Have you ever wondered about who runs that company that makes that status bag? You know the bag that wears the LV Logo. He is the richest man in Paris. (more…)

 
The great kingdom that lies along the banks of the river Niger is Nigeria. A woman controls the wealth of this natural resource rich nation. (more…)

BRUSSELS (AP) — Denmark’s finance minister says she and her European Union counterparts are close to a deal to force banks to build up bigger capital cushions against financial shocks.

Early Thursday, after more than 15 hours of debate, Margrethe Vestager said only a few “technical issues” needed to be ironed out before the ministers’ next meeting in two weeks.

The EU is in the process of writing an international agreement on capital defenses for banks into European law that regulators hope will prevent a repeat of the 2008 financial crisis.

The so-called Basel III deal would force lenders to increase their highest-quality capital gradually from 2 percent of the risky assets they hold to 7 percent by 2019. An additional 2.5 percent would have to be built up during good times.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

BRUSSELS (AP) – European finance ministers were divided Wednesday on how the region’s banks can protect themselves from future financial shocks.

The European Union is in the process to writing an international agreement on capital defences for banks into European law. This would determine the level of risk Europe’s banks can take and what regulators can do to ensure that financial crises like the one brought on by the collapse of U.S. investment bank Lehman Brothers in 2008 do not happen again.

The so-called Basel III deal would force banks gradually to increase their highest-quality capital – such as equity and reserves – from 2 percent of the risky assets they hold to 7 percent by 2019. An additional 2.5 percent would have to be built up during good times.

But several countries, including the U.K. and Sweden, want to require their banks to build up even higher defenses without having to go to the European Commission, the EU’s executive arm in Brussels, for approval. There was also some disagreement over what should count as capital. Some countries are warning that Europe could be seen as softening banking rules at a time when it is already under close scrutiny from international investors.

“If we duck the challenge of implementing Basel we could face very important challenges to confidence in Europe this year,” warned George Osborne, the U.K.’s Treasury chief.

Basel III was agreed by the world’s leading economies after the 2008 financial crisis demonstrated that many banks did not have enough of a capital cushion to absorb sudden losses on loans and other risky activities. Once agreed, the new rules would apply to more than 8,300 banks in Europe, forcing them to build up billions in extra capital by selling shares or assets or reining in bonuses and dividends.

The 2008 financial panic that followed Lehman’s collapse hit Europe hard. Between 2008 and 2010, governments across the 27-country-bloc spent (EURO)4.6 trillion ($6.1 trillion) propping up struggling banks.

What complicated efforts even more was that the open borders in the EU allow banks to operate freely across the bloc, but when lenders ran into trouble it was national governments – and taxpayers – who had to foot the bill. While the EU is now striving for a single set of banking rules, there is still no pan-European bank resolution fund that could relieve national governments.

The U.K., which had to save three major banks, has seen its debt load almost double since 2007. Meanwhile much smaller Ireland had to seek an international bailout to help stem the losses of its domestic lenders. And many economists fear that the economic recession in Spain may soon reveal massive bank losses there.

Now, the U.K. is leading a group of countries that want to be able to force their own banks to have bigger defenses than the ones prescribed by the pan-European rules without first getting approval from Brussels.

“We should make it clear that the crisis did not originate exclusively from weak fiscal policy. It originated also from insufficiently strong banks,” said Polish Finance Minister Jacek Rostowski. “So therefore a group of countries including Poland, the Czech Republic, Sweden and the United Kingdom are very determined to see that banking systems in the future should be as healthy as we expect the fiscal side, the budgetary side, to be kept.”

That demand is opposed by France and the Commission, which fear that jacking up capital requirements in one country could force banks based there to cut down lending by their foreign subsidiaries. That, they argue, could hurt small states that don’t have a big domestic banking system.

To bridge the divide between the two camps, Denmark, which currently holds the EU presidency, has proposed a compromise that would allow national regulators to require an extra capital buffer of 3 percent. Anything beyond that would have to be approved by the Commission in Brussels, which would examine not only the level of risk in the home state but also the potential impact in neighboring countries.

After several hours of public discussion, finance ministers retreated into bilateral talks. A possible compromise could include requiring not the Commission, but another European supervisor – the European Systemic Risk Board, which is led by the European Central Bank President Mario Draghi – to approve higher national buffers.

If they cannot find agreement Wednesday, several ministers said they hoped a deal could be struck at their next meeting in two weeks. Once finance ministers have struck a deal, they have to negotiate a final agreement with the European Parliament.

—

Don Melvin contributed to this story.

AP Photo/Richard Drew

NEW YORK (AP) — When hiring slumps, so do stock prices.

That was at least the message investors sent Wednesday, when they ignored flashes of positive news about the economy and instead homed in on troubling reports about jobs in the U.S. and Europe.

The Dow Jones industrial average fell as much as 87 points after a company that tracks payrolls said the U.S. added far fewer jobs in April than in March. The Dow ended the day down 10.75 points, at 13,268.57.

It was a turn from the day before, when investors chose to focus on a couple of positive reports on U.S. manufacturing and sent the Dow up 66 points to its highest close in more than four years.

While the market’s day-to-day fluctuations may be difficult to predict, some investors say they’re certain that stocks will generally climb for the rest of the year. As justification, they cite strong first-quarter earnings.

Of the 330 companies on the S&P 500 that have reported first-quarter earnings, 77 percent have beaten the estimates of stock analysts, said John Butters, senior earnings analyst at FactSet, a provider of financial data.

“The market has room to run,” said Karyn Cavanaugh, market strategist with ING Investment Management in New York. “It doesn’t always go up in a straight line.”

The Standard & Poor’s 500 fell 3.51 points to 1,402.31. The Nasdaq composite index was the outlier. It fell throughout the morning, then finished up 9.41 points at 3,059.85.

The report on private sector hiring weighed on investors, who see jobs as the key ingredient to an economic recovery.

The payroll processor, ADP, said U.S. businesses added 119,000 jobs in April, down from 201,000 in March. The government releases its monthly figures, which include the public sector, on Friday. The two reports can vary sharply.

Another jobs report from Europe underscored the gravity of the continuing debt crisis there. The 17 countries that use the euro reported that unemployment rose to 10.9 percent in March, the highest since the euro launched in 1999.

Markets fell across most of Europe, including Germany and Greece.

There was also good news out of Europe, even if it didn’t seem to sway investors. Standard & Poor’s lifted Greece’s credit rating out of default, noting how the country had recently secured a massive writedown on its debt to private investors.

Germany also reported that the number of people seeking work in April slipped below 3 million, a psychologically important barrier that it hasn’t broken in that month for two decades.

AP Photo/Alvaro Barrientos

LONDON (AP) — The 17 countries that use the euro are facing the highest unemployment rates in the history of the currency as recession once again spreads across Europe, pressuring leaders to focus less on austerity and more on stimulating growth.

Unemployment in the eurozone rose by 169,000 in March, official figures showed Wednesday, taking the rate up to 10.9 percent – its highest level since the euro was launched in 1999. The seasonally adjusted rate was up from 10.8 percent in February and 9.9 percent a year ago and contrasts sharply with the picture in the U.S., where unemployment has fallen from 9.1 percent in August to 8.2 percent in March. Spain had the highest rate in the eurozone, 24.1 percent – and an alarming 51.1 percent for people under 25.

Austerity has been the main prescription across Europe for dealing with a debt crisis that’s afflicted the continent for nearly three years and has raised the specter of the breakup of the single currency. Three countries – Greece, Ireland and Portugal – have already required bailouts because of unsustainable levels of debt.

Eight eurozone countries, including Greece, Spain and the Netherlands, have seen their economies shrink for two straight quarters or more, the common definition of a recession.

Economies are contracting across the eurozone as governments cut spending and raise taxes to reduce deficits. That has prompted economists to urge European Union policymakers to dial back on short-term budget-cutting and focus on stimulating long-term growth.

“The question is how long EU leaders will continue to pursue a deeply flawed strategy in the face of mounting evidence that this is leading us to social, economic and political disaster,” said Sony Kapoor, managing director of Re-Define, an economic think-tank and policy advisory company.

In a nod to shifting attitudes about austerity, European Central Bank president Mario Draghi recently called for a “growth pact” in Europe to work alongside the “fiscal pact” that has placed so much importance on controlling government spending.

Bailout fears have intensified in recent months as Spain, Italy and other governments face rising borrowing costs on bond markets, a sign that investors are nervous about the size of their debts relative to their economic output. Austerity is intended to address this nervousness by reducing a government’s borrowing needs, but there has been a negative side effect: As economic output shrinks, the debt burden actually looks worse.

Economists recommend pro-growth measures including reducing red tape for small businesses, making it easier for workers to find jobs across the eurozone and breaking down barriers that countries have created to protect their own industries. Some economists go a step further and say governments should actually increase spending while economies are so weak – and make reining in deficits a longer-term goal.

The central bank has tried to reinvigorate Europe’s financial system by lowering interest rates and extending $1.3 trillion in cheap, three-year loans to banks. Banks have used some of the money to purchase government bonds, which briefly eased pressure on countries’ borrowing costs. But interest rates on Spanish and Italian bonds have crept even higher in recent weeks.

Across Europe, austerity has come in the form of layoffs and pay cuts for state workers, scaled-back expenditures on welfare and social programs, and higher taxes and fees to boost government revenue.

 
Winds sent old newsprint soaring like white kites caught in the updraft along the concrete corridors of Wall Street, in October 29, 1929. The world had just begun to feel the horrendous pain of the Great Depression. (more…)

AP Photo/Paul Sakuma

NEW YORK (AP) — Hewlett-Packard Co. is combining its printer and PC divisions as it tries to overcome dragging profits, growing competition and the lack of clear identity.

The move announced Wednesday will help the company streamline its business and save money to invest in growing areas. HP, a Silicon Valley pioneer, is hoping a renewed focus on innovation will re-establish the 73-year-old company as a technology trailblazer

“We have got to place a few bets where we can fundamentally change the name of the game,” HP CEO Meg Whitman told shareholders Wednesday at the company’s annual meeting in Santa Clara, Calif. The Associated Press monitored a webcast of the meeting.

Whitman said printing remains one of the areas where HP can still make its mark. First, though, she said the company needs to trim its expenses, describing the combination of the PC and printing division as a “perfect example” of her streamlining plans.

“We are going to have to save to get growth going again at HP,” Whitman told shareholders.

Wednesday’s restructuring is one of the first major steps that Whitman, formerly eBay Inc.’s chief, has taken since she took the top job at HP in September. Her predecessor, Leo Apotheker, had wanted to sell or spin off the PC business, a plan that contributed to his ouster after 11 months on the job. Under Whitman, HP decided to keep the unit after all.

AP Photo/Brian Witte

ANNAPOLIS, Md. (AP) — As if gas prices weren’t high enough, several states across the U.S. are looking to raise fuel taxes they say are needed to pay for roads and bridges that are outdated, congested and in some cases, dangerous.

Maryland’s governor is proposing a phased-in 6 percent sales tax by 2 percent a year, which would raise about $613 million annually when fully implemented. Iowa is considering raising its current 21-cent-per-gallon tax by either 8 cents or 10 cents.

Such proposals were hard to even contemplate during the recession and its immediate aftermath. Now, states forced to grapple with the problem are running into record-high gas prices for this time of year and lingering effects of the recession.

In Maryland, lawmakers are questioning whether the time is right for such an increase, which is never popular even in good fiscal times.

“They understand that it’s needed,” Delegate Tawanna Gaines, a Democrat, said when asked about the proposal last month, on a day when the national average price of gasoline hit $3.65 a gallon. The average price of gas on Monday pushed toward $3.80 a gallon. “They get that, but they basically believe that you can’t get blood out of a turnip. It’s going to be a very, very tough sell.”

Maryland Gov. Martin O’Malley, a Democrat, is quick to point out that the state hasn’t raised its gas tax since 1992 – and the flat tax doesn’t buy nearly as much as it once did. But some lawmakers say they are getting significant pushback from residents who are calling their offices to express opposition at a time when Maryland, like most other states, is still trying to bounce back from the recession.

O’Malley’s plan would delay a 2 percent annual increase if gas prices rise by more than 15 percent in a fiscal year. Lawmakers also say Maryland’s $1.1 billion deficit is creating another obstacle, because his challenging budget plan includes a variety of other tax increases that legislators will be considering.

Other states also are looking at increasing revenue streams for transportation projects after years of neglect.

Michigan Gov. Rick Snyder, a Republican, is calling on lawmakers in his state to raise $1.4 billion more for transportation needs. In Arkansas, voters may be asked to consider raising two taxes to help pay for the state’s roads. In Iowa, a commission named by Republican Gov. Terry Branstad recommended late last year that the fuel tax be increased.

In Michigan, state lawmakers in both parties are considering higher fuel-related taxes and vehicle registration fees to raise more than $1 billion of the $1.4 billion the governor is seeking. Rep. Rick Olson, a Republican who supports the revenue increases, contends it’s a matter of trying to avoid larger expenses later, if maintenance is deferred.

“It’s certainly going to be difficult, and no one argues that we need $1.4 billion,” Olson said. “The longer we wait, the more it is going to cost us.”

In both Maryland and Michigan, business groups have been supportive of raising revenue for transportation.

Rich Studley, president of the Michigan Chamber of Commerce, said Michigan’s transportation system is crucial to three top industries in the state, including manufacturing, agribusiness and tourism.

AP Photo/Matt Rourke

DIMOCK, Pa. (AP) — Tugging on rubber gloves, a laboratory worker kneels before a gushing spigot behind Kim Grosso’s house and positions an empty bottle under the clear, cold stream. The process is repeated dozens of times as bottles are filled, marked and packed into coolers.

After extensive testing, Grosso and dozens of her neighbors will know this week what may be lurking in their well water as federal regulators investigate claims of contamination in the midst of one of the nation’s most productive natural gas fields.

More than three years into the gas-drilling boom that’s produced thousands of new wells, the U.S. Environmental Protection Agency and the state of Pennsylvania are tussling over regulation of the Marcellus Shale, the vast underground rock formation that holds trillions of cubic feet of gas.

The state says EPA is meddling. EPA says it is doing its job.

Grosso, who lives near a pair of gas wells drilled in 2008, told federal officials her water became discolored a few months ago, with an intermittent foul odor and taste. Her dog and cats refused to drink it. While there’s no indication the problems are related to drilling, she hopes the testing will provide answers.

“If there is something wrong with the water, who is responsible?” she asked. “Who’s going to fix it, and what does it do to the value of the property?”

Federal regulators are ramping up their oversight of the Marcellus with dual investigations in the northeastern and southwestern corners of Pennsylvania. EPA is also sampling water around Pennsylvania for its national study of the potential environmental and public health impacts of hydraulic fracturing, or fracking, the technique that blasts a cocktail of sand, water and chemicals deep underground to stimulate oil and gas production in shale formations like the Marcellus. Fracking allows drillers to reach previously inaccessible gas reserves, but it produces huge volumes of polluted wastewater and environmentalists say it can taint groundwater. Energy companies deny it.

The heightened federal scrutiny rankles the industry and politicians in the state capital, where the administration of pro-drilling Gov. Tom Corbett insists that Pennsylvania regulators are best suited to oversee the gas industry. The complaints echo those in Texas and in Wyoming, where EPA’s preliminary finding that fracking chemicals contaminated water supplies is forcefully disputed by state officials and energy executives.

Caught in the middle of the state-federal regulatory dispute are residents who don’t know if their water is safe to drink.

EPA is charged by law with protecting and ensuring the safety of the nation’s drinking water, but it has largely allowed the states to take the lead on rules and enforcement as energy companies drilled and fracked tens of thousands of new wells in recent years.

In Pennsylvania, that began to change last spring after The Associated Press and other news organizations reported that huge volumes of partially treated wastewater were being discharged into rivers and streams that supply drinking water. EPA asked the state to boost its monitoring of fracking wastewater from gas wells, and the state declared a voluntary moratorium for drillers that led to significant reductions of Marcellus waste. Yet a loophole in the policy allows operators of many older oil and gas wells to continue discharging significant amounts of wastewater into treatment plants, and thus, into rivers.

The state’s top environmental regulator, Michael Krancer, says Pennsylvania doesn’t need federal intervention to help it protect the environment. He told Congress last fall that Pennsylvania has taken the lead on regulations for the burgeoning gas industry.

“There’s no question that EPA is overstepping,” Katherine Gresh, Krancer’s spokeswoman, told the AP. “DEP regulates these facilities and always has, and EPA has never before shown this degree of involvement.”

The American Petroleum Institute urged the Obama administration last week to rein in the 10 agencies it says are either reviewing, studying or proposing regulation of fracking.

“The fact is that there is a strong state regulatory system in place, and adding potentially redundant and duplicative federal regulation would be unnecessary, costly, and could stifle investment,” API Vice President Kyle Isakower said in a statement.

EPA says public health is its key focus and insists it is guided by sound science and the law.

AP Photo/Anonymous

NEW ORLEANS (AP) — BP agreed late Friday to settle lawsuits brought by more than 100,000 fishermen who lost work, cleanup workers who got sick and others who claimed harm from the oil giant’s 2010 Gulf of Mexico disaster, the worst offshore oil spill in the nation’s history.

The momentous settlement will have no cap to compensate the plaintiffs, though BP PLC estimated it would have to pay out about $7.8 billion, making it one of the largest class-action settlements ever. After the Exxon Valdez disaster in 1989, the company ultimately settled with the U.S. government for $1 billion, which would be about $1.8 billion today.

BP still has to resolve claims by the U.S. government, Gulf states and its partners in the doomed Deepwater Horizon project, in which pressure from a well a mile below the ocean’s surface blew up a massive drilling rig, killing 11 men and spewing oil into the sea for nearly three months. That could add billions of more to its tab.

BP said it expects the money to come from the $20 billion compensation fund that it previously set out. According to the Deepwater Horizon Oil Spill Trust, current total trust assets are approximately $9.5 billion.

The spill exposed oil industry failings, forced BP chief executive Tony Hayward to step down after his repeated gaffes and led to new lexicon in American vocabulary as crews used innovative attempts to plug the spewing well, such as the top kill and the junk shot.

The spill soiled sensitive tidal estuaries and beaches, killing wildlife and shutting vast areas of the Gulf to commercial fishing. After several attempts to cap the well failed, engineers finally were successful on July 15, halting the flow of oil into the Gulf of Mexico after more than 85 days.

The main targets of litigation resulting from the explosion and spill were BP, Transocean, Halliburton and Cameron International, maker of the well’s failed blowout preventer. BP, the majority owner of the well that blew out, was leasing the rig from Transocean.

The Justice Department sued some of the companies involved in the ill-fated drilling project, seeking to recover billions of dollars for economic and environmental damage. The department opened a separate criminal investigation, but that probe hasn’t resulted in any charges.

BOSTON (AP) — Las Vegas casino owner Steve Wynn unveiled details Friday of a proposed Massachusetts resort casino he hopes to develop near the home of the New England Patriots.

Wynn mailed a brochure and 20-minute DVD to thousands of Foxborough households explaining the proposal, which has met resistance from many residents who are worried that it will add to traffic congestion and crime in the town about 25 miles south of Boston.

An artist’s rendering depicts a sprawling, six-story building that resembles a rustic lodge, rather than a high-rise Las Vegas-style casino. It would be built on vacant land across from Gillette Stadium that would be leased from Patriots owner Robert Kraft.

Wynn, the billionaire CEO of Wynn Resorts Ltd, had earlier pledged that the proposed casino would fit the character of the town and would not be as large or flashy as the typical Las Vegas casino.

In a letter accompanying the brochure and DVD, Wynn said the casino would benefit the town “both socially and economically.” He said the plans included a luxury hotel, convention space, more than 5,000 covered parking spaces, a public skating rink, high-end shops, a spa, fine dining and casual restaurants, and a performance theater.

The casino would create more than 4,000 permanent jobs and about 10,000 construction jobs, Wynn wrote, and it would generate between $10 million and $15 million for Foxborough that could be used to lower property taxes or invest in other town services. He also said an agreement could be reached with the town to cover public safety and other costs associated with the casino and that a study would be done to determine the traffic impact.

“We’re excited by the design and the unique opportunity the Wynn Resorts project presents for long-term economic growth in Foxborough,” Kraft Group spokesman Dan Krantz said.

“Since bringing forth the idea in December of last year, Wynn Resorts has followed through on a commitment to generate renderings and estimate the resort’s direct tax benefits. As we anticipated, the design and decor assimilates to its surroundings, and is likely in stark contrast to the Las Vegas-style high-rise that some may have envisioned,” he said.

Stephanie Crimmins, a spokeswoman for the group No Foxboro Casino, said casino opponents had anticipated that Wynn would launch a public relations blitz aimed at the hearts and minds of residents.

“We fully expected all along that they were going to send out some really fancy brochures,” Crimmins said.” It is certainly not going to change my mind or the minds of most people in the community.”

AP Photo/Petros Giannakouris

ATHENS, Greece (AP) — The ratings agency Moody’s downgraded Greece to the lowest rating on its bond scale late Friday, following a deal with private investors that would see them ultimately lose an estimated 70 percent of their holdings in Greek debt.

Moody’s lowered Greece’s sovereign rating to C from Ca, arguing that the risk of default remains high even a bond-swap deal with banks and other private investors, due to be completed this month, is successful.

It said it would “re-assess the credit risk profile” after Greece issues the new bonds.

Ratings agency Standard & Poor’s took similar action on Feb. 27.

The swap deal aims to cut euro107 billion ($144 billion) from the country’s debt, and would see private investors lose more than half the face value of their Greek bonds in exchange for new ones issued with more favorable repayment terms for the crisis-hit country.

The exchange is an integral part of a second bailout package for Greece by other eurozone countries and the International Monetary Fund.

“Looking ahead, the EU program and proposed debt exchanges will reduce Greece’s debt burden, but the risk of a default even after the debt exchange has been completed remains high,” Moody’s said.

“Moody’s believes that Greece will still face medium-term solvency challenges: its stock of debt will still be well in excess of 100 percent of gross domestic product for many years, the country is unlikely to be able to access the private market once the second assistance package runs out, and its planned fiscal and economic reforms will still face very significant implementation risks.”

BANGKOK (AP) — Asian stock markets rose Wednesday, powered higher by the strongest close for U.S. stocks since before the 2008 financial crisis.

Japan’s Nikkei 225 index rose 1.3 percent to 9,846.46 and Hong Kong’s Hang Seng added 0.5 percent to 21,685.33. South Korea’s Kospi gained 1.4 percent to 2,031.43. Australia’s S&P/ASX 200 rose 1.2 percent to 4,313.90.

Benchmarks in Singapore, Taiwan, Indonesia were also higher. Mainland Chinese shares were little changed.

Surging consumer confidence helped push the Dow to close at 13,005.12 on Tuesday. The last time the benchmark closed above 13,000 was in May 2008, four months before the fall of the Lehman Brothers investment bank and the worst of the financial crisis.

Investors are also anticipating the Federal Reserve’s so-called Beige Book report on economic activity which is due Wednesday. The report is expected to reflect a slowly improving U.S. economy.

“A plethora of positive developments helped to buoy markets overnight … a jump in US consumer confidence to its highest since February 2011 gave equity markets and risk assets in general a lift,” said analysts at Credit Agricole CIB in Hong Kong.

AP Photo/Mark Lennihan

NEW YORK (AP) — Americans are feeling better about the economy again, but will it last this time?

A widely watched barometer of consumer confidence surged in February to its highest level in a year as Americans took note of improving job prospects among friends and family and falling unemployment, which is now at a three-year low.

The brighter assessment released Tuesday by a private research group reflected a more upbeat attitude for the nation generally as the economy picks up. That is a boon for President Obama as he seeks re-election. Polls, including a recent Associated Press-GfK survey, show the Democratic incumbent is beginning to benefit politically from improved views of the economy.

“The economy is getting momentum. Clearly, shoppers are more optimistic about their job prospects,” said Amna Asaf, economist at Capital Economics.

The rising confidence among consumers gave confidence to Wall Street, too, helping it to reclaim the last of the ground it held before plunging into the depths of the Great Recession. The Dow Jones industrial average closed above 13,000 on Tuesday for the first time since May 19, 2008, four months before the fall of Lehman Brothers investment bank and the worst of the financial crisis.

Jack Ablin, chief investment officer at Harris Private Bank, called it “a momentous day for investor confidence.”

Tuesday’s gain puts the Dow 1,160 points below its all-time high, set Oct. 9, 2007. The Great Recession began two months later.

The milestone could draw some fence-sitting investors back into the market and add to the gains, said Brian Gendreau, market strategist at Cetera Financial Group.

But consumer confidence is still below the level of a healthy economy, and trouble could lie ahead. Rising gas prices could sully shoppers’ mood and derail the economic recovery. There are also fears about a nuclear showdown with Iran and the festering European debt crisis. Those worries could hurt demand for U.S. imports and make American companies pull back in hiring.

The confidence index is closely watched because consumer spending constitutes 70 percent of U.S. economic activity.

The big question mark is the price of gasoline, which Asaf said has climbed 20 cents per gallon since the confidence survey concluded two weeks ago.

The price of gas is a big issue because it has an immediate effect on shoppers’ pocketbooks, particularly low- to middle-income households that are already squeezed by higher costs for basics such as food.

The average U.S. price of a gallon of gasoline was $3.69, according to the Lundberg Survey of fuel prices released Sunday.

The Conference Board’s Consumer Confidence Index now stands at 70.8, significantly higher than the expected 63. A reading of 90 or above indicates a healthy economy. But the index has not reached that level since December 2007, when the recession began.

Still, Tuesday’s numbers were closer to levels that indicate a stable economy than to the danger zone that would suggest trouble.

WASHINGTON (AP) — Heads up: Drones are going mainstream.

Civilian cousins of the unmanned military aircraft that have tracked and killed terrorists in the Middle East and Asia are in demand by police departments, border patrols, power companies, news organizations and others wanting a bird’s-eye view that’s too impractical or dangerous for conventional planes or helicopters to get.

Along with the enthusiasm, there are qualms.

Drones overhead could invade people’s privacy. The government worries they could collide with passenger planes or come crashing down to the ground, concerns that have slowed more widespread adoption of the technology.

Despite that, pressure is building to give drones the same access as manned aircraft to the sky at home.

“It’s going to be the next big revolution in aviation. It’s coming,” says Dan Elwell, the Aerospace Industries Association’s vice president for civil aviation.

Some impetus comes from the military, which will bring home drones from Afghanistan and wants room to test and use them. In December, Congress gave the Federal Aviation Administration six months to pick half a dozen sites around the country where the military and others can fly unmanned aircraft in the vicinity of regular air traffic, with the aim of demonstrating they’re safe.

The Defense Department says the demand for drones and their expanding missions requires routine and unfettered access to domestic airspace, including around airports and cities. In a report last October, the Pentagon called for flights first by small drones both solo and in groups, day and night, expanding over several years. Flights by large and medium-sized drones would follow in the latter half of this decade.

Other government agencies want to fly drones, too, but they’ve been hobbled by an FAA ban unless they first receive case-by-case permission. Fewer than 300 waivers were in use at the end of 2011, and they often include restrictions that severely limit the usefulness of the flights. Businesses that want to put drones to work are out of luck; waivers are only for government agencies.

But that’s changing.

Congress has told the FAA that the agency must allow civilian and military drones to fly in civilian airspace by September 2015. This spring, the FAA is set to take a first step by proposing rules that would allow limited commercial use of small drones for the first time.

Until recently, agency officials were saying there were too many unresolved safety issues to give drones greater access. Even now FAA officials are cautious about describing their plans and they avoid discussion of deadlines.

“The thing we care about is doing that in an orderly and safe way and finding the appropriate … balance of all the users in the system,” Michael Huerta, FAA’s acting administrator, told a recent industry luncheon in Washington. “Let’s develop these six sites – and we will be doing that – where we can develop further data, further testing and more history on how these things actually operate.”

Drones come in all sizes, from the high-flying Global Hawk with its 116-foot wingspan to a hummingbird-like drone that weighs less than an AA battery and can perch on a window ledge to record sound and video. Lockheed Martin has developed a fake maple leaf seed, or “whirly bird,” equipped with imaging sensors, that weighs less than an ounce.

Potential civilian users are as varied as the drones themselves.

Power companies want them to monitor transmission lines. Farmers want to fly them over fields to detect which crops need water. Ranchers want them to count cows.

Journalists are exploring drones’ newsgathering potential. The FAA is investigating whether The Daily, a digital publication of Rupert Murdoch’s News Corp., used drones without permission to capture aerial footage of floodwaters in North Dakota and Mississippi last year. At the University of Nebraska, journalism professor Matt Waite has started a lab for students to experiment with using a small, remote-controlled helicopter.

“Can you cover news with a drone? I think the answer is yes,” Waite said.

The aerospace industry forecasts a worldwide deployment of almost 30,000 drones by 2018, with the United States accounting for half of them.

“The potential … civil market for these systems could dwarf the military market in the coming years if we can get access to the airspace,” said Ben Gielow, government relations manager for the Association for Unmanned Vehicle Systems International, an industry trade group.

The hungriest market is the nation’s 19,000 law enforcement agencies.

Customs and Border Patrol has nine Predator drones mostly in use on the U.S.-Mexico border, and plans to expand to 24 by 2016. Officials say the unmanned aircraft have helped in the seizure of more than 20 tons of illegal drugs and the arrest of 7,500 people since border patrols began six years ago.

Several police departments are experimenting with smaller drones to photograph crime scenes, aid searches and scan the ground ahead of SWAT teams. The Justice Department has four drones it loans to police agencies.

“We look at this as a low-cost alternative to buying a helicopter or fixed-wing plane,” said Michael O’Shea, the department’s aviation technology program manager. A small drone can cost less than $50,000, about the price of a patrol car with standard police gear.

Like other agencies, police departments must get FAA waivers and follow much the same rules as model airplane hobbyists: Drones must weigh less than 55 pounds, stay below an altitude of 400 feet, keep away from airports and always stay within sight of the operator. The restrictions are meant to prevent collisions with manned aircraft.

Even a small drone can be “a huge threat” to a larger plane, said Dale Wright, head of the National Air Traffic Controllers Association’s safety and technology department. “If an airliner sucks it up in an engine, it’s probably going to take the engine out,” he said. “If it hits a small plane, it could bring it down.”

Controllers want drone operators to be required to have instrument-rated pilot licenses – a step above a basic private pilot license. “We don’t want the Microsoft pilot who has never really flown an airplane and doesn’t know the rules of how to fly,” Wright said.

Military drones designed for battlefields haven’t had to meet the kind of rigorous safety standards required of commercial aircraft.

“If you are going to design these things to operate in the (civilian) airspace you need to start upping the ante,” said Tom Haueter, director of the National Transportation Safety Board’s aviation safety office. “It’s one thing to operate down low. It’s another thing to operate where other airplanes are, especially over populated areas.”

AP Photo/Alvaro Barrientos

MADRID (AP) — Daniel Lorente has worked construction, flipped burgers at McDonald’s, been a camp counselor, telemarketing representative and doorman.

But Lorente’s part-time jobs never lasted more than seven months: He was laid off from each one as Spain’s economic gloom deepened into a historic crisis. Now the 21-year-old is staring into a dead-end future.

“How am I going to make it if I don’t have a steady job, to pay a mortgage, for example?” asks Lorente. “Or for a wedding, or anything involving a big expense? You can’t get anywhere.”

Lorente is stuck among Spain’s “Lost Generation” of 20-somethings, with no work and no real prospects in sight: Roughly half of all Spaniards between 16 and 24 are jobless, the highest level among the 17 nations that use the euro. It’s a devastating picture of blighted youth that threatens to distort Spain’s social fabric for years to come, dooming dreams, straining family structures and eroding the well-being of a rapidly aging population.

“This puts the whole welfare state at risk,” said Gayle Allard, a labor market specialist at Madrid’s IE Business School. “The young people who are coming on the market now are the lost generation. They are losing the advantage of their youth and energy and that does not come back.”

The staggering jobless figures – 48.6 percent for Spaniards between 16 and 24; 39 percent for those ages 20-29 – hold dire consequences for a country that grew accustomed to prosperity on the back of a property boom that collapsed in 2008.

The 1.6 million unemployed teens and young adults in the nation of 47 million risk never having a decent start to a career. They probably won’t accumulate assets like their own homes or savings until they are in their 40s. And they then will likely face much higher taxes to maintain Spain’s costly social welfare system.

What’s more, they’re expected to put off having children or have fewer than their parents, slashing a birth rate that’s already declining just as Spain’s large baby boom generation begins to retire. That means fewer people to absorb the costs of caring for the swelling ranks of pensioners.

“It’s a historic waste,” Allard said. “The economy has not been transformed into a higher-productivity economy even though all those educated young workers were available for the task. I would not be surprised if eventually they rebelled against the tax burden.”

Anger and frustration among young adults have already taken root. Thousands erected protest camps last spring and summer in Madrid and Barcelona in illegal tent cities set up in central plazas. Unrest erupted again last week when students in Valencia protesting austerity cuts clashed with riot police, generating nationwide demonstrations against alleged police brutality.

Some Spaniards fear that Spain’s relatively new democracy, launched in 1978 after decades of dictatorship, may become threatened if an entire generation ends up convinced they will never attain the same lifestyle as their parents.

“The main risk for the country is we could lose a generation who go away and the young people who stay will have less education, condemning Spain to crisis for many years to come,” said Ricardo Ibarra, the 27-year-old president of The Spanish Youth Council, which represents groups for young adults.

“In 10 years we could have populism instead of democracy, and we cannot waste our democracy and throw it away.”

Segundo Gonzalez – a 23-year-old university student majoring in economics – says the only job offers he has received are for menial positions, for no more than eight hours a week with monthly pay of euro300 ($400).

“If those of us who should be entering employment have to leave the country or can’t get a job, or can only get poorly paid and low-tax work, it’s going to be very complicated for us to be able to sustain our parents’ pensions,” said Gonzalez.

“Future prospects are very complicated, bleak.”

In a scene mirrored nationwide, Lorente lives at home with his mother and an unemployed 28-year-sister. Like many other young Spaniards, he thinks Spain’s economy is so bad as it heads toward recession for the second time in four years that he might not be able to move out until he hits 40.

But with the overall unemployment rate now at a eurozone high 22.8 percent, even family support networks are being eroded – as young people find they can rely far less on handouts and shelter from mom and dad.

 
It’s as if by magic that we expect the world economy to suddenly correct itself; even more to expect our populaces to elect leaders with miraculous qualities of leadership. (more…)

AP Photo/Richard Drew

NEW YORK (AP) — Stocks are closing their worst day this year after Greece hit a roadblock on its way to a critical bailout.

The Dow Jones industrial average is finishing down 89 points, or 0.7 percent, at 12,801. The broader Standard & Poor’s 500 is down nine points to 1,343. It is the first losing week for the index this year.

The Nasdaq composite is closing down 23 points at 2,904.

Stocks fell all day on news that European finance ministers were insisting that Greece cut even more in wages and spending if the nation hopes to get bailout money to pay its creditors.

Three stocks fell for every one that rose Friday on the New York Stock Exchange. Volume was light with just 3.5 billion shares trading hands.

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