Demand for US assets slows
WASHINGTON, D.C. (AP) -- Foreign demand for long-term U.S. financial assets slowed in October and China's holdings of U.S. Treasury securities were unchanged.
Continued strong demand for U.S. debt is critical to financing America's soaring budget deficits and keeping domestic interest rates low enough to support a broad economic recovery.
Foreigners purchased $20.7 billion more in assets than they sold in October, down from a $40.7 billion increase in September, the Treasury Department said Tuesday, Dec. 15.
China, the largest holder of U.S. Treasury securities, maintained its holdings at $798.9 billion in October.
China's foreign holdings of Treasury securities are a direct result of the huge trade deficits the U.S. runs with China. The Chinese take the dollars Americans pay for Chinese products and invest them in Treasury securities and other dollar-denominated assets.
Weyerhaeuser OKs REIT switch
NEW YORK (AP) -- Weyerhaeuser said Tuesday, Dec. 15, its board has approved a conversion of the forest products giant into a real estate investment trust, letting the company take advantage of certain tax benefits.
The Federal Way, Wash., company said the conversion may occur as soon as next year, depending on the economic recovery and changes in tax policy.
Weyerhaeuser has been under pressure for years to lower its taxes by becoming a REIT. It said it plans to pay a significant portion of dividends in stock.
REITs distribute at least 90 percent of their taxable income to shareholders as dividends each year. The company then can deduct those dividends from its corporate taxable income. In many cases, REITS will pay out all of their taxable income and owe no corporate tax.
GM set to repay federal loans
DETROIT (AP) -- General Motors Co. plans to pay all of its $6.7 billion in government loans by the end of June, Chairman and CEO Ed Whitacre Jr. said Tuesday, Dec. 15.
The automaker plans to make quarterly installments starting this month with a $1.2 billion payment, Whitacre said.
GM has received $52 billion total in aid from the government as it navigated bankruptcy protection earlier this year. Of that total, $45.3 billion was converted into equity, giving the government a 61 percent stake in the automaker.
Whitacre said GM has no timetable yet for an initial public offering of stock, which would be necessary for the government to recoup the rest of its investment in the company.
2010 oil demand forecast increased
CAIRO (AP) -- OPEC nudged its 2010 forecast for global oil demand slightly higher Tuesday, Dec. 15, a week before it's due to meet, but cautioned that the pace of the global recovery may affect consumer appetite for its chief export.
The 12-nation Organization of the Petroleum Exporting Countries said in its December Monthly Oil Market Report that world oil demand was expected to increase by 800,000 barrels per day to 85.13 million barrels per day, largely from developing countries. That's a 70,000 barrel per day upward revision from its November forecast.
The group, which supplies about 35 percent of the world's crude, said the market still faced some risks linked to the world's ability to rebound from its worst recession in over six decades.
'Emporium' set for local food
PALMYRA, Pa. -- Tom Maurer craves a return to locally grown food systems.
He wants to establish the infrastructure for communities to get more of their food from local sources rather than California, Florida or overseas.
To that end, his latest venture, a "real food emporium," will be the first step to his vision of creating a local food system from farmer to consumer in the town he calls home.
Located inside a 600-square-foot abandoned T-shirt factory, the emporium will include locally grown foods and products from 50 miles away or less.
Producers selling to the emporium will have to get regular soil tests and grow their items using the Albrecht Method of soil management, which discourages the use of synthetic chemicals.
Soil fertility and nutrient balance is a major focus of the method. If the initial launch goes well, Maurer has plans of expanding the facility to include a commercial food kitchen, educational classes, cold food lockers for producers and consumers, and possibly a meat processing facility.