- The Washington Times - Friday, January 4, 2008


Sallie Mae, the biggest U.S. educational lender, plans to become more selective in pursuing loan originations, the Reston company said. SLM Corp., as it is formally known, will curtail less-profitable student-loan acquisitions, it said in a regulatory filing.

Sirius Satellite Radio, which is seeking federal approval to acquire District-based competitor XM Satellite Radio for $13.6 billion, said it ended 2007 with 8.3 million subscribers, up 38 percent from a year earlier. The company added about 2.3 million net subscribers during the year.

Amtrak workers without a labor agreement could strike as soon as the end of the month after a presidential emergency board presents its recommendations to the White House, the passenger railroad said. The five-member board was appointed by President Bush to help negotiate a labor agreement between the railroad and eight unions representing maintenance workers, dispatchers and other employees.


State Street Corp. cleaned house after investments tied to subprime mortgages soured, but its shares surged to a record high as the trust bank raised earnings expectations. Boston-based State Street set aside $618 million to cover expected legal fallout and other costs from its investments, and replaced the head of its investment management unit.

General Motors abandoned plans to build a V-8 engine for luxury vehicles at a plant near Buffalo, N.Y., blaming new federal mileage requirements and high gasoline prices cutting into consumer demand. A GM Powertrain spokeswoman said plans to build the new V-8 Duramax clean diesel engine for light-duty pickup trucks are still on track.

Boeing Co. delivered 441 planes last year, nearly 10 percent more than in 2006, and is expected to blow past its previous record when it announces its 2007 commercial-jet order total soon. Rival Airbus is on pace to beat Boeing in deliveries. As of Nov. 30, Airbus had delivered 410 planes.

Rates on 30-year mortgages fell last week to the lowest level in a month as investors found new reasons to worry about a possible recession. Freddie Mac reported that 30-year, fixed-rate mortgages averaged 6.07 percent this week, down from 6.17 percent last week.

The market for asset-backed commercial paper managed its first increase since early August in the latest week, confirming that a set of coordinated central bank initiatives managed to keep that market liquid at the year’s end. Analysts said Federal Reserve data in future weeks will clarify whether the growth the asset-backed market saw at year’s end is a fluke or the start of a positive trend.

An internal audit warned last year that the Florida state board that invests local government money should have a special committee to review overall risk in the agency’s investments, and that it was relying on too few brokerages when buying securities. The audit was completed in March, months before cities and counties began frantically withdrawing billions from the Local Government Investment Pool.

U.S. prosecutors named the first witnesses they plan to call in the fraud trial of former General Reinsurance Corp. Chief Executive Officer Ronald Ferguson, including billionaire Warren Buffett’s biographer as well as the billionaire himself, who denies any knowledge of improper transactions. Mr. Ferguson is charged with overseeing reinsurance contracts that let insurance giant AIG inflate reserves by $500 million.

A former Goldman Sachs analyst was sentenced to nearly five years in prison for his role in an insider trading operation that used illegal tips from a grand juror and leaked copies of a market-moving magazine to make millions of dollars illegally. Eugene Plotkin, 28, apologized before he was sentenced to four years and nine months in prison. He also was ordered to pay a $10,000 fine and to forfeit up to $6.7 million.

General Electric Co.’s Homeland Protection unit settled a 2006 lawsuit it brought against five former employees, which accused them of stealing trade secrets for a system to detect explosives and narcotics. Terms weren’t disclosed in a document filed with the federal court in Boston.

Bed Bath & Beyond, the largest U.S. home-furnishings retailer, said quarterly earnings fell for the first time in at least 15 years and forecast profit that trailed estimates. Third-quarter net income dropped 3 percent to $138.2 million (52 cents a share), including an $8 million tax benefit, the company said. Profit a year earlier was $142.4 million (50 cents a share).

Drug maker Merck & Co. said it is licensing an experimental drug for schizophrenia from drug developer Addex Pharmaceuticals in a deal that could bring the small Swiss company up to $702 million.

IBM is completing the biggest revamp of its hardware unit in 15 years to increase sales to smaller companies and compete better with Hewlett-Packard and Dell, as business with 1,000 employees or fewer boost spending faster than larger corporations.

Residents and businesses in central upstate New York sued IBM for more than $100 million, saying pollution from the company’s former microelectronics plant in Endicott endangered people in the area. The state Department of Health documented higher rates of certain cancers and heart defects in areas affected by pollution south and southwest of the former plant.

InfoSpace Inc., the money-losing owner of Internet search engines Dogpile and WebFetch, said it plans to dismiss a fifth of its work force, or 40 jobs, to save as much as $9 million a year and named David Binder chief financial officer. Severance costs of $7 million to $8 million will be booked in 2007’s fourth quarter, the Bellevue, Wash., company said.

Investment bank Needham & Co. said the Macintosh personal computer’s global market share could double over the next 10 years, from the current 3 percent to 7 percent. The firm recommends buying Apple Inc.’s shares and has a price target of $235, compared with yesterday’s $194.93 close. Apple’s IPhone might eventually capture 15 percent of the smart-phone market, Needham said.


The U.S. and Australia are trying to reach an agreement ending restrictions on which airlines can fly between the two nations, and scheduled talks for next month. Meetings are tentatively set for the week of Feb. 11 in Washington, the U.S. Department of Transportation said, with the goal of reaching an “open skies” deal.

No dollars, just rupees please. India’s tourism minister said U.S. dollars will no longer be accepted at the country’s heritage tourist sites, including the Taj Mahal, which announced its own dollar ban last week. The dollar is at a nine-year low against the rupee.

From wire dispatches and staff reports



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