Zoellick criticizes Europe for debt crisis
The head of the World Bank is criticizing the 17 countries that share the euro currency for not taking tough actions to prevent the debt crisis in Europe.
Robert Zoellick said Wednesday that the nations did not act responsibly because they created a shared currency without ensuring that it would work. He said they should have first considered those nations that couldn't compete in global trading markets and those that are burdened by debt.
"The global economy has entered a new danger zone with little running room as European countries resist difficult truths about the common responsibilities of a common currency," he said in a speech at George Washington University.
Fears that Greece is headed for a default on its debt have roiled markets for days.
A Greek bankruptcy could destabilize other financially troubled European countries, such as Portugal, Ireland, Spain and Italy.
It also would be a severe blow to many European banks, which are large holders of Greek government bonds. Moody's on Wednesday downgraded the credit ratings of two French banks, Societe Generale and Credit Agricole.
In his speech, Mr. Zoellick also criticized the United States for failing to deal with soaring budget deficits and not moving forward with free-trade agreements.
"It is not responsible for the United States to falter in facing fundamental issues such as unsustainable growth in entitlement spending, the need for a pro-growth tax system and a stalled trade policy," he said.
Sirius XM to raise price for basic package
NEW YORK | Satellite radio company Sirius XM Radio Inc. is raising the price of its basic package for the first time on Jan. 1.
The price of basic service will go from $12.95 to $14.49 per month, Sirius said Wednesday. It hasn't raised that price since the service launched in 2002.
Sirius said earlier this year that it would raise prices for basic service, but it didn't say by how much. To get approval from federal regulators for its 2008 merger with XM Satellite Radio, it agreed not to raise prices for three years.
The company has raised prices on premium packages in the intervening years and said that it will "adjust" prices on many packages Jan. 1.
Investors exit stock and bond funds in August
BOSTON | Investors sought refuge from the market's volatility in August, withdrawing money from stock mutual funds and bond funds alike. The retreat from stock funds was unusually heavy for the third consecutive month, marking a renewed aversion to risk.
A net $21.4 billion was withdrawn from U.S. stock mutual funds in August, and $10.8 billion from bond funds, industry consultant Strategic Insight said Wednesday.
Last month's exit from stock funds followed net withdrawals of more than $23 billion in July and $17 billion in June. The three-month trend marks an about-face from the start of the year, when investors consistently deposited more than they withdrew. Now, the year-to-date stock fund flow is negative, with $21.2 billion in net withdrawals.
Popular store expands exclusive toy offerings
NEW YORK | Toys R Us is scaling back on holiday pop-up stores this year and betting that offering more exclusive toys, like Air Swimmers Extreme, a helium-filled radio-controlled shark that floats through the air, will help attract shoppers into its stores during the all-important holiday season.
CEO Jerry Storch said at a press conference Wednesday that the company hasn't yet determined how many pop-up stores it will open this year. But it will open fewer than the 600 it had in 2010 and more than the 90 it opened 2009. Instead, Toys R Us is adding more exclusive toys and bolstering its online business.
Toys R Us, in Wayne, N.J., still plans to hire about the same amount of seasonal workers as it did 2010, about 45,000.
Avis Budget drops bid for Dollar Thrifty
NEW YORK | Avis Budget Group Inc. said Wednesday that it's dropping its bid to buy rival rental car company Dollar Thrifty, citing current market conditions.
The Parsippany, N.J.-based company said in a regulatory filing that while it's made significant progress toward getting antitrust approval for a deal, and thinks it could get a deal approved, buying Dollar Thrifty Automotive Group Inc. isn't in its best interest anymore.
Avis' decision to bow out leaves Hertz Global Holdings Inc. as Dollar Thrifty's lone suitor, following a tug of war between Hertz and Avis that has dragged on for more than a year.