Financial life in a big town

Premier Wen Jiabao on Sunday restated China’s long-standing position that the yuan’s exchange rate should be kept at a reasonable, balanced level.

State television showed Wen meeting a trio of top economic officials from the euro zone, who were making the case for a strengthening of the Chinese currency.

Wen also said China wanted to see stability in the world’s major reserve currencies — a thinly veiled way of saying China is unhappy with the weakening trend of the dollar.

(Reporting by Zhou Xin and Alan Wheatley)

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Chi-X Europe criticized the London Stock Exchange for adopting a procedure that prevented trades being routed to rival venues when glitches halted trading for more than three hours on Thursday.

The LSE’s main rival said the exchange put its market into auction status when the system broke down and that this triggered the block on routing to other venues.

“The auction status hampered investors’ ability to trade by not enabling participants to seek a reference price on another venue,” multilateral trading facility Chi-X said in a statement.

A spokesman for the LSE denied Chi-X’s claim.

“Our decision was a result of customer feedback,” he said. “Some were experiencing connection issues while others were not, and customers requested for the market to be put into auction status so that there would be a level playing field.”

Chi-X said many firms’ trading systems treated the auction status like a normal market event such as the daily closing auction.

By contrast, on November 9 the LSE halted trading during a partial systems failure, and many member firms were able to switch to other venues to trade UK stocks, Chi-X said.

“We call for the LSE and any other market of listing to close their market outright when outages occur in order to allow market participants to continue trading,” the statement said.

Chi-X also called on the Financial Services Authority to ensure the “continuation of trading and an orderly market.”

Another LSE rival, Nasdaq OMX called for standardization of market data in Europe.

“This would enable trading to continue even if one market fails to operate,” said Charlotte Crosswell president of Nasdaq OMX. “We are supportive of the European Commission further investigation this issue.”

(Editing by Will Waterman)

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George Weston Ltd. executives say they’re still hunting for acquisitions, but hinted the company could be closer to making a move after months of searching for the right fit.

"Obviously a lot of values have gone up in a lot of companies, but not many in our space," chairman and president Galen Weston Sr. told analysts in a conference call on Tuesday.

"There’s probably going to be stuff coming due from a number of sources. We are scouring the nation, north and south, to ensure that nothing passes us by which we feel would be appropriate for us."

North America’s largest baked goods maker reported that its third-quarter net earnings dropped 52 per cent to $86 million, or 56 cents per share, for the quarter ended Oct. 10.

That was down from a year-ago profit of $180 million, or $1.29 per share, largely because of foreign exchange losses.

Revenue totalled $9.78 billion for the quarter, down about $100 million from $9.88 billion last year. Analysts had expected revenue of $9.90 billion, according to Thomson Reuters.

Toronto-based Weston said most of its revenue came from Loblaw, a publicly traded grocery retailer that it controls.

Its Weston Foods sector, which includes the baking business, accounted for just $502 million of revenue, down 26 per cent from a year before.

George Weston has been selling assets in recent years in an attempt to tighten its focus. Last year, the company sold its Neilson dairy business to cheese maker Saputo for $465 million and its U.S. fresh baked goods division to Grupo Bimbo for $2 cash advance loan.5 billion (U.S.).

Since those sales, the company has said it would use the $3.3 billion in cash, along with $1.6 billion in short-term investments, to make an acquisition, but that it didn’t feel pressure to make a play quickly.

Excluding discontinued operations following the sale of Weston Food’s dairy and bottling operations at the end of last year and its U.S. fresh bread and baked goods business early this year, Weston’s overall net income was $71 million or 44 cents a share in the third quarter.

George Weston said its net earnings in the most recent quarter took a beating from a 58 cent charge per common share related to unrealized foreign exchange losses.

In last year’s third quarter, spanning a 16-week period ended Oct. 4, 2008, Weston’s net earnings from continuing operations was $119 million, or 81 cents per share, while net earnings including discontinued operations was $180 million. or $1.29.

But the company said that excluding the foreign exchange losses and other items, its performance in the third quarter was "strong" compared with last year.

George Weston said brand and product development efforts continue while plant and distribution optimization and other cost-cutting measures remain a priority.

It said the sale of its dairy and bottling operations in the fourth quarter of 2008 negatively impacted sales growth by about 26 per cent, but foreign currency translation positively impacted sales growth by about 2 per cent.

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Retailers are thinking beyond Cyber Monday — a holiday marketing promotion many push for the Monday after Thanksgiving — and trying to spin their discounts into Cyber Weekends or even Cyber Weeks.

Target, Walmart, Toys R Us and others will be running online sales throughout the holiday weekend, with additional sales on Nov. 30, or Cyber Monday. J.C. Penney will offer online sales for items such as clothes and electronics on Monday and Tuesday, and Walmart.com will offer deals starting Monday through Dec. 4.

Retailers are planning more promotions this year, as opposed to last year, when the sudden consumer spending downturn sent online sales down 3 percent, the first decline on record.

The National Retail Federation said Monday that nearly 9 out of 10 retailers plan specific Cyber Monday deals, up slightly from about 84 percent last year. Deals on specific products, one-day sales and free shipping are expected to be the most common promotions.

While the day after Thanksgiving is known as Black Friday, historically the point when retailers start to turn a profit, the following Monday has become known as Cyber Monday, when sellers look to lure holiday shoppers online, either from work or home.

ComScore analyst Andrew Lipsman expects free shipping deals to be key, as companies this year are planning their promotions more carefully so there will be less discounting.

"Psychologically, consumers need to get some sort of a deal on almost every transaction, and free shipping tends to be pretty compelling," Lipsman said.

Lipsman is expecting "marginally positive" online sales growth compared with a year ago.

The Monday after Thanksgiving is typically one of the top 10 busiest online shopping days, but it’s not the busiest day. Last year it was the third-busiest day since a late Thanksgiving holiday led to pent-up demand.

This year Thanksgiving also falls late in November, and Lipsman expects the date to rate similarly high.

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I always advise using a credit card to pay for major bills. Visa, MasterCard and American Express have guarantees that you won’t be held responsible for any fraudulent charges.

But no one spells out what counts as unauthorized use of your credit card. So, you may have to fight for your refund.

Here are a few cases of customers running into resistance when trying to reverse a credit card transaction.

Sandy De Domenico-Carless called Sirius Satellite Radio to order a two-year subscription. Later the same day, she changed her mind.

"Since I was cancelling on the day of activation, I wanted to confirm the initial payment would be credited. I was told yes," she says.

But her Visa statement showed the first $114.35 payment was charged to her account. What happened?

Unfortunately, Sirius is in financial trouble and tries its best to hang onto customers.

When she called to cancel, she was offered a cheaper plan and said she’d talk to her husband. She never made that call to decline later on. Sirius told Visa she hadn’t cancelled – even though her satellite radio was never activated.

Her husband sells cars with satellite radio. He managed to get the refund.

"If you cancel, I’d advise getting a name and making sure the person reads out loud the message they’re keying into the system. Better still, get everything in writing," she says.

June Clark and Catherine Kirk stayed at a Best Western hotel for one night before going on a cruise.

The two seniors paid the room charge in full. Later, a $100 fee for smoking cleanup appeared on Clark’s credit card.

"Neither my mother nor her sister are smokers," says Cameron Clark, June’s son.

They complained to American Express, which said the hotel talked about a smell of smoke in the washroom and evidence of ash pay day loans.

"It accused June and Catherine of attempting to cover up the smell by placing towels under the washroom door. And it said June signed a waiver at the time of check-in, accepting charges if there’s a need to clean the room."

The sisters suspected that any smoking had occurred after they checked out, either by an employee or contractor with key access.

But the premium card issuer wouldn’t budge until I asked it to review the case. I got a reply within hours.

"We are going to reverse the charges for June and absorb the cost for this," said Amex Canada spokeswoman Jolene Price.

Shamus Pikk signed up with Premier Fitness and cancelled his membership after one year. Still, he found an $18.13 charge on his credit card the next month.

Fitness clubs have a well-known habit of continuing to bill monthly fees and saying members didn’t cancel properly.

Pikk was well prepared for such a battle and took steps to head off additional charges.

One, he paid up front and got a written agreement that he wouldn’t be charged anything beyond his one-year contract.

Two, he got another written agreement when he cancelled that no further charges be incurred.

Three, he asked the person handling his paperwork to send a scanned copy to head office that said, "No payments due. Member paid in full at the beginning of the contract."

Sending copies of his emails to the Star also helped. And after cashing his refund, he promised to donate $40 to the Santa Claus Fund.

Next week, we’ll look at how to use PayPal to safeguard online purchases.

eroseman@thestar.ca

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As companies hire extra workers for the holidays, some of these seasonal employees are already wondering: How do I turn this temporary position into something permanent? And, in this economy, can I?

Retailers who are typically big seasonal employers are suffering through a prolonged slump in consumer spending that’s forced many to cut back staffing. Other employers such as the Postal Service have implemented hiring freezes. So, while these companies are employing temporary help, they don’t expect to make many permanent offers.

Still, personnel consultants and company executives say there are plenty of opportunities for hard-working seasonal employees to stay on even after the new year. Shipping giant UPS Inc., for one, says it could eventually hire thousands of workers who make it through the frenetic holiday season.

The first step in nabbing a job: make it clear you’re interested, and looking for a permanent role. Most seasonal workers never get a chance at other jobs because they simply never ask, said Jeff Joerres, the CEO of Manpower.

But be tactful, and don’t pester management. "Make yourself available for additional opportunities," he said. "But don’t overextend yourself."

More tips:

REMEMBER THE BASICS

Even when a job is short term, employees need to behave as they would in a full-time, permanent position. So, arrive on time, follow your schedule and don’t request time off work unless it’s absolutely necessary.

Seasonal workers do to tend to get the less desirable shifts. But to make a good impression, just smile and keep working hard.

"In a temporary employee, that’s the No. 1 thing: reliability and dependability," said Craig Rowley, vice president of the global retail sector for the Hay Group, a consulting firm.

Along with that, show that you’re willing to be flexible. If managers ask you to work longer, do it. Likewise, if they need someone to pick up an extra shift, be the first to volunteer.

Small gestures can go a long way, Joerres said.

"There’s an amazing amount of people who show up for work and want to collect a paycheck and don’t show that they want anything more than that," he said. "And I think that disappoints employers."

AUDITIONING FOR A JOB

A seasonal job, like an internship or temporary gig, is truly a multiweek job interview.

Supervisors watch to see how well employees fit with the company, and they quickly judge how easily workers pick up on new tasks.

That’s because many companies treat seasonal positions as "auditions to find some of their best people," said John Challenger, chief executive of consulting firm Challenger, Gray & Christmas.

To stand out, look for ways to "wow" customers and demonstrate a mastery of the business.

At the high-end kitchen retailer Sur La Table, CEO Jack Schwefel says the best seasonal workers are ones who interact with customers on a personal basis while also explaining the key differences between products, such as a copper-bottomed pot versus a steel one.

Sur La Table will hire about 2,000 seasonal workers this year to work in its stores and distribution warehouses, essentially doubling the size of the company’s work force. Schwefel said up to 20 percent of those could eventually be offered either permanent part-time or full-time jobs.

OPPORTUNITIES EXIST

Companies across a variety of industries say they’re still interested in hiring temporary workers, even amid the recession.

UPS plans to hire about 50,000 seasonal workers this year. Some of those employees will work in the company’s hubs, loading and unloading trucks, while others will be on the road with drivers going door-to-door to deliver packages.

The jobs can be exhausting, given that the holidays represent the company’s busiest time of the year.

But spokeswoman Karen Cole said employees who make it through peak season could be in a prime position to land a permanent job. The company hopes to hire about 20 percent to 30 percent of its temporary work force this year.

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Continental European stock markets which have recently lagged are set to outperform the United States and the UK, with consumer stocks, financials and exporters leading the way.

Fund managers and analysts said the most growth will come from the German and French markets, with Credit Suisse expecting Germany to be the best play on global recovery.

The analysts said consumer stocks will gain from a rise in domestic spending, financials will be boosted in a virtuous circle of rising liquidity levels, and exports will do well as demand from emerging markets overshadows a stronger currency.

“The German DAX .GDAXI and French CAC .FCHI should outperform the UK and the U.S. equity market in the medium term,” said David Hussey, head of pan-European Equities at MFC Global Investment Management.

“Valuations on a range of metrics are more attractive and growth prospects are better, with greater demand for exports from emerging markets than for comparable U.S. companies. The consumer in continental Europe is generally less leveraged than in the UK and U.S. and housing is more affordable.”

On valuation grounds, continental Europe offers investors better value. On a forward P/E basis, it trades at a 8 percent discount to global markets.

So far, the French CAC and the German Dax have only risen 1.3 percent and 1.9 percent respectively this quarter, while the FTSE .FTSE, the S&P 500 .SPX and the Dow Jones industrial average .DJI have risen 4.1 to 7.1 percent.

CONSUMER TO SPEND

Although some economists expect U.S. GDP growth to outperform next year over Europe, Credit Suisse said leading indicators show U guaranteed approval cash advance loans.S. and European growth will be broadly at the same level.

However, lower household debt levels in core Europe than in the United States and UK will put the European consumer in a better position. European Cental Bank figures show 2008 gross debt outstanding is 94.1 percent of gross disposable income in the euro zone compared to 129.8 percent in the U.S.

“The European consumer is going to be stronger than the U.S. as the savings rates are historically higher, the debt levels are lower so they are starting at a better place,” said Hussey.

French shoppers defied expectations in September by spending more than they did the previous month on everything from cars to toasters and televisions.

“Consumer stocks can really do well really driven by domestic demand and financials as a geared play for the overall economy,” said Andrew Goodwin, fund manager of the SVG European Focus Fund at SVG Investment Managers.

Fund managers like financials because if there is to be a recovery, a recovery in the banking sector is set to drive it through the increased provision of liquidity to corporates and consumers.

Although analysts do not expect a complete consumption boom in Germany, they see much less downside risk than in other economies. They said it does not have the high debt levels and overheated real estate problems of other countries, so there is more potential for upside. 

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Mitsubishi UFJ Financial Group became the third major Japanese bank to post upbeat results, underscoring the improving outlook for the sector, and said it would raise $11 billion to meet stricter capital rules.

Japan’s top bank also said it would adjust its plan to merge its brokerage with Morgan Stanley’s Tokyo operation, cancelling its original target of full-scale integration. Mitsubishi UFJ owns one-fifth of the U.S. investment bank.

Japanese lenders have suffered smaller credit losses than their Western rivals, but have been slow on the rebound, hampered by their dependence on Japan’s sluggish economy.

“It appears that the worst is behind, but revenue momentum is still not strong and the outlook for Japanese banks is unclear, given the uncertainties about the economy and the possibility of deflation,” said Masahiko Watanabe, credit analyst at Fitch Ratings in Tokyo.

Economists expect Japan’s deflation to persist until at least the second quarter of 2011, a recent Reuters poll showed, meaning that interest rates and revenue from lending will have little chance to rise.

Mitsubishi UFJ confirmed earlier reports that it planned to raise up to 1 trillion yen ($11.2 billion), becoming one of scores of Japanese firms to tap a modest rebound in share prices for much-needed cash.

Japanese companies have so far raised about $40 billion this year by issuing common stock and convertible bonds to shore up balance sheets depleted by the economic downturn.

EYES ON MIZUHO, SUMITOMO MITSUI

Almost three-quarters of the fundraising has been by financial firms, and analysts say that Mizuho Financial Group and Sumitomo Mitsui Financial Group, Japan’s other big banks, will also need to raise more funds cash til payday.

Speculation about the possibility of further fundraising has weighed on bank shares this year.

“These companies issuing their own shares is a big burden on the market,” said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

“And now you have to wonder if Mizuho will do it, and how big, as well as a lot of smaller banks,” he said.

All three banks have already completed a round of fundraising, but only Mitsubishi UFJ is out of the “lock-period,” meaning it is the only one able to issue new shares now. The timing may be a critical advantage, analysts have said, if Japan’s stock market slides again.

Mitsubishi UFJ and Morgan Stanley said that they would be forming two separate companies to share their Japanese securities businesses, instead of one, fully merged unit. The creation of the two firms will be completed by May 2010 the said, two months later than originally planned.

Mitsubishi UFJ President Nobuo Kuroyanagi told a news conference that Mitsubishi UFJ Morgan Stanley Securities, to be owned 60 percent by the Japanese bank, will concentrate on the retail business. 

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WASHINGTON–A group of businessmen on Monday launched a new coalition to urge the federal government to make a major investment in electric transportation, pointing to electric cars as the best way to confront the nation's dependence on imported oil.

Top executives with more than a dozen companies, including Nissan Motor Co., Fedex Corp., electric utility PG&E Corp. and battery developers A123 Systems Inc. and Johnson Controls-Saft, announced the formation of the Electrification Coalition to lay the groundwork for millions of electric cars to reach U.S. highways.

Issuing a lengthy plan to electrify the nation's fleet, the coalition urged Congress to pass a series of tax credits and loan guarantees to bring 14 million electric cars to the road by 2020 and more than 100 million by 2030. The group envisions a network of electric vehicles in six to eight cities in the short term and an expansion across the country, making 75 percent of all vehicle miles traveled powered by electricity by 2040.

"There's no pie-in-the-sky here," said Frederick W. Smith, FedEx's chairman, president and CEO. "It's simply a matter of organization, a matter of will and a matter of execution.''

Participants, however, acknowledged that the proposals would be expensive and would require a major commitment from Congress. The group's blueprint would cost more than $120 billion over eight years and promote tax credits for the installation of advanced batteries, loan guarantees for the retooling of plants, and tax credits for public charging stations and home charging equipment no credit check payday loans.

"Ultimately the consumer will make the judgment about where this country goes, but from the standpoint of public policy we can set the stage for it," said Sen. Byron Dorgan, D-N.D., who joined the group for its announcement.

Nissan President and CEO Carlos Ghosn said the auto industry was working quickly to develop zero-emissions cars in response to concerns about oil security, tighter emissions requirements in the United States and elsewhere and a public thirst for alternative vehicles not tied to petroleum.

Ghosn said the world market of 600 million vehicles is expected to expand to 2.5 billion vehicles in 2050 with the growth in vehicle purchasing in developing nations such as China and India, making electric cars a must. Nissan is releasing the Leaf, an all-electric car, in limited numbers next year and plans to put the vehicle into mass-production globally in 2012.

"The time is right for electric cars – in fact the time is critical," Ghosn said.

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On the Net:

Electrification Coalition: http://www.electrificationcoalition.org/

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The Silverdome is going, going, going … and soon it will be gone.

The hard-hit city of Pontiac, Mich. is nearly finished accepting bids for the Silverdome, an 80,000-seat stadium on a 127-acre site. The deadline for bids is 4 p.m. EST Thursday, according to Williams & Williams, the Tulsa, Okla.-based auctioneer.

Amy Bates, vice president of marketing at Williams & Williams, said the city will announce the winning bidder on Friday, or will continue the process with an in-house auction if the top bids have a narrow spread.

"The city has the right to accept the high bid today, or can choose to have up to five of the sealed bidders come in to participate in a live outcry auction in Pontiac," she said.

The city of Pontiac announced in early October that it was placing the Silverdome on the block, as the stadium has seen little use since 2002 and costs $1.5 million in annual upkeep. There is no minimum bid for this auction, though it does require a deposit of $250,000, which would be reimbursed once the process is completed, said Bates.

Williams & Williams declined to provide details about the bidding.

"We’re in the middle of the auction, so we’re providing no information about the number of people who have called," said Bates. "We did extensive global marketing and we’re very pleased with the response to the marketing and the interest in the property."

The Silverdome was the biggest stadium in the National Football League when it was built in 1975 for $55.7 million. As the former home of the NFL’s Detroit Lions and the National Basketball Association’s Detroit Pistons, the stadium has a rich sports history, playing host to Super Bowl XVI in 1982 and the World Cup in 1994.

At its zenith in 1987, the stadium drew a record number of indoor fans for WrestleMania III, when 93,000 people showed up to watch Hulk Hogan body-slam Andre the Giant.

That same year, Pope John Paul II held Mass at the stadium. In its time, the Silverdome has also served as a concert venue for pop luminaries Michael Jackson, Madonna and Elvis Presley.

Pontiac was a core player in Michigan’s once-thriving automobile manufacturing industry. But hard times have come to the city, which is suffering budget shortfalls and high unemployment, like close-by Detroit and other cities throughout Michigan.

General Motors announced plans earlier this year to close a truck plant in Pontiac that employed more than 1,400 workers. The state of Michigan was recently listed by the Pew Center, a research organization, as one of the top 10 most fiscally troubled states. Michigan’s statewide unemployment rate of 15.3% is the highest in the country.

Fred Leeb, emergency financial manager for Pontiac, did not immediately return a phone message to the city offices, which are closed Thursday and Friday.

But in an October interview, Leeb said the Silverdome was being auctioned "because the Detroit Lions moved out years ago, and since then it’s only been used sporadically. So we want to convert a major premier asset of the city — convert it from something that’s been languishing into a new, vibrant marquee asset of the community."

Leeb also said the city "established a very flexible zoning ordinance to allow people to do virtually anything that makes economic sense." He acknowledged that "demolition is a possibility." 

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