Archive for March, 2010

Asian stocks fall after mixed US economic reports (AP)

Sunday, March 14th, 2010 | Finance News

HONG KONG – Asian stocks slid Monday after mixed economic reports about the U.S. economy inspired caution among investors.

Major bourses were down as much as 1 percent after a lackluster session on Friday. Oil prices dipped below $81 a barrel and the dollar gained against the euro and the yen.

Investors found few reasons to buy after U.S. economic data released Friday painted an uneven picture of recovery in the world's largest economy. While retail sales were better than expected last month, a weaker report on consumer sentiment disappointed traders.

In Japan, the Nikkei 225 stock average lost 19.26 points, or 0.2 percent, to 10,732.00. Hong Kong's Hang Seng was down 1 percent at 21,004.54 and South Korea's benchmark shed 1.1 percent to 1,644.47.

Elsewhere, Shanghai's market fell 1.2 percent, Australian stocks lost 0.6 percent and Taiwan shares dropped 1 percent.

Oil prices were lower in Asia, with benchmark crude for April delivery falling 41 cents to $80.83. The contract slipped 87 cents on Friday.

In currencies, the dollar was lower at 90.58 yen from 90.65 yen. The euro fell to $1.3737 from $1.3685.

Friday in the U.S., the Dow ended up 12.85, or 0.1 percent, at 10,624.69.

The broader S&P 500 index slipped 0.25, or less than 0.1 percent, to 1,149.99. The Nasdaq composite index fell 0.80, or less than 0.1 percent, to 2,367.66. It stands at an 18-month high.

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Studies: Intense treatment doesn’t help diabetics (AP)

Sunday, March 14th, 2010 | Finance News

ATLANTA – Key results from a landmark federal study are in, and the results are disappointing for diabetics: Adding drugs to drive blood pressure and blood-fats lower than current targets did not prevent heart problems, and in some cases caused harmful side effects.

A decade ago, the federal government launched the three-part study to see whether intensely lowering blood sugar, blood pressure, or fats in the blood would reduce heart attacks and strokes in diabetics. The first piece of the study — about blood sugar — was stopped two years ago, when researchers saw more instead of less risk with that approach. Now, the other two parts of the study are in.

What should diabetics do? Focus on healthy diets and lifestyles, and take tried-and-true medicines that doctors recommend now to control health risks, said several experts, including Dr. Clyde Yancy, a Baylor University cardiologist and president of the American Heart Association.

The studies were presented Sunday at an American College of Cardiology conference and published on the Internet by the New England Journal of Medicine.

They involve people with Type 2 diabetes — the most common form and the one rising because of the obesity epidemic. Diabetics have more than double the risk of dying of heart attacks or strokes than people without the disease.

For the blood-fat study, researchers led by Columbia University's Dr. Henry Ginsburg recruited more than 5,500 diabetics who also had another health risk, such as high blood pressure or cholesterol.

All were given a statin — cholesterol-lowering pills sold as Lipitor and Zocor that have long been known to save lives. Half also were given Abbott Laboratories' blockbuster drug, TriCor; the rest got dummy pills. TriCor is a fibrate, a drug that lowers blood fats called trigylcerides while boosting "good" cholesterol.

Nearly five years later, the groups had similar rates of heart attacks and strokes, although people with very high blood fats seemed to benefit from TriCor.

There also were signs of a gender difference — TriCor seemed to help men but appeared to possibly harm women, by raising the chance they would suffer a heart problem compared to women taking dummy pills.

"It's hard to know what to make of these trends," said Dr. Jorge Plutzky, preventive cardiology chief at Brigham and Women's Hospital in Boston. He had no role in the study and has consulted for a variety of drug makers, as have many of the researchers involved in the work.

The blood-pressure part of the study was led by Dr. William Cushman, preventive medicine chief at Veterans Affairs Medical Center in Memphis, Tenn. About 4,700 diabetics were treated with various medicines to keep their systolic blood pressure — the top number — either below 140 or below 120.

The intense treatment did not reduce the number of heart attacks, although it prevented more strokes, a less common problem. Side effects were greater with the intense treatment.

However, people should not stop taking any medicine without checking with their doctors first, experts said.

"In no way do these studies mean that patients do not need to make sure their blood pressure, glucose or lipid levels are under good control," Plutzky said.

An Abbott vice president, Dr. Eugene Sun, said the results of the fat-lowering study were "not surprising given that two-thirds of patients in the trial would not be treated with fibrates under current guidelines."

North Chicago, Ill.-based Abbott makes TriCor and a newer version, Trilipix. The drugs had more than $1.3 billion in U.S. sales last year.

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Dodd seeking middle ground on new financial rules (AP)

Sunday, March 14th, 2010 | Finance News

WASHINGTON – The senator trying to rewrite the nation's financial industry rules is dropping plans to create a stand-alone consumer financial protection agency and give a single regulator the power to oversee all banks, according to people familiar with the evolving proposal.

Backing away from the proposal he offered four months ago, the chairman of the Senate Banking, Housing and Urban Affairs Committee is now incorporating GOP ideas, and yet not one Republican senator is coming along so far.

Sen. Christopher Dodd's new regulatory scheme, expected to be released Monday, follows months of bipartisan negotiations that abruptly ended last week when he said it was time for his committee to consider a bill.

The legislation, a priority for President Barack Obama, aims to avoid a repeat of the financial crisis that caused the Wall Street meltdown 18 months ago.

Those familiar with the plan described it on condition of anonymity because they were not authorized to speak publicly. The details, they said, remained in flux.

Dodd, who's not running for re-election this fall, is planting himself squarely between a united bloc of Republicans on his committee and Democrats who have insisted on a strong, autonomous consumer agency. He's also facing Democratic pressure from outside his committee to take stronger measures to cut down the size of banks and to limit their activities.

In a signal that Republicans were not yet prepared to support Dodd's efforts, the committee's 10 Republicans urged Dodd in a letter Friday not to push the bill through before the Easter recess, which begins March 27.

Dodd wants to create a special council that would watch over the financial markets, looking for trouble spots that could threaten the economy. The council would have an independent chairman appointed by the president. Members would include the treasury secretary, the chairman of the Federal Reserve, and the heads of several regulatory agencies.

The Fed, which would have lost all its regulatory powers under Dodd's initial plan, would emerge with fewer banks to supervise, but retain the power to oversee some of the largest nonbank financial institutions.

The central bank, faulted for not seeing the recent crisis, would oversee all bank holding companies with assets of more than $50 billion — about 50 institutions in all. That's more than Dodd had considered as early as last week. Currently, the Fed supervises all bank holding companies.

The Fed would still supervise state-charted banks and the U.S. branches of foreign banks.

But the Fed would oversee nonbanks that the council determines are so large and interconnected that their failure would threaten the financial system.

Dodd's other significant shift is on consumer protections, after initially adopting Obama's plan for a separate agency.

The new bill would create a division within the Fed that would have the power to write regulations governing a range of consumer financial transactions, from mortgages to payday loans to credit cards. Those rules could be vetoed by a two-thirds vote of the council. The consumer agency would not have enforcement powers; other regulators would police the various parts of the financial industry.

This proposal is similar to what Dodd was negotiating with Tennessee Sen. Bob Corker, a Republican who had stepped into the talks after Dodd reached an impasse with Alabama Sen. Richard Shelby, the committee's top Republican.

Unlike Corker's plan, though, Dodd would let states write and enforce their own tougher consumer rules. Dodd's bill would incorporate language similar to the House bill, which would allow those state rules to be challenged in court if they "materially interfere" with the business of banking. Bankers have lobbied heavily against the right of states to write their own laws, fearing a patchwork of regulations.

Among other likely provisions in Dodd's proposal:

_Institutions that are bank holding companies, such as Goldman Sachs and Morgan Stanley, could not alter their status to avoid Fed oversight; thus they could enter Fed supervision but never leave.

_Unlike the House bill, with new requirements on broker-dealers and investment advisers, Dodd's measure would call for a study of potential investor protections before writing any new rules.

_Like the House bill, the legislation will require clearinghouses for most derivative trades, forcing them out into the open. Derivatives are instruments whose value depends on an underlying asset, such as mortgages or stocks. They can help hedge risks. But derivatives can also produce steep losses, or huge profits, if the value of their underlying asset sinks.

Banks and corporations are pushing for certain exemptions from central clearing and reporting requirements. It was unclear what those exemptions would be.

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On the Net:

Senate Banking, Housing and Urban Affairs Committee: http://banking.senate.gov/public/

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