Archive for June, 2008

Wal-Mart to revamp logo at its US stores (AP)

Sunday, June 29th, 2008 | Finance News

LITTLE ROCK, Ark. - The familiar logo of the world's largest retailer is getting a makeover.

Wal-Mart Stores Inc. said Sunday the company will begin replacing logos on the front of its U.S. stores with a new design beginning this fall. Wal-Mart spokesman Kevin Gardner said the change would reflect changes customers already have seen in some store signs and advertisements.

"This logo update is simply a reflection of the refreshed image of our stores and our renewed sense of purpose of helping people save money so they can live better," Gardner said in a written statement.

Gardner said he had no other information about the change. However, The Wall Street Journal reported Saturday that the new look would include eliminating the hyphen in the company's name, now shown as a star at its more than 3,600 U.S. stores. The new logo would show company's name in white letters on an orange background, followed by a small starburst, the Journal reported, based on an artist's rendering filed with planning officials in Memphis, Tenn.

The revamped logo comes as Wal-Mart continues to tweak its image after facing criticism from union-led groups and local communities across the nation opposed to big-box store developments. In the time since, the company has launched a marketing campaign highlighting its environmentally focused practices and efforts to make health care more affordable for customers through a discounted prescription drug program.

Still, Wal-Mart's low-cost advantage remains what draws customers as questions persist about the strength of the U.S. economy.

Sam Walton started Bentonville, Ark.-based Wal-Mart in 1962, opening a single store in nearby Rogers. The company's logo once included lasso-like script, still seen on older tractor-trailers and distributing centers throughout Arkansas and elsewhere.

The company said it last tweaked its logo in 1992. Customers remain most familiar with its current incarnation, a white block-type logo lit against a deep blue background, red lines above and below.


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Detroit’s mood grim as automakers face the brink (Reuters)

Sunday, June 29th, 2008 | Finance News

DETROIT (Reuters) -
After three decades at work in a GM
factory, John Martinez has reached a crossroads.

Martinez, 50, must choose between retiring and making a
long and expensive commute across state lines to stay with
General Motors Corp (GM.N). Any future he can imagine is going
to be costly and tough.

"My whole family is under stress," he said.

The same can be said of the embattled U.S. auto industry
and its recession-hardened hometown, Detroit. GM, once an
emblem of U.S. post-war economic might, is being driven to the
brink by dwindling sales that are expected to test cash
reserves and the nerves of investors in the months ahead.

Crosstown rivals Ford Motor Co (F.N) and privately held
Chrysler LLC face similar pressures. As the automakers weigh
their options to ride out the industry's most-trying slump in
25 years, thousands of Detroit families are doing the same.

For many, the choices line up from bad to worse.

With four kids, retirement is not an option for Martinez.
But driving more than 100 miles daily between home in the
Detroit suburb of Lincoln Park and Toledo, Ohio -- where GM has
a job for him -- is going to hurt with gas over $4 a gallon.

Moving from Detroit, one of the markets hit hardest by the
ongoing housing slump, could prove impossible.

"I can't probably sell my home for what it's worth," said
Martinez. "I will owe more than I sell it for."

When Martinez joined GM in the late 1970s, it controlled 46
percent of the U.S. vehicle market. A union job in the U.S.
auto industry was seen as steady work with good wages and
rock-solid benefits -- for life.

But last week, GM shares skidded to their lowest level
since 1955. The stock had its worst week since trading in the
wake of the September 11, 2001 attacks, with Wall Street
handicapping when and how it will raise new capital.

GM's sales have dropped 15 percent so far this year, and
its share of the U.S. market is down to just 21 percent.

When major automakers report sales for June on Tuesday,
there is a chance that GM will be overtaken by Toyota Motor Co
(7203.T) as the monthly sales leader, a reversal that points to
the popularity of small cars like the Yaris and the abandonment
of SUVs and trucks like the Yukon and Silverado.


GM has responded by slashing costs, cutting truck
production and slashing its factory work force to less than
half of the 118,000 it employed four years ago.

When Martinez joined GM, it was near its peak factory
payroll of 468,000 with a new factory in Oklahoma City set to
start up. Now it is rolling back, shuttering plants and cutting
jobs. On Friday, 17,000 more GM workers took buyouts to leave.

On a combined basis, GM, Ford and Chrysler have cut more
than 100,000 factory jobs since sales began to slow in 2006.

For Detroit, the downturn has been brutal. Michigan's
jobless rate jumped to a 16-year high of 8.5 percent for May.
Detroit led the nation with its home foreclosure rate in 2007.

In nearby Inkster, hometown of Motown's Marvelettes,
businesses on either side of the Picture Perfect beauty salon
are boarded-up.

Tasha Shaw, the salon owner, is considering giving up too.
Sales have dropped 60 percent over the last year as clients in
the auto industry been forced to cut back.

"I have never seen it this bad," she said.

Inkster is tied to the fortunes of Ford, headquartered in
nearby Dearborn. In the industry's boom days, jobs were
plentiful, drawing workers from around the country. Civil
rights activist Malcolm X lived in Inkster in the early 1950s
and worked briefly in a local Ford plant.

But now, for many left in Inkster, a haircut is no longer
an affordable luxury, Shaw said. "They have so many bills.
People have lost their cars, homes... It's terrible," she said.

Across town in the suburb of Oak Park, Lauri Kopack's
husband, an electrician, has been forced to take a job in West
. He comes home on weekends when he can, but gas is
expensive for his Ford F-150 pickup truck.

"There are no jobs here," Kopack said, adding that about
1,400 in her husband's union local are out of work.

"It's tough," she said. "When he comes home, he is like a

(Editing by Braden Reddall)


Central bankers unite vs inflation (Reuters)

Sunday, June 29th, 2008 | Finance News

BASEL, Switzerland (Reuters) -
Central bankers issued a
stern warning on Sunday against the dangers of surging
inflation, saying rising energy costs risk damaging growth in
rich and poor countries alike.

Policymakers attending talks at the annual meeting of the
Bank for International Settlements said they were on high alert
to the dangers posed by rising inflation and slowing growth,
but there was no one-size-fits-all solution.

"We see very difficult times for the world economy moving
ahead," said Martin Redrado, Argentina's central bank governor.

"In particular in the financial sector we are going to be
witnessing the second wave of turbulence now that the slowdown
is going to hit consumer credit ... It is uncharted waters that
we are testing at this point, and central bankers all over the
world are very alert."

Officials from more than 100 central banks exchanged views
on the global economic outlook on Saturday and agreed oil
prices -- which surged past $142 a barrel for the first time
last week -- were a major concern.

In emerging economies, where consumers spend more of their
income on food than in industrialized nations, inflation is no
longer just a monetary policy problem but a social one.

"Around the world there is an enormous problem because of
the rise in crude oil prices," Daouda Bangoura, Guinea's
central bank governor, told Reuters.

Guinea, the world's top bauxite exporter, is among
countries from Asia to Western Europe where anger over
inflation has ignited protest and sometimes violence.

A mutiny in Guinea this month left two dead and several
wounded in a shoot-out between an anti-riot brigade and police
demanding payment of salary arrears.

"We need to take concerted measures against inflation. We
need to conciliate policy with social considerations ... in
many countries today we are seeing tensions and protests,"
Bangoura said.

Chinese central bank governor Zhou Xiaochuan said he
expected some domestic inflation pressures in the world's most
populous nation to ease due to a good harvest.

"However, we know the international price of energy and
other commodities, they add additional pressure to inflation in
China," he told reporters on the sidelines of the meetings,
also attended by European Central Bank President Jean-Claude
Trichet and U.S. Federal Reserve Chairman Ben Bernanke.


Central bankers agreed there was no single way to tame
inflation and boost growth.

"The issue today is that this adjustment that must take in
relative prices does not result in wage and price spirals or
increases in inflationary expectations that will make it much
more difficult then to stabilize economies," said Jose de
Gregorio, who heads the Chilean central bank.

"Which measures on monetary policy each country must take
depends on their situation at the moment."

Even countries like the United Arab Emirates, enjoying
surging revenues from oil exports, say oil prices have gone too

"Oil prices -- we would like to see them lower ... whatever
the market can reduce them to. I know (it benefits the UAE) but
it creates also other problems," Sultan Nasser Al-Suweidi, the
UAE's central bank governor, told Reuters.

Gulf states in particular, which peg their currencies to
the dollar, have seen inflation surge to record highs but
policymakers' options have been limited as the peg forces them
to track the policy of the U.S. Federal Reserve, which has cut
interest rates aggressively to bolster the economy.

The resulting decline in the dollar has in turn fuelled the
surge in global energy and commodity prices, creating a vicious

Yet Al-Suweidi, echoed by Qatar's central bank governor
Sheikh Abdullah bin Saud Al-Thani, said there was no change in
the region's exchange rate policy.

"We are firm on the (dollar) peg, there's no revaluation,"
Al-Suweidi said.

"We see that inflation is causing the United States to
raise interest rates in the near future and that's going to
take the dollar up. So why do anything opposite to what is good
for us?"

(Additional reporting by David Milliken, Tamora Vidaillet,
Sven Egenter and Andreas Framke; Writing by Natsuko Waki;
Editing by Ruth Pitchford)