Financial life in a big town

U.K. services, manufacturing and construction probably waned this month as Bank of England policy makers prepare to discuss whether they need to extend stimulus after the economy slipped back into recession.

A gauge of factory activity based on a survey of purchasing managers will fall to 51.5 from 52.1 in March, according to the median estimate of 27 forecasts in a Bloomberg News poll. A reading above 50 indicates expansion. An index of services, the largest part of the economy, will decline to 54.1 from 55.3, while a construction measure will also fall, separate surveys of economists show.

U.K. gross domestic product fell in the first quarter, pushing the economy into its first double-dip recession since the 1970s. While Bank of England officials have said that may hurt confidence, they must balance that risk with the threat from faster-than-targeted inflation at their May 9-10 meeting.

The Netherlands, the fifth-largest economy in the euro region, no longer belongs to the core of the common currency and may face rising borrowing costs, Citigroup Inc. said.

A development group is proposing to turn the Doe Run lead smelter property in Herculaneum into a $100 million facility that will have a port and additional commercial and industrial uses.

St. Louis-based Environmental Operations Inc. and J.H. Berra Construction Co. in St. Louis County have partnered to create a development group, Riverview Commerce Park LLC, to purchase 500 acres in Jefferson County that includes the Doe Run Co’s lead smelting facility and adjoining property in Herculaneum, the companies announced Friday.

The project is in an early stage and will undergo six months of due diligence before more details are announced in the fall, said Environmental Operations’ chairman and CEO Stacy Hastie.

“We’ve talked to two to three potential users for the site, and we think it has a lot of potential.”

Riverview Commerce Park LLC has signed a letter of intent to purchase the property for an undisclosed amount from Maryland Heights-based Doe Run Co.

The property has been used as a lead smelter for more than a century, and in recent years, Doe Run has come under fire because of environmental problems at the site.

In 2010, the company announced it planned to cease production of primary lead at the Herculaneum smelter. In a settlement with federal and state environmental regulators, Doe Run also agreed to pay for clean-up at the site.

Bruce Neil, Doe Run Co.’s president and chief executive officer, said in a statement that the property has “infrastructure and environmental challenges.”

It chose Environmental Operations and J.H. Berra as buyers and developers of the property, he said, because of their expertise in handling similar challenges.

“We’ve been looking at how we could re-purpose the property and still provide some economic vitality for the area,” said Doe Run spokesperson Tammy Stankey. Doe Run’s smelter currently has 277 employees.

Doe Run is developing an alternative lead metal production process, called electrowinning, that uses a wet chemical process to dissolve lead that it claims reduces emissions.

The company is testing the process at a facility in southeastern Missouri and will decide this spring whether to make a recommendation to the company’s board to open a commercial-scale plant for the new technology.

If it moves forward, the new commerce center proposed at Herculaneum would be considered as a possible location, Stankey said.

Jefferson County officials have worked for years to get a port built along the Mississippi River to spur job growth, said Dan Govero president of the port authority.

“We have all this water frontage and we’re not using it,” he said. “The studies we’ve done show there’s an opportunity to ship grain, sand and other materials, and we have the highway and rail access.”

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As spring approaches, Occupy Wall Street protesters who mostly hibernated all winter are beginning to stir with plans for renewed demonstrations six months after the movement was born.

The global protests against corporate excess and economic inequality are generally thought to have begun Sept. 17 when tents sprang up in a small granite plaza in lower Manhattan. The movement has lost steam in recent months, with media attention and donations dropping off as Occupy encampments across the country were dismantled, some by force.

On March 7, the finance accounting group in New York City reported that just about $119,000 remained in Occupy’s bank account _ the equivalent of about two weeks’ worth of expenses.

The Occupy movement has influenced the national dialogue about economic equality, with the word “occupy” itself becoming part of the public lexicon. In his third State of the Union address, President Barack Obama issued a populist call for income equality that echoed the movement’s message. But has anything really changed in the past six months?

Some achievements that can be connected to the efforts of the Occupy movement, and some plans for the near future:

WHAT GOT DONE

In Albany, N.Y., Occupy protesters dubbed Democratic Gov. Andrew Cuomo “Gov. 1 Percent” for his refusal since the 2010 campaign to agree to a millionaire tax, and because his major campaign financial support comes from corporate executives.

Cuomo tried to evict Occupy Albany from the park co-owned by the city and the state. But the Democratic mayor, Gerald Jennings, agreed to allow Occupy Albany to stay on the city-owned side. Local Democratic District Attorney David Soares also announced he wouldn’t prosecute anyone for disorderly conduct at Occupy Albany who might be arrested by state police _ who answer to Cuomo.

In a surprise, Cuomo reversed his position on the millionaire tax in December to avoid further cuts to schools and health care. Part of the $2 billion in revenue went to a modest but rare income tax cut of $200 to $400 for most middle class families. Cuomo refers to the millionaire tax as the biggest tax cut for the middle class in decades.

Democratic lawmakers attributed Cuomo’s move in part to the Occupy protesters who had targeted him across the street from the Capitol for months and had begun demonstrating just outside his office.

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An Atlanta pastor, whose church struggled to pay its bills after its building was struck by a 2008 tornado, credits Occupy Atlanta with helping it to avoid foreclosure. The Rev. Dexter Johnson’s church, the Higher Ground Empowerment Center, took out a loan to rebuild and has struggled to pay its mortgage in recent months.

Johnson said the bank had agreed to work with the church to help pay its mortgage after demonstrations by Occupy members. Demonstrators had set up a camp at the church in Atlanta’s Vine City neighborhood, just west of downtown.

In January, Johnson learned his congregation would be allowed to stay in the building.

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In Rhode Island, Occupy Providence pushed for _ and won _ a temporary day center to serve the homeless during the winter. Protesters made the center’s opening a condition of their departure from a public park downtown, where they had camped against the city’s wishes for more than three months.

While the city didn’t fund the center, officials pledged to help its operator, the Roman Catholic Diocese of Providence, find money for it.

“It shows that with pressure from people, a government can be made to move,” protester Robert Malin said at the time of the center’s opening.

The city had threatened legal action to remove the protesters and their tents from the park, but the two sides instead went into mediation before a judge.

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Also in Rhode Island, the state’s junior U.S. senator, Sheldon Whitehouse, introduced a bill in November to crack down on high credit card interest rates _ the same week he visited the Providence encampment. While there was no direct relationship between Occupy and the bill, Whitehouse spokesman Seth Larson said Thursday, the legislation no doubt resonated with the protesters.

“It was timely, and I’m sure the Occupy folks appreciated this bill,” Larson said.

Whitehouse had introduced similar legislation a year earlier.

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Occupy protesters helped save an Iraq war veteran’s home from foreclosure in Atlanta, the Huffington Post reported. “I strongly believe Occupy Atlanta accelerated the process and helped save my home,” Brigitte Walker, whose home activists began occupying Dec. 6, told the website. “If it had not been for them standing up, I probably wouldn’t be having this happy ending.” Walker had left Iraq in May 2004 when she was injured by the shock from mortar rounds, the Post reported.

Occupy Minneapolis also worked with community organizers to help a former Marine who faced eviction from his home strike a deal with his bank, the Post reported.

WHAT’S NEXT

Occupiers in New York City will commemorate the six-month mark with a rally Saturday in Zuccotti Park, where protesters camped out for months until the city ousted them in November.

Organizers are hoping donations will start to flow in as protests begin anew this spring, including a global day of “economic disruption” on May 1.

And in some states, Occupy supporters are making forays into politics. Asher Platts is running for the state senate in Maine as a “Clean Elections” candidate. Platts, an activist who attended the protests last fall, is running on an Occupy platform.

In suburban Philadelphia, Occupy protester Nathan I. Kleinman is running a write-in campaign for Congress against four-term Rep. Allyson Schwartz in the Democratic primary on April 24. The 29-year-old said he never would have mounted a run without his Occupy experience. Kleinman withdrew from the ballot after a court hearing in which Schwartz’s supporters questioned some of the 1,500 required signatures he had gathered to appear on the ballot.

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European Union Economic and Monetary Affairs Commissioner Olli Rehn said authorities are

China

China will roll out measures to boost consumption this year as it strives to meet challenges posed by a global slowdown, Commerce Minister Chen Deming said.

The government is studying policies to encourage spending on energy-saving products, and will take other measures including the promotion of online shopping and tourism, Chen told the ministry

Greece’s government warned Tuesday that the debt-crippled country will have to ditch the euro if it fails to finalize a second, euro130 billion ($169 billion) international bailout.

Spokesman Pantelis Kapsis said negotiations in the next three or four months with international debt monitors will “determine everything,” including whether Greece escapes a disastrous bankruptcy.

Greece is being kept afloat by a first, euro110 billion ($142 billion) international bailout agreed in May 2010, after investors shocked by the country’s huge budget deficit and debt mountain demanded sky-high interest rates to continue buying Greek bonds.

An additional bailout was agreed in October, when it became clear that the first batch of funds would not suffice, but that deal has yet to be finalized.

Sorting out the details of the bailout, which also foresees a euro100 billion writedown of Greece’s privately held debt, is the main task of the coalition government headed by former central banker Lucas Papademos, whose short mandate is expected to expire in early April.

“This famous loan agreement must be signed, otherwise we are outside the markets, out of the euro and things will become much worse,” Kapsis told private Skai TV.

In return for its first batch of rescue loans from its European partners and the International Monetary Fund, Greece imposed deeply resented austerity measures to contain its budget deficit _ set to hit at least 9 percent of GDP last year despite repeated spending cuts and tax hikes.

Kapsis said further cutbacks, possibly including new taxes, might be required to address a revenue shortfall,

“We will see what the shortfall is and it is very likely that measures will be required,” he said. “I also don’t believe it is easy to impose new taxes, but what does cutting spending mean? To close down the public sector?”

“There is no easy solution,” Kapsis said.

The details are expected to be determined during talks later this month with debt inspectors from the EU, the European Central bank and the IMF, who will determine whether the country receives its next loan installment.

“We can’t take (approval of the next installment) for granted,” Kapsis warned.

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Working almost to exhaustion and persuading countries one by one, European leaders agreed Friday to redefine their continent _ hoping that by joining their fiscal fortunes they might stop a crippling debt crisis, save the euro currency and prevent worldwide economic chaos.

Only one country said no: Britain. It will risk isolation while the rest of the continent plots its future.

The coalition came together in a marathon negotiating session among the 27 European Union heads of government _ hard bargaining that began with dinner Thursday evening and ended after 4 a.m., when red-eyed officials appeared before weary journalists to explain their proposed treaty.

It was a major step forward in the long, postwar march toward European integration. It was two decades ago, on Dec. 9 and 10, 1991, that European negotiators drafted a treaty in Maastricht, Netherlands, to unite their politics, create a central bank and, one day, invent a common currency.

The agreement _ with 23 countries in favor and three more saying they are open to the idea _ would force countries to submit their budgets for central review and limit the deficits they can run.

A crisis over sovereign debt that consumed Greece and spread to Ireland, Italy, Portugal and Spain threatened to explode into a worldwide financial crisis capable for forcing the global economy into recession.

“This is the breakthrough to the stability union,” German Chancellor Angela Merkel said. “We are using the crisis as an opportunity for a renewal.”

To prevent excessive deficits, countries in the treaty will have to submit their national budgets to the European Commission, the executive body of the EU, which will have the power to send them back for revision.

They must also bring their budgets close to balance. Except in special circumstances, the budget deficit of a country must not exceed 0.5 percent of gross domestic product, the amount of goods and services produced by its economy. An unspecified “automatic correction mechanism” would punish the rule-breakers.

Germany and France insist that fiscal union is the best way to regain market trust, badly shaken by the escalating financial crisis. Most economists think it will not be enough.

They say the euro countries need to have enough money on hand to guarantee everyone can pay their debts. Euro leaders put off until March a decision on whether to provide money on top of a euro500 billion, or $668 billion, bailout fund for euro countries.

European leaders did agree to add euro200 billion to the International Monetary Fund to help ailing countries.

Only 17 of the 27 European Union countries use the euro currency, and its stability has been threatened by the massive national debts of some of those 17. All but two of the non-euro countries _ Britain and Denmark _ are committed to adopting it eventually.

The countries that use the euro found they had friends among those that do not. At least six and as many as nine non-euro countries are willing to bind themselves to the euro countries in a pact aimed at having their economies converge.

Britain said no for two reasons: Prime Minister David Cameron’s Conservative Party includes a strong anti-EU element, and Cameron, despite trying deep into the night, failed to win an exemption from regulation for the British financial industry.

The other leaders would have none of it: Bankers and lack of regulation are viewed on the continent as a prime cause of the financial crisis.

“What was on offer is not in Britain’s interest, so I didn’t agree to it,” Cameron said. “We’re not in the euro, and I’m glad we’re not in the euro. We’re never going to join the euro, and we’re never going to give up this kind of sovereignty that these countries are having to give up.”

Britain, which prides itself on its fierce independence, joined the then-European Economic Community in 1973 _ only after French President Charles de Gaulle, who had vetoed the U.K.’s membership along with Germany’s leader, fell from power.

Since then, it has retained a frosty skepticism toward the ambitions of France and Germany to forge ever closer political and fiscal ties. It eschewed both the euro single currency and the Schengen open borders policy, fearful of losing power to determine its own fate.

French President Nicolas Sarkozy blamed the British leader for scuttling what could have been an EU-wide treaty. He said Cameron’s exemptions for British finance “seemed to us unacceptable.”

Some countries may face parliamentary opposition to the pact, which would allow for unprecedented oversight of national budgets.

Stocks and the euro climbed on the news of the treaty, even though it offers only a long-term solution and leaves many details to be worked out. Stocks rose 3.4 percent in Italy, 2.5 percent in France and almost 2 percent in Germany. In New York, the Dow Jones industrial average rose 1.5 percent and vaulted back over 12,000.

Borrowing costs for European countries fell, but only slightly, a sign of cautious confidence from the bond market. The yield on the benchmark Italian government bond fell to 6.33 percent, down about 0.05 percentage point. A yield above 7 percent is considered unsustainable.

One by one through the long night, the leaders of the 17 euro nations persuaded the non-euro nations to come along.

Hungary, the Czech Republic and Sweden said they would need to consult their parliaments. The six other EU countries that use currencies other than the euro _ Denmark, Poland, Bulgaria, Romania, Latvia, Lithuania _ agreed right away. The leaders want the treaty written by March.

The countries hope to help European nations tame their long-term debt. Such an agreement is considered necessary before the European Central Bank and other institutions commit more money to lower the borrowing costs of heavily indebted countries like Italy and Spain.

How exactly that will happen remains unclear. Financial markets around the world had hoped the ECB would buy massive amounts of national bonds, flooding the market with money and lowering borrowing costs. But ECB President Mario Draghi dashed those hopes Thursday and said there was no plan to buy more bonds.

On Friday, Draghi called the treaty agreement “a very good outcome for the euro area, very good.

“It is going to be the basis for much more disciplined economic policy for euro-area members,” he said. “And certainly it is going to be helpful in the present situation.”

A breakup of the euro would have disastrous consequences. It would almost certainly trigger a financial crisis while banks figured out who owned what and while countries leaving the union awkwardly transitioned back to their own sovereign currencies.

Such a disorderly exit could cause banks to become fearful and stop lending money to each other. In 2008, a credit crisis followed the bankruptcy of Lehman Brothers investment house and triggered a meltdown in the stock market.

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Stocks rallied Wednesday on hopes that a deal to save the euro would be agreed at a summit of European leaders at the end of the week.

Investors are betting EU leaders will agree on Friday a strategy that will allow the 17 countries that use the euro to link up their economies more closely. The tighter budget rules, proposed by the leaders of Germany and France, could then allow the European Central Bank to play a bigger role in solving the crisis by buying up the bonds of the most-imperiled countries.

“The market is becoming optimistic that the ECB will aggressively step up its action as both a reward for political action or in reaction to the threat of recession,” said Jane Foley, an analyst at Rabobank International.

Ahead of Friday’s meeting, the ECB is expected to cut interest rates on Thursday, possibly by as much as half a percentage point. If it did sanction such a big move, then the rate would fall to 0.75 percent and below the 1 percent that had previously been considered the floor.

Lower interest rates would help the eurozone economy, which has been sliding back toward recession under the weight of the debt crisis that threatens to spread from the relatively small economies such as Greece to much-bigger Italy and Spain.

Concerns that this could happen have eased this week. That was most evident in the performance of Italian and Spanish bond prices. Both have recovered this week, sending their yields _ the interest rates the countries would pay to borrow on markets _ down to more manageable rates. The yield on Italy’s ten-year bond was at 5.75 percent on Wednesday, way down from the 7 percent level it had traded at in recent weeks.

In Europe, Germany’s DAX rose 0.4 percent to 6,051 while the CAC-40 in France rose 1 percent to 3,212 paperless payday loans. The FTSE 100 index of leading British shares was 0.4 percent higher at 5,593.

Wall Street was poised for a solid opening too _ Dow futures were up 0.5 percent at 12,176 while the broader Standard & Poor’s 500 futures rose 0.6 percent to 1,262.

The euro was trading flat on the day at $1.3400.

U.S. Treasury Secretary Timothy Geithner said Wednesday he is very encouraged with the progress Europe is making in coming up with a plan to shore up the euro in the wake of a crippling debt crisis. Geithner’s comments to reporters followed a meeting with French Finance Minister Francois Baroin on the second day of his whirlwind trip through Europe.

“A more upbeat tone from Geithner in his support for Europe’s efforts to unify fiscal policy across the eurozone has been well received by investors,” said Jordan Lambert, a trader at Spreadex.

Earlier in Asia, Japan’s Nikkei 225 jumped 1.7 percent to end at 8,722.17 _ its highest close in a month. South Korea’s Kospi added 0.9 percent to 1,919.42 and Hong Kong’s Hang Seng gained 1.6 percent to 19,240.58.

Mainland Chinese shares edged higher, with the benchmark Shanghai Composite Index climbing 0.3 percent to 2,332.73, ending a five-session losing streak.

Oil prices meanwhile edged higher alongside stocks _ benchmark crude for January delivery was up 51 cents to $101.79 a barrel in electronic trading on the New York Mercantile Exchange.

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Pamela Sampson in Bangkok contributed to this report.

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