(Headlines - scroll down for full stories)
1. Energy Sec.: High Oil Prices Can ‘Wreck' Economies
2. Commerce Sec. in China to Boost Trade
3. Survey: 89% Plan to Shop Wal-Mart for Holidays
4. Is Bank of America Looking to Buy KeyCorp?
1. Energy Sec.: High Oil Prices Can ‘Wreck' Economies
High crude oil prices can wreck global economies, U.S. Energy Secretary Sam
Bodman said Monday.
"It is not an understatement to say ... that high oil prices can literally wreck
economies," Bodman told a conference hosted by the Middle East Institute. Bodman
did not specify whether current crude oil prices were too high.
Story Continues Below
High prices "can restrict development in a way that stifles business growth and,
more notably, inhibits improvements in the health and well-being of so many
around the world," Bodman said.
Though Bodman did not mention OPEC by name, he did warn that market
interventions are "ineffective for controlling prices."
"We know that purposeful market distortions — such as rationing supply, cutting
production, or creating price floors and ceilings — do not work," Bodman said.
The Organization of the Petroleum Exporting Countries began to curb output by
1.2 million barrels per day from Nov. 1. Top exporter Saudi Arabia, shouldering
380,000 bpd of the total, cut exports to all regions in November.
© 2006 Reuters.
Editor's Note:
2. Commerce Sec. in China to Boost Trade
U.S. Commerce Secretary Carlos Gutierrez, in Beijing for meetings with Chinese
officials, said he wants to boost U.S. exports to China in order to narrow the
trade imbalance between the two countries.
"The future should be focused on exporting to China as a way of improving our
balance," Gutierrez told reporters. "We judge by results, by the numbers we see,
and I can tell you this year our exports to China are up on a year to date basis
34 percent, and that is up over last year, which was up 20 percent."
In September, the U.S. imported $27.6 billion worth of goods from China. The
U.S. trade deficit with China swelled 4.6 percent to a record $23.0 billion for
the month. For the first nine months of the year, the nation's trade deficit
with China is $166.3 billion, on pace to break another record. In comparison,
U.S. exports to China totaled just $40.2 billion for the year ended September.
Many U.S. politicians have called for China to let its currency float freely
against the U.S. dollar, hoping that a stronger yuan will make U.S. exports to
China more attractive. Because the value of the yuan is artificially low, they
contend, U.S. exports are expensive. Conversely, Chinese imports into the U.S.
are cheap.
Chinese Commerce Minister Bo Xilai told Gutierrez in a meeting on Monday said,
"China does not pursue a large trade deficit with the United States, instead it
will make efforts to realize a trade balance."
Editor's Note:
3. Survey: 89% Plan to Shop Wal-Mart for Holidays
A survey of 1,000 adults showed 89 percent plan to do their holiday shopping at
Wal-Mart this year, says Reuters.
Shoppers are clearly responding to the world's largest retail store's
announcement that it will slash prices on products for the season. Wal-Mart has
already marked down prices on electronics, small appliances, and some toys.
Britt Beemer, head of America's Research Group, confessed to being "a little
flabbergasted" by the number of people planning to shop at Wal-Mart. Normally,
about 70 percent say they'll shop the discount retailer for gifts.
For more proof that this year's shoppers are looking for bargains, 95 percent of
those surveyed say that they would buy big-ticket items advertised as early-bird
specials. The group reports that that's twice as many as last year's survey.
Overall, the survey showed a modest increase in sales for the holiday season.
The survey group projects that same-store sales will increase 3.1 percent based
on responses. That's comparable to last year's sales.
The survey, done by America's Research Group for Reuters, is the first in a
series of holiday shopping polls.
Editor's Note:
4. Is Bank of America Looking to Buy KeyCorp?
Bank of America Corp., the No. 2 U.S. bank, may yet consider making an
acquisition in the Midwest, with Cleveland-based KeyCorp a possible target,
according to Punk, Ziegel & Co. analyst Richard Bove.
In a note, Bove wrote Bank of America has about 9.2 percent of U.S. bank
deposits, well below the 10 percent ceiling that could prevent it from making a
domestic acquisition. This means Bank of America could acquire another $54
billion in deposits.
Bove wrote that Bank of America would be precluded from buying the 11 top
depositories in the United States but it could buy any of the 9,000 other banks
in the country.
"If one assumes that the government might let Bank of America sell off enough
deposits after a merger to get under the 10 percent deposit ceiling required by
law, then there are really only 9 banks it could not acquire in a realistic
sense," Bove wrote.
Bank of America spokesman Terry Francisco said the company did not comment on
speculation, but pointed out that chief executive Kenneth Lewis has said the
company sees no strategic imperative to make an acquisition.
KeyCorp spokesman Bill Murschel said the company does not comment on analyst
speculation.
As to where Bank of America is likely to acquire, Bove wrote that the Midwest
would seem likely as it is the only region of the country the bank does not
blanket with branches.
"Who might the bank buy? Not U.S. Bancorp, it is too big," Bove wrote. "Everyone
else in the market is possible and KeyCorp might even be probable." KeyCorp has
a market value of about $14.75 billion.
KeyCorp was not immediately available for comment.
Bank of America shares were down 9 cents at $54.42 and KeyCorp stock was up 28
cents at $36.99 on the New York Stock Exchange on Friday afternoon.
© 2006 Reuters.
Editor's Note:
Editor's Notes:
