Isnin, 10 September 2012

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US stocks fall, Apple plummets

Posted: 10 Sep 2012 04:45 PM PDT

NEW YORK: US stocks fell Monday as investors digested an unexpected decline in consumer credit, another weak signal on consumer spending, and Apple plummeted ahead of its expected iPhone 5 launch.

The Dow Jones Industrial Average finished down 52.35 points (0.39 percent) at 13,254.29.

The S&P 500-stock index dropped 8.84 (0.61 percent) to 1,429.08, while the tech-heavy Nasdaq shed 32.40 (1.03 percent) at 3,104.02.

Apple was a big drag on the Nasdaq and the S&P 500, tumbling 2.6 percent ahead of Wednesday's expected announcement of the next generation of its popular iPhone, dubbed the iPhone 5.

"US equities finished lower in lackluster action, losing steam toward the close, as traders appear to (again) be waiting for major events to unfold in the latter part of the week," said Charles Schwab & Co. analysts.

The Federal Reserve opens a two-day policy meeting Wednesday amid speculation the central bank will unveil support for the flagging economy.

The indices accelerated their losses in the final hour of trade after the Fed reported consumer credit fell in July after 10 months of gains, raising concerns about consumer confidence amid high unemployment.

The blue-chip Dow was dragged down by Intel, off 3.8 percent, after it slashed its third-quarter revenue outlook.

Other major Dow decliners were Boeing, down 2.5 percent; 3M, 2.3 percent; and Caterpillar, 1.1 percent.

Computer giant Hewlett-Packard rose 0.8 percent after announcing that job cuts under a major restructuring program will total some 29,000, or 2,000 more than previously estimated.

AIG fell 2.0 percent after the Treasury Department launched a public offering to sell $18 billion of the giant insurer's stock.

US-traded BP shares edged up 0.1 percent. The British oil giant plans to sell US$5.55 billion in oil assets in the Gulf of Mexico to Texas rival Plains Exploration, down 10.5 percent.

Navistar International slid 3.1 percent after activist investor Carl Icahn pressed the company for more representation on the board. -- AFP

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Thousands of teachers strike in Chicago, parents scramble - Reuters

Posted: 10 Sep 2012 08:52 AM PDT

Chyra Southward, 6, looks back while walking with supporters of Chicago teachers during a march in advance of a possible strike in Chicago September 9, 2012. Some 29,000 teachers and support staff have threatened to strike on Monday, setting up an awkward confrontation between Mayor Rahm Emanuel, President Barack Obama's former top White House aide, and organized labor in the president's home city. REUTERS/Jean Lachat

CHICAGO | Mon Sep 10, 2012 11:50am EDT

(Reuters) - Thousands of public school teachers formed picket lines in Chicago on Monday and parents scrambled for child care during their first strike in a quarter century over reforms sought by Mayor Rahm Emanuel and endorsed by President Barack Obama's administration.

Some 29,000 teachers and support staff in the nation's third-largest school system were involved, leaving parents of 350,000 students between kindergarten and high school age to find alternative supervision.

"There's no excuse for either side for not coming to an agreement," said Faith Griggs-York, mother of a first-grader at Agassiz Elementary School, as she dropped her daughter off at a community center a mile from the school.

"I think both sides, because of what they are doing to parents and because of what they are doing to kids, should be embarrassed," Griggs-York said.

Churches, community centers, some schools and other public facilities were ready on Monday to care for thousands of children under a $25 million strike contingency plan financed by the school district. The children will be supervised half a day and receive breakfast and lunch, allowing some parents to work.

"What are these families going to do? Are you going to stay home from work today because of this?" U.S. Senator Dick Durbin, an Illinois Democrat, said on CNN. "What is going to happen to your son or daughter?"

"Both sides need to get back to the table as quickly as possible and really stay there and negotiate through the night if necessary. Get it over with quickly so we can get these kids back in school," Durbin said.

Talks resumed on Monday morning in the months-long contract negotiations. Emanuel is among a number of big city U.S. mayors who have championed such school reforms and Obama's education secretary, Arne Duncan - a former head of Chicago public schools - has endorsed them.

The Chicago confrontation also threatens to sour relations between Obama's Democratic Party and labor unions before the presidential election on November 6.

While Obama is expected to win the vote in Chicago and his home state of Illinois, union anger could spill into neighboring Midwestern states such as Wisconsin, Michigan and Ohio, where the race with Republican challenger Mitt Romney is much closer.

'TRAIN WRECK'

The union has called the plan to care for children during the strike a "train wreck." It warned that caregivers for the children do not have proper training, and there are fears of an increase in gang-related violence in some high-crime areas.

The school district's charter schools will be open on Monday, meaning about 50,000 public school students will be in classes as scheduled.

About 20 teachers picketed in front of Overton Elementary School on Chicago's South Side, wearing red T-shirts, carrying strike signs and singing "We're not going to take it," the chorus from the rock band Twisted Sister's popular anthem.

Several passing cars honked in support, prompting loud cheers from the striking teachers.

Emanuel, the tough talking former White House chief of staff for Obama, blamed the union for the strike and said the two sides had been close to agreement. Union officials have accused Emanuel of disregard and disrespect, which the mayor has denied.

"The kids of Chicago belong in the classroom," Emanuel said at a Sunday night news conference after talks broke down.

Chicago offered teachers raises of 3 percent this year and another 2 percent annually for the following three years, amounting to an average raise of 16 percent over the duration of the proposed contract, School Board President David Vitale said.

"This is not a small contribution we're making at a time when our financial situation is very challenging," he said.

Laura Gunderson, a fourth-grade teacher at Nettelhorst Elementary School, held a "proud union home" sign outside the North Side school with 55 other teachers, aides and clerks lining both sides of the street. Cars honked in support and teachers cheered.

"My heart sank on Friday night when I clocked out and realized I was not going to be teaching Monday," said Gunderson, a teacher for 26 years.

Catherine Schaller, a math teacher at Beethoven Academic Center, an elementary school on the South Side, said: "It's all about people's rights. Our children have a right to a solid education. We're going to stand up for that."

Chicago's South Side, often mentioned by first lady Michele Obama in reference to her humble roots, is one of the city's poorest districts and has a large African-American population.

SCHOOLS BUDGET DEFICIT

The Chicago school district, like many cities and states across the country, is facing a financial crisis, with a projected budget deficit of $3 billion over the next three years and a crushing burden of pensions promised to retiring teachers.

Emanuel said two main issues remain: his proposal that teachers be evaluated based in part on student performance on standardized tests, and more authority for school principals.

Union President Karen Lewis, who has sharply criticized Emanuel, said standardized tests do not take into account inner city poverty as well as hunger and violence in the streets.

Vitale said the two sides were not far apart on compensation issues. But he said district proposals on evaluations followed an Illinois state law passed last year mandating a role for the tests.

"We're following the law and while they may not like the law we have to put it in place," Vitale said on Monday.

More than 80 percent of Chicago students qualify for free lunches because they come from low-income households, and Chicago students have performed poorly compared with national averages on most reading, math and science tests.

Union officials said more than a quarter of Chicago public school teachers could lose their jobs if they are evaluated based on the tests.

"Evaluate us on what we do, not the lives of our children we do not control," Lewis said in announcing the strike.

(Additional reporting by James Kelleher, Greg McCune and Peter Bohan; Editing by Doina Chiacu)

Romney Would Keep Part of Health Care Law as Obama Gains Support - San Francisco Chronicle

Posted: 10 Sep 2012 08:34 AM PDT

(For more on the campaign, see ELECT <GO>)

Sept. 10 (Bloomberg) -- Republican Mitt Romney said he would keep parts of President Barack Obama's health care law, shifting his focus to independent voters as polls showed the president gained support after the Democratic convention.

Both candidates focused on health care yesterday as Obama wrapped up a two-day bus tour across the swing state of Florida by attacking Romney's proposal to change Medicare.

Romney, speaking in an interview on NBC's "Meet the Press," said he would replace Obama's health care law with his own plan while keeping some popular provisions including coverage for people with pre-existing conditions. The Obama administration contends that requiring insurers to cover those people, without also mandating that almost everyone have insurance, would cause prices to soar.

"I'm not getting rid of all health care reform," said Romney. "Of course there are a number of things that I like in health care reform that I'm going to put in place."

Obama's post-convention Florida bus tour showed signs of a gain in intensity at the rallies. His audience in heavily Puerto Rican Kissimmee was so fired up that he said he was tempted to just "say 'thank you' and leave the stage."

An audience of 6,000 at his final stop in West Palm Beach broke into a sing-along before he took the stage, as the speakers played Al Green's "Let's Stay Together." He told the crowd that while he knew he was preaching to the choir, now he needed them to go out and "preach to the unconverted."

Central Theme

Romney, 65, has made opposition to the health care law a central theme of his campaign, saying one of his first actions in office would be to seek to repeal it.

On coverage for people with pre-existing conditions, Nobel- prize winning economist and New York Times columnist Paul Krugman wrote yesterday that such a requirement, without an insurance mandate, would lead healthy people to opt out of insurance, leaving behind "a high risk, high cost pool."

"It's not as easy as keeping some of the pieces" without a requirement that individuals obtain insurance, Obama campaign spokeswoman Jen Psaki told reporters. Romney needs to explain his proposal with details and math, she said.

Making his first appearance on "Meet the Press" in more than three years, Romney said it was a "mistake" for Republicans to back a budget deal with the White House that would enact $1.2 trillion in automatic spending cuts in defense and other areas. His running mate, Representative Paul Ryan of Wisconsin, voted for the cuts and later tried to undo them.

Less Partisan

Romney's less partisan tone marked a contrast from the previous day, when he stood beside television evangelist Pat Robertson at a campaign rally in Virginia Beach, Virginia, and suggested that Democrats wanted to take the word "God" off the American currency. Psaki called the idea absurd, saying it was as likely as the possibility that "aliens are going attack Florida."

The narrow lead Obama gained over Romney during last week's Democratic National Convention in Charlotte, North Carolina, widened in the latest Gallup Poll conducted Sept. 2-8, in which 49 percent of voters said they supported Obama compared with 44 percent for Romney.

The candidates had been tied or within 1 percentage point of each other in the every-day poll since mid-August until Obama registered a 3 percentage-point lead over Romney in the poll conducted Aug. 31-Sept. 6. The poll, updated daily, is based on telephone interviews with 3,050 registered voters and has a margin of error of plus or minus 2 percentage points.

No Bounce

The Republican candidate received no bounce from his party's convention, which concluded Aug. 30, according to Gallup.

Romney took the day off from campaigning yesterday, went to church with his family and prepared with staff for the presidential debates. Today he plans to rally voters at a manufacturing company in Ohio before heading to Reno, Nevada, to address a National Guard convention on Sept. 11.

Obama, in his two-day bus tour, sought to move the focus from a weak jobs report that showed the share of the working-age population in the labor force had slumped to 63.5 percent, the lowest since 1981.

Campaigning in eastern Florida yesterday, the 51-year-old president defended his commitment to space research and told future retirees they will see Medicare costs rise and benefits suffer if Republican Mitt Romney is elected.

Medicare 'Voucher'

"I will never turn Medicare into a voucher," Obama told a crowd of 3,050 at a technology institute in Melbourne, along the space coast.

Obama cited an analysis by Harvard professor David Cutler that said changes in Medicare favored by Romney and Ryan would translate to $16 billion to $26 billion in new profits for insurers by the end of the next decade.

"Your costs would rise by thousands so that their profits could rise by millions," Obama said.

Romney's campaign disputed the study. Campaign spokesman Ryan Williams said Obama was relying on "discredited" analyses and "outright falsehoods."

Obama targeted voting blocs in eastern Florida tied to the economy around the Kennedy Space Center.

He told the audience in Melbourne, a region that suffered job losses from the last year's end of the manned space shuttle program, that his administration has "begun an ambitious new direction" for NASA that will create new jobs in the area. The decision to end the shuttle program was made under President George W. Bush, a Republican, and completed under Democrat Obama.

Deep Space

The president championed the NASA rover Curiosity's landing on Mars last month. He said Republicans want to cut federal spending on research.

Outside the speech site, protesters carried signs that read "Outsourced Manned Spaceflight" and "Obama Lied Space Coast Died."

Later in the afternoon, Obama stopped in a pizza store in Ft. Pierce, Florida, to meet the owner. Obama said Scott Van Duzer, owner of Big Apple Pizza & Pasta, was recognized by the White House and the U.S. surgeon general for his work in organizing community blood drives.

The 6-foot-three, 260-pound owner Van Duzer bear-hugged the president and lifted him off the ground.

Obama said Van Duzer has done "unbelievable work" in his community. "The guy's just got a big heart along with big pecs," the president said.

--With assistance from Kathleen Hunter and Roxana Tiron in Washington. Editors: Laurie Asseo, Ann Hughey

To contact the reporters on this story: Lisa Lerer in Washington at llerer@bloomberg.net; Margaret Talev in Washington at mtalev@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net


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