Archive for July, 2010

Coast Guard allows toxic chemical use on Gulf oil (AP)

Saturday, July 31st, 2010 | Finance News

WASHINGTON – The U.S. Coast Guard has routinely approved BP requests to use thousands of gallons of toxic chemical a day to break up oil slicks in the Gulf of Mexico despite a federal directive that the chemicals be used only rarely on surface waters, congressional investigators said Saturday after examining BP and government documents.

The documents show the Coast Guard approved 74 waivers over a 48-day period after the restrictions were imposed, resulting in hundreds of thousands of gallons of the chemicals to be spread on Gulf waters. Only in a small number of cases did the government scale back BP's request.

The extensive use of dispersants to break up oil gushing from BP's Deepwater Horizon raised concerns early on as to what long-term damage the toxic chemicals might be doing to the Gulf's aquatic life. That prompted the Environmental Protection Agency on May 26 to direct BP to stop using the chemicals on the water surface except in "rare cases."

But Rep. Edward Markey, D-Mass., said Saturday that the chemicals continued to be used extensively with Coast Guard approval, often at a rate of 6,000 to 10,000 gallons a day. A request was made and approved on June 13 to spread as much as 36,000 gallons of dispersant, according to data obtained by Markey's Energy and Environment subcommittee.

The EPA directive "has become more of a meaningless paperwork exercise than an attempt ... to eliminate surface application of chemical dispersants," Markey wrote in a letter sent Friday to retired Coast Guard Adm. Thad Allen, the government's point man on the spill.

Markey's office released the letter Saturday as well as the documents his panel had analyzed. Markey said that instead of complying with the EPA directive, "BP often carpet bombed the ocean with these chemicals and the Coast Guard allowed them to do it."

The House investigators found that the Coast Guard routinely approved the chemical use, in some cases a week in advance. On five occasions the Coast Guard approved a BP request to use 6,000 gallons a day over a weeklong period and "in many of these days BP still used more than double" the limit that was approved, Markey said in his letter.

A call to the BP press office in Houston was not immediately returned.

A spokesman on duty for the Unified Command Center in New Orleans did not have an immediate comment.

The chemicals break down masses of oil into small droplets that allow the oil to be more easily consumed by bacteria. But the chemicals also are toxic and it's not known what impact the large volume of chemicals being used against the BP spill might be having on marine life.

The EPA has acknowledged that there are tradeoffs and that some use of the chemicals are essential to combat the oil spill. The EPA directive issued in May concerned only surface dispersal of the chemicals. BP also has been using large amounts of chemicals near the ocean floor at the site of the damaged wellhead.

In recent weeks, little oil has been noticed on the Gulf surface, and scientists believe one reason for that might be the extensive use of the chemical dispersants.

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Champagne corks popping again in luxury business (AFP)

Saturday, July 31st, 2010 | Finance News

PARIS (AFP) – Champagne corks are popping again in the luxury business as "It" bags and expensive watches this year sell like hotcakes from Beijing to New York, signalling the turning of a page after the global financial crisis.

As the owner of Gucci, Yves Saint Laurent and Puma -- French luxury goods giant PPR -- on Friday joined a string of high-end brands reporting ballooning 2010 profits, firms and consultants predicted rosy days ahead for luxury goods.

"The recession's starting to look like an old memory for the luxury industry," said analyst Matthew Curtin, quoted by Dow Jones Newswires.

PPR chief executive Fracois-Henri Pinault, whose son is married to film star Salma Hayek, said of the group's doubled first half net profits, "very good results ... in an economic environment that remains hesitant."

"There's a new perception of luxury, a more discreet sophisticated luxury where notions of heritage and craft play a big role," he added.

Asia has played a prime role in turning around luxury sector fortunes.

PPR's net profit in the first six months shot up 113.3 percent to 403 million euros (528 million dollars).

Earlier this week, the world's biggest luxury group, LVMH Moet Hennessy-Louis Vuitton, announced a 53-percent rise in net profit to 1.1 billion euros.

"We were expecting good results from LVMH but not that good. It was a good surprise," Isabelle Ardon, of specialist luxury investment fund SG Actions Luxe, told AFP.

While luxury goods sales slumped eight percent overall last year (though some big names weathered the storm), even smaller brands such as Hermes (22.8 percent sales increase), Burberry and the world's top high-end watch firm Luxottica are seeing burgeoning orders this year.

Specialist consultants Bain&Company said that last year's slide, first noted when Christmas sales crashed in the United States, had been offset by continuing demand from Asia, notably from China's growing monied class.

Worst hit last year were wines and spirits, as well as watches and jewellery.

But the Remy Cointreau champagne and cognac group was back in the black in the first quarter of 2010, with sales up 21.3 percent against a drop of 7.5 percent in 2009. And bottles of Laurent Perrier champagne are popping at pre-crisis levels again.

In Switzerland, watch exports gained 35 percent in June, largely due to a 40 percent hike in high-end watches.

Luxury supremos nonetheless remain quietly cautious, mindful of new tremors on the financial horizon.

LVMH chief Bernard Arnault offered no set forecast for the coming months but given the group's return to pre-crisis figures in all branches, he said he was "very confident" about the future.

Consultant Ardon said brands such as Louis Vuitton or Hermes that control distribution had sailed more calmly through the troubled waters of the crisis, while products such as champagne or watches, often sold by other retailers, had fared less well as these firms got rid of stocks.

"There was so much clearance of stocks in 2009 that in the end shipments of champagne were far below actual customer demand," she said.

This year's bounceback largely has Asia to thank. Hermes saw 45 percent sales to Asia, excepting Japan, while Burberry sold 43 percent of its goods to Asian buyers, bar Japan.

2010 also saw the return of US luxury buffs, with LVMH noting an 18 percent rise there and an 11 percent increase from Europe.

In Europe, sales are better due to the fall of the euro, the return of Asian and US tourists and new demand from European buyers, analysts said.

"There is continual sustained interest from China and the demand is for Europe-crafted goods, with luxury outlets opening constantly," said another anaylst.

"In the US last year it was not the done thing to buy luxury goods, it went against the grain to show off your money. Now a psychological barrier has been overcome."

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Soaring e-book sales speak volumes (AFP)

Saturday, July 31st, 2010 | Finance News

HONG KONG (AFP) – After years of lurking in the literary wilderness, the e-book market has exploded with online retailer Amazon.com's digital volumes recently overtaking sales of their hardcover counterparts.

The increase in sales has come as Amazon slashes the price on its Kindle device amid heavy competition from Apple's multi-purpose iPad and e-readers from Sony and bookstore giant Barnes & Noble.

Underscoring the growth, Hong Kong's massive book fair, an annual event attended by almost one million people, wrapped up last week with visitors exposed to a brand-new section: digital reading.

Beijing-based Hanvon Technology unveiled a black-and-white tablet reader that comes with 5,000 Chinese and English book titles pre-installed for about 3,400 Hong Kong dollars (440 US).

Readers can download thousands more titles for as little as 20 Hong Kong dollars each on the device, which also lets users enlarge the typeface, take notes and look up words in the dictionary.

"One (print) book might cost you 100 Hong Kong dollars or more, and then you have to find a place to store it," Hanvon employee Bo Bo Wong told AFP. "With this, you can have thousands and thousands of books in one place," she said.

Mainland companies such as Hanvon, Acuce and Tianjin are taking on the likes of Apple and Amazon by pushing content tailor-made for the vast and rapidly growing Chinese digital market.

The total value of digital publications across all platforms overtook that of traditional print publications in mainland China for the first time last year, the General Administration of Press and Publication said last week.

According to the South China Morning Post, a recent survey by the Chinese Institute of Publishing Science found that nearly a quarter of the 20,000-plus people it surveyed now do most of their reading digitally.

The newspaper quoted Chen Fuming, a manager of a major bookstore chain in Guangzhou across the border from Hong Kong, as saying Chinese book shops were in crisis.

"Even I myself now prefer to read fiction with my mobile phone," Chen said. "It's cheap and convenient."

New Zealand's Kiwa International, another company showing off its wares at the Hong Kong book fair, is using Apple's iPad as a platform for its child-targeted software.

The Auckland firm's technology lets children interact with books downloaded onto the iPad by colouring in story characters and swiping words that are then repeated aloud -- in nine languages.

"They can totally personalise the book," Kiwa's creative director Derek Judge told AFP. "And we provide a service to (traditional) publishers who want to enter into the digital arena."

Amazon temporarily sold out of its 189-dollar Kindle e-reader last week and on Thursday unveiled a new 139-dollar model that connects online by WiFi instead of via 3G networks.

"Amazon.com customers now purchase more Kindle books than hardcover books -- astonishing when you consider that we've been selling hardcover books for 15 years, and Kindle books for 33 months," Amazon boss Jeff Bezos said last month.

US bookstore chain Borders has also launched an electronic book store to tap into the market, which has seen late Swedish crime writer Stieg Larsson become the first novelist to sell more than one million e-books on Amazon.com.

But while British author and actor Stephen Fry is an avowed technophile, he doesn't think printed books should be written off quite yet.

"Printed books certainly will continue to exist," he said at the Hong Kong fair.

"I love them and will continue to collect them... (with) some books I just want to turn the pages myself."

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