and CEO Ron Sugar told the attendees that the company's political clout in Washington DC had increased dramatically.

The other was an interview I had with Sy Ramo, co-founder of TRW and now an adviser to Sugar and other Northrop top brass. Ramo bemoaned the politicization of the defense industry, where defense systems are purchased due, in large part, to political factors -- which Congressional districts get which jobs -- rather than strictly based on what is best for the defense of the nation.

Ironic, huh?

This makes sense.

Toyota's 28% decline still enviable

(DETROIT FREE PRESS) Thursday was a rare bad day for Toyota Motor Corp., the world's second-largest and most profitable automaker.

Toyota, whose US sales and marketing headquarters is in Torrance, reported a 28% decline in fiscal fourth-quarter earnings and saw its stock slide 4% on the day. Toyota's stock closed at $100.56 Thursday, down $4.20 per share.

Toyota's net income fell to 316.8 billion yen -- $3.2 billion -- for the three months ending March 31, based on that day's exchange rates.

The automaker missed the 375.2 billion yen median of six analyst estimates compiled by Bloomberg.

But a bad day for Toyota may still be the envy of the auto industry. For the same 3-month period GM lost $3.3 billion, Ford reported a profit of $100 million and Chrysler LLC, now a private company that does not report results, recently acknowledged that it is not yet profitable.

Like many automakers, Toyota is getting hurt by falling pickup and SUV sales in the United States and rising raw material costs. But unlike the Detroit Three, Toyota is also facing unfavorable currency exchange rates.

"The conditions surrounding Toyota are changing rapidly, with the rise in raw material costs, drastic changes in foreign exchange rates, and more stringent environment regulations worldwide," said Toyota Senior Managing Director Takeshi Suzuki during a conference call Thursday. "We plan to turn all of these challenges into business opportunities."

Toyota also said it expects earnings to drop 27% for its current fiscal year, which runs from April to March. Assuming the yen continues to gain against the dollar and the euro, Toyota expects its operating income will decline by 690 billion yen or $6.9 billion.

"It just shows Toyota is not immune to problems in the economy," said Erich Merkle, a vehicle forecasting analyst for IRN Inc. "They've really been helped by a strong U.S. dollar for a number of years, but now the dollar has gone the other way."

Lehman Bros. equity analyst Tsuyoshi Mochimaru predicted Toyota's dour forecast will continue to depress the company's stock, but also pointed out that Toyota typically provides Wall Street with worst-case scenarios and then outperforms those forecasts.

"We think these are bottom-end targets," Mochimaru said in a research note Thursday. "However, the 30% profit-decline outlook is likely to have a heavy impact on investors."

The last time Toyota's annual profit declined was in the fiscal year ending March 2002; the last time annual sales fell was in the year ending March 2000, mainly because of a weak dollar.

Honda Motor Co., Japan's No. 2 automaker behind Toyota, said last month that its January-March profit declined 86% compared with the same period a year ago because of a corporate tax levied on its Chinese joint venture. Nissan Motor Co. reports earnings next week.

Toyota's full-year results were much better than its fourth quarter. For the year, Toyota said net income increased 4.5% to $1.7 trillion yen ($24.5 billion) this year. Toyota's revenues increased 9.7% from 23.9 trillion yen ($241.4 billion) last year to 26.3 trillion yen ($265 billion).

Toyota reported that sales for the quarter increased 3.7% to 6.6 trillion yen ($66.2 billion).

Toyota also continues to gain market share in the United States and said it reached a record high of 16.3% for the year.

But Merkle said Toyota's problems in North America are significant. Last year, Toyota launched its redesigned Tundra pickup while ramping up output from its new plant that opened in San Antonio, Texas, in 2006.

"It certainly starts to impede profitability when you have a plant that is not operating at full potential," Merkle said.

Toyota's stock is trading at the low end of its one-year range. It is down more than $27 from its 52-week high of $128.33, reached last July. The low over the range was $91.21.

$3.67 is nothing compared to California's gas prices.

Gas jumps above $3.67, oil passes $126 on Venezuela concerns

NEW YORK (AP) -- Oil rose above $126 a barrel for the first time Friday, bringing its advance this week to nearly $10, as investors questioned whether a possible confrontation between the U.S. and Venezuela could cut exports from the OPEC member. Gas prices, meanwhile, rose above an average $3.67 a gallon at the pump, following oil's recent path higher.
On Friday, The Wall Street Journal published a report that suggested closer ties between Venezuelan President Hugo Chavez and rebels attempting to overthrow Colombia's government. Chavez has been linked to Colombian rebels previously, but the paper reported it had reviewed computer files indicating concrete offers by Venezuela's leader to arm guerillas. That appears to heighten the chances that the U.S. could impose sanctions on one of its biggest oil suppliers.

"If we put on sanctions, I'm sure Chavez would threaten to cut off our oil supply," said Phil Flynn, an analyst at Alaron Trading Corp. "Obviously that would have a major impact on oil prices."

Light, sweet crude for June delivery vaulted to a new record of $126.20 in morning trading on the New York Mercantile Exchange before retreating to trade up $1.09 at $124.78 a barrel.

Even if Chavez cut oil shipments to the U.S., Venezuelan oil would still make its way to the U.S. via middle men, who would buy it from Venezuela and resell it to the U.S., Flynn said. But that new layer in the supply chain would bump up costs.

Oil prices also were boosted Friday by the dollar, which declined against the euro. The European Central Bank said it was unlikely to consider interest rate cuts to cool the strong euro against the slumping dollar. Investors often buy commodities such as oil as a hedge against inflation when the greenback falls. A weaker dollar also makes oil less expensive to overseas investors.

Many analysts believe the doubling in oil prices since this time last year has much to do with the dollar's protracted decline. Another school of thought thinks tight global supplies of oil, driven by growing demand in countries such as China, Brazil and India, is the primary factor driving oil higher.

Oil's surge is pushing retail gas prices higher. The national average price of a gallon of regular gas jumped 2.6 cents overnight to a record $3.671 a gallon according to a survey of stations by AAA and the Oil Price Information Service. The Energy Department expects prices to peak at a monthly average of $3.73 in June, though many analysts say national average prices could rise as high as $4. Consumers in many regions, including parts of California and Hawaii, are already paying that much.

Demand for diesel fuel is also growing worldwide, but supplies of distillates, which include diesel and heating oil, fell unexpectedly last week, the Energy Department said Wednesday. That's pushing U.S. diesel prices to record highs and inflating heating oil prices in the futures market; heating oil futures are often viewed as a proxy for diesel.

Heating oil for June delivery rose 7 cents to $3.5798 on the Nymex after earlier setting a trading record of $3.6125. At truck stops, retail diesel prices rose 1.8 cents overnight to a record national average of $4.269 a gallon,

Diesel is used to move most of the world's food, consumer and industrial goods via truck, ship and rail. Skyrocketing diesel prices are part of the reason food and consumer goods prices are so high.

In other Nymex trading Friday, June gasoline futures rose 3.72 cents to $3.175 a gallon, and June natural gas futures rose 13.2 cents to $11.395 per 1,000 cubic feet.

In London, June Brent crude futures rose $1.79 to $124.63 a barrel on the ICE Futures Exchange.

I've given up expecting the price to go down.

Gas jumps nearly 3 cents to record; oil crosses $124

NEW YORK (AP) -- Gasoline and crude oil jumped to new records Thursday, with gas rising 3 cents to an average national price of nearly $3.65 a gallon and oil crossing $124 a barrel for the first time.
At the pump, the average price of a gallon of regular gas nationwide rose 2.7 cents to a record $3.645, according to a survey of stations by AAA and the Oil Price Information Service. Diesel prices also rose, adding 0.9 cent to match a record national average of $4.251 a gallon.

Gas prices tend to lag oil futures, and with crude rising to a new record near $124 a barrel Wednesday and likely headed higher, it's widely expected the average price of gas will soon rise as high as $4. Motorists in many areas, including parts of California and Hawaii, are already paying that much, or more.

"If oil prices go the way that pundits are expecting, there's no way we'll stay under $4 a gallon," said Fadel Gheit, an analyst at Oppenheimer & Co. in New York.

Meanwhile, light, sweet crude for June delivery rose 16 cents to reach a settlement record of $123.69 a barrel on the New York Mercantile Exchange Thursday after spending much of the day in negative territory. But in after-market electronic trading, prices shot to a new trading record of $124.61. Analysts said volume was quite low, making it easy for oil to keep pushing higher.

"This appears to me to be computer-generated buying," said Linda Rafield, senior oil analyst at Platts, the energy research arm of McGraw-Hill Cos. Some investors use software that buys automatically when prices rise to certain levels; Thursday's record settlement may have triggered a flurry of electronic buy orders.

"There is no fundamental news out to cause this market to move like this," Rafield said.

Bullish momentum -- and expectations that the dollar will continue to weaken against foreign currencies including the euro -- are likely to keep pushing oil to new records, he said.

Buy your summer airline tickets soon or risk an additional charge.

Top 3 air carriers boost fuel charge by $20 roundtrip

NEW YORK (AP) -- The three biggest U.S. carriers said Thursday they have again raised ticket prices, this time by $20 roundtrip, to recoup rapidly rising fuel costs.
The increases by American Airlines, United Airlines and Delta Air Lines affect the carriers' fuel surcharges, which now total $130 roundtrip on many flights. That means passengers on some cheap flights could be paying more in fees and taxes than for the airfare itself.

Delta Air Lines Inc. initiated the increase, which applies to most domestic routes. It is the Atlanta-based carrier's second hike in just over a week. The previous increase was quickly matched by competitors.

"This is obviously a result of the current market, and fares have to reflect the cost of doing business," spokeswoman Betsy Talton said.

Representatives for AMR Corp.'s American Airlines and UAL Corp.'s United Airlines said the carriers matched the increase on most routes Thursday.

Airlines have been racing to raise airfares, tack on surcharges, and charge for amenities such as extra bags and legroom as they struggle to cope with soaring energy prices. Many airlines now count fuel as their biggest cost.

The price of jet fuel, like gasoline, has risen rapidly along with the price of crude. A gallon on the spot market in New York was selling for $3.57 as recently as Tuesday, according to the Energy Information Administration. That is up about 78 percent from this time last year.

At the same time, carriers are cutting back on flights to reduce costs and maintain their pricing power as the economy slows. Even so, analysts expect many large carriers to post large losses this year.

"I would say to my CEOs: fasten your seat belts, tougher times are coming," Giovanni Bisignani, director general and chief executive of the International Air Transport Association trade group, said in an interview.

Rick Seaney, chief executive of airfare research site FareCompare.com, said the increases mean that fees and taxes together now cost more than the actual base fare on several short-haul flights.

"With a backdrop of a slowing economy, I continue to look for a tipping point where domestic air travelers begin to significantly push back on record high airline ticket prices. At best the jury is still out," Seaney said in an e-mail.

Delta shares fell 10 cents to $7.57. AMR shares fell 26 cents to $8.31, while UAL shares fell 28 cents to $13.54.

The reason Americans want their leaders' tax returns is to make sure they're not making decisions simply to financially benefit themselves or their families.

Cindy McCain says she'll never release her tax returns 2 hours, 24 minutes ago

(AP) Cindy McCain says she will never make her tax returns public even if her husband wins the White House and she becomes the first lady.

"You know, my husband and I have been married 28 years and we have filed separate tax returns for 28 years. This is a privacy issue. My husband is the candidate," Cindy McCain, wife of Republican presidential nominee-in-waiting John McCain, said in an interview aired on NBC's "Today" on Thursday.

Asked if she would release her tax returns if she was first lady, Cindy McCain said: "No."

The Arizona senator released his tax return last month, reporting he had a total income of $405,409 in 2007 and paid $84,460 in federal income taxes. He files his return separately from his wife, an heiress to a Phoenix-based beer distributing company whose fortune is in the $100 million range.

Sen. McCain is routinely is ranked among the richest lawmakers in Congress, but he and his wife have kept their finances separate throughout their marriage. A prenuptial agreement left much of the family's assets in Cindy McCain's name.

Democratic National Committee Chairman Howard Dean said Cindy McCain's refusal to release her tax returns gives the appearance of a double standard on the part of her husband.

"What is John McCain trying to hide?" Dean said in a statement. "Throughout this campaign, he has acted like his own calls for openness and accountability apply to everyone but himself. Now he thinks he can bring that same double standard to the White House."

Democrats Barack Obama and Hillary Rodham Clinton filed joint tax returns with their spouses and publicly released those returns.

Everyone's suffering from the economic downturn.

Toyota Feels Slowdown in U.S.

(NYT) TOKYO -- Toyota Motor said Thursday that the slowdown in the United States economy would probably cause its first annual profit drop in nine years, accelerating a shift by it and other Asian car manufacturers into emerging markets like China, Latin America and the Middle East.

The shifting emphasis toward emerging markets is part of a broader trend in the industry, and underscores the declining stature of the United States in the global economy. Both Asian carmakers and American rivals like General Motors have seen a rising portion of sales in emerging markets that were not even a factor a decade ago.

Toyota, now in a dead heat with G.M. to be the world's largest car company, said most of its recent profit growth has come in new markets like Brazil, China and Russia. It said the growth helped offset sluggish sales in the United States, traditionally Toyota's largest and most profitable market, and other mature economies like Europe and Japan.

"Our profit structure has become more geographically balanced, with growing contributions from resource-rich countries and emerging countries," Toyota's president, Katsuaki Watanabe, said in a statement.

This shift has been partly driven by the faltering prospects of the United States market. Declining American sales, along with the weakening dollar and rising material prices, prompted Toyota to forecast a 27.2 percent decline in net profit to 1.25 trillion yen, or $12.5 billion, during the current fiscal year, which ends in March 2009. Last month, Honda Motor projected an 18 percent drop in net profit this fiscal year, citing similar reasons.

Read the full story.

One of them is journalism. Yeah!

Taxing Jobs Pay Off in the End

(Time) When it comes to keeping your brain healthy - and working at its best - doctors have long advised patients to "use it or lose it." The idea is to keep the intellectual highways humming; if circuits aren't used, they tend to deteriorate and eventually wither away, leading to dementia, and in some cases,Alzheimer's. But new research provides a twist on this familiar advice - it turns out that some people benefit more from using it than others.

Psychiatrists led by Guy Potter at Duke University conducted a study of more than 1,000 male twins, most of whom were World War II veterans. Potter collected 50-year-old data on the vets' IQ scores when they joined the Army, and then compared them to cognitive test scores the men generated after they retired from various jobs. He found that those who scored in the bottom quartile of the IQ scale when they were in their 20s, and then took on mentally challenging jobs, had the greatest gains on the cognitive tests in their 70s. "Being in a more complex job later in life helped them to develop skills they might not have had, or pushed them in ways so they were able to overcome their intellectual limitations," says Potter.

That means that those with the lowest cognitive abilities are most likely to lose it if they don't use it, and also most likely to protect themselves from dementia and other cognitive problems by keeping their brain circuits active. Not surprisingly, the jobs that proved most beneficial to these folks include the higher degree professions such as law, medicine and journalism, but any career that required multi-tasking, organizing and managerial skill also boosted cognitive abilities later in life. "Any job that requires you to keep fresh, whether it is new sales techniques or learning about new products, can keep you stimulated intellectually," says Potter. Even being self-employed can qualify, since it requires considerable managerial and organizational skills. "People who are self-employed contractors or plumbers, for example, may be doing plumbing most of the day, but they have to also do inventory, prepare bids, and schedule workers, all of which adds a level of complexity."

Read the full story.

That could be a sign that true inflation is rising much faster than the government statistics indicate.

Consumers increase their borrowing in March at the fastest pace in 4 months

WASHINGTON (AP) -- Consumer borrowing rose in March at the fastest pace in four months, more than double the increase of the previous month, in what was seen as a sign of rising economic stress.

The Federal Reserve reported Wednesday that consumers increased their borrowing at an annual rate of 7.2 percent, compared with a 3.1 percent rate of increase in February.

The gain was much larger than economists had been expecting and reflected strong borrowing on credit cards and also in the category that includes auto loans. The increase in consumer debt totaled $15.3 billion at an annual rate in March, much bigger than the $6 billion increase that economists had been expecting.

Economists said consumers were being forced to make greater use of their credit cards during hard economic times when they are being battered by job losses, soaring gasoline prices and higher food costs.

"This represents distressed borrowing. Consumers need cash and they have turned back to their credit cards to fill the void left by lost jobs and weaker incomes," said Mark Zandi, chief economist at Moody's Economy.com.

Borrowing on credit cards was up at an annual rate of 7.9 percent, compared to a 5 percent gain in February, while borrowing in the category that includes auto loans jumped by 6.8 percent, compared to a 2 percent increase in February.

The overall growth in debt of 7.2 percent at an annual rate was the biggest gain since an increase of 8.25 percent last November.

Consumers have been moving to put more of their purchases on their credit cards as banks have tightened lending standards for home equity loans in response to the deepening credit crisis.

The Fed's measure of consumer borrowing, which does not include any debt secured by real estate such as mortgages or home equity loans, stood at a record $2.558 trillion in March.

But why don't we feel richer?

Worker productivity up at 2.2 percent rate in first quarter

WASHINGTON (AP) -- Worker productivity rose by a better-than-expected amount in the first three months of the year while labor cost pressures eased.
The Labor Department reported Wednesday that productivity, the amount of output per hour of work, increased at an annual rate of 2.2 percent in the first quarter. That was slightly higher than the 1.5 percent increase that had been expected.

In a sign that inflation could be easing, labor cost pressures slowed a bit. Unit labor costs rose at an annual rate of 2.2 percent, down from a 2.8 percent rise in the final three months of last year.

While rising wages and benefits are good for employees, those increases can lead to higher inflation if businesses are forced to boost the cost of their products to cover the higher payroll costs.

However, if productivity is increasing, it allows businesses to finance higher wages out of the increased output.

The Federal Reserve, always on guard about the threat of inflation, closely monitors developments in productivity since wage pressures are often the main way inflation gets out of control.

The Fed last week boosted a key interest rate for the seventh time since September, but the increase was a smaller quarter-point move and the Fed signaled that it may pause its rate cutting campaign in part because of concerns about inflation.

Analysts read the bigger-than-expected rise in productivity and the smaller increase in unit labor costs as a good sign that inflation pressures, at least on the labor front, are remaining under control and the country is not facing the danger of a wage-price spiral.

"There is certainly nothing to worry about here from a cost-push inflation perspective," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.

Scottrade, the online investment firm that also serves customers at its branch offices, said it will open a location in El Segundo.

The branch, located at 831 N. Douglas St. at the Edge at Campus El Segundo, opens on Monday, May 12.

The branch will be managed by Richard Chun, who has 24 years of financial services experience.

Scottrade's other nearby offices are in Torrance and Santa Monica.

DirecTV share rose 93 cents, or 3.6%, in morning trading.

DirecTV profit rises 10 pct on demand for high-def service

(AP) El Segundo-based satellite television company DirecTV said Wednesday its first-quarter earnings rose 10.4%, as it acquired more subscribers in the U.S. and Latin America and customers spent more on high-definition and video recording services.

DirecTV Group Inc. also said media mogul John Malone's Liberty Media Corp. had agreed to restrict its voting interest to 48 percent in exchange for DirecTV's decision to increase its share repurchase program to $3 billion, funded by up to $2.4 billion in new debt.

Its shares rose $1, or 3.9 percent, to $26.80 in morning trading. They are nearer the high end of their 52-week range of $18.20 to $27.73.

The company said net income climbed to $371 million, or 32 cents per share, in the three months ended March 31 from $336 million, or 27 cents per share, a year ago.

Revenue rose 17 percent to $4.59 billion from $3.91 billion.

Analysts surveyed by Thomson Financial expected a net profit of 31 cents per share on revenue of $4.47 billion.

DirecTV said it added 275,000 net U.S. subscribers, increasing its domestic subscriber base by 5.2 percent to 17.1 million.

Average monthly revenue per subscriber rose 8.6 percent from a year ago to $79.70, driven by price increases for programming, higher fees for HD and DVR equipment and services and better pay-per-view sales.

It added 200,000 net subscribers in Latin America, boosting the subscriber base 24 percent to 3.5 million. Monthly revenue per subscriber rose 20 percent to $53.52, thanks to a weak U.S. currency and growth in Venezuela and Argentina.

In late February, Liberty Media acquired a 41 percent stake in DirecTV by swapping a 16 percent stake in News Corp. plus $625 million in cash.

In April, Liberty increased its stake in the satellite television provider to 48 percent, and analysts had expected Liberty to attempt to buy the whole company.

How will the American consumer, who is trying to cut costs amid a sour economy, react to this?

Toyota raising prices on some models in US this month

TOKYO (AP) -- Toyota Motor Corp., the world's second-biggest automaker by annual vehicle sales, is raising its prices on some U.S. models later this month amid increased worries about its profit growth in the American market.

The price increases, which will start in the middle of May, include a hike of $200 on the 2008 Yaris sedan, which will cost $12,425. The 2009 Camry will go up $200 to $18,920, the automaker's U.S. unit said in a statement released Friday.

The hybrid Camry, introduced as a 2007 model in late 2006, will cost $300 more, at $25,650, Toyota said.

Like other Japanese automakers, Toyota is enjoying sales growth while American automakers are struggling. Soaring gas prices have increased demand for smaller, fuel-efficient cars that Japanese automakers are reputed for.

Toyota, whose US marketing headquarters is in Torrance, faces a challenge in maintaining profits partly because of the recent decline in the dollar, which erodes the value of overseas earnings of Japanese exporters. Worries are also rising about how a U.S. economic slowdown may hurt sales.

Toyota is set to release financial results Thursday, when it could report its first profit drop in nearly a decade.

But it's still faring better than its U.S. rivals. GM lost $3.3 billion in the first quarter. Ford had a surprise profit of $100 million for the same period but expects to lose money this year as the U.S. auto market deteriorates.

Atsushi Kawai, auto analyst with Mizuho Investors Securities in Tokyo, said the price increases of about 1 percent won't make up for the damage Toyota's bottom line is expected to suffer from the weak dollar. The dollar, trading at about 114 yen last year, fell below 100 yen in March and is now trading at around 105 yen.

But he noted Toyota raises prices about this time every year, and the hike was routine.

"Outside people are the ones giving special meaning to the decision" because of the concerns about the U.S. market, he said in a telephone interview. "It is a fact that Toyota is losing some of its momentum."

General Motors Corp., Ford Motor Co. and Chrysler LLC saw double-digit U.S. sales declines last month compared with April 2007. Toyota's U.S. April sales, meanwhile, edged up 3 percent. But during the same period, Honda Motor Co.'s and Nissan Motor Co.'s U.S. sales were up about twice that much.

Nissan already raised U.S. prices in April by $170 to $480 on models including the Versa Hatchback, Altima sedan, 350Z Roadster and the Pathfinder sport utility vehicle. Honda said it has no plans so far to raise its U.S. prices.

Kawai said more time was needed to assess whether Toyota sales will continue to lag even after new models, including the remodeled Corolla, come out.

Toyota is also raising the U.S. prices of some Lexus luxury models. For example, the price of the Lexus IS 350 entry sports sedan will rise $300 to $36,305. The pricing of the 2008 Lexus IS F high-performance sports sedan won't change, Toyota said.

Northrop Grumman Corp. is accepting applications from teachers for the 2008 Weightless Flights of Discovery program, an initiative that places teachers on micro- and zero-gravity flights to test Newton's Laws of Motion and energize students in the formative middle-school years.

Middle-school math and science teachers are welcome to apply for the program at www.northropgrumman.com/teachers.

The Foundation has selected four locations for this year's flights: San Jose (Sept. 18); Florida's Space Coast (Sept. 30); Atlanta (Oct. 7); and the Chicago area (Oct. 21).

Up to 60 teachers in each of the cities will participate. The Foundation chose these locations because of the relatively close connections Northrop Grumman has with these areas, in terms of employee concentration and community involvement.

The catch is you have to buy or lease a Chrysler.

Chrysler offers $2.99 for a gallon of gas

(Chicago Tribune) DETROIT - As gasoline tops $4 per gallon in some areas and crude oil spikes to new records, no major automaker has been hit harder than Chrysler LLC.

The No. 4 U.S. auto seller still relies on trucks and sport utility vehicles for 70 percent of its sales, and buyers are shunning more fuel-efficient models it has introduced in the past few years.

With sales down 23 percent in April and nearly 18 percent for the first four months of the year, the Auburn Hills company on Monday night tried to pull some buyers back. The maker of Chrysler, Dodge and Jeep vehicles announced an offer that caps the price of gasoline at $2.99 a gallon for three years for people who buy or lease new vehicles from Wednesday through June 2.

The offer covers most of its models and is based on 12,000 miles of driving per year and the vehicle's government fuel economy rating. Customers will get a card for buying gas that is linked to their own charge account, Chrysler said. The customer will be billed $2.99 a gallon, and Chrysler will pay the rest.

OSI Systems Inc., the Hawthorne-based maker of security products, said it won a $4.4 million contract from the Transportation Security Administration for the firm's 620DV Advanced Technology X-ray systems.

The TSA will use the X-ray systems for carry-on baggage screening at select US airports.

Next month's magic number could be $130.

Oil hits record above $121 on supply woes

VIENNA, Austria (AP) -- Oil futures surpassed $121 a barrel for the first time Tuesday, the spike fueled by worries about threats to supply and a weakening of the U.S. dollar.

The surge in oil prices was also fueled by hopes that the U.S. economy will be spared a sharp downturn after the release of data Monday showing an unexpected expansion in the U.S. service sector in April, analysts said.

Light, sweet crude for June delivery rose to a record $121.49 a barrel in electronic trading on the New York Mercantile Exchange on Tuesday. The contract later retreated to $121.30 a barrel, up $1.33 from Monday's close.

Crude futures settled on Monday at $119.97 a barrel, up $3.65 from Friday's close.

"The bulls are in control of the market," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. "The economic report out of the U.S. yesterday on the service sector seems to suggest the economic slowdown may not be as deep as initially thought."

"The sentiment is that the oil pricing is likely going to stay quite strong, with a lot of volatility," Shum said.

Meanwhile, a Goldman Sachs analyst on Tuesday predicted that oil prices could reach $150 to $200 a barrel over the next six months to two years, but said that how far prices could climb still "remains a major uncertainty."

"We believe the current energy crisis may be coming to a head, as the lack of adequate supply growth is becoming apparent," analyst Arjun N. Murti wrote in a client note.

He raised his 2008 prediction for benchmark West Texas Intermediate crude to $108 per barrel from $96, and his 2009 estimate to $110 from $105. He lifted his prediction for 2010 and 2011 to $120 from $110.

But he also said it was possible that oil could hit $125 this year and $200 in 2009 before coming down to $150 in 2010.

The dollar weakened against the euro on Monday, attracting investors to oil and other commodities viewed as hedges against inflation. Also, a falling dollar makes oil less expensive to investors overseas. A series of U.S. Federal Reserve rate cuts starting last year weakened the dollar considerably against foreign currencies, and analysts blame the dollar's protracted decline for oil's sharp rise this spring.

Supply outages or potential threats to supply emerged in Iran and Nigeria over the weekend and from Iraq on Monday; events in all three nations have caused prices to spike many times in recent months.

In Iraq, Kurdish rebels warned they could launch suicide attacks against American interests to punish the U.S. for sharing intelligence with Turkey after Turkey bombed rebel bases in Iraq on Friday. In Nigeria, a Royal Dutch Shell PLC spokesman said attackers hit an oil facility belonging to Shell's joint venture in southern Nigeria and that some oil production had been shut down. And Iran's Supreme Leader Ayatollah Ali Khamenei said his country will not bend to international pressure and give up its nuclear program.

Energy investors grow concerned any time conflict breaks out or is threatened in the oil-rich Middle East. Years of unrest in Nigeria have cut off nearly a quarter of the major U.S. supplier's oil output.

Amid the occasional threats to crude supplies, global demand for oil continues to grow. The Chinese and Indian economies are growing by double digits, boosting global demand for oil.

In the U.S., where demand has been dampened over economic concerns, the prince for "gasoline at the pump is averaging 29.4 percent above last year's pace," noted Stephen Schork of the Schork Report. "Meanwhile, average diesel prices are up by 41.1 percent or $1.079 a gallon."

In other Nymex trading, heating oil and gasoline futures were both down by over a penny at $3.29225 and $3.0400 a gallon. Natural gas futures slipped more than 6 cents to $11.145 per 1,000 cubic feet.

Brent crude futures rose 30 cents to $118.29 a barrel on the ICE Futures exchange in London.

Northrop Grumman will hold a celebration for its win of the US Air Force KC-45 aerial tanker contract.

The celebration will occur on Friday at the El Segundo headquarters of Northrop's Integrated Systems sector.

The event could be viewed as part of the PR war going on between Northrop and its losing rival, Boeing, which is lobbying to overturn the Pentagon's decision to award the contract to Northrop and its European partner EADS.

Get used to it, folks.

Oil passes $120, gas prices slip more than a cent Monday May 5, 3:36 pm ET

NEW YORK (AP) -- Oil futures surged to a new record over $120 a barrel Monday, raising concerns about higher prices for gasoline and goods and services throughout the economy. Retail gas prices fell more than a cent over the weekend, but oil's advance increased the likelihood that pump prices would resume their climb.
Supply threats that emerged overseas and a weaker dollar sent light, sweet crude for June delivery to a new trading record of $120.36 a barrel on the New York Mercantile Exchange before futures retreated slightly to settle up $3.65 at a record $119.97.

Oil's sharp rise this year has driven gas prices to unprecedented levels, prompting consumers to reconsider summer vacation plans and limit daily excursions; they're also spending less at malls and shopping centers because they're paying more not just for fuel, but for all kinds of goods and services. Americans are also being pinched by tight credit conditions, a sluggish jobs market and a downturn in the housing market.

"American consumers are being hit hard financially from a bunch of different directions," said Troy Green, a spokesman for AAA.

The average national price of a gallon of regular gas slipped to $3.611 a gallon on Monday, down 1.1 cents from Friday, according to AAA and the Oil Price Information Service. Prices reached a record $3.623 a gallon on Thursday.

But if oil prices continue climbing, gas prices could rise as high as $3.75 a gallon on a national basis, Green said, though, "in some places, it's already above $4 a gallon."

In most years, gas prices peak in May or early June, then mostly decline for the rest of the year. But oil at $120 -- and rising -- may force the experts to rewrite their rulebook.

The mix of factors that drove oil to its latest record were a microcosm of the forces that have nearly doubled oil prices from their levels of about $62 a barrel one year ago. The dollar weakened against the euro on Monday, attracting investors to commodities such as oil which they see as a hedge against inflation. Also, a falling dollar makes oil less expensive to investors overseas. A series of Federal Reserve rate cuts starting last year weakened the dollar considerably against foreign currencies; analysts blame the dollar's protracted decline for oil's sharp rise this spring.

Supply outages or threats emerged in Iraq, Nigeria and from Iran on Monday; events in all three nations have caused prices to spike many times in recent months.

In Iraq, Kurdish rebels warned they could launch suicide attacks against American interests to punish the U.S. for sharing intelligence with Turkey after Turkey bombed rebel bases in Iraq on Friday. In Nigeria, a Royal Dutch Shell PLC spokesman said attackers hit an oil facility belonging to Shell's joint venture in southern Nigeria and that some oil production has been shut down. And Iran's Supreme Leader Ayatollah Ali Khamenei said his country will not bend to international pressure and give up its nuclear program.

Energy investors grow concerned any time conflict breaks out or is threatened in the oil-rich Middle East. Years of unrest in Nigeria have cut off nearly a quarter of the major U.S. supplier's oil output.

Beyond the occasional threats to crude supplies, global demand for oil continues to grow. While demand for oil and gasoline has been soft in the U.S., the Chinese and Indian economies are growing by double digits, boosting global demand for oil.

Diesel prices fell Monday, slipping to a national average of $4.239 from a record $4.251 on Thursday. The runup in prices of diesel, used to power most trucks, trains and ships, is one reason why food prices are so high.

Andy Lebow, senior vice president at MF Global Inc., thinks the gas price declines of the last four days are almost entirely due to crude oil's sharp drop last week; prices fell from $119.93 on Monday as low as $110.30 on Thursday before rebounding. Gas prices tend to follow prices in the futures market, but with some lag.

"If the price of oil remains this high, we could see the price of gas rise another 10 to 15 cents," Green said.

It's impossible to tell whether gas prices will fall this summer, as they have in the past, Green said. However, he noted that demand for gasoline has fallen since early this year, a sign that high prices are cutting Americans' appetite for fuel. Analysts believe falling demand is preventing refiners from raising gas prices fast enough to keep up with oil prices, which they much buy to turn into fuel. While oil prices have risen nearly 94 percent in one year, gas prices are up only 19 percent.

In other Nymex trading Monday, June gasoline futures rose 8.65 cents to settle at $3.0529 a gallon, and June heating oil futures rose 8.78 cents to settle at $3.3065 a gallon. June natural gas futures rose 40.1 cents to settle at $11.178 per 1,000 cubic feet.

Torrance-based American Honda Motor Co. posted April sales of 135,180 vehicles, a
decrease of 1.3% over April 2007 sales of 126,419 vehicles, the company said Monday.

American Honda sold 82,252 cars in April, up 7.1% over last year, and sold 52,655 light trucks, a drop of 12.1% compared to the year-ago period.

Year-to-date American Honda sold 487,822 vehicles, a rise of 0.5% over the same period last year.

On the bright side, Microsoft shares are up.

Yahoo shares fall 17 pct after Microsoft withdraws bid
Monday May 5, 10:15 am ET

SAN FRANCISCO (AP) -- Yahoo shares fell 17 percent in early trading Monday as hopes for the once-dominant search engine dimmed following Microsoft's withdrawal of a $47.5 billion takeover bid.

Analysts believe Yahoo Inc.'s stock price will surrender most, perhaps all, of its 50 percent gain since Microsoft Corp. made its initial offer on Jan. 31 in an effort to challenge online advertising and search leader Google Inc. The anticipated sell-off would leave Yahoo's market value hovering around $30 billion.

Last-ditch talks between Yahoo and Microsoft were fruitless, leading Microsoft to walk away from a deal Saturday.

In early Monday trading, Yahoo shares fell 17.2 percent to $23.73, below Friday's close of $28.67, when investors were still hopeful about a deal.

Microsoft shares rose 2.3 percent, or 66 cents, to $29.30. The shares had declined 10 percent to $29.24 since the bid, reflecting concerns that the proposed marriage would turn into a complicated mess that would enable Google to grow even stronger.

Shares in Google went up 2.3 percent, or $13.06, to $594.35. The company not only averted a marriage it had fiercely objected but also began discussions that could lead to a long-term advertising partnership with Yahoo, a deal made more likely with Microsoft's withdrawal. Any Google-Yahoo alliance, though, would likely face antitrust hurdles.

Yang remained convinced that Yahoo, a company he started in a Silicon Valley trailer 14 years ago, was worth more than the money Microsoft Corp. had offered for the Internet pioneer.

Now he may only have a few months to convince Wall Street that his rebuff of Microsoft's takeover bid was a smart move -- and if he can't, analysts won't be surprised if Yang is either replaced as CEO or forced to consider accepting a lower offer if Microsoft comes knocking at his door again.

"This squarely puts the pressure on Jerry Yang to deliver results and shareholder value," Standard & Poor's equity analyst Scott Kessler said. "You are going to see a lot of shareholders just throwing in the towel because they are going to realize it's going to take awhile for the stock to get back to where it was Friday."

Yahoo shares finished last week at $28.67, slightly less than the $29.40 per share that Microsoft was offering before Chief Executive Steve Ballmer agreed to raise the offer to $33 per share in a last-ditch effort to get a deal done.

Disillusioned shareholders are bound to question whether the rejection of Microsoft's sweetened offer was driven more by emotion and ego than sound business sense.

"Clearly there's frustration," said Darren Chervitz, co-manager of the Jacob Internet Fund, which owns Yahoo stock. "I am not even sure if Yahoo cares about its shareholders because they didn't show much regard for shareholders' best interests in this process."

Despite such negative sentiment, Yahoo shares are unlikely to immediately fall back to their $19.18 pre-bid price, partly because some investors may still be holding out hope that the software maker will renew its takeover attempt if Yahoo continues to struggle.

Accompanied by fellow Yahoo co-founder David Filo, Yang flew to Seattle on Saturday to inform Ballmer that the company wouldn't sell for less than $37 per share -- a price that Yahoo's stock hasn't reached since January 2006.

To win the faith of shareholders, Yang will have to execute a turnaround plan that he began drawing up nearly a year ago after he replaced Terry Semel as CEO amid shareholder angst about the company's financial malaise.

Ballmer also will be under the gun to prove he can come up with another way to challenge Google's dominance of the Internet's lucrative search and advertising markets.

The unsolicited bid was widely seen as Ballmer's admission that Microsoft needed Yahoo's help to upgrade its unprofitable Internet division.

Analysts now expect Ballmer to use the money he had earmarked for the Yahoo acquisition to explore other possible deals with large Internet companies like Time Warner Inc.'s AOL and News Corp.'s MySpace and promising startups like Facebook Inc. and LinkedIn Corp. Microsoft already owns a 1.6 percent in Facebook, the second-largest social network behind MySpace.

But Ballmer is unlikely to be under as much duress as Yang, 39, who has promised that Yahoo's development of a more sophisticated and far-flung Internet advertising platform will produce net revenue growth of at least 25 percent in 2009 and 2010.

That would be a dramatic improvement, considering that Yahoo's revenue rose by 12 percent last year and is expected to grow at about the same pace this year.

Analysts, though, are skeptical about whether Yahoo will be able to hit those targets, raising the chances for a shareholder rebellion if the company stumbles in the next two quarters -- a distinct possibility if advertisers curtail spending in a shaky U.S. economy, as many analysts fear.

As it is, Yang and the rest of Yahoo's board almost certainly will face more lawsuits from incensed shareholders.

Even some of Yahoo's own employees may be irritated because virtually all of them own stock options.

What's more, Microsoft had planned to offer $1.5 billion in retention packages to the thousands of Yahoo employees it wanted to stay on after a takeover.

To help boost its short-term profits and its stock price, Yahoo is widely expected to form a long-term advertising partnership with Google.

Although the final details are still being ironed out, Yahoo wants to hire Google to place some of the text-based ads that appear alongside the search results on its Web site. It's a task that Google already handles for scores of Web sites, including AOL and Ask.com.

But turning to Google for help would be a humbling step for Yahoo after spending more than $2 billion to acquire and build its own technology.

An alliance between Google and Yahoo also would face antitrust hurdles because the two companies combined control more than 80 percent of the U.S. search advertising market.

Yahoo also has been exploring a possible merger with AOL's Internet operations but may now have to contend with a competing offer from Microsoft.

Yahoo also might attempt to placate shareholders by buying back stock.

Kessler believes Yang should use some of his estimated $1.9 billion fortune to personally buy more Yahoo stock even though he already owns 54.1 million shares, or 3.9 percent of the company.

"Jerry Yang really needs to put his money where his mouth is," Kessler said. "If he really thinks Yahoo is worth $37 (per share), then he needs to step up and buy some shares when they are in the low $20."

This surprised me. Microsoft isn't known for giving up.

Microsoft abandons Yahoo bid, rebuffing higher sale price

(AP) Microsoft Corp. withdrew its $42.3 billion bid to buy Yahoo Inc. on Saturday, scrapping an attempt to snap up the tarnished Internet icon in hopes of toppling online search and advertising leader Google Inc.

The decision to walk away from the deal came after last-ditch efforts to negotiate a mutually acceptable sale price proved unsuccessful.

The talks reached a breaking point after Jerry Yang and David Filo, the co-founders of Sunnyvale-based Yahoo, flew to Seattle in the morning to meet personally with Microsoft Chief Executive Steve Ballmer and Kevin Johnson, who runs the software maker's unprofitable online services division, according to someone familiar with the talks. The person was not authorized to speak publicly and asked not to be identified.

"Clearly a deal is not to be," Ballmer wrote to Yang in a letter sent late Saturday.

Microsoft was willing to pay $47.5 billion, or $33 per share, up from the bid's current value of $29.40 per share, according to Ballmer's letter.

But Yahoo's board demanded at least $53 billion, or $37 per share, according to Ballmer. That would have been nearly double Yahoo's stock price of $19.18 at the time Microsoft first made its bid a little over three months ago.

And Yang, who became Yahoo's CEO 11 months ago, wanted $38 per share in a Wednesday meeting, according to the person familiar with the discussions. That meeting was held the day after Yang and Yahoo Chairman Roy Bostock called to ask Microsoft not to withdraw its bid, the person said.

Read the full story.

Is there still hope for Boeing?

Air Force tanker project clears panel May 1, 2008

(Seattle P-I) WASHINGTON -- A team of Northrop Grumman and EADS cleared a key legislative hurdle when lawmakers announced Thursday that the Senate Armed Services Committee has approved startup funding for a new fleet of Air Force tankers.

"This is great news for the tanker project," said Sen. Jeff Sessions, R-Ala., a committee member whose state stands to gain employment from the program. EADS plans to build a tanker-manufacturing facility in Mobile, Ala.

Supporters of The Boeing Co.'s losing bid to build the planes have said they will try to halt the program through congressional action.

But Sen. Carl Levin, D-Mich., chairman of the Senate committee, said Thursday that he would not support any such action before the Government Accountability Office rules in mid-June on the merits of an appeal from Boeing. Chicago-based Boeing claims that the Air Force erroneously selected the EADS team for the multibillion-dollar program.

Read the full story.

(Reuters) Former U.S. baseball star Jose Canseco said on Thursday he had lost his California mansion to foreclosure -- one of the first celebrities to publicly admit being a statistic in the U.S. housing crisis.

Canseco, 43, one of the most flamboyant U.S. baseball players until his retirement from the major leagues in 2001, told the celebrity TV show "Inside Edition" that it did not make financial sense to keep his 7,300 square-foot (678.2 sq-metro) home in the Los Angeles suburb of Encino.

"Inside Edition" said it had foreclosure documents showing Canseco owed a bank more than $2.5 million on the house.

"I've been out of the game for about eight or nine years and obviously this issue with the foreclosure on my home," he told "Inside Edition."

"I do have a judgment on my home and it to me is very strange because it didn't make financial sense for me to keep paying a mortgage on a home that was basically owned by someone else," he said.

Canseco said the foreclosure was not a difficult issue emotionally. But he sympathized with the millions of other Americans who have already lost, or face losing their homes, because of soaring interest rates on sub-prime loans.

"I decided to just let it go, but in most cases and most families, they have nowhere else to go," he said.

It was not clear from the "Inside Edition" report where Canseco was now living.

Read the full story.

Toyota's US marketing headquarters is in Torrance.

GM, Ford US sales down, Toyota up as gas prices rise

DETROIT (AP) -- General Motors and Ford saw double-digit U.S. sales declines but Toyota's sales edged up 3 percent in April as high gas prices accelerated consumers' rush away from trucks and sport utility vehicles.
A downward pattern was expected throughout the industry as gas prices rose to record highs. Automakers reported sales Thursday.

General Motors Corp. said its truck and SUV sales were down 27 percent, dragging down increases in car and crossover sales. GM's overall sales were down 16 percent for the month compared with last April.

"Consumer preference is shifting, and we're shifting with it," said Mark LaNeve, GM's vice president of North American sales. Sales of GM's midsize Chevrolet Malibu shot up 40 percent, but the long popular Chevrolet TrailBlazer SUV saw sales dip 73 percent.

Ford Motor Co. said its SUV sales were down 36 percent in April compared with the same month last year. Car sales were down only 1 percent, buoyed by sales of the Ford Focus small car, which saw a 44 percent jump in sales. The Focus gets 24 miles per gallon in the city and 33 on the highway. By comparison, Ford's largest SUV, the Expedition, gets 12 miles per gallon in the city and 18 on the highway, according to federal statistics. Ford's overall sales were down 12 percent.

Toyota Motor Corp. said its car sales rose 12 percent, largely on the strength of the subcompact Yaris, which saw sales rise 46 percent and the hybrid Prius, which was up 54 percent. Toyota's truck and SUV sales dropped 8 percent.

"Smaller vehicles are going over big," said Jim Lentz, president of Toyota Motor Sales U.S.A. Inc.

Retail gas prices began April at $3.26 a gallon nationwide but crept up to $3.57 per gallon by the last week, according to the U.S. Department of Energy. They set a record on April 30, rising to a national average of nearly $3.62 a gallon.

Pickup sales have been falling for months because of the slowdown in housing construction, and the trend away from SUVs began several years ago as Baby Boomers aged and roomy but more fuel efficient crossover vehicles gave consumers more choice. But automakers said gas prices are accelerating the trend.

"At $3 a gallon, there's a lot of discussion about the price of gasoline but not much change in behavior. But in the mid-$3.50 range with $4 on the horizon, there's a lot of change in behavior," said Mike Jackson, the chief executive of AutoNation Inc., the country's largest auto retailer.

Jackson said it will be interesting to see if the change is permanent or if consumers return to larger vehicles once their initial shock at the pump has worn off and the economy improves.

GM shares rose 76 cents to $23.96, Ford shares were up 20 cents to $8.46 and Toyota's U.S. shares rose $1.41 to $102.80 in afternoon trading, while Toyota's U.S. shares rose $1.39 to $120.89.

The Associated Press reports unadjusted figures, calculating the percentage change in the total number of vehicles sold in one month compared with the same month a year earlier. Some automakers report percentages adjusted for sales days. There were 26 sales days last month and 24 in April 2007.

I hope all the carmakers do the same.

Here's the video.

How many people will pay $4 for a latte in a recession?

Starbucks looks to international stores to fuel earnings

SEATTLE (AP) -- Starbucks Corp. is dialing back expectations for its U.S. stores in light of economic uncertainty but has a three-year plan for snazzy new drinks and future profit growth fueled by aggressive international expansion.

As expected, the company said Wednesday its fiscal second-quarter profit sank 28 percent as U.S. consumers responded to rising food and gas prices by making fewer latte runs.

The coffee purveyor slashed 30 additional store openings from its already-scaled-back plan for 2008 and said it will open fewer than 400 stores per year in 2009 through 2011.

International openings will increase at a far faster clip, though, with 975 this year and a projected 1,300 in 2011. Starbucks expects to have 21,500 stores worldwide by the end of fiscal 2011.

Starbucks' financial goals for the coming years reflect worries about a protracted U.S. economic downturn and rely on international stores -- particularly ones run by licensed partners rather than Starbucks itself -- to drive profit.

The company forecast earnings of 90 cents to $1 per share in 2009, $1.10 to $1.20 per share in 2010, and $1.35 to $1.50 in 2011, predicated on a 20 percent average rise in sales each year internationally but just 6 percent growth in the U.S.

Starbucks shares gained 3 cents to close at $16.23 Wednesday before the results were released. The shares fell 11 cents in after-hours trading.

Concurrent with its heavy focus on international growth, Starbucks is working through a series of high-profile changes meant to stabilize U.S. sales. Chairman and Chief Executive Officer Howard Schultz has already picked out new coffee brewing machines and yanked fragrant breakfast sandwiches that masked the smell of coffee.

Schultz said Wednesday that the company will launch three new types of drinks in the U.S. this summer:

--A health-conscious smoothie-style line.

--An icy Italian coffee-based drink that's indulgent, low-calorie and less expensive than a Frappucino.

--An energy drink that adds extra kick to the existing Starbucks DoubleShot, which is sold in cans and will also be prepared fresh in stores.

The CEO said new health-conscious foods are planned for fall, and that the company will continue to experiment with new menu items through the holidays and into 2009.

In a conference call, Schultz repeatedly told analysts that the trouble Starbucks was experiencing in the U.S. was not the result of increased competition from chains like McDonald's Corp., which is testing espresso drinks in some cities.

"We continue to come under very heavy consumer pressure due to the economy," Schultz said in an interview. "Most retailers, restaurants, certainly other premium brands are facing similar headwinds."

Sharon Zackfia, an analyst for William Blair & Co., said "management should be saying that at least 30 times a day to every investor it talks do. Given that Starbucks is such a unique brand and company, the assumption is that when things are good or when things are bad, that it's Starbucks-specific."

The economic climate, Zackfia said, affects Starbucks just like it does other retailers and restaurants.

For the quarter ended March 30, Starbucks' net income sank to $108.7 million, or 15 cents per share, from $150.8 million, or 19 cents a share, in the same period last year.

Revenue rose 12 percent to $2.53 billion from $2.26 billion in the year-ago quarter.

Starbucks blamed the weakness on U.S. consumers making fewer trips to its stores, especially in areas hit hardest by the housing market's collapse, like Florida and California.