LITTLE ROCK — QUOTE OF THE DAY
"What we are proposing to do is to tap the ample liquidity of the banking industry to improve our own liquidity position without borrowing from the Treasury."
Federal Deposit Insurance Corp.Chairman Sheila Bair
Article, 1D
Fed pitches credit-card rate rules
WASHINGTON - The Federal Reserve proposed rules Tuesday that it said would better protect Americans from sudden increases in interest rates on credit cards.
The proposal would generally bar rate increases during the first year after an account is opened.
It also would ban - with a few exceptions - increasing the rate on existing credit-card balances. For instance, if a customer is behind more than 60 days on a payment, then the rate on the existing balance can be boosted.
"This proposal is another step forward in the Federal Reserve's efforts to ensure that consumers who rely on credit cards are treated fairly," said Fed member Elizabeth Duke.
The proposal also would require credit card companies to obtain a customer's consent before charging fees or transactions that exceed their credit limit and would forbid companies from issuing credit cards to people younger than 21 unless they have the ability to make the required payments or a parent or other co-signer.
The Fed is required to take the action under legislation passed by Congress and signed into law by President Barack Obama in May.
The public, industry and other interested parties will have an opportunity to weigh in on the Fed's proposal.
The provisions are scheduled to take effect Feb. 22, 2010.
Microsoft offers anti-virus software
REDMOND, Wash. - Microsoft Corp. said its new computer security program can be downloaded as of Tuesday.
Microsoft Security Essentials, as the free anti-virus software is called, has been available in a beta test version since June.
The software updates daily to stay current with the latest malicious programs, which can steal passwords or turn PCs into spam servers. Microsoft says it won't make computers run slower.
Microsoft has said it isn't out to steal business from companies such as McAfee Inc. and Symantec Corp., which make popular anti-virus programs with more features. Microsoft said it hopes the free program will appeal to people who don't already run anti-virus software.
Starbucks widens instant-java sales
Starbucks Corp., the world's largest coffee shop operator, is expanding its Via Ready Brew to hundreds of new locations throughout the U.S., including Barnes & Noble Inc. bookstores and Marriott International Inc. hotels.
The instant coffee was available beginning Tuesday at Starbucks' U.S. and Canadian cafes, as well as 1,500 other locations, including stores, hotels and airlines, Chief Executive Officer Howard Schultz said.
"We've begun to sell it to unique accounts, places where Starbucks has never lived before," Schultz said.
Starbucks is building on Via's March introduction in Chicago, Seattle and London as it seeks a piece of the $21 billion soluble-coffee market.
"As a stand-alone soluble coffee, it's very good," said Dan Cox, president of Burlington, Vt.-based Coffee Enterprises, a coffee-testing company. "It's not close to their roasted brewed coffee; it doesn't have the same aromatics."
Starbucks is in the process of closing about 800 U.S.
stores to cut labor and other costs after consumers curbed visits amid rising unemployment. Sales at U.S. stores open at least a year declined 6 percent in the quarter that ended in June, while international sales dropped 2 percent.
Oil slips on consumer, supply news
Oil prices fell Tuesday on a new report suggesting that consumers remain leery of job losses and growing evidence that U.S. crude supplies continue to grow.
Benchmark crude for November delivery fell 13 cents to settle at $66.71 on the New York Mercantile Exchange.
Crude has doubled in price since February, pulled higher by a six-month rally on Wall Street and a battered dollar. The U.S. currency is near its lowest point in the past year against the euro, and that makes dollar-based crude cheaper.
But in the past two weeks, oil has given up about $6 a barrel as supplies continue to build and demand remains woeful, though the number of miles driven by Americans is on the upswing.
Today, the Energy Information Administration releases its weekly supply report, which is expected to show that crude placed into storage grew by more than 2 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
Last week's report that showed a giant increase in inventory levels for crude and refined products played a big role in the recent decline in oil prices.
Burgeoning supplies have sent retail gas prices to two month lows.
The auto club AAA reported Tuesday that the average price of regular gasoline in Arkansas was just under $2.29, a half-cent lower than Monday.
Prices stoke deflation fear in Japan
TOKYO - Prices in Japan tumbled at a record pace in August, intensifying concerns that deflation could undermine the country's fragile economic recovery.
The country's key consumer price index, which excludes volatile fresh food prices, fell 2.4 percent from a year earlier amid rising unemployment and falling wages, the government said Tuesday. The figure marks the steepest decline since officials began compiling comparable data in 1971.
Tetsufumi Yamakawa, chief Japan economist for Goldman Sachs, said in a recent report that it sees "no end to the vicious spiral leading from price decline to wage decline."
Core CPI has now dropped for six straight months and suggests that the world's second largest economy could face another bout of prolonged deflation.
The core CPI for Tokyo retreated 2.1 percent in September, according to the statistics bureau. Prices in the nation's capital are considered a leading barometer of price trends across Japan.
Deflation can hamper growth by depressing company profits and causing consumers to postpone purchases.
The big drop over the last few months stems mainly to lower oil prices, which are down more than 50 percent from last year. But the latest figures reveal that the downtrend now extends to other categories including clothes, household goods and recreation.
Business, Pages 26 on 09/30/2009