PHILADELPHIA — The Federal Communications Commission has opened an investigation into the pricing policies of major cable operators, including Charter Communications Inc.
The agency wants to ensure the companies’ customers are getting treated fairly, FCC Chairman Kevin Martin said in an interview.
"I’m certainly concerned with the increasing cable prices that consumers are facing," Martin said. "They are getting less and being charged the same or more."
The FCC wrote Thursday to cable operators including Town and Country-based Charter, Comcast Corp., Time Warner Cable Inc., Cox Communications Inc., Cablevision Systems Corp., Bright House Networks, Suddenlink Communications, Bend Cable Communications, GCI Company, Harron Entertainment and RCN Corp.
Phone-service provider Verizon Communications Inc., which offers pay-TV services with FiOS, also was included in the inquiry.
The agency’s letter questioned the companies’ practice of moving analog channels into digital tiers to free bandwidth for other uses, such as high-definition channels. Analog customers will have to get a digital set-top box from the operator or buy the digital TV tier to watch those channels.
Most cable customers are analog customers, and those who do not wish to upgrade to digital cannot watch the channels that are moved to the digital tier.
The agency also will look into whether cable operators and Verizon are confusing customers by linking the shift of the analog channel to the digital tier to the nation’s transition to digital broadcasts, Martin said no fax pay day loans.
The two moves are unrelated.
Linking the two in customers’ minds could prompt more people to opt for digital video and cable services because the digital TV transition in February is mandated by the federal government. The FCC has asked companies being investigated to submit information about their pricing practices within two weeks.
Martin said it appears consumers weren’t given "appropriate notice" about the channel changes.
He said the FCC has received a "significant" number of consumer complaints about the practice of moving analog channels to digital, which has accelerated this year.
The FCC’s letter was sent out a day after Consumers Union sent a letter to the Senate Committee on Commerce, Science and Transportation asking for an investigation into the practice of moving analog channels to the digital tier.
"Consumers are left paying the same monthly rate for significantly less service, or must rent more expensive set-top boxes for each television set they own," said Consumers Union, a nonprofit advocacy group.
Stocks tumbled Monday, ending a choppy session lower as recession jitters outweighed relief that the government’s programs to shore up the financial system have gotten underway.
Investors also weighed a better-than-expected September new home sales report.
The Dow Jones industrial average (INDU) lost 203 points or 2.4% according to early tallies, after having been on both sides of breakeven throughout the session. Verizon rallied 10% after its profit report, but it was one of only 3 Dow components to rise.
The Standard & Poor’s 500 (SPX) index fell 3.2% and the Nasdaq composite (COMP) fell 3%. All three major gauges closed at fresh five-year lows.
Tuesday brings the release of the October consumer confidence report.
Stocks had seesawed on both sides of unchanged throughout the session as investors geared up for critical events due later in the week and early next.
As a result, Wall Street is unlikely to move much over the next few sessions, said Harry Clark, CEO of Clark Capital Management Group.
Ahead of the election, the Federal Reserve is expected to announce an interest rate cut at the conclusion of its two-day meeting Wednesday.
"The rate cut this week will help a bit, but we really need to get past the election right now," Clark said.
The start of some of the government’s rescue programs this week is significant, Clark said, but it’s still going to take several weeks for the impact to be felt and borrowing rates to improve more substantially.
Recession fears decked stocks last week, near the end of a brutal month on Wall Street. The credit crisis, sluggish corporate profit outlook and slump in commodity prices have all exacerbated fears that a recession is imminent, if not already underway.
These underlying issues aren’t going to disappear anytime soon, but there are signs that the stock market is closer to hitting bottom, said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research.
Detrick said that stocks are the most "oversold" they’ve been since the period surrounding Black Monday in October 1987. That means that on a technical basis, it wouldn’t be hard to spark a big bounce. Additionally, the level of money sitting in mutual funds and the level of investor fear are good contrarian indicators. Plus, November, December and January are typically good months seasonally on Wall Street.
However, there’s nothing typical about this year or this time period on Wall Street, he said, and the usual factors may not carry much weight.
"You have the uncertainty of worldwide recession and the credit markets are still a problem," Detrick said. "For the market to see a significant bounce, we’d need to see signs that our economy and the global economy are turning around."
He said that the recent housing market reports have been positive, but that doesn’t change the broader economic outlook.
Brutal month: With just one week left in October, the Dow is down 24.7%, the S&P 500 is down 27.2% and the Nasdaq is down 27.7%.
The Dow is currently on track to post its worst month ever on a point basis and fifth worst ever on a percentage basis, according to Stock Trader’s Almanac info going back to 1901.
The S&P 500 is currently on track to post its worst month ever on a point basis and third worst ever on a percentage basis, going back to 1930.
The Nasdaq is on track to post its fourth-worst month ever on a point basis and its second-worst month ever on a percentage basis, going back to its inception in 1971.
Global market effect: World markets continued to retreat as the new week began.
European markets ended lower, with the London FTSE closing down 1%, erasing bigger session losses. Asian markets tumbled overnight, with the Japanese Nikkei falling 6 one hour cash loan.6% to a 26-year low on worries that the strong yen will hurt exports. The Hong Kong Hang Seng fell 12.7% to a more than four-year low.
The declines followed a Sunday statement from the G7 warning about the excessive volatility of the yen, which hit a 13-year high versus the dollar Friday. Analysts said the statement could mean the government is set to intervene in the currency markets.
The dollar continued to retreat versus the yen on Monday and gained against the euro. Bets that the Bank of England and European Central Bank will have to cut rates aggressively over the next few months have weighed on the euro and pound lately.
Banks and credit: Nine big banks are set to get $125 billion from the Treasury Department this week as part of the $700 billion bank rescue plan passed last month.
Ten regional banks said Monday that they will get at least $18 billion under the bailout plan.
Also beginning this week: The Fed’s previously announced program to buy up commercial paper, short-term debt that businesses depend on to fund daily operations.
Despite the government’s efforts, lending has remained constrained, with short-term borrowing rates the one exception.
Libor, the overnight bank-to-bank lending rate, edged lower to 1.26% from 1.28% Friday, according to Bloomberg.com. It was a modest retreat after two days of gains. On the upside, that still kept Libor below the Fed’s benchmark lending rate of 1.5%, seen as a good sign. Libor hit a record 6.88% earlier this month at the height of the market panic.
The 3-month Libor rate, what banks charge each other to borrow for three months, inched lower to 3.51% from 3.52% Friday.
The TED spread, the difference between what banks pay to borrow from each other for three months and what the Treasury pays, narrowed to 2.67% from 2.70% Friday. The spread hit a record 4.65% earlier this month. The narrower the spread, the more willing banks are to lend to each other.
Treasury prices were little changed, with the yield on the 10-year note at 3.68%, roughly where it stood late Friday. Treasury prices and yields move in opposite directions.
The yield on the 3-month Treasury bill, seen as the safest place to put money in the short term, slipped to 0.75% from 0.86% late Friday, showing investors would rather see little return on their money than risk the stock market.
Last month, the 3-month yield reached a 68-year low around 0%, as investor panic hit its peak.
Results: Dow component Verizon Communications reported higher quarterly earnings that met estimates on higher sales that beat forecasts. Verizon (VZ, Fortune 500) shares jumped over 10%.
With 45% of the third-quarter reports out already, profits are currently on track to have fallen 11.3% from a year earlier, according to the latest estimates from Thomson Reuters.
Oil, gas and gold: U.S. light crude oil for December delivery fell 93 cents to settle at $63.22 a barrel, after falling to a 17-month low in morning trading.
Prices have been sliding since crude peaked at a record $147.27 a barrel on July 11, with speculators pulling out of the market on bets that global demand is slowing. Investors have also had to raise money fast amid the stock market slump and have done so by dumping their oil positions.
Gasoline prices fell another 3.1 cents overnight, to a national average of $2.668 a gallon, according to a survey of credit-card activity by motorist group AAA. It was the 40th consecutive day that prices have decreased. During that time, prices have fallen by $1.18 a gallon, or more than 30%.
COMEX gold for December delivery rose $12.60 to settle at $742.90 an ounce.
NEW YORK — Investors who are getting beaten up in the stock market often look to bonds as a safe place to stash their money. But they need to make their moves deliberately, not out of panic, or they can end up losing money rather than stabilizing a portfolio.
Common mistakes investors are likely to make in the current climate include moving too quickly and not paying enough attention to the kinds of bonds they’re buying.
The idea of moving toward safety is more complex these days because some of the chaos in the financial markets stems from bonds — including those tied to risky mortgages that since have gone into default. The multiplication in recent years of the types of fixed-income investments means that not all bonds are the same; while the government provides safe investments, there also are bonds that bring in higher returns but take more chances to do so.
Rich Berg, chief executive and co-founder of Performance Trust Capital Partners, said investors need to know what they’re getting into. If they’re lured by exotic names like collateralized debt obligations or collateralized loan obligations, they need to understand that the more complex the investment, the more likely it is to spell trouble.
"These aren’t mom and dad’s bonds," he said. "When people think they’re going into bonds for safety they might actually be exacerbating their risk."
He said investors also need to consider how much they’re willing to sacrifice in investment returns in order to safeguard their money by putting it into bonds. That’s important these days because interest rates are low, limiting what many bonds pay.
"Right now, if people are OK with a long-term return of between 3 and 4 percent, go put your money in government bonds. But don’t expect 6 to 8. It can’t happen," he said.
They might want to consider that professional investors have been stashing cash into 3-month Treasury bills, sometimes earning almost nothing, but secure knowing that their principal will remain intact.
The average investor doesn’t need to look for such short-term investments, but that kind of safety is what makes government debt of all maturities so attractive.
Stuart Ritter, an assistant vice president and certified financial planner at T (instant payday loans). Rowe Price Associates Inc., said investors who want to make money shouldn’t simply scout around for the highest returns because market forces can shift what is in favor — and those returns could then head south.
"If you start making investment decisions based on what happened in the recent past and try to forecast the near future, you’re no longer investing, you’re fortune telling," he said.
And he warned that investors who move too much money into bonds might risk earning so little they can’t keep pace with inflation.
"As people go to something that is ’safe’ from short-term volatility, by definition they are in something that gives them much higher exposure to the risks of inflation," he said.
Consider an example of how two investors with $1 million portfolios at the start of 2001 would have fared by taking two different paths, according to T. Rowe Price research.
The first investor who panicked and shifted from stocks to cash during the downturn after the tech-stock boom and the Sept. 11, 2001 terror attacks would have ended up five years later with about $700,000, while the investor who stayed in stocks and rode the ups and downs would have come out with about $1.25 million.
"You didn’t see the decline coming, you’re not likely to see any recovery that’s to come. The only way to participate in the recovery is to stay in," Ritter said.
But before putting money into bonds or bond funds, investors should remember, again, that those paying higher yields likely are taking on more risk. And a conservative approach can be in order for investors who soon will need the money.
Michael Cuggino, president and portfolio manager at Pacific Heights Asset Management, said the company’s bond funds didn’t extract the returns that some other funds did in recent years because they didn’t wade into more exotic investments that now have run into trouble.
"We’ve never pretended that we should chase every last basis point of yield and take on unnecessary risk to do so," he said.
Shares in Swiss bank UBS AG took a new tumble on Monday, falling further than a hard-hit banking sector after reports it will have to write down another $5 billion on its risky investments in the second half of the year.
News that lack of liquidity had forced U.S. investment bank Lehman Brothers (LEH.N: Quote, Profile, Research, Stock Buzz) to file for bankruptcy protection dragged down financial sector stocks worldwide.
Without quoting sources, Swiss paper Sonntags Zeitung said UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz), Europe’s hardest hit bank in the financial market turmoil, would have to write down another $5 billion on its risky investments in the second half.
The paper said it expected UBS to update the market before an October 2 shareholder meeting. UBS declined to comment.
“The bad news is that the banking crisis is not over and that there are still lots of bad credits around,” Claude Zehnder, head of research for technical trading at Zuercher Kantonalbank, said.
“Also, the possibility has arisen this weekend of further writedowns,” he added.
UBS announced last month writedowns had climbed a further $5 billion in the second quarter to top $42 billion, and said it was splitting the investment bank that had dragged it into the red from its core wealth management business.
UBS shares were down 10.1 percent at 21.14 Swiss francs at 0815 GMT, underperforming the DJ Stoxx European banks index , which was down 5.8 percent http://fcrwizard.com. UBS shares had rallied recently after losing two-thirds of their value in the last year.
WGL Entertainment Holdings Inc. announced it has closed a broadcast license agreement with Zcom Networks Inc. on Sept. 4.
The agreement between Calabasas, Calif.-based Zcom and the Lake Mary-based TV production company will grant Zcom non-exclusive broadcast rights to all of WGL's programming, which includes the WGL Million Dollar Shoot Out.
Financial details of the transaction were not released.
The deal will also result in 15 million shares of Zcom's common stock being distributed to WGL shareholders cash advance. As of Oct. 1, all WGL shareholders will receive one share of Zcom stock for every 500 WGL shares owned.
WGL Entertainment Holdings Inc. (PINKSHEETS: WEHI) is a television production company. Zcom Networks Inc. (PINKSHEETS: ZCMN) is a media broadcasting and shopping network company that targeting early start-up telecom, media and technology companies.
Democrats’ stance against offshore drilling shifted more Saturday, with House Speaker Nancy Pelosi signaling she was willing to consider opening up more areas off the nation’s coastlines to oil and gas exploration.
In her party’s weekly radio address, Pelosi said opening portions of the Outer Continental Shelf for drilling would be a part of energy legislation House Democrats will put forward in coming weeks to address the country’s dependence on foreign oil and high gasoline prices.
House members will be able to "consider opening portions of the Outer Continental Shelf for drilling, with appropriate safeguards, and without taxpayer subsidies to Big Oil," said Pelosi, a California Democrat.
Just weeks ago Pelosi seemed resolved to block any votes to allow offshore drilling, in part because Californians have opposed drilling off their coasts since an oil spill off Santa Barbara in 1969. New oil drilling is only allowed now in federal waters in the western Gulf of Mexico and off Alaska.
Pelosi’s radio remarks were the latest to hint that the energy debate in Congress is still evolving, and that Democrats are budging on the issue.
Congress left for the August recess deadlocked over how to address $4-a-gallon gasoline. Democratic proposals to tap the nation’s petroleum reserve, curb oil speculation and force oil companies to drill on already leased federal lands were blocked by Republicans trying to force votes on offshore drilling.
Yet any vote on drilling is likely to force the Republicans’ hand, since it will likely be packaged with unpopular proposals to tap the petroleum reserve and recoup unpaid royalties from the late 1990s to pay for renewable energy projects.
"This comprehensive Democratic approach will ensure energy independence which is essential to our national security, will create millions of good paying jobs here at home in a new green economy, and will take major steps forward in addressing the global climate crisis," said Pelosi, who criticized Republicans’ "drill only" plan.
Republican leaders called Pelosi’s proposal a ruse.
"It is solely intended to provide political cover to Democrats that are losing more ground by the day on this issue," said Kevin Smith, a spokesman for House Republican Leader John Boehner of Ohio cash advance usa. Boehner and more than a hundred other House Republicans have refused to depart for recess in protest of Democrats’ refusal to have a vote on their proposals.
The pressure to expand offshore drilling intensified last month when President Bush lifted an executive prohibition on drilling for oil and gas on the Outer Continental Shelf. A congressional ban remains in place.
Polls have shown that voters have grown more supportive of more domestic oil production as fuel prices have climbed.
Roche Holding on Monday said it was offering $43.7 billion to take over the remaining shares of Genentech Inc. and create the seventh-largest pharmaceuticals company in the U.S.
Roche, which already owns 55.9% of the San Francisco-based drug maker, said it was offering $89 per share, 8.8% above the closing price Friday and 19% above the price a month ago. It’s the largest offer ever made by a Swiss company for a takeover.
Franz Humer, Roche board chairman, said Roche’s investment in Genentech over the years has helped it to focus on innovation and long-term projects, leading to some of the most important breakthroughs in the treatment of cancer and other life-threatening diseases.
"Our long and successful participation in Genentech has provided great benefits to both of our companies and shareholders. It has resulted in one of the biggest success stories in the healthcare industry," he said.
Global Insight analyst Gaelle Marinoni said 8.8% above the closing price Friday was not a big premium but as Roche already owned the majority of shares, the offer was "probably fair."
Minority shareholders "might try to get a little more," she said.
The announcement came as Roche announced its first half net profit declined 2% to $5.6 billion in view of a weaker U.S. dollar and a sharp drop in government purchases of the anti-viral Tamiflu because anti-pandemic stockpiles have been filling up.
Net income was down from $5.8 billion for the same period a year earlier. Roche reports profit figures only for the first six months and full year.
Sales were $19.6 billion, down 4% from the first half of 2007.
Roche has been a partner with Genentech since 1990.
Genentech did not immediately return a message seeking comment.
The combined company would generate more than $15 billion in annual revenue and employ a total of about 25,000 people in the U.S., Roche said in a statement payday loans. The Basel, Switzerland-based company did not specify how many of the 10,700 employees of Genentech would be retained.
Roche said the takeover would improve operational efficiency by reducing complexity, eliminating duplications and increasing scale in the United States.
Roche said Genentech’s San Francisco site would operate as an independent research and early development center and become headquarters of combined U.S. commercial operations.
The statement said it expects the Genentech Board of Directors will establish a committee of independent directors to evaluate Roche’s proposal with the assistance of independent outside financial and legal advisers.
Genentech board members who are employees of Roche will not participate in the evaluation of the proposal, it said.
The statement said Roche plans a cash merger between Genentech and a Roche subsidiary and that all currently outstanding shares and options of Genentech other than shares owned by Roche would be converted into cash.
Precise terms will be determined through negotiations with the independent directors, it said, adding that it expects the merger would be subject to the approval of holders of a majority of the Genentech outstanding shares not held by Roche.
"Roche expects to complete the transaction as soon as possible following negotiation of a definitive merger agreement," it said.
When it comes to advertising on the Internet, industry experts say "funny" sells. Viral video ads are a relatively new market and in just a short time have managed to change the rules of traditional advertising.
"We’re trying to experiment out there and do things that are interesting and engaging," said Reuben Hendell, CEO of MRM Worldwide.
That includes over the top humor and ads that masquerade as home videos. BMW recently went as far as making a 30-minute mockumentary about a fictional Bavarian town that comes up with a plan to catapult the latest BMW 1-series vehicle from Germany to the United States.
The goal is to create buzz and hopefully tap into new customers.
"We never target demographically. We always focus psycho-graphically," said Jack Pitney, vice president of Marketing at BMW North America. "It means what kind of mindset do we think this vehicle will really resonate with? In the end it could be an 18-year old and it could be an 80-year old. But if they share a similar mindset we think we have the right car for them."
BMW went to great lengths to keep the public guessing about whether there was any truth to the spot payday advances. They created Web sites for the made-up German town as well as one of the characters. Another character was given his own Facebook profile where he made 800 friends. It was months before BMW finally took ownership of the ad.
Industry experts say there’s still a learning curve in how far they can take the joke. "If you get too quirky or a little too obtuse with what you’re trying to say, people might just miss the whole idea," Hendell said.
Or you could end up scaring people - like a recent Internet ad that showed cell phones popping popcorn making people wonder if cell phones can be damaging to the brain. That ad like the BMW mockumentary was also a hoax.
In the end, BMW’s audience got the joke. The company says it received 10 million hits as well as better than anticipated sales of the 1-series model featured in the viral video ad.
Yahoo Inc executives dismissed a search-advertising deal with Google due to antitrust concerns, one day before Microsoft Corp made its takeover offer earlier this year, according to court documents made public on Monday.
The position came to light in a complaint filed by attorneys representing two Michigan pension funds in a shareholder lawsuit that aims to revoke Yahoo takeover defenses and press the company to renew merger talks with Microsoft.
“We are focused on long-term value creation rather than short-term gains,” said a Yahoo document prepared for Yahoo executives ahead of an “all hands” internal meeting on January 30 — the day before Microsoft made its merger offer.
Bracing for employee questions over whether Yahoo should outsource its search-ad sales to Google, executives were prepared to argue that any short-term gains would derail Yahoo’s long-term push to become a “must buy” for advertisers.
“Short-term analysis of the revenue potential of outsourcing monetization may not take into account the longer term impact on the competitive market if search becomes an effective monopoly,” an excerpt from the company document said http://abc-cashadvance.com. Monetization refers to sales of search-related ads.
These comments appear to contrast with Yahoo’s subsequent position when it announced on April 9 that it was conducting a test with rival Google, the market leader in Web search and related advertising, to rely on Google to sell its search ads.
TURNABOUT
The turnabout was part of a strategy by Yahoo management to seek alternatives for its business instead of settling for Microsoft’s cash-and-stock offer at $31 per share, which the company’s board had rejected as undervaluing Yahoo’s assets.
Halliburton has made a conditional bid of $3.36 billion for Expro International Group PLC, the British oil services firm said Friday.
Halliburton’s all-cash proposal of $30.14 per share is richer than the $28.36 per share offer made in April by a consortium led by Candover Partners Limited, valuing the company at $3.16 billion.
An Expro statement said the Halliburton Co. proposal "does not yet constitute a firm intention to make an offer" and was subject to preconditions.
Halliburton (HAL, Fortune 500), which provides services and equipment to oil and natural gas companies, said it considers Expro’s sub-sea and flow management sector to be an area of potential expansion easy payday loan. Expro’s primary focus is providing services and products to measure and control the flow of oil and gas from wells.
Expro (EXPRF) shares rose 0.4% to $30.57.
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