Financial life in a big town

Some shareholders have sued Hecla Mining Co. for stock losses they endured after the federal government shut down the Lucky Friday Mine for safety violations.

The Bricklayers of Western Pennsylvania Pension Plan this week filed the lawsuit in federal court in Idaho against Hecla, which is based in Coeur d’Alene.

Hecla announced on Jan. 11 that the mine will be closed for a year to make the changes ordered by federal regulators after two miners died in separate accidents last year.

The lawsuit contends the closure caused Hecla’s stock price to fall 21 percent to $4.61 per share on Jan. 11 and that the company prior to that had made false and misleading statements that artificially inflated the price of its stock.

“Defendants lacked a reasonable basis for their positive statements about the company’s operations and its expected silver production,” the lawsuit said, accusing the company of fraud.

Officials for Hecla said the company’s comments on its financial prospects were appropriate and the company will defend itself.

“This lawsuit has no merit,” said spokeswoman Melanie Hennessey, adding such lawsuits were common when a stock price dropped.

The company’s stock has since rebounded to more than $5.30 per share.

In January, Hecla announced that the Mine Safety and Health Administration had ordered it to remove sand and concrete material that had built up in the main elevator shaft of the Lucky Friday, one of the nation’s deepest underground mines. The company said the work would take up to a year, and the mine would be closed during that time.

The closure prompted Hecla to reduce its estimated silver production for 2012 from more than 9 million ounces to about 7 million ounces, all from its remaining Green’s Creek mine in Alaska.

Production is expected to resume in early 2013.

The mine has been shuttered since mid-December, when a rock burst injured seven miners.

Federal regulators have been conducting a close inspection of the mine because of the series of 2011 accidents. They decided they wanted the sand and concrete material removed because it can break off and fall down the shaft, injuring people or damaging the elevators.

The silver mine is located about 50 miles east of Coeur d’Alene in a region called the Silver Valley.

Miner Brandon Lloyd Gray, 26, was buried in rubble while trying to dislodge jammed rock last Nov. 17, and died two days later.

On April 15, miner Larry “Pete” Marek was crushed when his work area collapsed.

Federal inspectors found company safety failures led to his death.

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Orders to U.S. factories rose in December, supported by a rebound in business investment in capital goods such as heavy machinery.

The results cap off another strong year for U.S. manufacturing. Combined with strong figures released Thursday on job growth in January, they signal the economic recovery is gathering strength.

Factory orders rose 1.1 percent following a 2.2 percent gain in November, the Commerce Department reported Friday. For the year, total orders were up 12.1 percent following a gain of 12.9 percent in 2010. Orders had plunged 22.1 percent in the 2009, the year the deep recession ended.

For December, orders for so-called core capital goods, which are viewed as a good measure of business investment plans, rose 3.1 percent to an all-time high. That gain was driven in part by a rush by businesses to take advantage of expiring tax breaks.

The advances in 2011 pushed orders for the year up to $5.36 trillion, still slightly below the peak of $5.44 trillion set in 2008.

For December, orders for durable goods, items expected to last at least three years, rose 3 percent, a figure that was unchanged from a preliminary report last week. Orders for nondurable goods slipped 0.4 percent, reflecting declines in petroleum products.

The orders category that signals business investment plans, non-defense capital goods excluding aircraft, climbed to an all-time high of $68.9 billion in December.

While some of that surge likely reflected a rush to make orders before investment tax breaks expired at the end of last year, many economists believe the boom in spending on new equipment will continue even with the tax breaks gone because there is a large amount of pent-up demand on the part of businesses to modernize their operations.

Companies are hiring more, factories are making more goods and more people are buying cars. Those positive signs for the economy have to be balanced against the threat that Europe’s prolonged debt crisis is acting as a drag on global growth. That would hurt sales of U.S. exports.

In December, orders for commercial aircraft were up 18.9 percent, orders for autos increased 1.7 percent and demand for heavy machinery rose 6.7 percent, reflecting strong demand for oil field equipment and construction machinery.

Manufacturing has been a bright spot in the recovery, although there was a slowdown in the middle of last year as factories dealt with supply shortages caused by the Japanese natural disasters that occurred in March.

The Institute of Supply Management reported this week that its gauge of manufacturing activity expanded in January at the fastest pace in seven months. The index rose to 54.1, up from 53.1 in December. Readings above 50 indicate expansion and the index has been in expansion territory for 30 straight months.

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Berkshire Hathaway Inc.’s energy business agreed to buy an 81-megawatt wind power project from Invenergy Wind LLC to expand production in Illinois.

The Bishop Hill II project, which is under construction, will use 50 General Electric Co. 1.62-megawatt turbines, according to a statement Friday from Berkshire’s MidAmerican Energy Holdings Co. in Omaha, Neb.

Berkshire, led by Warren Buffett, has been expanding renewable production at the energy unit, which also produces power with coal and natural gas. Mid-American has invested about $6 billion in wind generation and built or acquired more than 3,300 megawatts of the renewable energy source in states including Iowa, Wyoming, Washington and Oregon since 2004. Last month, the unit agreed to buy the $2 billion Topaz solar project in California from First Solar Inc payday loans guaranteed no fax.

Wind “meets current and future energy needs in an environmentally efficient and cost-effective manner,” said MidAmerican Chairman and Chief Executive Greg Abel.

The Bishop Hill II wind project is near the town of Galva, Ill., about 40 miles northwest of Peoria. The project is expected to be in commercial operation in the fourth quarter. A unit of Ameren Corp. in Illinois has agreed to buy electricity from the project under a 20-year power-purchase agreement. Terms of the Invenergy deal weren’t disclosed.

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French President Nicolas Sarkozy bluntly declared Monday that a harsh downgrade by Standard & Poor’s of France’s formerly top-rung debt rating “changes nothing” for the eurozone’s No. 2 economy.

Sarkozy, in a testy exchange with a journalist at a Madrid news conference, suggested that a solid investor demand for a French debt auction Monday and a reaffirmation from rival ratings agency Moody’s of France’s triple-A sovereign debt had offset S&P’s much-publicized downgrade.

“We have to react to this with calm, by taking a step back,” he told reporters during a visit with Spain’s new prime minister, Mariano Rajoy. “At the core, my conviction is that it changes nothing.”

The S&P downgrade Friday _ which Sarkozy’s own finance minister called “bad news” _ came just 100 days before the president faces what is expected to be a tough re-election campaign.

The news conference began combatively when Sarkozy refused to answer a question about whether France’s downgrade would affect its ability to lead Europe out of the crisis _ and if the move prompted the postponement of a crisis summit for him and the leaders of Germany and Italy next week.

Sarkozy and German Chancellor Angela Merkel have taken the lead in proposing solutions to the crisis and major decisions are often hashed out at their meetings ahead of European summits.

“You don’t have the latest information,” Sarkozy retorted to a reporter who asked about the downgrade and the summit. Sarkozy refused to answer even after the reporter rephrased his question twice.

The French leader later confirmed that the three-way summit would take place in February and downplayed the S&P downgrade, but never gave a clear answer as to why the summit was rescheduled.

Sarkozy did manage to win much-needed political support from Rajoy _ notably for his pet project for a financial transaction tax that could help ailing European state coffers get out of the red.

France, which has long enjoyed relatively low borrowing costs and had S&P’s top-tier AAA rating uninterrupted since the mid-1970s, on Friday was the largest of nine eurozone members hit by S&P downgrades _ dropping one notch to AA+. The agency also kept a negative outlook on French state debt.

Analysts said Sarkozy’s denial that the downgrade meant much was wishful thinking guaranteed payday loan.

“The fact that there is a negative outlook, it means that there is a probability _ a quite high probability _ of further downgrade in 2012, 2013,” said French economist Norbert Gaillard. “So it’s bad news for France.”

But in a vindication of sorts for Sarkozy, France sold euro8.6 billion ($10.9 billion) in short-term debt on Monday. The yields _ or the interest rates charged by investors on the debt _ fell, a sign investors still see the country as a good bet.

Spain was also hit by an S&P downgrade, from AA- to A+, but Rajoy said that blow and downgrades for other European nations shouldn’t be seen as a sign they will have trouble emerging from the financial crisis.

Rajoy’s Socialist predecessor also supported the financial transaction tax, but Jose Luis Rodriguez Zapatero was ousted from office by Spaniards angry about the country’s hurting economy and high unemployment.

The European Commission has estimated that the tax could raise as much as euro57 billion ($72.2 billion) a year, funds that could be used to help reduce the substantial budget deficits crippling European economies.

Moody’s cited France’s economic strength as a reason for affirming its top rating, but said bleak growth prospects in France and the region present “risks to the French government’s fiscal consolidation plans.”

Moody’s said it would again review French debt later in the first quarter as part of a broader look at sovereign debt within the EU _ meaning a decision is likely close to France’s two-round presidential vote in April and May.

Sarkozy’s challengers for the presidency _ including Socialist nominee Francois Hollande _ have seized on the S&P downgrade as evidence that his policies are wrong-headed and ineffective.

It will be a bruising election battle for Sarkozy, a dynamic leader who has a strong international profile but is widely disliked at home. Leftists say he has coddled the rich, while many of those who supported him in his 2007 campaign say he hasn’t fulfilled his promises.

And Hollande is currently leading in the polls.

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Agribusiness conglomerate Archer Daniels Midland Co. says it will cut 1,000 jobs company wide.

CEO Patricia Woertz said in a Wednesday statement that the majority of the positions will be salaried staff. The move will cut about 15 percent of the company’s corporate staff.

The Decatur, Ill.-based company employs 30,000 people worldwide.

Woertz says the company is cutting jobs to boost productivity and profits. The company does everything from processing crops to make food ingredients, to shipping grain overseas.

The last year has been a volatile one for agribusiness companies, with crop prices swinging wildly on global markets.cher Daniels Midland to cut 1,000 jobs

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Agribusiness conglomerate Archer Daniels Midland Co business card. says it will cut 1,000 jobs company wide.

CEO Patricia Woertz said in a Wednesday statement that the majority of the positions will be salaried staff. The move will cut about 15 percent of the company’s corporate staff.

The Decatur, Ill.-based company employs 30,000 people worldwide.

Woertz says the company is cutting jobs to boost productivity and profits. The company does everything from processing crops to make food ingredients, to shipping grain overseas.

The last year has been a volatile one for agribusiness companies, with crop prices swinging wildly on global markets.

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U.S. stocks rose Thursday in a thinly-traded session as investors focused on signs of strength in the economy before calling it a year.

The Dow Jones industrial average () rose 136 points, or 1.1%, to end at 12,287. The S&P 500 () added 13 points, or 1.1%, to 1,263. The Nasdaq () gained 24 points, or 0.9%, to 2,614.

Thursday’s rebound put the S&P 500 back on track for a modest 0.4% gain in 2011, after the broad market index fell sharply Wednesday. The Dow is currently up 6.1% for the year, while the Nasdaq is set for a 1.5% loss.

Stocks were supported by reports on housing, manufacturing and employment that raised hopes about the U.S. economy.

"Today’s last round of major U.S. reports before the weekend New Year’s celebration provided a decidedly positive spin to the outlook," wrote Michael Englund, chief economist at Action Economics, in a note to clients.

Traders said low volume, typical of the holiday week, has led to more pronounced swings, and some of the moves are coming from year-end portfolio rebalancing rather than convictions over the trajectory of the market or particular stocks.

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"We expect light trading through today and tomorrow, and any noise can create wild swings," said Doug Cote, chief market strategist at ING Investment Management.

Looking ahead, many investors expect stocks to move higher in the first few months of 2012.

The U.S. economy has shown signs of improvement recently, with economists forecasting a 3.3% increase in gross domestic product in the final three months of 2011. In addition, corporate profits are expected to rise in the fourth quarter, continuing an 11-month streak.

But the outlook for next year remains clouded by the debt crisis in Europe, which continues to weigh on demand for risk assets such as stocks.

On Thursday, an auction of Italian 10-year bonds, which have seen yields continue to flirt with the 7% danger zone, provided muted results. While yields were reported below prior levels, demand was short.

The euro fell to a 17-month low and analysts warn the currency could fall even further in 2012.

"Europe is a powder keg and could explode at any time, and likely will when we are the most complacent," said Keith Springer, president of Springer Financial Advisors in Sacramento cash advance america.

Economy: Jobless claims rose 15,000 to 381,000 in the latest week, according to the U.S. Labor Department. Analysts surveyed by Briefing.com had expected 368,000 claims.

But the figure remained below 400,000, giving investors hope that the labor market will strengthen in the new year.

The National Association of Realtors index of pending home sales, which measures signed sales contracts but not closed sales, rose 4% to a seasonally adjusted annual rate of 4.42 million in November from 4.25 million in October.

Economist had expected the a 0.6% increase in pending home sales.

The report boosted shares of homebuilders, including Pulte (, Fortune 500), Masco (, Fortune 500), Lennar () and DR Horton (, Fortune 500).

An index of manufacturing activity in the Chicago area eased slightly in December but held near a 7-month high, according to the Institute for Supply Management.

Companies: Amazon (, Fortune 500) eased after analysts at Goldman Sachs (, Fortune 500) suggested that the online retailer’s sales growth for the holiday period may fall short of expectations.

Shares of Yahoo (, Fortune 500) gained 2.7% after reports that China’s Alibaba Group has hired a lobbying firm to prepare a bid for Yahoo.

BP () edged higher despite reports that employees could face criminal charges in relation to last year’s Gulf of Mexico oil spill.

World markets: European stocks closed higher. Britain’s FTSE 100 () added 0.8%, the DAX () in Germany rose 0.9% and France’s CAC 40 () rose 1.1%.

Asian markets ended mixed. The Shanghai Composite () edged up 0.2%, the Hang Seng () in Hong Kong fell 0.7% and Japan’s Nikkei () lost 0.3%.

Betting on the dollar in 2012

Currencies and commodities: The dollar gained strength against the euro and the British pound but fell versus the Japanese yen.

Oil for February delivery rose 31 cents to $99.05 a barrel.

Gold futures for February delivery fell $23.20 to $1,540.90 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury rose, with the yield easing to 1.89% from late Wednesday.  

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Four years after Bruno Prior paid less than a dollar for an unprofitable ski resort in the Swiss Alps, the strength of the country

+%3Cp%3EMervyn+King%2C+vice+chairman+of+the+European+Systemic+Risk+Board%2C+said+Europe%92s+sovereign+debt+crisis+is+threatening+to+hurt+the+real+economy+and+the+outlook+for+financial+stability+has+worsened.+%3C%2Fp%3E+%3Cp%3EGrowth+prospects+%93have+deteriorated%94+since+September%2C+King%2C+who+is+also+governor+of+the+Bank+of+England%2C+said+at+a+briefing+hosted+by+the+European+Central+Bank+in+Frankfurt+yesterday.+%93Investors+lack+confidence+to+continue+to+provide+normal+levels+of+funding.+Dependence+on+central+banks+has+risen.%94+%3C%2Fp%3E+%3Cp%3EThe+ECB+loaned+banks+a+record+489+billion+euros+%28%24636+billion%29+for+three+years+on+Dec.+21+to+avert+a+credit+crunch+from+the+sovereign+debt+crisis.+The+central+bank+said+earlier+this+week+that+the+turmoil+has+taken+on+systemic+proportions+not+seen+since+the+2008+collapse+of+Lehman+Brothers+Holdings+Inc.+%3C%2Fp%3E+%3Cp%3EKing+said+the+outlook+for+financial+stability+has+%93worsened%94+since+the+last+ESRB+meeting+in+September%2C+and+while+intervention+by+the+ECB+is+expected+to+%93assuage+funding+problems+in+the+near+term%2C+in+the+longer+term+private+funding+markets+must+be+revitalized.%94+%3C%2Fp%3E+%3Cp%3EBank+shares+have+suffered+this+year+as+borrowing+costs+surged+in+the+euro+region.+The+Stoxx+600+Banks+Index+has+fallen+28+percent+since+the+end+of+June%2C+compared+with+a+12+percent+decline+by+the+Stoxx+Europe+600.+%3C%2Fp%3E+Capital+Plea++%3Cp%3EKing+also+appealed+to+banks+not+to+%93reduce+lending+to+the+real+economy%94+as+they+increase+their+capital+levels+to+meet+new+standards+set+by+regulators.+%3C%2Fp%3E+%3Cp%3E%93We+are+very+conscious+there+is+extreme+risk+aversion+in+private+financial+markets%2C%94+he+said+%3Ca+href%3D%22http%3A%2F%2Fus-fast-cash-now.com%22%3Ecash+advance%3C%2Fa%3E%3C%21–+.+–%3E.+%93We+want+a+more+robust+banking+system+so+that+whatever+risks+crystallize%2C+whatever+their+source%2C+the+banking+system+is+in+a+better+position+than+2008.%94+%3C%2Fp%3E+%3Cp%3EThere+was+%93no+discussion%94+at+the+ESRB+meeting+of+any+country+leaving+the+euro+area%2C+King+said.+Still%2C+%93all+financial+institutions+are+advised+to+prepare+for+a+wide+range+of+contingencies%2C%94+he+said.+%3C%2Fp%3E+%3Cp%3EAndrea+Enria%2C+the+second+ESRB+vice+chair+who+is+also+the+chairman+of+the+European+Banking+Authority%2C+said+he+is+%93disappointed%94+by+European+leaders+dithering+over+putting+rescue+measures+in+place%2C+effectively+delaying+Europe%92s+bank+recapitalization.+%3C%2Fp%3E+%3Cp%3E%93We+have+always+been+quite+adamant+in+all+occasions%2C+also+in+the+debate+running+up+to+the+decision%2C+that+this+should+have+been+a+comprehensive+package%2C%94+Enria+said.+This+includes+%93recapitalization%2C+some+measures+–+funding+guarantees+–+addressing+the+funding+problems+and+strengthening+of+the+European+Financial+Stability+Facility+and+of+the+tools+to+deal+with+the+sovereign+crisis.%94+%3C%2Fp%3E+%3Cp%3EThe+ESRB%2C+which+aims+to+warn+of+brewing+risks+in+the+financial+system%2C+was+set+up+in+January+as+part+of+a+new+European+architecture+designed+to+ward+off+another+financial+crisis+such+as+that+which+followed+the+Lehman+collapse.+Its+65-+member+board+is+headed+by+ECB+President+Mario+Draghi.+%3C%2Fp%3E++%3Cp%3E%3Ca+href%3D%27http%3A%2F%2Fwww.bloomberg.com%2Fnews%2F2011-12-23%2Fking-says-crisis-threatens-europe-s-economy-as-stability-outlook-worsens.html%27+rel%3D%27nofollow%27%3ESource%3C%2Fa%3E%3C%2Fp%3E+