New York Community Reports 1Q Earnings Drop, Touts Apartment-Loan Demand

New York Community Bancorp in the first quarter partially offset a slowdown in home-mortgage production with more fees from New York apartment-building owners who repaid loans early.

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Have Kings held court for last time in Sacramento? Anaheim awaits

Sacramento, CA, United States (AHN Sports) – The Kings could have seen their final days in Sacramento, as team owners Joe and Gavin Maloof weigh the pros and cons of moving the franchise to Anaheim.

According to Sacramento Bee, the Maloofs made a presentation before the NBA Board of Directors about their plans to move the franchise to Anaheim Thursday night in New York and could formally file a formal application on Monday.

“We’re making a presentation today [Thursday] about what’s good and bad about Sacramento and Anaheim. If the owners are comfortable with it, we’ll take the next step. We’ll put in an application on Monday [April 18] if things are right.”

Meanwhile, Sacramento Mayor and former NBA player Kevin Johnson also traveled to New York in an effort to convince league owners to keep the Kings in the city.

“We felt very strongly that the Sacramento Kings were worth fighting for,” Johnson said Thursday at a news conference (according to Bloomberg). “If anybody thinks that we’re going to sit on our hands and roll over and just let somebody leave town without putting up a good fight, they’d be gravely mistaken.”

Over the last two years, the Kings’ net value has plummeted sharply (from $350 million in 2008 to $293 million in 2011) due to poor gate attendance.

The Kings are just averaging 13,890 fans per game, which is ranked 29th among 30 teams in the league.

The Maloof brother blamed the city’s adamant approach in approving the construction of a new arena built with tax payers’ money as the reason for decline of the team’s value.

They insisted relocating the Kings out of Sacramento is the only way to keep the franchise rolling financially. Still, the Maloofs will have to hurdle several road blocks for their plan to materialize. To relocate their franchise, the Maloofs will need the approval of majority of club owners.

However, Lakers owner Jerry Buss and Clippers owner Donald Sterling are apparently not happy of having another team in the Los Angeles-based area.

Moreover, the Kings must repay Sacramento a $77 million loan before they can move to another city.

With these obstacles, selling the team could be another feasible option for the Maloofs, but the business tycoons asserted they won’t sell the franchise. So far, business magnate Ron Burkle showed interest in buying the franchise and keeping the Kings in Sacramento.

The Kings played thier final regular-season game and perhaps their last at Power Balance Pavilion Wednesday against the Los Angeles Lakers. The Kings lost the game 116-109 in OT.

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Supreme Court to decide states and private groups’ right to sue polluters

Washington, D.C., United States (AHN) – The Supreme Court is scheduled to hear arguments April 19 in a case that will decide whether states and private groups can sue utilities for their greenhouse gas emissions.

Additional legal briefs are due Monday in the case of American Electric Power Co. v. Connecticut, which already was joined by seven other states, New York City and three land trusts.

They are suing five utilities, saying they created a “public nuisance” by violating federal Clean Air Act limits on their emissions.

Environmentalists say the Supreme Court’s decision on whether states, cities and private groups even have a right to sue will have a dramatic effect on the nation’s efforts to stop global warming.

A decision saying public interest groups and local governments can sue is likely to unleash a flood of lawsuits that would increase the courts’ authority over emissions.

A ruling for the utilities would mean only the federal government can clamp down on how they operate.

The environmentalists already have won before the U.S. Court of Appeals for the Second Circuit in a 2009 ruling.

The power companies appealed to the Supreme Court. A decision is expected by July.

New York Attorney General Eric T. Schneiderman filed a brief for New York City and state governments of California, Connecticut, Iowa, Rhode Island and Vermont.

“Climate change threatens our economy, our health and our natural resources,” Schneiderman said. “This lawsuit protects New Yorkers and our environment from the serious harms caused by unrestrained greenhouse gas pollution. As some of the biggest global warming polluters in the country, these five companies produce 10 percent of the nation’s carbon dioxide emissions. To protect our future, we must have the right to hold these polluters accountable in a court of law.”

Utilities named in the lawsuit are American Electric Power Co., Cinergy Corp., Southern Co., the Tennessee Valley Authority and Xcel Energy Inc.

Two states – New Jersey and Wisconsin – have dropped out of the lawsuit since the dispute started in 2004.

Three land trusts, the Audubon Society of New Hampshire, Open Space Institute and Open Space Conservancy, also are suing the utilities.

Business groups, such as the U.S. Chamber of Commerce and major oil companies, are staunchly opposed to broader court authority over pollution.

They said in amicus briefs that judges would enforce a patchwork of rulings against them that ultimately would hurt businesses and the nation’s economy.

American Electric Power Co. made the same kind of argument in its brief, which says allowing public nuisance claims against utilities would authorize lawsuits “by anyone who claims to be affected by climate change against any source of greenhouse gas emissions. It would empower courts to determine the ‘reasonable’ level of global greenhouse gas emissions, allocate them among economic sectors, and order individual actors to conform their emissions to the court’s judgments.”

As a result, judges would be able to override authority that should rest with the Environmental Protection Agency, American Electric Power’s brief says.

The utility’s lawyers cited previous federal court rulings in saying, “These issues are wholly inappropriate for resolution by an unelected, unrepresentative judiciary … under the vague and indeterminate nuisance concepts of the common law.”

The Tennessee Valley Authority argues that allowing public nuisance lawsuits against polluters is impractical..

“… virtually every person, organization, company, or government across the globe also emits greenhouse gases, and virtually everyone will also sustain climate-change-related injuries,” the Tennessee Valley Authority’s brief says.

The EPA was set to announce new greenhouse gas reporting requirements for large polluters by March 31, but has delayed the date.

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FHA let lenders put home buyers at risk for years

When the Federal Housing Administration stopped a New York mortgage company from making FHA loans in June, the move came nearly three years after agency records flagged the company’s lending practices as potentially fraudulent.

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U.S. stocks up for second straight day on surge of tech shares

New York, NY, United States (AHN) – U.S. stocks gained for the second straight day on Thursday as technology firms’ positive earnings reports beat concerns on crises in Japan and Libya.

The Dow Jones Industrial Average rose 85 points or 0.5 percent to 12,171 with Hewlett-Packard Co. as the top gainer.

The Standard & Poor’s 500 Index recovered lost ground since the earthquake and tsunami that struck Japan increasing 12 points or 0.9 percent to 1,310. Linux vendor Red Hat was the top gainer after reporting high earnings and raising its profit forecast. Other gainers were semiconductor maker Micron Technologies and chipmaker Nvidia.

The Nasdaq Composite Index climbed 38 points or 1.4 percent to 2,736.

Crude oil futures settled at $105.60 a barrel on the New York Mercantile Exchange. The oil for May delivery was 59 cents or 0.6 percent lower.

Gold futures for April delivery fell $3.10 or 0.2 percent to $1,440 an ounce.

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U.S. stocks extend surge for third day, Dow hits 12,000 mark

New York, NY, United States (AHN) – U.S. stocks continued its surge for the third straight day on Monday sending back the Dow Jones Industrial Average above the 12,000 level.

The $39 billion merger of AT&T and T-Mobile plus improving containment of overheating nuclear reactors in disaster-stricken Japan sparked investors’ rally that send the Dow rising 173 points or 1.5 percent to 12,036. The Dow was below the psychological level since after the March 11 earthquake and tsunami that hit northeastern Japan.

The Standard & Poor’s 500 Index closed 19 points or 1.5 percent up at 1,298 led by luxury retailer Tiffany & Co.

The Nasdaq Composite Index added 48 or 1.8 percent to close at 2,692.

Crude oil for April delivery rose $1.26 or 1.3 percent to settle at $102 per barrel. The rise came as an international coalition forces continued air strikes on Libyan military targets on Monday as part of a UN Security Council sanctioned no-fly zone aimed at protecting rebels in the north African country.

Gold futures for April delivery jumped $13.70 or 1 percent to $1,430 an ounce.

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AIG Continues Bailout Repayment Efforts

Money Morning submits:

By Kerri Shannon

American International Group Inc. (NYSE: AIG ) on Thursday offered to pay $15.7 billion for a portfolio of mortgage-backed securities the Federal Reserve Bank of New York acquired when it bailed out the collapsing insurer during the financial crisis. The New York Fed set up the fund, named Maiden Lane II, in 2008 to buy from AIG about 800 securities that were backed by subprime home loans. “The conditions that necessitated Maiden Lane II in the first place have been resolved,” AIG said in a letter Thursday to the New York Fed. The company said it is now more stable and can match the assets with “appropriate longer-term insurance liabilities, not shorter-term liabilities.” AIG originally purchased the mortgage-backed securities with collateral from Wall Street banks in securities-lending deals. When the housing market collapsed, AIG couldn’t reimburse banks that wanted their collateral back. The Fed bought the bonds at Complete Story »

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U.S. stocks, oil price retreat

New York, NY, United States (AHN) – U.S. stocks were down Wednesday as investors kept a wait-and-see stance on the Libyan crisis and crude oil prices slightly retreated with the increase of U.S. oil stockpiles.

The Dow Jones Industrial Average shed a point or 0.01 percent to close at 12,213 led by IBM.

The Standard & Poor’s 500 Index lost 1.8 points or 0.14 percent to 1,320.

The Nasdaq Composite Index fell 14 points or 0.51 percent to 2,752.

On the New York Mercantile Exchange, crude oil for April delivery fell 85 cents to settle below at $104 a barrel.

Gold futures climbed $2.40 to $1,429.60 an ounce.

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Report: NFL can financially absorb two years without games

New York, NY, United States (AHN Sports) – In the event the looming lockout does occur, the NFL reportedly will weather out the dreaded work stoppage for two years.

According to Standard & Poor Monday, a lockout will not hinder the flow of revenue to team owners in 2011.

The note from the rating agency also indicated that some teams would also survive despite the absence of games played.

The continued flow of money from television and sponsors deals as well as other customers during the stoppage will keep owners in good standing.

The S&P note indicates an expected $14 billion in revenue in television rights deals in 2011. It shows a sharp increase realized last year which amounted to about $9 billion.

Meanwhile, the NFL and the NFLPA have decided to enter mediation in an attempt to prevent a work stoppage. The current CBA will expire on March 3.

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Mets owners took $25 million loan from MLB

Major League Baseball made a short-term, $25 million loan in November to the owners of the New York Mets in order to shore up the team’s liquidity, the Daily News has learned. Fred and Jeff Wilpon and their partner, Saul Katz, are fighting a massive lawsuit by the trustee representing the victims of Bernie Madoff’s epic Ponzi scheme, and have said they are seeking an investor to purchase 20% to 25% of the team, valued last year by Forbes at $838 million.

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Obama pushes multibillion-dollar mortgage pact: report

NEW YORK (Reuters) – The Obama administration is trying to push a settlement that could force the largest U.S. banks to pay for reductions in loan principal worth billions of dollars following breakdowns in mortgage servicing, The Wall Street Journal said.

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U.S. stocks plummet on soaring oil prices, fall in home prices

New York, NY, United States (AHN) – U.S. stocks sank on Tuesday with the three major indexes suffering their biggest one-day drops. Soaring oil prices triggered by the ongoing popular revolt in Libya and a weak U.S. housing market sparked sell-offs.

The Dow Jones Industrial Average shed 178 points or 1.4 percent to 12,213. The index’s biggest decline since Nov. 16 was partly caused by Wal-Mart’s lower-than-expected fourth quarter revenue.

The Standard & Poor’s 500 index lost 27 points or 2.1 percent to 1,315.

The Nasdaq Composite Index fell 77 points or 2.7 percent to 2,756.

Oil prices for March delivery jumped $7.37 to $93.57 a barrel, the highest close since Oct. 3, 2008 and the biggest one-day percentage increase since April 2, 2009.

Gold futures for April delivery rose $12.50 or 0.9 percent to close at $1,401 an ounce. It was the highest close since Jan. 3.

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Washington to cut utility subsidies for poor by $2.5 billion

D.C., Washington, United States (AHN) – The 2012 proposed U.S. budget will cut $2.5 billion in utility subsidies for poor American families, according to reports.

The subsidy benefits families during winter and summer in states that are classified as low average incomes and high energy costs. However, the White House pointed out despite the budget cut, the subsidy program will still have $2.57 billion in funding, which was the 2008 level.

According to Rep. Ed Markey of Massachusetts, the program serves only one-fifth of eligible people, and a cut will badly impact those on the subsidy list. He estimated that with the $2.5 billion cut, 3.1 million poor families will have to opt whether to buy food or pay for their electric bills.

According to the American Gas Association, the budget cut will affect 3.2 million households or 9 million individuals.

In 2010, New York got the largest cut of the subsidies at $479 million, followed by Pennsylvania which got $282 million and Michigan and Illinois, which both received $233 million each. Fifteen other states received subsidies beyond $100 million.

If it is of any consolation to consumers, according to the results of an AGA survey in 2010 the number of customers who could not pay their utility bills went down by more than 2 percent. Disconnections dipped by 3 percent.

The same survey said about 14 percent settle their utility bills by an average of 30 days late and 4 percent are disconnected because of outstanding power bills.

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Pepsi says rising prices will cut into its 2011 profits

New York, NY, United States (AHN) – Pepsi said Friday that it expects rising commodity prices to cut into its 2011 profits.

Company officials said the prices of the commodities it uses in its products could increase this year by as much as 9.5 percent or $1.6 billion over 2010, which will eat into the company’s profits. In addition, the ongoing weak economy and high employment mean lackluster sales and also rule out raising prices to match costs.

Pepsi issued its 2011 net earnings expectations along with the news that its fourth-quarter 2010 profits were down 5 percent from the previous quarter. It blamed the drop in Q4 profits on increased costs.

Commodities that Pepsi uses include oil, in the manufacturing of plastic bottles, fuel for plants and transportation costs; aluminum, in the manufacturing of cans; and corn, in the production of chips and as high fructose corn syrup as a sweetener in its drinks.

The prices of all three of those commodities have increased on world markets and more increases are expected.

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PepsiCo 4Q drops 5 percent, outlook dim

Purchase, NY, United States (AHN) – PepsiCo earnings for the fourth quarter fell 5 percent, the company said on Thursday, citing a difficult economy. The company issued a gloomy full-year outlook, sending shares down 2 percent.

Net income for the period was $1.36 billion, or 85 cents a share, compared to $1.43 billion, or 90 cents, a year ago. Excluding charges, earnings rose 17 percent to $1.05. Revenue for the quarter grew 37 percent to $18 billion.

For the full 2010 fiscal year, PepsiCo earned $6.3 billion, up 6 percent from the previous fiscal year. Revenue increased 34 percent to $57.8 billion.

Chair and chief executive Indra Nooyi said she was pleased with the company’s performance, citing the strength of beverage and snack products despite “a challenging macroeconomic environment.”

PepsiCo products include Gatorade, Doritos, Lay’s, Lipton Tea and Quaker Oats. The New York-based company recently boosted its beverages business in Europe and North America by buying two anchor bottlers. It also acquired Russia’s top food company, Wimm-Bill-Dann.

The company, however, expects a tough 2011. It forecast earnings growth for the year of between 7 to 8 percent, citing a weak consumer landscape, unemployment in key markets and inflation.

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