LITTLE ROCK — QUOTE OF THE DAY “Given the environment, the firm
does not believe it’s appropriate to host or sponsor holiday parties.” Gia Moron, a Goldman Sachs spokesman Article, 1D30-year mortgage rates top 5%
McLEAN, Va. - The average fixed-rate for a 30-year mortgage climbed above 5 percent for the first time in two months, leading to a decline in mortgage applications.
The average fixed rate on a 30-year mortgage was 5.05 percent this week, up from 4.94 percent last week, Freddie Mac said Thursday. The last time rates were above 5 percent was the week ending Oct. 29, when they were 5.03 percent.
Mortgage rates have risen since they hit a record low of 4.71 percent the week of Dec. 3. They are closely tied to yields on long-term government debt, which have gone up since then.
Higher rates usually lead to a decrease in loan applications to purchase or refinance a home. Mortgage applications for purchases fell nearly 12 percent last week compared with the previous week, while refinance applications dropped 10 percent, the Mortgage Bankers Association said Wednesday.
A Federal Reserve program to buy $1.25 trillion in mortgage-backed securities has kept rates on 30-year mortgages around 5 percent this year. The program, designed to make home-buying more affordable, is set to end next spring.
Freddie Mac, the Federal Home Loan Mortgage Corp., collects mortgage rates each week from lenders around the country. The average rate on a 15-year fixed mortgage rose to 4.45 percent from 4.38 percent last week.
Rates on five-year, adjustable-rate mortgages averaged 4.4 percent, up from 4.37 percent last week. Rates on one-year, adjustable-rate mortgages rose to 4.38 percent from 4.34 percent.
Active rigs down by 15; state loses 2
HOUSTON - The number of rigs actively exploring for oil and natural gas in the U.S. dropped 15 this week to 1,178.
Houston-based Baker Hughes Inc. said Wednesday that 751 rigs were exploring for natural gas and 416 for oil. Eleven were listed as miscellaneous. A year ago this week, the rig count stood at 1,721.
Of the major oil- and gas-producing states, Arkansas and Colorado each were down by two while Alaska, California, New Mexico and Wyoming declined by one. Louisiana, North Dakota and Oklahoma each gained two and Pennsylvania was up one. Texas and West Virginia were unchanged.
The rig count peaked at 4,530 in 1981, during the height of the oil boom. The industry posted a record low of 488 in 1999.
The weekly report, normally released on Friday, moved early this week because of Christmas.
2 fires hit Texas refinery; no injuries
TEXAS CITY, Texas - Authorities said two small fires broke out Thursday at a Texas refinery.
Bill Day of Valero Energy Corp. said nobody was hurt in either blaze at the Texas City refinery.
Day said the initial fire was reported around 5 a.m. at a crude unit and was quickly put out. He said a small secondary fire in a gas line was contained several hours later.
There’s no word on the cause of the fires.
Day said there is believed to be no environmental impact to the community and the impact on refinery production is unknown.
A boiler failure at the refinery Dec. 4 left one man dead from blunt-force trauma and two other workers hurt.
Texas City is about 40 miles southeast of Houston.
Cuba sees record tourist numbers
HAVANA - Cuba said more than 2.4 million tourists will come to the island by the end of the year, up 3.3 percent from 2008’s record, though deep discounts and shorter stays mean vacation industry revenue is down overall.
The country will break the previous year’s mark of 2.34 million visitors by nearly 80,000, fueled by 2,000 new hotel rooms in top tourist areas, including Havana and Varadero, a white-sand beach north of the capital, Tourism Minister Manuel Marrero Cruz said in Thursday editions of the Communist Party newspaper Granma.
He did not say how much Cuban tourism took in and, unlike in previous years, no information on vacation-industry revenue was made public during the year-end meeting of Cuba’s parliament Sunday.
Marrero said in November that his ministry’s revenue would fall about 11.7 percent, as Cuba has been forced to cut prices because of the global recession.
Foreign visitors generated more than $2.7 billion last year, a 13.5 percent increase from 2007.
Dizzy Madoff back in prison hospital
BUTNER, N.C. - A lawyer for the hospitalized Bernard Madoff said Thursday that his client has experienced dizziness and high blood pressure.
The Bureau of Prisons said the 71-year-old financier remains under medical care for a seventh day.
Prison officials have declined to reveal why he was transferred from a North Carolina federal prison to Duke University Medical Center.
Lawyer Ira Sorkin said Madoff has “had some dizzy spells and some high blood pressure.”
A prison official said Madoff is now in a prison medical facility. Madoff has been imprisoned since March after pleading guilty to fraud and admitting cheating investors out of billions of dollars.
Zale looks at restructuring options
Zale Corp., the Texas-based jewelry chain that posted seven straight quarters of losses, is working with Rothschild to evaluate restructuring options, according to three people with knowledge of the situation.
The investment bank was named to help the unprofitable retailer weigh its choices in 2010, said the people, who declined to be identified because the information isn’t public.
Zale didn’t respond to requests for comment. Rothschild declined to comment.
Jewelry sales have slumped as U.S. unemployment climbed, contributing to the demise of chains that include Finlay Enterprises Inc. and Fortunoff Holdings LLC this year. Zale lost $189.5 million last year. It twice delayed releasing fourth-quarter results and last month reported a loss of $57.6 million in the first quarter that ended Oct. 31.
Zale shares rose 5 cents, or 2.1 percent, to close Thursday at $2.47.
On Aug. 6, Zale said it would record a $50 million pretax charge to close 118 locations in the quarter that ended July 31. The charge included $23 million to cover lease guarantees on Bailey, Banks & Biddle stores, replacing a previous estimate of $62 million, Treasurer David Sternblitz said.
Zale sold Bailey, Banks & Biddle in 2007 to Finlay Enterprises Inc., which filed for bankruptcy protection on Aug. 5.
Business, Pages 26 on 12/25/2009