Finance Blog number 1

The Oregon Transportation Commission on Friday approved 31 projects with federal stimulus funding of $122.6 million.

“I applaud the speed at which the Oregon Transportation Commission and the Department of Transportation moved to get contracts out for bid, resulting in jobs Oregonians this summer,” Kulongoski said in a statement. “This is exactly the intent of the federal stimulus dollars and the jobs will mean everything to many Oregon families no fax pay day loan.”

The commission also approved a $10 million list of “Transportation Enhancement” projects, such as sidewalks and lighting, for funding provided by the federal legislation.

The federal funds contained in the American Recovery and Reinvestment Act, and directed to transportation infrastructure, are expected to be about $334 million for Oregon. Counties and cities receive their own allocation of about $100 million from the package, and have one year to obligate the funds. The state share of the funds is about $224 million.

With the remaining funds, the commission is expected to consider additional projects at it’s March 18 meeting in Salem. The commission hopes to have at least $190 million under contract by May to sustain jobs this summer.

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Express Scripts Inc., one of the nation’s largest managers of pharmacy benefits, reported that fourth-quarter profit rose 49 percent and reaffirmed its 2009 earnings per share guidance in the range of $3.63 to $3.73.

The north St. Louis County-based company said net income was $206.8 million, or 84 cents per share, for the fourth quarter ended Dec. 31 versus $138.5 million, or 54 cents per share, a year ago quick payday loan. Revenue was $5.51 billion compared with $5.55 billion.

For 2008, net income rose to $776.1 million, or $3.08 per share, up from $567.8 million, or $2.15 per share. Revenue was $22 billion, up from $21.8 billion.

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Instead of calling his office, Dr. Elie Azrak’s cardiology patients can hop online to request prescription refills, check portions of their medical records or send questions about their conditions.

Dr. Azrak and his fellow physicians at St. Louis Cardiology Consultants opened the Web portal to a segment of patients late last month, part of a systemwide rollout of electronic medical records across SSM Health Care.

Within a few years, the interventional cardiologist expects to be trading e-mails with patients and possibly holding real-time Web chats.

"If we can use technology to communicate with our patients and make it easier, why not?" asked Azrak, who is also vice president of the St. Louis Metropolitan Medical Society. "I’m sure this is coming."

In fact, it’s already here.

Technological advances rapidly are changing the way patients and doctors communicate. Video-conferencing with other physicians, remote patient monitoring and e-mail already are standard tools for many physicians across the country.

One of the newest innovations, a platform that allows insurers to provide patients with real-time access to their doctors via webcam, launched in Hawaii in mid-January.

Proponents say "e-care" will help broaden access to health care, create savings for employer-sponsored health plans and help fight a growing shortage of physicians nationwide.

Others welcome technology but worry about reimbursement for e-care and the effectiveness of digital diagnoses.

"I don’t see tele-health as ever replacing a personal relationship and direct one-on-one contact with your physician," said Dr. Michael Wulfers, president of the Missouri Academy of Family Physicians. "I just don’t see how you’re going to be able to ever accurately do a physical exam over the Internet."

CONSULTATIONS ONLINE

Dr. Roy Schoenberg is working on that.

The Boston physician’s health tech company, American Well, has developed a secure communication platform that connects doctors and patients for real-time consultations.

American Well’s first customer, Hawaii’s Blue-Cross-Blue Shield licensee, took the system live on Jan. 15. Consumers access the service by logging on through the insurer’s website.

Patients can search for specific physicians or seek out specialists for 10-minute consultations through webcams or text chats. The sessions can be extended for a fee.

"Online care is a technology that allows us to extend the reach of the existing health care system so that it is much more available and in a way much more financially reachable," said Schoenberg, the company’s president and chief executive. "It has tremendous promise."

The company did not release preliminary utilization figures from Hawaii.

Doctors can search through a patient’s electronic medical records and write prescriptions. Health plan members pay $10 to access the platform. The uninsured or those on other plans pay $45 per session.

American Well receives transaction and licensing fees through its deal with the Hawaii Medical Service Association guaranteed online personal loans. Only physicians licensed in Hawaii can provide care, and they’re covered under a blanket medical malpractice policy from AIG. Doctors are reimbursed automatically and electronically.

Schoenberg declined to discuss the company’s plans to expand outside of Hawaii. However, he said a number of health plans across the country are expected to implement the platform this year.

Of course, American Well doesn’t bill itself as a cure-all. Patients experiencing chest pains or flare-ups of complex conditions should head straight to an emergency room, Schoenberg said.

Some physicians, including Wulfers, have raised concern about the potential hazards. Doctors can’t feel a patient’s abdomen or conduct a cavity exam through the screen.

"It seems to be just another (idea) along with urgent care or minute clinics, which will in the end lead to more fragmentation of care … and lower quality of health care," said Wulfers, a longtime family physician in Cape Girardeau. "It seems to me like it’s a walk-in clinic over the Internet."

Still, many patients couldn’t take advantage of "virtual house calls" if this service was suddenly available everywhere.

Only about 11 percent of U.S. Internet users have webcams connected to home computers, according to a recent study conducted for the California Healthcare Foundation. Meanwhile, about 65 percent of adult Americans have broadband or dial-up service, providing access to e-mail and the Web, according to a recent study by the Pew Internet & American Life Project.

Despite skepticism of the virtual house call, Wulfers e-mails some patients, adding that "in the future, I could do a lot of things by e-mail."

A survey by the California Healthcare Foundation also found increased use of e-mail between physicians and patients in the Golden State: 13 percent of Californians using the Internet reported getting medical advice via e-mail in 2007, up from 8 percent in 2004.

Starting March 1, Mercy Medical Group in St. Louis will test an online pilot program that gives secure Web access to a select group of patients. The patients will be able see lab results, get information about X-rays and schedule appointments through an interactive calendar.

Patients can take a picture of a suspicious rash and send the image in an e-mail. Doctors can respond to an e-mail question about high cholesterol with links to health-related websites.

Mercy plans to offer the Web portal to all patients by January, said Dr. Thomas H. Hale, president and chief executive.

Excited about the possibilities of the "electronic stethoscope," as he called the Internet, Hale also sounded a note of caution.

"What we don’t want to do is to take that opportunity and say, ‘Everything we’ve done in the past we need to throw away,’" Hale said.

"It has to be a clinical tool in the (arsenal) of physicians and caregivers."

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Oil slipped below $39 a barrel on Monday as the U.S. stock market retreated and investors worried about the weak economy.

Crude fell $1.59 to end the day at $38.44, and reached as low as $37.87 during the session. It closed at $40.03 on Friday.

"Overall, the weakness in the economy is still what’s dictating direction for oil prices," said Phil Flynn, an analyst at Alaron Trading in Chicago.

Oil had risen in early trade on Monday after published reports said that the U.S. government could end up owning as much as 40% of Citigroup.

A source familiar with the situation told Reuters talks were ongoing between Citigroup and regulators. Equities traders had expected a full-scale nationalization so reports of only a partial takeover helped boost shares in Asia and Europe.

But the U.S. stock market turned negative later and dealers said the Citigroup story refocused attention on the U.S. banking crisis and the deepening slump in the wider economy.

"The banking crisis is still at the core of the broad recession," said Mike Wittner, analyst at Societe Generale.

More evidence emerged on Monday that the Organization of the Petroleum Exporting Countries is strictly enforcing output cuts.

89% compliance

As the financial crisis has thrown major economies into recession, global energy consumption has shrunk, prompting oil prices to fall by more than $100 since last July’s peak of nearly $150.

In response, OPEC has already agreed on cuts totaling 4 low interest rate personal loans.2 million barrels per day (bpd) since last September and evidence has mounted of a high level of compliance with the lower production targets.

In February, OPEC oil supply is expected to have dropped sharply, Petrologistics told Reuters on Monday.

OPEC’s 11 members with output targets were expected to pump 25.32 million bpd in February, down 980,000 bpd from January levels and giving a compliance rate of 89%, according to Reuters calculations, which would be one of the highest rates yet.

"It’s provisional because we’re still in February," said Wittner. "But that’s mighty constructive."

The producer group is also very likely to decide on a new production cut at its next meeting scheduled in March, Algerian Energy and Mines Minister Chakib Khelil said at the weekend.

Financial markets will be keeping an eye on Federal Reserve Chairman Ben Bernanke’s policy report to the U.S. Congress on Tuesday and Wednesday. He is expected to offer assurances that help is on the way for the U.S. economy and may offer clues on additional steps that could halt the economy’s downward spiral.

President Barack Obama is also expected to talk about the economy before a joint session of Congress Tuesday.

Gold, a safe-haven investment, eased on Monday, after topping $1,000 an ounce last week. 

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European leaders meeting in Berlin on Sunday backed oversight of the world’s financial markets and products, including hedge funds, and urged that sanctions be drawn up to punish tax havens.

A copy of the “chair’s summary” from a summit hosted by Chancellor Angela Merkel and seen by Reuters describes the situation in financial markets as “fraught” and says structural reforms and a focus on public spending are needed to emerge stronger from the global crisis.

“We have today underscored once again our conviction that all financial markets, products and participants must be subject to appropriate oversight or regulation, without exception and regardless of their country of domicile,” the statement says.

“This is especially true for those private pools of capital, including hedge funds, that may present a systemic risk.”

The statement also urges definitive actions against tax havens and uncooperative jurisdictions.

“According to objective criteria to be based on ongoing work in relevant international institutions, a list of uncooperative jurisdictions and a toolbox of sanctions must be devised as soon as possible,” the statement says.

Merkel invited the leaders of Britain, France, Italy, Spain, the Netherlands, Czech Republic and Luxembourg, as well as the European Commission president, finance ministers and European central bankers to prepare a common stance ahead of a full G20 meeting in London on April 2.

DISTORTION

Since a first G20 summit on reforming the global financial architecture was held in Washington late last year, recessions in Europe and the United States have deepened, forcing governments to push through massive stimulus packages 500 payday loans.

The Berlin meeting takes place after a week of accusations of protectionism between European nations, with some of France’s partners objecting to its plans to offer 6 billion euros ($7.6 billion) in state loans to domestic carmakers.

In the final statement, the leaders commit to implementing stimulus measures and financial rescue plans in a manner that “limits distortions to competition to an absolute minimum.”

New tensions within the single currency bloc and the financial woes of European Union members to the east have cast a cloud over the meeting in the German capital.

Ahead of the gathering, the IMF threw its weight behind the idea of a common European bond to alleviate pressure on euro states such as Ireland and Greece that are being forced to pay hefty premiums over stronger bloc members to finance their debt.

In eastern Europe, the currencies of countries such as Poland, the Czech Republic and Hungary have come under severe pressure, hitting millions across the region who borrowed in foreign currencies such as the euro.

Germany, Europe’s benchmark issuer of debt, has rejected the idea of a euro-zone bond.

(Additional reporting by Paul Carrel, Matt Falloon, Francesca Piscioneri, Dave Graham, Yann Le Guernigou; Writing by Noah Barkin)

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FilmSavage.com, a Web site that lists film industry-related services and film news, will hold a series of three classes in Albuquerque for companies looking to get involved in the industry.

The classes will cover all aspects of working with film production companies and how to access the millions of dollars they spend each year in New Mexico.

The first session, on Feb. 23, will cover the nuts and bolts of the film business. The second day, Feb. 24, will dig deeper into issues, such as the different departments that make up a film or television production, questions to ask and how to ensure you get paid.

More than 40 films and television productions filmed in New Mexico in 2008. Productions spent $241.8 million in the state’s fiscal year 2008, which ended June 30, and are projected to spend an estimated $106 million in the first six months of 2009 payday loans with low fees.

Gwyn Savage, who launched FilmSavage.com, has worked with the film industry for seven years in New Mexico as a casting director and business owner servicing the industry. She has more than 20 years of experience in business consulting, development, management and marketing.

The first two sessions run from 1 p.m. to 5 p.m. at the Greater Albuquerque Chamber of Commerce offices, 115 Gold Ave. SW. The third day will be scheduled after the first two days and will focus on targeted strategies for specific businesses.

The cost is $50 and space is limited. For more information, visit the Film Savage Web site or call (505) 331-0177.

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TAX-CUTTING TIPS

If you’ve lost money in the stock and bond markets, Uncle Sam wants to share your pain. Capital losses are deductible. First, you must use your losses to offset your capital gains — if you’re lucky enough to have any. Then, up to $3,000 can be used to reduce ordinary income. Any leftover losses can be applied to taxes in coming years.

You can’t take a tax loss unless you’ve actually sold the investment. Losses on paper don’t count.

Unfortunately, a loss on the sale of your house doesn’t count either. That’s considered a "personal" loss and can’t be deducted from income or capital gains, according to guidance from CCH Inc., the tax publishing company.

With the stock market still in the pits, taxpayers can save on next year’s tax bill by culling their pile of losing investments this year. You’ll lose the tax break if you buy the stock or mutual fund within 30 days of selling it.

The tax law provides new boons and old bummers this year.

Among the tax boons:

•Good news for homeowners: The standard deduction of $5,450 per taxpayer, taken by people who don’t itemize, can now be padded with a deduction for property taxes. Says CCH: "If you paid state and local property taxes, you can pad the standard deduction by up to $500, or $1,000 for joint filers."

—"…There’s an added break for those over 65 who own homes and take the standard deduction. They can pad the deduction with up to $1,050 for property taxes for each taxpayer who meets the age requirement. You can claim more if you or your spouse is blind.

—"…Lots of homeowners are in trouble these days, and some banks are forgiving part of the debt. That forgiven loan used to be taxable to the debtor as income. A new law exempts forgiven loans from income taxes from January 2007 through 2011. You may not qualify if you took cash out when refinancing your mortgage in years past. You’ll have to fill out IRS Form 982. "It’s a doozy," says Mark Steber, vice president for tax resources at the Jackson Hewitt tax preparation firm.

—"…If you’re a first-time home buyer, Uncle Sam wants to give you an interest-free loan of $7,500. You get it in the form of a refund on your taxes. You’re eligible if you bought after April 8, 2008. If you buy before June 30 of this year, you can get the loan through your 2008 tax return. "You have to pay it back equally over 15 years, beginning in the second year," Steber says. If you sell the home, the loan becomes due that year. Meanwhile, the stimulus bill now in Congress contains a new tax credit for homes purchased this year. The new credit doesn’t have to be repaid.

— If you drive for business, you’ll get a break on last year’s big gasoline bills. The IRS mileage rate was 50.5 cents for the first half of the year, and 58.5 cents from July 1 to year end, according to CCH.

—"…If you drove for charity work, you’ll get your reward in heaven, but not from Uncle Sam paperless payday loans. The charity mileage rate remained at 14 cents last year. However, for those who drove to help out in the Midwest disasters, the rate was 36 cents before July 1 and 41 cents afterward.

—"…Speaking of disasters, victims of last year’s Midwest flooding and tornadoes get special breaks under a special act of Congress. Victims in most counties in the St. Louis area qualify, though the tax breaks vary by county. The rules here are complex. See IRS Publication 4492-B for details.

—"…Missouri State University, Lindenwood and Westminster College students, listen up. There’s a special break for students attending college in a county declared a major disaster area. Taxpayers who go to college in those counties are eligible for up to double the usual Hope and Lifetime Learning tax credits. Greene County, home of Missouri State, is on the list. Nearer home, Lincoln, St. Charles, Callaway and Pike counties are on the list. In Illinois, Calhoun and Jersey counties are eligible.

—"…Teachers can deduct up to $250 a year for unreimbursed purchases of books, computer equipment and other supplies used in the classroom.

•Remember those economic stimulus checks we got last spring? If you didn’t receive the maximum amount, you might merit a fatter refund this spring. The maximum stimulus rebate was $600 for singles, $1,200 for joint filers and $300 per child.

The refunds were figured based on your 2007 taxes. But if your circumstance changed last year — for instance, if you had a child or your income fell — the IRS will retroactively boost your stimulus award.

You have to enter the amount of last year’s stimulus check on your tax return. If you don’t remember the amount, you can find out at this website: www.irs.gov. Click "Avoid recovery rebate credit confusion."

—"…On the Missouri income tax return, the maximum public pension exemption rises to 35 percent, or $6,000. The Social Security exemption rises to 35 percent of taxable Social Security.

TAX BUMMERS

—"…Unemployment benefits are taxable. The government giveth, and it taketh away. However, job-hunting expenses are deductible if you’re looking for a job in your current line of work.

•If you’re saving for college in your child’s name, Uncle Sam wants his slice. If the child was under 18 on last New Year’s Eve, the child’s investment income of more than $1,800 must be reported on the parent’s tax return and taxed at the parent’s rate. Ditto if the child is 18 and didn’t earn more than half his keep by working. Ditto if the kid is in college, up to 23 year old, and still not earning more than half his keep.

—"…By the way, if you steal or embezzle, you must report the loot as income. That’s how they got Al Capone.

jgallagher@post-dispatch.com | 314-340-8390

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Units of the Yellow Pages Income Fund have been clobbered in recent months as investors worry about future revenues from its directories businesses – and year-end results yesterday still kept them wondering as management put an upbeat spin on the fund’s prospects in the midst of the nasty global downturn.

"Despite the current economic climate, 2008 was another year of industry-leading financial and operational performance for Yellow Pages," said president and CEO Marc Tellier on a conference call.

Fourth-quarter profits fell to $100 million from a year-ago $157 million on higher income tax provisions and restructuring charges, but the company said revenues actually rose to $425.6 million from $412.6 million.

The Montreal-based fund, which publishes a range of hard copy and online directories, said distributable cash per unit increased 9.1 per cent to 36 cents during the quarter.

"The numbers in the quarter are pretty close to expectations. This quarter was sold so long ago so there wasn’t too much mystery there," said CIBC World Markets analyst Bob Bek.

While stockholders continue to wonder just how long they’ll be raking in the Yellow Pages’ tasty distributions of about 21 per cent, Tellier gave no hint that the board was looking to cut those payouts, despite the harsh economic climate.

"Management is sticking with their story that they have no issues in their ability to pay," said Bek.

"The big risk to the story is how they manage the transition to online" and how fast they move to an all-online business, he said one hour payday loans.

"But the directories business has always held up well in recessions," said Bek, pointing to the nearly 44 per cent growth in Yellow Pages’ online business in the quarter.

"I think they’ll be able to earn their distribution," he added. His target price per unit is $8.

The results gave a boost to the struggling fund yesterday, as units rose 35 cents to close at $5.57 on the Toronto Stock Exchange.

Full-year profits fell to $509.2 million, including restructuring and special charges, from $527.7 million in 2007. Income from operations grew to $710.4 million versus $648.6 million.

"These positive results demonstrate our ability to grow the directory category and to improve profitability of Trader Corporation," a division of the fund that publishes automotive, real estate, employment and other forms of directories and classified ad publications and online content.

Yellow Pages noted online revenues for its directories and vertical media showed organic growth of 43.5 per cent – beating its 30 per cent target – as total revenues in 2008 increased to $1.7 billion from $1.62 billion in the prior year.

"We are looking forward to the future with confidence," Tellier said.

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Economists who support legislation to stimulate growth say the version passed in the House of Representatives would create at least half a million more jobs than the bill the Senate votes on today.

The key difference: The Senate version provides less money than the House measure for public works and aid to state and local governments. While the two measures have similar price tags, the Senate’s includes bigger tax cuts and adds tax breaks for auto and home buyers, part of a compromise to win some Republican votes.

“The House bill will create more jobs and a stronger economy than the Senate bill,” said Mark Zandi, chief economist at Moody’s Economy.com, who was a campaign adviser to Republican presidential candidate John McCain. Zandi estimates that the $838 billion Senate package would create about 625,000 fewer jobs than the $819 billion House version over the next two years.

The U.S. economy has lost 3.5 million jobs since the beginning of the recession in December 2007. President Barack Obama has pledged to save or create as many as 4 million jobs over two years through stimulus and other economic measures.

The Senate plan was hammered out last week between Democrats and moderate Republicans. While providing more generous tax breaks than the House version, the Senate agreement pared $40 billion targeted at helping state and city governments avoid layoffs, $19.5 billion for school construction, $7 billion for health care and about $1 billion for early education programs.

Stimulus Blunted

Excising or reducing funds to those programs significantly blunts the stimulative effects of the Senate package, economists say.

“The things that have been cut in the Senate compromise are some of the best job creating provisions in the House bill,” said Ross Eisenbrey, vice president of the Economic Policy Institute, a Washington-based research organization affiliated with organized labor. “It’s clear that the House bill is better.”

Not much of the spending trimmed from the Senate plan is likely to be restored in the final bill Congress sends to the president, said Pete Davis, president of Davis Capital Investment Ideas in Washington, which provides analysis of Congress to investors. He said moderate Republicans, including Senator Susan Collins of Maine, won’t vote for a final bill much larger than the one negotiated in the Senate.

“I don’t think Senator Collins can swallow another $5 or $10 billion, and they’re going to need her vote,” Davis said.

Tax Cuts

In addition, the Senate agreement adds or boosts several tax cuts, including a $15,000 tax break for homebuyers that’s expected to cost $35.5 billion and a credit for new car buyers, at a price of $11 billion no faxing payday loan.

“Those measures have some stimulative value, but nothing like the effect of a construction project or help for those most affected by the crisis,” said Will Straw, associate director for economic growth at the Center for American Progress.

The Senate also reserved $70 billion in its bill to prevent additional taxpayers from having to pay the Alternative Minimum Tax. Because the benefit will go mostly to upper income Americans who are less likely to spend it, the measure has very little value in boosting sagging consumer demand.

The Tax Policy Center in Washington gives it a D-minus grade for stimulative effect. It is “neither timely nor targeted,” and “makes no sense as economic stimulus,” according to a recent report from the TPC, a joint project of the Urban Institute and the Brookings Institution.

Apples-to-Apples

Not counting the AMT fix, which Congress probably would have passed this year anyway, the price tag of the Senate package is closer to $750 billion, Zandi said: “That’s the apples-to-apples comparison.”

Viewed that way, “the House bill is just bigger, and that matters,” said Dean Baker, co-director of the Center for Economic and Policy Research in Washington.

Not every economist agrees. Harvard University economics professor Martin Feldstein, who was a top economic adviser to former President Ronald Reagan, said both bills simply “add a tremendous amount to the national debt and add less to GDP spending.”

“We’re just not getting the bang in terms of increased economic activity,” Feldstein, a member of Obama’s Economic Recovery Advisory Board, said yesterday in a Bloomberg Television interview. Feldstein didn’t discuss the job creation effect of the legislation in the interview.

While Feldstein says a stimulus package is still necessary, other economists reject the idea altogether.

“There’s basically no historical evidence since World War II that stimulus bills help,” said William Niskanen, chairman of the free-market Cato Institution in Washington. His organization ran an advertisement in national newspapers today, signed by 243 academic economists, registering their dissent.

Still, the focus of the Washington debate remains on the composition of a package that is almost certain to be enacted.

“Economies to some extent are self healing, but often need government assistance. This is the time for that,” said Allen Sinai, chief global economist at Decision Economics Inc. in New York. “To do nothing is a big mistake.”

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Boeing Co. has won a contract worth up to $2.95 billion from the U.S. Air Force for 15 additional C-17 military cargo aircraft.

In a statement, Chicago-based Boeing (NYSE: BA) said the new contract “will keep C-17s moving down our production line until at least August 2010, even as we complete existing orders from the Air Force and our international customers cash advance america.”

The contract was awarded to Boeing’s McDonnell Douglas unit.

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