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WELLESLEY, Mass., Feb. 19 – WELLESLEY, Mass., Feb. 19 /PRNewswire-USNewswire/ — The world faces daunting problems, from energy needs to medical research to clean water and more. Without a doubt, the answers lie in the ability of our educational system to rise to these challenges. With that goal, Babson College, Olin College of Engineering and Wellesley College will co-sponsor an interdisciplinary regional summit, "Educational Imperatives of the Grand Challenges," Wednesday, April 21, from 8:30 am to 4:30 pm in Houghton Chapel at Wellesley College (http://grandchallengesummit.olin.edu).

The summit will bring together educators, business leaders, scientists, engineers, students, government officials and policy makers to discuss the changes necessary at all levels in the educational system to prepare students with the skills and perspectives necessary to tackle global problems in energy, health, the environment and other critical areas.

The meeting is part of a national series being held in various regions of the country this spring and fall (http://www.grandchallengesummit.org) focusing on "Grand Challenges," 14 critical global problems identified by the National Academy of Engineering (NAE) that must be solved to maintain national security, improve global living standards and ensure a sustainable future (http://www.engineeringchallenges.org).

Speakers include U.S. Chief Technology Officer Aneesh Chopra, Harvard Business School "disruptive innovation" expert Clayton Christensen, Stanford economics professor and Charter Cities advocate Paul Romer, MIT appropriate technology proponent Amy Smith and Sharon Nunes of IBM's Systems and Technology Group. Award-winning NPR Correspondent Linda Wertheimer will moderate.

"This summit will be an opportunity for us to come together to show how we can prepare the next generation to address our toughest global challenges," said Babson College President Leonard A guaranteed payday loan. Schlesinger. "We also can demonstrate through this summit how working beyond our natural boundaries empowers institutions and individuals within them and ultimately can move us much closer to solving the problems our society needs solved."

"While technology will play a key role in confronting each of the grand challenges, it cannot solve them alone," said Richard K. Miller, president of Olin College. "Solving these problems will require unprecedented levels of cooperation and holistic approaches. Global solutions — not new

technologies — must be the objective, and these require innovation and cooperation among many fields."

"Modern complex problems require complex solutions, and a broader education makes those solutions possible," said Wellesley College President H. Kim Bottomly. "Insights occur when knowledge is integrated across the disciplines to approach global issues in a new way. To gain acceptance of new innovation you must understand human behavior. To develop the most appropriate innovations you must understand their social, psychological, political and economic ramifications. Engineering, business leadership and the liberal arts are a natural and powerful partnership for our times."

Provided by Newswise, online resource for knowledge-based news at www.newswise.com

SOURCE Babson College

Boston Area Colleges Sponsor Summit on Transforming Education to Meet Critical Global Challenges

LONDON (AFP) – World oil prices plunged on Friday as traders took their cue from the strengthening US dollar and eyed a crucial update on energy stockpiles in the United States, analysts said.

New York's main futures contract, light sweet crude for delivery in March, fell 1.64 dollars to 73.64 dollars a barrel.

Brent North Sea crude for March delivery plunged 1.48 dollars to 72.64 dollars a barrel.

Oil sank after the European single currency fell close to a nine-month dollar low, as markets took a dim view of eurozone growth data and unclear EU proposals to help debt-ridden Greece.

In late morning London trade, the euro tumbled to 1.3532 dollars, the lowest level since May 19. That compared with 1.3695 in New York late on Thursday.

A stronger dollar usually dampens demand for oil because it makes dollar-priced crude more expensive for buyers using weaker currencies.

"While European key players and the IMF will not allow a complete failure of Greece, the euro is likely to remain under pressure from the issue and similar concerns for other countries in the region," said analysts at the JBC Energy consultancy in Vienna.

EU leaders stopped short Thursday of offering a bailout to rescue eurozone member Greece. Deep problems in Greek public finances have highlighted the parlous debt of other crisis-hit countries such as Italy and Spain.

Investors also sought the safe-haven dollar after China ordered financial institutions to increase the amount of money they keep in reserve, as Beijing looked to rein in rampant lending amid fears of asset bubbles no fax needed payday loans.

The development was an additional concern for the oil market because China is the world's second biggest energy consuming nation after the United States.

Later Friday, traders will digest a key US inventories report for the week ending February 5. The report, usually published on Wednesdays, was delayed due to a snowstorm in the northeastern US.

This week, crude futures have edged higher as investors mulled the prospect of EU financial support for crisis-hit Greece — and as the US east coast experienced its second huge snowstorm in less than a week.

The International Energy Agency forecast on Thursday that world oil demand and prices would rise this year, driven higher by strong growth in emerging economies, revising upward its earlier forecasts.

The Paris-based agency said demand was now expected to be 86.5 million barrels per day in 2010 compared to a forecast last month of 86.3, while average prices will rise to 75 dollars per barrel from 58 in 2009.

Global daily demand is now estimated at 84.9 million barrels per day (mbd) in 2009, and thus the IEA is predicting a 1.6-mbd increase.

Demand growth is expected to come "entirely" from outside the Organisation for Economic Cooperation and Development (OECD), a grouping of 30 developed economies including Britain, France, Germany, Japan and the United States.

Oil prices slide on back of strong dollar

Filed at 2:33 a.m. ET

YOKOHAMA, Japan, Feb 9 (Reuters) - Nissan Motor Co (NASDAQ:NSANY) , Japan’s No.3 carmaker, said it returned to profit in the third quarter from a year earlier and raised its annual forecast for the second time this financial year, boosted by brisk sales globally.

Nissan, in which France’s Renault SA holds a 44 percent stake, reported on Tuesday an operating profit of 134.07 billion yen ($1.5 billion) for the October-December quarter, swinging from a loss of 99.19 billion yen a year earlier.

The result beat the average estimate of 80 billion yen from three analysts.

For the year ending in March, Nissan now expects an operating profit of 290 billion yen, up from the 120 billion yen profit it forecast in November. That compared with the average 210 billion yen estimate in a poll of 19 analysts by Thomson Reuters (NYSE:TRI) (TSX:TRI) I/B/E/S short term personal loan.

Nissan had initially projected a second straight year of losses this financial year, but it revised its outlook to a profit three months ago as government incentives helped rev up sales in China.

Bigger Japanese rivals Toyota Motor Corp (NYSE:TM) and Honda Motor Co (NYSE:HMC) also upgraded their annual forecasts last week. [IDs:nSGE61209G]

Shares of Nissan have risen 8.7 percent in the last three months, outperforming the Nikkei stock average’s 1.7 percent gain.

Nissan shares closed up 2.4 percent at 731 yen before the results announcement, against a 0.2 percent fall in the Nikkei.

Nissan Returns to Profit and Lifts Forecast

In another blow to Google’s plan to create a giant digital library and bookstore, the Justice Department on Thursday said that a class-action settlement between the company and groups representing authors and publishers had significant legal problems, even after recent revisions.

In a 31-page filing that could influence a federal judge’s ruling on the settlement, the department said the new agreement was much improved from an earlier version. But it said the changes were not enough to placate concerns that the deal would grant Google a monopoly over millions of orphan works, meaning books whose right holders are unknown or cannot be found.

The department also indicated that the revised agreement, like its predecessor, appeared to run afoul of authors’ copyrights and was too broad in scope.

The revised agreement “suffers from the same core problem as the original agreement: it is an attempt to use the class-action mechanism to implement forward-looking business arrangements that go far beyond the dispute before the court in this litigation,” the department wrote.

The department asked the court to encourage the parties to continue discussions on further changes to the settlement, which it said had many public benefits.

While the Justice Department did not explicitly urge the court to reject the deal, as it had the previous version, its opposition on copyright, class action and antitrust grounds represented a further setback for Google and the other parties to the deal.

The settlement stems from copyright lawsuits filed by the Authors Guild and the Association of American Publishers over Google’s plan to digitize books from major libraries personal business card. The settlement, introduced in October 2008, would allow Google to make millions of books available online and commercialize them, while creating new ways for authors and publishers to earn money from digital copies of their works.

But the deal faced a chorus of critics who argued that it would give Google a monopoly on millions of out-of-print books and had failed to take into account the interests of many authors.

In a statement on behalf of Google and the author and publisher groups, a Google spokesman, Gabriel Stricker, said the Justice Department’s filing “recognizes the progress made with the revised settlement, and it once again reinforces the value the agreement can provide in unlocking access to millions of books in the U.S.” He said Google looked forward to the court’s review of the department’s views and those of the deal’s supporters.

Critics of the agreement include Amazon, Microsoft and a range of authors, academics and public interest groups.

Judge Denny Chin of the United States District Court for the Southern District of New York, who will rule on the settlement, scheduled a hearing on the agreement for Feb. 18.

Justice Dept. Criticizes Latest Google Book Deal

Hot News: MarketWatch First Take: SEC settlement no tonic for shareholders

BERLIN — The soaring glass and iron Siemens factory here opened almost exactly a century ago. At first, it churned out turbines to generate electricity, then switched to munitions during World War II before being looted by the Soviets, which required it to be rebuilt at the dawn of the Cold War.

Today, it is manufacturing turbines again — except the models being made now are among the most advanced in the world, each one able to power all the homes in this city of three million people by itself.

“It’s not a museum; it’s a workshop,” said Michael Schwarzlose, a project manager at the Berlin plant.

The same might be said for much of Europe itself, despite American suspicions to the contrary. European companies may not be as nimble as their U.S. counterparts, but in moving to preserve jobs in the midst of the worst global downturn since the end of World War II, they have forged a different path toward recovery.

In doing so, they are making old plants more modern and effective rather than starting over elsewhere or shifting jobs to less expensive locales.

“American companies have been faster to adjust their work forces and quicker in protecting profit margins,” said Gilles Moëc, a senior economist at Deutsche Bank. Indeed, while overall profit margins have fallen for both European and American companies, European firms have been willing to accept lower profit and productivity in the short term.

But that does not mean companies on the Continent have fallen behind in innovation, experts say, especially when it comes to green technology, despite increasing pressure from China.

Instead, Europe relies on its large companies to maintain a cutting edge in key industries, a sharp contrast to the American pattern of turning to newer, smaller companies to drive innovation and create jobs.

“The large incumbents in Europe, which might have been considered technological laggards, have used green technology and sustainability as a core new element of growth,” said Luc Soete, a professor of international economics at Maastrict University, in the Netherlands.

They are also remarkably resilient. The Siemens factory added 500 workers here during the depths of the economic crisis last year, beginning production of new gas-burning turbines that are the most powerful Siemens makes but emit substantially less carbon dioxide than older models.

Barbara Kux, the chief sustainability officer at the company, points to the state-of-the art products made by the century-old factory as an example of green innovation.

“It’s part of sustainability and it shows you think long term and are there to stay,” she said. “It gives you the chance to keep experienced people, to keep their knowledge in-house and develop a high level of loyalty and trust so they feel like part of a family rather than just doing a job.”

The varying responses to the economic downturn come amid a fierce intellectual debate in the United States about whether the country is headed toward a more European economic model, given Washington’s nationalization of big banks and intervention in the auto industry, as well as President Barack Obama’s proposal to overhaul the health care system.

“The end result would be an America much closer to the European model of a social-welfare state, which prioritizes cohesion over innovation,” warned a recent article in National Affairs quarterly by Jim Manzi, a former software executive who is now a senior fellow at the Manhattan Institute, a conservative research group.

While unemployment has soared into the 20 percent range in hard-hit countries on the periphery of Europe like Spain and Latvia, the relative success of other European countries in avoiding deep job cuts adds a new wrinkle to a long-standing trans-Atlantic argument.

When it comes to jobs, the most powerful political issue in the United States today, “companies in Europe are probably much more aware of the social limits in which they operate,” Mr. Soete said.

The overall European unemployment rate of 10 percent matches that of the United States, but northern and central Europe have fared much better, with joblessness at 4 percent in the Netherlands and 5.4 percent in Austria, for example.

Germany’s economy contracted by 5 percent last year, yet its unemployment rate of 7 cashadvance.5 percent is actually down from where it was two years ago. By contrast, the U.S. economy shrank 2.4 percent last year as unemployment doubled to 10 percent over the period.

The ability of the German economy, the biggest in Europe, to stanch job losses despite a markedly deeper recession than in the United States is “something of an economic miracle,” contends Jorg Kramer, chief economist for Commerzbank in Frankfurt.

Much of the attention on saving jobs has focused on the government’s short-work program, in which taxpayers and companies share the cost of furloughing workers. But Mr. Kramer said the government-financed program of shorter work weeks, or Kurzarbeit, was responsible for saving only about 20 percent of jobs.

“Half of this miracle can be explained because firms allowed workers to do less; they tolerated a 2.5 percent drop in productivity,” he added. “You can either cut workers or cut hours.”

In the more flexible U.S. labor market, where industrial unions are weak and contracts far less rigid, companies responded more often by letting workers go, sharply cutting costs and preserving profit margins.

German companies not only reduced hours on the job, they also made a decision to accept lower profit margins in the short term, Mr. Kramer said, a practice he called “labor-hoarding.”

In Germany, profit margins have fallen from 6.26 percent in the first quarter of 2008 to just 0.58 percent in the latest quarter, according to Thomson Reuters Datastream. Similarly, French profit margins have dropped from 6.5 percent to 1.2 percent. By contrast, corporate profitability in the United States have shrunk from 7.8 percent to 3.6 percent.

The choices may have fateful consequences. As the recovery picks up steam, European competitors will be well situated to take advantage of new growth opportunities while American companies are required to rebuild their work forces.

But if the fears of a “double-dip recession” turn out to be true, the leaner profile of big U.S. companies could help them hold up better in a renewed downturn.

Whatever the outcome, European experts say that the varying strategies of companies during the financial crisis, and the different ways they treated their workers, ought to prompt a revision of the traditional American view that Europe’s social democracies are condemned to slow growth and high unemployment.

“It’s not true that there is a correlation between how much you spend on social policy and welfare and economic growth,” said Paolo Guerrieri, a professor of international economics at the University of Rome I.

“The best performing group — Denmark, Sweden, Holland, Germany — are exactly the kind of countries that shouldn’t be doing well according to the U.S. stereotype of high taxes and high welfare benefits.”

Siemens is an example of the kind of European company that is leading the way.

Although its global work force has shrunk over the past five years as it exited businesses like telecommunications and auto parts, that has not stopped it making advances in facilities like its Berlin factory, even if the setting resembles Fritz Lang’s 1927 film “Metropolis.”

The 163-year old company spent €500 million, or $700 million, to develop the new turbines being built at the Berlin factory as part of a push into green technology, which it broadly defines to include low carbon-dioxide-emitting turbines and locomotives, solar paneling and wind technology, as well as air and purification equipment.

With revenue increasing 11 percent from 2008 to 2009, Siemens’ broad green portfolio is now growing faster than the company’s other businesses, Ms. Kux added.

And it managed to save its customers an estimated 210 million tons in carbon dioxide emissions last year, the equivalent of the amount generated by New York, Tokyo, London and Berlin put together.

“The global economic crisis has actually allowed us to increase our green advantage,” she said. “It’s an opportunity to jump ahead, cut costs, and improve our own resources.”

Europe Takes Its Own Path Toward Economic Recovery

This Wednesday, Steven P. Jobs will step to the stage at the Yerba Buena Center for the Arts in San Francisco and unveil a shiny new machine that may or may not change the world.

In the magician’s world, that’s called “the reveal.”

And the most magical part? Even as the media and technology worlds have anticipated this announcement for months, Apple has said not word one about The Device. Reporting on the announcement has become crowdsourced, with thousands of tech and media journalists scrambling for the latest wisp and building on the reporting of others.

However miraculous the thingamajig turns out to be — all rumors point to some kind of tabletlike device — it can’t be more remarkable than the control that Apple and Mr. Jobs have over their audience.

“The reason that we all write about Apple is because we are, of course, interested, but also because everybody likes to read about Apple,” said Matt Buchanan, a contributing editor at the technology site Gizmodo. “Even if they hate Apple.”

As an organization, Apple is more disciplined in managing message than even the Obama campaign, with a culture — some would say cult — of corporate omertà. The only reason we know that the tablet is for real, that it is probably a 10-inch touch device that will cost $600 to $1,000, is that at some point, Apple had to reach out to partners who do not share its sense of pristine hygiene around information.

“Other companies put things in beta, let people try it out and then bring it out,” said Steven Levy, a senior writer at Wired. “With Apple, they say nothing, build the suspense and then say: ‘Here it is. You may discuss.’ Other companies don’t have the discipline, the heart, to do that.”

John Gruber, who writes at DaringFireball.net, says that there may be a business and communications lesson here: make something rather than talk about it.

“When I was younger, I used to love to go to the Philly car show, but I learned after a while that the coolest cars at the show — the prototypes — never get built,” he said. “Apple builds and unveils actual products. They don’t do prototypes.”

Even David Blaine, who is a real magician, calls Mr. Jobs “the ultimate showman who keeps the audience excited the whole way leading up to the reveal.” The strategy carries a measure of risk: Apple TV and the Cube were both introduced with the fanfare of an ocean liner, but behaved more like boat anchors in the marketplace. And iTunes was a soft unveiling that took its time in taking over the world in part because it came out on a Mac-only platform.

But more often than not, Apple has delivered on Mr. Jobs’s showmanship. People remember the debut of the iPhone three years ago, and Apple’s promise that it would change everything car loan. It promptly did, so who wants to miss out on the reveal for the next big thing? (I took the bait, by the way.)

Other properties unique to Apple may be at work. There is a well-chronicled reality distortion field around Mr. Jobs, and his bout with illness and industrious recovery have only reinforced his otherworldly properties. That aura, combined with the company’s history of producing technology that jailbreaks digital culture and transforms entire industries, means it’s best to remain vigilant, even when the company is saying nothing.

Another media dynamic is in play: shared interests. Because the tablet is said to create a new digital reading experience, offering publishing companies a kind of do-over, many media types see the tablet as a life preserver in the midst of the tall waves. Already, the prospective challenge has pushed Amazon to open up its Kindle reader to applications and sweetened royalty arrangements for certain kinds of content.

There was a suggestion at the beginning of the month that Apple actually quietly engages with the news media in a way that does not leave fingerprints. Writing for The Mac Observer, John Martellaro, a former senior marketing manager at Apple, said it had happened before: “The way it works is that a senior exec will come in and say: ‘We need to release this specific information. John, do you have a trusted friend at a major outlet? If so, call him/her and have a conversation. Idly mention this information and suggest that if it were published, that would be nice. No e-mails!’”

That would be news to people who have covered Apple for decades.

“What Steve wants to do more than anything is surprise the world,” said John Markoff, the longtime technology reporter at The New York Times. “It is not in his interest to have a steady drip of product information before he takes the stage.”

Paul Saffo, a veteran technologist in Silicon Valley who has known Mr. Jobs for years, said he hadn’t seen any traces of Apple in the current frenzy.

“We used to say that Apple was a ship that leaked from the top, but it’s been a lot more like North Korea for the past few years,” Mr. Saffo said. “When you look at the night sky, would you notice a single bright star or a huge black hole? Steve creates a black hole and then fills it in with stars.”

So it’s simple really. If you make a product that turns the culture upside down, drives stock price and reconfigures other industries, you step to the stage amid a herald of trumpets and perform magic.

Just make sure the dang thing works.

E-mail: carr@nytimes.com http://twitter.com/carr2n

The Media Equation: Conjuring Up the Latest Buzz, Without a Word

NEW YORK (Reuters) – Profits from top U.S. technology companies like IBM (IBM.N) and financial companies like Goldman Sachs Group Inc (GS.N) next week could help stocks gain as long as investors see room for more profit growth.

Stronger-than-expected results late Thursday from tech bellwether Intel Corp (INTC.O) failed to excite investors on Friday, while steep loan losses reported by JPMorgan Chase & Co. (JPM.N) dragged down the market.

The benchmark Standard & Poor's 500 index (.SPX) rose 23.5 percent last year, with information technology the top-performing sector. It jumped 60 percent, raising questions about whether the sector may have become too expensive.

"It's all about how fast they can grow earnings to catch up to those valuations," said Jeff Kleintop, chief market strategist at LPL Financial in Boston.

"This is a business spending-led recovery rather than consumer recovery … so I think earnings growth will remain above average and justify those valuations."

Fourth-quarter results are expected to show a sharp improvement compared with 2008's last quarter, when the economic downturn took a heavy toll on corporate profits.

S&P 500 earnings for the quarter are forecast up 186 percent versus a year ago, according to Thomson Reuters estimates. It would be the first quarter that S&P 500 company earnings grew year over year since the second quarter of 2007.

Next week the earnings period accelerates, with some 57 S&P 500 companies reporting.

International Business Machines Corp is scheduled to post results on Tuesday while Google Inc (GOOG.O) is expected on Thursday. Among financials, Goldman Sachs is expected on Thursday, while Bank of America (BAC.N) and Morgan Stanley (MS.N) should report on Wednesday.

STOCKS END DOWN FOR WEEK

For the second week of the new year, the three major indexes lost ground. The Dow Jones industrial average (.DJI) was down 0.1 percent, while the S&P was down 0.8 percent and Nasdaq (.IXIC) was down 1.3 percent.

The S&P 500 is still up 68 percent since its early March lows, largely because of stronger-than-expected earnings and economic data.

On the economic front, data that could influence stocks next week includes reports on housing starts, producer prices and leading indicators easy payday loans.

Data on December housing starts, expected on Wednesday, is forecast to show 580,000 new units from 574,000 in November.

More than 70 percent of companies beat estimates in recent reporting periods, and investors are eager to see if the fourth-quarter will produce similar results. The last quarter of 2008 was the worst earnings period in the history of the index.

"I think we're going to get decent numbers relative to estimates," said Fred Dickson, market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon.

"Valuations have gone up, but so have earnings."

Intel, which fell 3.2 percent to $20.80 on Friday, "had such a good run on the margin front that I think a lot of people are a little bit leery that there's going to be any further improvement in margins," said Owen Fitzpatrick, head of U.S. Equity Group, Deutsche Bank Private Wealth Management, said.

FINANCIALS KEY TO MARKET

IBM shares have risen almost 60 percent in the past year as the company cut costs and changed its business mix. Analysts expect the company to report fourth-quarter revenue of about $27 billion, about even with a year earlier, and profit per share of $3.47 versus $3.27 a year earlier.

Financials, which were up 14.8 percent as an S&P sector last year, could benefit from gains in investment banking and other factors, Kleintop said.

"Financials still remain the sore spot in the market. If financials are going down, the whole market is going down," he said.

Financials, materials and consumer discretionary companies are expected to have the highest earnings growth for the fourth quarter, Thomson Reuters estimates showed. Energy and industrials are expected to have the lowest.

Also set to report next week: General Electric (GE.N), McDonald's Corp (MCD.N) and American Express Co (AXP.N).

(Editing by Kenneth Barry)

Earnings growth takes center stage

NEW YORK (Reuters) – U.S. mortgage applications rose during the first week of 2010, reflecting a surge in demand for home refinancing loans as interest rates dropped, data from an industry group showed on Wednesday.

Demand for loans to purchase a home, however, only rose marginally. A continuation of this trend would not bode well for the U.S. housing market, which has been showing signs of stabilization, but remains highly vulnerable to setbacks.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended January 8 increased 14.3 percent to 528.1. The index, however, pales in comparison to its year-earlier level of 1,324.8.

The four-week moving average of mortgage applications, which smoothes the volatile weekly figures, was down 6.4 percent.

The lowest mortgage rates in decades and high affordability helped the hard-hit U.S. housing market find some footing in 2009 after a three-year slump.

Anthony Hsieh, founder and CEO of loanDepot.com, a mortgage lender based in Irvine, California and currently licensed in 18 states, said tight lending standards are one of the sector's biggest obstacles right now.

"I have been in the mortgage business for the past 25 years and I have never seen the industry as tight as it is today."

"Once a borrower leaps over one hurdle in the loan application process they face yet another hurdle, so it is as if they are participating in some sort of triathlon," he said.

The MBA's seasonally adjusted purchase index, a tentative early indicator of home sales, rose 0.8 percent to 213.7.

The seasonally adjusted index of refinancing applications increased 21.8 percent to 2,407.2.

The MBA said borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 5.13 percent, down 0.05 percentage point from the previous week no teletrack payday loan. The prior week's rate was the highest rate since late August.

Interest rates, however, were above the year-ago level of 4.89 percent and an all-time low of 4.61 percent set in the week ended March 27, 2009. The survey has been conducted weekly since 1990.

The refinance share of mortgage activity increased to 71.5 percent of total applications from 68.2 percent the previous week. The adjustable-rate mortgage, or ARM, share of activity was unchanged at 4.0 percent from the previous week.

Cameron Findlay, chief economist at LendingTree.com in Charlotte, North Carolina, said mortgage rates should rise sharply this year, reaching 6.20 percent in the fourth quarter.

"A rate at or over 6 pct is above my tolerance level."

"The housing market cannot afford to go beyond that level and I am convinced the Fed will take action to bring rates back down if they do," he said.

Interest rates are expected to rise when the Federal Reserve at the end of March stops buying mortgage-related securities. The Fed's agency MBS and agency debt purchase programs, aimed at lowering borrowing costs, will have reached more than $1.4 trillion.

U.S. residential mortgage originations will plunge 40 percent this year to the lowest level in a decade as home refinancing demand sinks with rising mortgage rates, the Mortgage Bankers Association said in its annual forecast on Tuesday.

Renowned Yale University economist Robert Shiller said on Tuesday he sees U.S. housing prices falling further in coming months, fueling more fears about the broader economy.

The MBA said fixed 15-year mortgage rates averaged 4.45 percent, down from 4.62 percent the previous week. Rates on one-year ARMs increased to 6.83 percent from 6.42 percent.

U.S. home refinancing demand soars first week of 2010

TORONTO – The Canadian mortgage insurance business of American International Group Inc. will be sold to a private investor group headed Ontario Teachers’ Pension Plan, the groups said Tuesday.

Terms of the transaction were not disclosed.

AIG’s sale of the Canadian mortgage division is the latest business unit to be sold by the insurance giant, which has been selling assets and spinning off divisions in an effort to help repay a government bailout package received last year when it was on the brink of collapse.

AIG United Guaranty Mortgage Insurance Company Canada, based in Toronto, is a leading mortgage provider in Canada with assets of about $264 million.

Teachers’ Private Capital is the private investment department of the Ontario Teachers’ Pension Plan, the largest single-profession pension plan in Canada. It is an independent corporation responsible for investing the fund’s assets and administering the pensions of Ontario’s 284,000 active and retired teachers.

AIG, based in New York, was bailed out by the government last fall at the peak of the credit crisis free online credit report. As losses continued to pile up, the government eventually extended AIG an aid package worth more than $180 billion. The government also received a stake of almost 80 percent in AIG in return for the support.

Just last month AIG said it would slash the amount of money it owes the government by $25 billion when it gives the government preferred equity stakes in two of its life insurance companies, American International Assurance Co. and American Life Insurance Co.

The companies will be placed into special holding units as AIG decided whether to complete initial public offerings or sell them privately.

As of Sept. 30, AIG had tapped $122.31 billion of the aid package and owed the government $85.66 billion in loans. The separation of AIA and Alico would reduce the outstanding aid package to $97.31 billion and the amount owed in loans to $60.66 billion.

Shares of AIG fell 8 cents to $29.81 in morning trading.

AIG sells Canadian mortgage insurance unit

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WASHINGTON (Reuters) – The Obama administration is poised to announce loan guarantees to help kick-start the country's nuclear power industry, which hasn't built a new plant in more than three decades.

Congress authorized $18.5 billion for nuclear loan guarantees in 2005, hoping to revive development of the carbon-free source of energy. Investments in nuclear power has dried up on soaring costs following the 1979 accident at Three Mile Island.

But earlier this year, the U.S. Energy Department signaled it was keen to aid the industry and narrowed the list of those likely to receive loan guarantees to four: Southern Co, Constellation Energy, NRG Energy and SCANA Corp.

"When DOE issues their first loan guarantee, that's going to send an important signal to private-sector financing, and Wall Street in particular," said John Keeley, a spokesman for the Nuclear Energy Institute.

Southern, which wants to build two reactors at the Vogtle plant in Georgia, is expected to be awarded the first loan guarantee.

Energy Department officials would not give a specific date on when the details will be announced but said they were committed to restarting the nuclear industry.

"We are on track to announce the first loan guarantee soon," said Stephanie Mueller, a department spokeswoman.

The money allotted would probably support construction of about two to three plants cash advance payday loan. A nuclear power plant can cost $6 billion to $7 billion to build, according to industry estimates.

Even after receiving a guarantee, the companies would still have to complete the licensing process and secure private financing before construction begins.

Barring major delays, actual construction of a plant would not start before 2011, with the first new plant coming on line around 2017 or 2018, according to the nuclear institute.

The nuclear trade group has called for $100 billion in additional loan guarantees for low carbon energy sources to help support replacing aging reactors and to help reduce greenhouse gas emissions.

U.S. utilities that hope to build new reactors will have to overcome rising construction costs, uncertain cost recovery from customers and lower power demand caused by the recession.

Critics of nuclear power say the projects are too expensive and too risky to receive billions of taxpayer dollars. Environmentalists also raise concerns about the disposal of nuclear waste.

(Additional reporting by Eileen O'Grady in Houston and Tim Gardner in Washington; Editing by Christian Wiessner)

U.S. loans to boost nuclear industry seen soon

Hot News: In Las Vegas, Sports Books in a Pocket

MIAMI (Reuters) – A key informant in the U.S. tax evasion case against Swiss bank UBS AG (UBSN.VX) (UBS.N) has asked a federal court in Florida to postpone the scheduled January 8 start of his prison term so that he can cooperate further with the U.S. government to uncover tax cheats.

Former UBS banker Bradley Birkenfeld, who was sentenced in August to three years and four months in prison for helping a billionaire hide assets from U.S. tax authorities, made the postponement request in a filing this weekend by his lawyer to a U.S. district court in Florida.

The filing also requested a hearing to reconsider the 4O-month sentence imposed on Birkenfeld, a U.S. citizen, by federal Judge William Zloch on August 21.

Birkenfeld's sentencing in August came two days after U.S. and Swiss authorities signed a pact in which Switzerland agreed to reveal the names of about 4,450 wealthy American clients of UBS to U.S. tax investigators.

Supporters of Birkenfeld and whistleblower advocates had criticized the sentence against as too harsh, saying his testimony was pivotal in helping prosecutors to uncover massive tax cheating by U.S. holders of undisclosed UBS accounts.

The critics said the informant's tougher-than-expected treatment would undermine future U.S. efforts to expose secretive offshore tax havens used by tax evaders.

"Since the August 21, 2009, sentencing hearing, Mr. Birkenfeld has been ready, willing and able to cooperate further with the Government" in helping bring cases against other UBS clients suspected of concealing assets from U.S. tax authorities, the filing by attorney David Meier said.

"Accordingly … the defendant respectfully submits that the court should extend the date on which Mr easy fast payday loans. Birkenfeld is to self-report to the Bureau of Prisons (presently scheduled to be January 8, 2010), the document said.

The filing noted that despite the U.S. government's stated intention, expressed at the original sentencing hearing, to continue to use him in its investigations, it had "neither met with Mr. Birkenfeld, not asked him a single question" in the last four months.

The request said an extension of Birkenfeld's voluntary surrender was warranted to give him sufficient time to provide additional assistance to the government.

There was no immediate comment from prosecutors.

Government lawyers had said that by coming forward in the summer of 2007 and volunteering insider information to the Justice Department, Birkenfeld had exposed UBS practices that encouraged tax fraud by U.S. citizens.

The Swiss bank earlier in the year settled criminal charges by paying $780 million, and then promising to name thousands of suspected American tax cheats and exit the U.S. tax-shelter business.

Birkenfeld had pleaded guilty to a single fraud conspiracy count in June 2008 for helping a billionaire client hide assets from the Internal Revenue Service.

Justice Department officials, in a claim disputed by Birkenfeld's supporters, said he received a prison sentence instead of probation because he had initially sought to conceal his personal involvement in tax fraud.

(Editing by Leslie Adler)

UBS whistleblower seeks prison postponement

The Northrop Grumman Corporation said on Tuesday that it would not bid on a $50 billion contract to build aerial refueling tankers unless the Air Force made significant changes in its request for proposals.

Northrop had teamed with a European company to bid against Boeing. If Northrop decided not to bid, the Pentagon would lose the chance to use competition to obtain the lowest price for the planes and could suffer another embarrassment in trying to replace its aging tanker fleet.

Northrop’s comments, made in a letter to the Pentagon’s top acquisition official, appeared to be a last-ditch effort to use that leverage to win changes in the final bid rules, which are expected to be released in January.

Northrop’s president, Wesley G. Bush, said in the letter that a draft of the rules included a “clear preference” for a smaller plane, which Boeing is likely to offer. He also said the proposed contract would place “financial burdens on the company that we simply cannot accept.”

Industry officials said Mr. Bush seemed to be referring to the government’s insistence on a fixed-price contract right from the start cheap payday advance. The Pentagon often covers the costs of developing new military systems and then sets a final price once the manufacturing costs are better known.

Pentagon officials said on Tuesday that they would like to have competition but would not change the requirements to give an advantage to either side.

Northrop and its partner, the European Aeronautic Defense and Space Company, also known as EADS, won a competition for new tankers last year, but government auditors overturned the award after Boeing filed a protest.

The Air Force picked Northrop and EADS, which makes Airbus planes, after they offered a more versatile plane at a cheaper initial price. But Boeing complained that the service had unfairly given its rivals extra points for offering a larger plane, even though it had higher operating costs.

This time, the Pentagon devised a numerical scoring system to try to cut through the lobbying and turn the competition into a shootout for the lowest price.

Northrop Could Withdraw From Bidding on Tanker

CHICAGO (Reuters) – In a worrisome sign for retailers, data released on Saturday showed that sales rose a scant 0.5 percent on the traditional kickoff to the holiday shopping season despite early signs of a strong showing.

A focus on bargains pulled shoppers into stores and onto websites over the Thanksgiving holiday weekend, but many said they would stick to their budgets and avoid purchases if they could not find a good deal.

Those trends appeared to play out in the results issued by ShopperTrak, which measures customer traffic in stores.

The firm said retail sales rose to $10.66 billion on Black Friday, which often is the single busiest shopping day of the holiday season and can set the tone for the weeks leading up to Christmas on December 25.

In 2008, Black Friday sales measured by ShopperTrak rose 3 percent compared to the prior year's Black Friday. Last year's entire holiday season marked the worst performance in nearly 40 years. The firm stuck by its forecast for total holiday sales to rise 1.6 percent this year compared to 2008.

"I figured Black Friday would be up 1 (percent or) maybe 2 percent, just because of the deal-consciousness of folks," said Patricia Edwards, founder and chief investment officer of Storehouse Partners, an investment advisory firm based in Bellevue, Washington. She noted that early November deals from stores and online promotions also may have diverted traffic.

"It's possible it took some of the glory out of the Friday number," she said.

Shoppers spent 35 percent more on Black Friday web purchases than a year earlier, with the average order value reaching $170.19, according to online retail analytics company Coremetrics. Those shoppers bought an average of 5.4 items per order, up from 4.6 items last year, Coremetrics said.

TOUGH HOLIDAY SEASON

Industry executives and analysts have predicted a tough holiday season that may show only a slight improvement over 2008 due to a weak economy and high unemployment.

But their optimism had crept up earlier this week. Analysts polled by Thomson Reuters Data on Friday had increased their forecast for November retail same-store sales to a 2.5 percent increase, from a previous view of 1.8 percent.

The National Retail Federation is due to release its early holiday data on Sunday.

"This will be the hardest holiday season ever to predict," said Eric Karson, associate professor of marketing at the Villanova University School of Business in Pennsylvania.

Retailers used to offer steep promotions on select items as the initial lure for shoppers, in the hopes they would buy more inside the store auto loans. Consumers now expect such discounts as a matter of course.

"We have this big game of chicken now evolving between the retailers and the customers," Karson said.

Claude Smith, a 45-year-old out-of-work plumber from Virginia, said he was trying to pay off his bills from his credit card, which now has a higher interest rate. He pays with cash when he visits stores such as TJX Cos's AJ Wright and Walmart.

"Things are bad. Everybody's thinking about saving everything they have. I go out when there's sales and that's it," said Smith, who visited the Galleria at White Plains mall in New York with his two teenagers on Saturday.

BUYING ONLY WHAT'S NEEDED

Many shoppers showed they were relying on lessons learned from the 2008 season, which began just after a global financial crisis erupted. A U.S. unemployment rate above 10 percent and other financial pressures also weighed on their minds.

"I have three children. I am a single mom. The economy is bad. I am getting only those things that we really need," said Natasha Walker, a 35-year-old telephone operator shopping in Times Square in New York. Her purchases included a GPS navigation system for her car, CD holders, movies for her children and clothing for herself.

Shawn Kravetz, president of hedge fund operator Esplanade Capital LLC, said retailers that slashed costs will do well.

"You can count companies with positive comps (an increase in existing store sales compared to the prior year) on two hands — J Crew, Wal-Mart, Chico's and few others. That is not a strong holiday," he said.

Even though online sales are growing, they still account for less than 4 percent of total retail sales, Karson said.

Wal-Mart Stores Inc's site Walmart.com was the most popular retail site on Thanksgiving for the fifth year in a row, followed by Amazon.com Inc and Best Buy Inc, according to tracking firm Hitwise.

Liberty Interactive's QVC, best known for its TV shopping channel, rang up more than $32 million in orders for its biggest Black Friday ever, a 60 percent increase from 2008, QVC said. It added that more than 40 percent of the sales came from its web site, QVC.com.

(Reporting by Jessica Wohl, additional reporting by Nicole Maestri in San Francisco, and Jennifer Ablan, Martinne Geller and Dhanya Skariachan in New York; Editing by Michele Gershberg and Will Dunham)

Black Friday sales barely up, online surges

BOSTON (MarketWatch) — My friend Keith works for a big mutual fund company and assumes I hate mutual funds because, he says, I “always write about the things we do wrong.”

He insists that fund companies don’t actually do much wrong, because they follow the proscribed rules and regulations and they’d get in trouble if they violated those standards.

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While he’s right from a legal standpoint, Keith ignores the simple truth that the rules leave fund companies a lot of ways to fudge the statistics, and the meaning of the numbers. What’s more, industry practices let fund companies and research firms hype red herrings, information that’s attractive but not necessarily meaty and important.

In our recent discussion, I laid out for Keith what I considered the most misleading statistics and data in the fund world. The longer the conversation ran on, the more I realized that most fund investors don’t necessarily know how this information can be used against them.

If these points factor into your investment decisions, you may want to look more closely at their meaning:

1. Past performance, Part I: The candy of the mutual fund world, past performance is where a fund “tastes great” and there are no consequences for indulging. Fund executives publish fine-print warnings that past results are not a reliable indicator of what to expect going forward, but that’s always below the large-type hype using those results as a big reason why you should buy a fund now.

So long as investors use past performance to frame future expectations and make it the key reason for buying a fund, management will promote a statistic that they know is bad for you.

2. Past performance, Part II: Some funds achieve their record the old-fashioned way: through shenanigans and financial engineering. Fund companies routinely merge away their bad track records. If XYZ Growth is a laggard but XYZ Large-Cap — run by the same management team — has reasonable performance, the growth fund will get the axe and the strong record will survive. Never mind that many investors had a lesser experience — or that management has shown an ability to underperform — the snapshot view looks good.

Similarly, fund companies pitch new funds as their “best new ideas.” What they don’t say is that they “incubate” funds, creating a bunch of new issues using house money. The best performers — and their newly minted track record — go public. You get the fund that sticks as opposed to the one that stinks, but you might have judged the new fund differently if you knew it was merely the best of a bad crop.

3. Past performance, Part III: The long-term annualized average record looks good but ignores the question “What have you done for me lately?” Some funds live off great past performance; they haven’t been solid for years, but big numbers produced in the distant past make them look ironclad quick payday loans.

4. Average cost: While there is no guarantee that cheap management is good management, costs matter. That’s why many investors base their purchase on the average cost for the type of fund they want. The average expense ratio is roughly 1.3% for stock funds and about 1% for bond funds.

In general, investors think that “below-average” is sufficient. What they don’t know is that the average is skewed dramatically by the way it is calculated. A “dollar-weighted average” — so that a fund with $10 billion in assets affects the average more than a fund with $10 million — drops the “average” expense ratio significantly, so that the typical costs for investors in stock funds drops below 1%. (That’s good, because it means investors gravitate to low-cost funds.)

Sadly, it’s not just investors who don’t look at dollar-weighted average expenses; it’s fund directors too. By using the bloated numbers that overemphasize tiny and obscure funds, a board can keep costs high without, theoretically, letting them go much “above average.”

5. Returns aren’t adjusted for taxes: The fund company doesn’t pay Uncle Sam; you do. Funds tell you what they earned, when what’s most important is what you get to keep.

6. Time-weighted performance measurement: This boils down to “your mileage may vary.” The typical pattern for a hot mutual fund is that the assets flow in after a period of great performance; in other words, investors tend to buy at the high points. If the fund suffers thereafter and the shareholder bails out, they have sold low.

Meanwhile the average performance numbers can continue to look pretty good.

What the fund does after your money arrives is all that matters. Funds that have feast-or-famine performance can look good when performance is annualized or smoothed out over several years, but the real question is whether investors actually got what the fund claimed to deliver. You’ll need independent research — Morningstar Inc. measures this — to know for sure, because fund companies won’t tell you.

7. Manager tenure: Studies show that managers with years on the job have better performance than their short-term brethren. Still, manager tenure has no effect on what happens next; it’s not like a manager who has a decade at the helm automatically gets a 1% edge on future performance. Plenty of experienced managers got crushed in 2008; experience was no cushion.

“emphasis”> Next week: The biggest mistakes fund investors make.

Chuck Jaffe: Fund companies’ biggest lies

NEW YORK – Two Bear Stearns executives who ran hedge funds that crashed in 2007 amid the subprime mortgage meltdown were acquitted Tuesday of lying to investors about the looming crisis on Wall Street.

Jurors found Ralph Cioffi and Matthew Tannin not guilty of conspiracy and other charges in an alleged fraud that cost 300 investors about $1.6 billion and nearly caused the demise of Bear Stearns itself. The firm barely avoided bankruptcy in a rescue buyout by JPMorgan Chase & Co. The jury began deliberating on Monday.

Both men had been charged with three counts of securities fraud and two counts of wire fraud. Cioffi was also charged with insider trading.

Tannin left the courtroom without comment. Cioffi said only, “I’m happy.”

During a monthlong trial in federal court in Brooklyn, prosecutors relied on a series of e-mails they alleged revealed behind-the-scenes alarm at the hedge funds as investments in complex, high-risk securities tied to the subprime market began to slide.

“The subprime market looks pretty damn ugly,” Tannin wrote to Cioffi in April 2007. If Bear’s internal reports were accurate, Tannin suggested, “I think we should close the funds now,” and “the entire subprime market is toast.”

The situation became so dire that Cioffi pulled $2 million of his own cash from the fund, but the pair still told investors that they should stay in and that the outlook was good, prosecutors said easy payday loans. He also was accused of hiding news that one worried investor had decided to pull out $57 million from the funds.

Based on a credit analysis, “there’s no basis for thinking this is one big disaster,” Cioffi told investors in a recorded conference call with investors that was played for jurors.

The defendants “lied to their investors. They defrauded their investors. The misled their investors,” prosecutor James McGovern said in his closing argument. “And it’s time for them to be held accountable.”

Defense attorneys sought to convince the jury that the e-mails were taken out of context. Cioffi and Tannin, they said, had no motive to steer investors off a cliff, and were honest with them about the volatility of the market.

Prosecutors failed to show that the managers “knew what the future held and they hatched a criminal scheme to lie to investors,” Cioffi’s attorney, Susan Brune, said in closing arguments.

Added Brune: “This is a case that is built on hindsight bias.”

2 ex-Bear Stearns hedge-fund managers acquitted