Financial life in a big town

Portugal reported a budget deficit of 8.6 percent of gross domestic product last year, missing a government target of 7.3 percent and causing a jump in borrowing costs that increases the risk of a bailout.

The revisions won’t affect the government’s goal for a 4.6 percent shortfall in 2011, the national statistics agency said today in an e-mailed statement. The agency also revised the 2009 budget gap to 10 percent from 9.3 percent, after European Union accounting changes prompted Portugal to add more than 2 billion euros ($2.8 billion) to the 2010 deficit. The yields on the country’s two, five and 10-year bonds rose to euro-era records.

Portugal has been raising taxes and implementing the deepest spending cuts in more than three decades, aiming to convince investors it can narrow its budget gap, curb its debt and avoid following Greece and Ireland in seeking a bailout. The nation was downgraded twice in the past week by Standard & Poor’s, which said new European bailout rules may mean it will eventually renege on its debt obligations.

“We always thought the debt sustainability of Portugal was at risk,” said Giada Giani, an economist at Citigroup in London, “It does add more pressure on Portugal, which is probably unable to access markets in the next few weeks and will probably need a bailout.”

Bonds Slump

Portugal’s two-year government bond yield today climbed 27 basis points to 8.30 percent, topping the rate on the nation’s 10-year debt for the first time since 2006. The difference in yield that investors demand to hold Portugal’s 10-year bonds instead of German bunds rose to a euro-era record 490 basis points. The 10-year yield gained 8 basis points to a record 8.18 percent.

S&P followed its cut in Portugal’s creditworthiness today by lowering its ratings on Banco Espirito Santo SA and three other lenders, leaving their outlook negative due to a possible further downgrade of the country’s credit rating. Another cut would strip Portugal of an investment grade. Portugal’s lenders have become increasingly dependent on financing from the European Central Bank as investor concern about a bailout has left them virtually shut out of interbank markets.

S&P said on March 29 the country may need an international bailout and debt restructuring. A rescue may total as much as 70 billion euros, said two European officials with direct knowledge of the matter free business cards.

No Aid Request

“The government is not in conditions and does not have the powers to request any type of external aid,” Portuguese Finance Minister Fernando Teixeira dos Santos told reporters in Lisbon today. “The government will guarantee that there is the necessary financing for the country to face its responsibilities and honor its commitments.”

Prime Minister Jose Socrates offered to resign March 23 after the opposition rejected further measures to curb the deficit. President Anibal Cavaco Silva is holding crisis talks today in Lisbon aimed at setting a date for early elections. Under Portuguese law, the vote is likely to fall between two bond redemptions Portugal faces on April 15 and June 15 that total 9 billion euros).

Bond Maturities

Portugal’s ability to raise funds to finance those maturities may determine whether it will have to seek EU aid. The country can meet “debt redemption commitments scheduled or 2011, especially the redemptions of long-term debt that will take place in April and June,” Secretary of State for Treasury and Finance Carlos Costa Pina said earlier this week.

Socrates said on Jan. 28 the 2010 deficit would be 7 percent of GDP or less, narrower than the 7.3 percent the government had initially forecast. In 2009, the shortfall was 9.3 percent, the fourth-biggest in the region after Ireland, Greece and Spain.

Teixeira dos Santos acknowledged in parliament on March 23 that the EU accounting changes would have an impact on public finances. “It’s like changing the score after the match is over,” he said. Without the additional charges, the deficit would have been 6.8 percent of GDP, he said today.

Impairment costs stemming from the 2008 seizure of Banco Portugues de Negocios SA added 1 percentage point of GDP to the budget deficit last year and charges linked to the public-transportation system accounted for 0.5 percentage point of the deficit, the statistics agency said.

The accounting changes ordered by Eurostat, the EU’s statistics agency, inflated 2010 deficits in other countries. Austria today revised its shortfall for last year to 4.6 percent after reclassifying debt of government-owned companies worth about 1 percentage point of GDP.

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Prime Minister Stephen Harper targeted his first campaign pledge at Canadian families with children, as he seeks to boost support in a bid to form a majority government.

Harper said yesterday his Conservative Party would let families with children under 18 split up to C$50,000 ($51,250) of their income for tax purposes, which would lower the combined burden for 1.8 million families in a country of 34 million people.

Harper won Canada’s last two elections after promising tax reductions aimed at families, including tax credits tied to the cost of public-transit passes and children’s sports fees, rather than broad-based reductions in income tax rates favored by previous governments. In the budget that opposition parties rejected last week, which preceded the government’s defeat, the Conservatives announced tax credits for children’s arts programs.

“Harper tends to pick the policies that have a clear and obvious benefit,” Jonathan Malloy, associate professor of political science at Carleton University in Ottawa, said in a telephone interview. Allowing couples to split income “could certainly swing some votes, particularly in key suburban areas” and among women, he said.

The Conservatives won 38 percent of the vote in 2008 elections, which gave them 143 seats in the 308-member House of Commons.

After Deficit Eliminated

Income splitting wouldn’t take effect until after the country eliminates its budget deficit, expected by 2015. The measure would cost about C$2.5 billion in foregone revenue a year, Harper said.

“Since coming to office in 2006, our government has placed lower taxes on families among its highest priorities,” Harper said in the backyard of a suburban house near Victoria, British Columbia. He mentioned other initiatives his party has taken, including a monthly C$100 benefit for all children under the age of six, and a C$2,000 tax credit for each child younger than 18 years of age. They also cut the rate of the federal value-added tax, the Goods and Service Tax, from seven percent to five percent.

Liberal leader Michael Ignatieff told reporters the promise can’t be counted on because it wouldn’t occur for five years, adding that the Conservatives are planning to continue tax relief for companies next year.

“It’s like he’s saying to middle-class families: ‘Take a number,’” Ignatieff said yesterday in Toronto. “That’s the policies that you get if you put banks, insurance companies and oil companies first and leave Canadian families at the back of the line.” He did not say whether the Liberals would adopt a similar policy.

‘Cynical Move’

New Democratic Party Leader Jack Layton yesterday said the delay in the tax measure wouldn’t help families dealing with rising bills today.

“This is exactly the sort of cynical move Stephen Harper used to denounce,” Layton said in a statement.

Opposition parties joined together March 25 to topple Harper’s government by passing a no-confidence motion. They rejected Finance Minister Jim Flaherty’s budget last week and said Harper’s government was in “contempt” of Parliament by withholding the cost of some of its legislation, including plans to buy new fighter jets and build prisons. Harper said the election was unnecessary.

Flaherty presented a fiscal plan last week that forecast the government may eliminate the deficit as early as 2014 if it manages to generate savings from a review of program spending that begins this year. The review will aim to save at least C$4 billion annually, according to the March 22 budget document.

‘Wasteful Spending’

Ignatieff said yesterday a Liberal government would halt Harper’s “wasteful” spending on new fighter jets and prisons that will squeeze out money needed in the future to pay for programs such as health care. He said he will present a platform in the next week that will be paid for in part by rolling back past corporate tax cuts.

“We have a great contrast to make between the fiscal responsibility which has been the brand of the Liberal Party, and the wastefulness of the Conservative government,” Ignatieff said.

Today, Ignatieff will be in Oakville, Ontario, about 25 miles southwest of Toronto, then fly to British Columbia. Harper will begin campaigning in Regina, Saskatchewan.

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A spike in radiation levels in Tokyo tap water spurred new fears about food safety Wednesday as rising black smoke forced another evacuation of workers trying to stabilize Japan’s radiation-leaking nuclear plant.

Radiation has seeped into vegetables, raw milk, the water supply and seawater since a magnitude-9 quake and killer tsunami crippled the Fukushima Dai-ichi power plant nearly two weeks ago. Broccoli was added to a list of tainted vegetables Wednesday, and U.S. officials announced a block on Japanese dairy and other produce from the region.

The crisis is emerging as the world’s most expensive natural disaster on record, likely to cost up to $309 billion, according to a government estimate Wednesday. The death toll continued to creep up, with more than 9,400 bodies counted and more than 14,700 people listed as missing.

Concerns about food safety spread Wednesday to Tokyo after officials said tap water showed elevated levels: 210 becquerels per liter of iodine-131 _ more than twice the recommended limit of 100 becquerels per liter for infants.

“It is really scary. It is like a vicious negative spiral from the nuclear disaster,” said Etsuko Nomura, a mother of two young children ages 2 and 5. “We have contaminated milk and vegetables, and now tap water in Tokyo, and I’m wondering what’s next.”

Infants are particularly vulnerable to radioactive iodine, which can cause thyroid cancer, experts say. The limits refer to sustained consumption rates, and officials urged calm, saying parents should stop giving the tap water to babies, but that it was no worry if the infants already had consumed small amounts.

They said the levels posed no immediate health risk for children or adults.

“Even if you drink this water for one year, it will not affect people’s health,” Chief Cabinet Secretary Yukio Edano said.

Tokyo residents shouldn’t worry, Dr. Lim Sang-moo, director of nuclear medicine at the Korea Cancer Center Hospital, said in Seoul.

Parents might want to be more cautious if they have a choice about what water to drink _ “nobody wants to drink radioactive water,” he said. But “it’s not a medical problem but a psychosocial problem: The stress that people get from the radioactivity is more dangerous than the radioactivity itself.”

Experts also say iodine-131 dissipates quickly in the air, with half of it disappearing every eight days.

The unsettling new development affecting Japan’s largest city, home to some 13 million in the city center and 39 million residents in the greater Tokyo area, came as nuclear officials struggled to stabilize the hobbled reactor 140 miles (220 kilometers) to the north.

The quake and tsunami that struck off the east coast March 11 knocked out the plant’s crucial cooling systems.

Explosions and fires have erupted in four of the plant’s six reactors, leaking radioactive steam into the air. Progress in cooling down the overheated facility has been intermittent, disrupted by rises in radiation, elevated pressure in reactors and overheated storage pools.

The plant operator had restored circuitry to bring power to all six units and turned on lights at Unit 3 late Tuesday for the first time since the disaster _ a significant step toward restarting the cooling system.

It had hoped to restore power to cooling pumps at the unit within days, but experts warned the work included the risk of sparking fires as electricity is restored through equipment potentially damaged in the tsunami.

In a new setback, black smoke billowed from Unit 3, prompting another evacuation of workers from the plant Wednesday afternoon, Tokyo Electric Power Co. officials said, but they said there had been no corresponding spike in radiation at the plant.

“We don’t know the reason” for the smoke, Hidehiko Nishiyama of the Nuclear Safety Agency said.

As a precaution, officials have evacuated a 12-mile (20-kilometer) radius around the plant and advised those up to 19 miles (30 kilometers) away to stay indoors to minimize exposure.

And for the first time, Edano suggested that those downwind of the plant, even those just outside the zone, should stay indoors with the windows shut tight.

Survivors, meanwhile, buried the tsunami dead in makeshift coffins, resorting to wrapping some bodies in blue tarps.

In Higashimatsushima, about 200 miles (320 kilometers) northeast of Tokyo, soldiers lowered bare plywood coffins into the ground, saluting each casket, as families watched from a distance. Two young girls wept inconsolably, their father hugging them tight.

“I hope their spirits will rest in peace here at this temporary place,” said Katsuko Oguni, 42, a relative of the dead.

Hundreds of thousands remained homeless, squeezed into temporary shelters without heat, warm food or medicine and no idea what to call home after the colossal wave swallowed up cities along the coast.

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Italy is warning that it will review the use of its bases by coalition forces for strikes against Libya if the mission doesn’t pass to NATO’s command.

Foreign Minister Franco Frattini issued the ultimatum Monday after Turkey blocked NATO from approving a military strategy that would allow NATO’s participation in the operation.

Italy has allowed seven military bases to be used, and six Italian Tornados took part in operations over Libya on Sunday.

Italian news organizations report that Frattini told a press conference in Brussels that if the mission doesn’t pass to NATO’s command, “Italy will begin reflecting on the use of its bases: if there is a multiplication of command centers, we must study a way in which Italy retakes control of its bases.”

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

LONDON (AP) _ U.K. Prime Minister David Cameron said Monday that coalition forces have neutralized Libyan air defenses and helped avert a bloodbath in the North African country.

The prime minister told British lawmakers that Moammar Gadhafi had violated a U.N. Security Council resolution by moving troops toward rebel-held cities and also had lied to the international community.

“Gadhafi responded to the U.N. resolution by declaring a cease-fire, but straightaway it was clear he was breaking that promise,” Cameron told lawmakers guaranteed online personal loans.

Cameron stressed that through airstrikes, coalition forces helped avert what could have been “a bloody massacre in Benghazi.”

The aims behind coalition airstrikes _ which Cameron called “necessary, legal and right” _ were to suppress Libyan air defenses to enable the enforcement of a no-fly zone and to protect civilians.

“Good progress has been made on both fronts,” Cameron said, stressing that all action was taken with the support _ and even invitation _ of Arab nations. He went on to say that he sought to build the “widest possible coalition” for action in Libya.

Cameron declined to specify if Gadhafi is himself a potential target of the airstrikes _ saying he would not go further than addressing that targets are chosen to help avert attacks on civilians and to implement the no-fly zone.

“Many people will ask questions I’m sure today about regime change and Gadhafi,” the prime minister said. “I’ve been clear; I think Libya needs to get rid of Gadhafi. But in the end we are responsible for trying to enforce this Security Council resolution. The Libyans must choose their own future.”

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The nuclear plant disaster in Japan has focused the spotlight on Ontario’s nuclear program in recent days, as it should.

It’s easy for nuclear regulators and operators in this country to grow complacent and start believing their own arrogant assurances that it could never happen here

Irish Prime Minister Enda Kenny said it’s “grossly unfair” that taxpayers alone should carry the cost of bailing out the country’s banks as he pushed for lower rates on a European-led rescue loan.

Kenny, on a visit to Washington where he says he’s trying to repair Ireland’s “damaged” reputation, called for changes to the aid package by the European Union and the International Monetary Fund to avoid a situation where Ireland struggles to pay back its loan and can’t generate economic growth.

“It is grossly unfair to expect the taxpayer to have to pay 100 percent for the reckless lending practices of banks which caused this in the first instance,” Kenny said yesterday in an interview with Bloomberg Television’s “InBusiness With Margaret Brennan” broadcast today. The 5.8 percent average rate Ireland pays for its loans is “too severe,” he said.

Kenny’s Fine Gael party took power last week after pledging to seek a European agreement on sharing the cost of rescuing the financial system with senior bank bondholders. His government is counting on ongoing stress tests to reveal the full extent of potential losses at the country’s lenders, after injecting 46.3 billion euros ($64.4 billion) into the financial system over the past two years.

Kenny stopped short of saying who should pay along with taxpayers. Asked about the treatment of senior bondholders, Kenny said that his government will put no additional cash into banks “until you see the scale of what the liability is, until there is an understanding of what might be here.”

U.S. Meetings

Kenny met with Treasury Secretary Timothy F. Geithner yesterday as part of his U.S. visit. He will hold talks with President Barack Obama today and attend the annual White House reception for St. Patrick’s Day, Ireland’s national holiday.

The Irish prime minister vowed to keep the nation’s corporate tax rate “intact” to attract foreign investors, adding that his country is “open for business.”

Less than a week after failing to obtain a discount on the rate charged by the EU because of Ireland’s refusal to increase the country’s 12.5 percent company tax, Kenny repeated he is not willing to negotiate it.

“It’s not correct to equate a conditionality of a reduction in interest rates with the condition that a corporate tax is increased,” he said. “I am not prepared to compromise on something that is the individual competence of each country in respect of our corporate tax rates.”

‘Playing With Fire’

The premium investors charge to hold Irish 10-year debt over the equivalent German bunds, Europe’s benchmark, was little changed today at 641 basis points. It reached a record of 680 on November 30, two days after the bailout.

Citigroup Inc. Chief Economist Willem Buiter said EU leaders are “playing with fire” by not acceding to Ireland’s request as it may force the country to restructure its debt unilaterally.

“They have to come up with something for Ireland,” Buiter said. “They’re going to have to make concession or Ireland will have no option but to go it alone.”

French President Nicolas Sarkozy and German Chancellor Angela Merkel at a March 11 euro-area leaders summit refused to extend a cut of Greece’s borrowing costs to Ireland as Kenny pushed back on taxes. Ireland has used the rate, which is about half the EU average, to lure companies such as Hewlett-Packard Co. and Pfizer Inc.

Ireland pays an average 5.8 percent interest rate on the 67.5 billion euros of aid from the IMF and the EU. Kenny said he expects to obtain “some flexibility” from Europe.

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A nearly completed new power line could restore cooling systems in Japan’s tsunami-crippled nuclear power plant, its operator said Thursday, raising some hope of easing the crisis that has threatened a meltdown and already spawned dangerous radiation surges.

The conditions at the plant appeared to worsen, with white smoke pouring from the complex and a surge in radiation levels forcing workers to retreat for hours Wednesday from their struggle to cool the overheating reactors.

As international concern mounted, the chief of the U.N. nuclear agency said he would go to Japan to assess what he called a “serious” situation and urged Tokyo to provide better information to his organization.

Tokyo Electric Power Co. spokesman Naoki Tsunoda said the new power line to the Fukushima Dai-ichi plant is almost finished and that officials plan to try it “as soon as possible,” but he could not say exactly when.

The new line would revive electric-powered pumps, allowing the company to maintain a steady water supply to troubled reactors and spent fuel storage ponds, keeping them cool. The company is also trying to repair its existing disabled power line.

Wednesday’s pullback by workers who have been pumping seawater into the reactors cost valuable time in the fight to prevent a nuclear meltdown, a nightmare scenario following Friday’s horrific earthquake and tsunami. The disasters pulverized Japan’s northeastern coast and are feared to have killed more than 10,000 people.

The tsunami destroyed the complex’s backup power system and left operators unable to properly cool nuclear fuel. The 180 emergency workers have been working in shifts to manually pump seawater into the reactors.

Japan’s emperor, in an unprecedented made-for-TV speech, called on the country to work together.

“It is important that each of us shares the difficult days that lie ahead,” said Akihito, 77. “I pray that we will all take care of each other and overcome this tragedy.”

He also expressed his worries over the nuclear crisis, saying: “With the help of those involved I hope things will not get worse.”

But officials are also taking increasing criticism for poor communication about efforts at the complex. There has been growing unease at the U.N.’s International Atomic Energy Agency’s 35 board member nations, who have complained that information coming from Japan on the rapidly evolving nuclear disaster is too slow and vague.

IAEA head Yukiya Amano spoke of a “very serious” situation and said he would leave for Tokyo within a day.

He said it was “difficult to say” if events were out of control, but added, “I will certainly have contact with those people who are working there who tackled the accident, and I will be able to have firsthand information.”

The nuclear crisis has partly overshadowed the human tragedy caused by Friday’s 9.0-magnitude earthquake, one of the strongest recorded in history.

Millions of Japanese have been with little food and water in heavy snow and rain since Friday. In some towns, long lines of cars waited outside the few open gas stations, with others lined up at rice-vending machines.

National broadcaster NHK showed mammoth military helicopters lifting off Friday afternoon to survey radiation levels above the nuclear complex, preparing to dump water onto the most troubled reactors in an effort to cool them down.

The defense ministry later said those flights were a drill _ then later said it had decided against making an airborne drop because of the high radiation levels.

“The anxiety and anger being felt by people in Fukushima have reached a boiling point,” the governor of Fukushima prefecture, Yuhei Sato, fumed in an interview with NHK. He criticized preparations for an evacuation if conditions worsen, and said centers do not have enough hot meals and basic necessities.

More than 4,300 people are officially listed as dead, but officials believe the toll will climb to well over 10,000. Police say more than 452,000 people are staying in temporary shelters such as school gymnasiums payday loan lenders.

Wednesday’s radiation spike was believed to have come from the complex’s Unit 3. But officials also admitted that they were far from sure what was going on at the four most troubled reactors, including Unit 3, in part because high radiation levels made it difficult to get very close.

While white smoke was seen rising Wednesday above Unit 3, officials could not ascertain the source. They said it could be spewing from the reactor’s spent fuel pool _ cooling tanks for used nuclear rods _ or may have been from damage to the reactor’s containment vessel, the protective shell of thick concrete.

Masahisa Otsuki, an official with Tokyo Electric Power Co., which owns the complex, said officials are most concerned about the spent fuel pools, which are not encased in protective shells.

“We haven’t been able to get any of the latest data at any spent fuel pools. We don’t have the latest water levels, temperatures, none of the latest information for any of the four reactors,” he said.

Late Wednesday, government officials said they’d asked special police units to bring in water cannons _ normally used to quell rioters _ to spray water onto the spent fuel storage pool for the complex’s Unit 4.

The cannons are thought to be strong enough to allow emergency workers to remain a safe distance from the complex while still able to get water into the pool, said Minoru Ogoda of the Japanese nuclear safety agency.

In the city of Fukushima, meanwhile, about 40 miles (60 kilometers) inland from the nuclear complex, hundreds of harried government workers, police officers and others struggled to stay on top of the situation in a makeshift command center.

An entire floor of one of the prefecture’s office buildings had been taken over by people tracking evacuations, power needs, death tolls and food supplies.

Elevated levels of radiation were detected well outside the 20-mile (30-kilometer) emergency area around the plants. In Ibaraki prefecture, just south of Fukushima, officials said radiation levels were about 300 times normal levels by late morning. It would take three years of constant exposure to these higher levels to raise a person’s risk of cancer.

A little radiation was also detected in Tokyo, triggering panic buying of food and water.

Given the reported radiation levels, John Price, an Australian-based nuclear safety expert, said he saw few health risks for the general public so far. But he said he was surprised by how little information the Japanese were sharing.

“We don’t know even the fundamentals of what’s happening, what’s wrong, what isn’t working. We’re all guessing,” he said. “I would have thought they would put on a panel of experts every two hours.”

Chief Cabinet Secretary Yukio Edano said the government expects to ask the U.S. military for help, though he did not elaborate. He said the government is still considering whether to accept offers of help from other countries.

There are six reactors at the plant. Units 1, 2 and 3, which were operating last week, shut down automatically when the quake hit. Since then, all three have been rocked by explosions. Compounding the problems, on Tuesday a fire broke out in Unit 4’s fuel storage pond, an area where used nuclear fuel is kept cool, causing radioactivity to be released into the atmosphere.

Units 4, 5 and 6 were shut at the time of the quake, but even offline reactors have nuclear fuel _ either inside the reactors or in storage ponds _ that need to be kept cool.

Meanwhile, the Nuclear and Industrial Safety Agency estimated that 70 percent of the rods have been damaged at the No. 1 reactor.

Japan’s national news agency, Kyodo, said that 33 percent of the fuel rods at the No. 2 reactor were damaged and that the cores of both reactors were believed to have partially melted.

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Luxembourg’s Jean-Claude Juncker, who chairs the group of euro-area finance ministers, said he is “not happy” about the role played by credit-rating companies in Europe’s sovereign-debt crisis, particularly in the case of Spain.

“In the U.S., people are saying that financial markets would not always be best advised to follow the assessments given by the rating agencies,” Juncker told reporters yesterday in Brussels, where he chaired a meeting of finance chiefs. “As far as this very point is concerned, I’m very American.”

Moody’s Investors Service lowered Spain’s credit rating to Aa2 on March 10, saying Spanish lenders will need as much as 50 billion euros ($70 billion) to meet new capital requirements, more than double the 20 billion euros seen by the government in Madrid. Juncker said it is “surprising” that Moody’s didn’t wait to see the Bank of Spain’s assessment of lenders’ capital shortfall, which was due on the same day, before downgrading the nation’s credit rating.

French Finance Minister Christine Lagarde said the ratings downgrade is being studied as an example of problems with how rating agencies work. “The fact that the downgrade came within a few hours of that statement prompted a rejection of the way they’re operating,” she said yesterday in Brussels. The European Union wants to set new rules for the timing and justification of such ratings changes, she added.

Warning Period

Credit-ratings companies may be forced to give governments three days’ notice of any change to their rating under proposals made in November by the European Commission, the EU executive no fax needed payday loans. Extending the warning period to 72 hours, from the current 12 hours, would give countries a chance to point out “factual errors” and “new developments” which may influence the rating, according to the commission.

Moody’s said it “will continue to engage constructively with European policy makers on the evolving regulation of our industry,” according to an e-mailed statement from the company. “Our ratings derive from transparent methodologies and are supported by in-depth research and analysis.”

The Brussels-based commission also is considering setting up a publicly funded agency to compete with companies such as Moody’s, Standard & Poor’s and Fitch Ratings. European Central Bank officials have criticized rating companies for announcing changes in sovereign ratings just as Europe’s debt crisis was unfolding, exacerbating market turmoil.

Spain has taken unprecedented measures to avoid following Greece and Ireland into a bailout, implementing the deepest budget cuts in at least three decades. The government in Madrid is tightening capital requirements for banks in an effort to show investors that its lenders can weather a fourth year of economic slump.

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Businesses and universities across the St. Louis region scrambled Friday to ensure that their employees and students in earthquake-ravaged Japan were safe in the aftermath of that country’s worst earthquake.

Most of those with a St. Louis connection live and work outside the area hardest hit by a tremblor that registered magnitude of 8.9.

“We’ve reached out and confirmed that all of our employees are safe and accounted for. Our hearts go out to our colleagues in Japan and everyone who has been impacted by this devastation,” said Kathleen Manning, a spokeswoman for Monsanto Corp.

All 20 Monsanto employees were safe, said Manning.

The reports were the same from representatives of Energizer Holdings, Emerson and other area companies with employees stationed in Japan.

Electric appliance manufacturer Emerson has 800 workers spread across 20 facilities in Japan.

“We’ve been able to confirm the safety of everyone we have been able to reach so far,” said spokesman Dave Baldridge said. “As you might expect, communications have been challenging, so it is too early to assess the total impact on Emerson facilities.”

Washington University and Webster University also reported that students in foreign study programs escaped injury in the quake, which struck Sandei in northern Japan midafternoon Friday. Azusa Tanaka, a librarian in Washington University’s East Asian Library, said she had been in contact with various family members in Japan, including her mother, whose train from Tokyo to Kyoto was delayed for several hours while inspectors made certain the tracks were safe.

“She said she felt a big shaking in the train. I guess she was really scared,” Tanaka said.

Doug Lerner, a Tokyo resident who maintains a home in Lafayette Square, was grocery shopping when the earthquake struck.

“People ran out of the supermarket, and I had to hold on to a bicycle post to stop from falling over,” Lerner wrote in an e-mail. He returned home to find that his residence was not damaged.

Still, Lerner was awakened by aftershocks through the night.

Lisa Brown, Tim Barker and Georgina Gustin of the Post-Dispatch contributed to this report.

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A former schoolmate of a one-time billionaire hedge fund boss has testified at an insider trading trial in New York that his former friend told him he would pay $500,000 annually to an overseas account if he revealed secrets about public companies.

Anil Kumar (AH-nuhl KOO-mahr) testified for the prosecution at the trial of Raj Rajaratnam (rah-juh-RUHT’-nuhm). Kumar worked for McKinsey & Co.

Rajaratnam is accused of earning tens of millions of dollars illegally by trading on inside information payday loan. He had pleaded not guilty to conspiracy and security fraud charges.

Prosecutors have said the probe of Rajaratnam and others was the biggest hedge fund insider trading case in history. In all, more than two dozen people have been charged. Nineteen, including Kumar, have pleaded guilty.

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