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Federal Reserve Chairman Ben S. Bernanke said the use of credit default swaps to destabilize a country is “counterproductive,” and added the central bank is reviewing the arrangements of Goldman Sachs Group Inc. and other companies with Greece.

“We are looking into a number of questions related to Goldman Sachs and other companies and their derivatives arrangements with Greece,” Bernanke said today in testimony before the Senate Banking Committee in Washington.

Greek bonds slid today, pushing the premium investors demand to hold the nation’s 10-year securities instead of German bunds to the most in more than two weeks, amid concern the country’s credit ratings may be cut.

Federal Reserve officials are using new supervisory powers over firms such as Goldman Sachs and Morgan Stanley to gather information on financial system risks. Bernanke was responding to a question from Senator Christopher Dodd, a Connecticut Democrat, who asked if there should be limits on the use of credit default swaps to prevent “runs against governments.”

Destabilize

“Obviously, using these instruments in a way that intentionally destabilizes a company or a country is — is counterproductive, and I’m sure the SEC will be looking into that,” Bernanke said. “We’ll certainly be evaluating what we can learn from the activities of the holding companies.”

U.S. stocks fell today in part as Moody’s Investors Service said it may downgrade Greek debt. The Standard & Poor’s 500 Index was down 1.52 percent at 10:51 a.m. in New York. Yields on U.S. 2-year notes declined 0.03 percentage point to 0.828 percent.

Goldman Sachs helped Greek officials raise $1 billion of off-balance-sheet funding in 2002 through swaps, which European Union regulators said they knew nothing about until recent days.

Goldman Sachs did “nothing inappropriate” when it arranged currency swaps for Greece that reduced the nation’s national debt by 2.37 billion euros ($3.2 billion), a top executive said.

“They did produce a rather small, but nevertheless not insignificant reduction, in Greece’s debt-to-GDP ratio,” Gerald Corrigan, chairman of Goldman Sachs’s regulated bank subsidiary, told a panel of U cash advance payday loan.K. lawmakers Feb. 22. The swaps were “in conformity with existing rules and procedures.”

“As a matter of policy, we don’t comment on legal or regulatory matters,” Michael DuVally, a Goldman Sachs spokesman, said today.

Credit Ratings

Corrigan is the former president of the Federal Reserve Bank of New York. The Federal Reserve gained oversight powers over Goldman Sachs and Morgan Stanley following their conversion to bank holding companies in Sept. 2008.

Yields on two-year Greek bonds rose to the highest since Feb. 9 after Standard & Poor’s and Moody’s said they may cut their ratings if Greece fails to implement a plan to reduce its budget deficit. Pierre Cailleteau, managing director of sovereign risk at Moody’s, said a downgrade may come by the end of March.

“Greece is able to make headlines every day, and for now volatility is here to stay,” said Michiel de Bruin, who helps manage $28 billion of assets as head of euro government bonds at F&C Investments in Amsterdam. “The market is also taking into account the possibility of a double dip in economic growth, and that’s causing risk aversion.”

The cost of insuring against default on Greek government bonds rose for a fourth day, with the credit-default swaps on the debt rising 10 basis points to 392, the highest in more than two weeks, according to CMA DataVision.

The Greek 10-year bond increased 12 basis points to 6.64 percent as of 3:02 p.m. in London. The 6 percent security maturing July 20109 lost 0.82, or 8.2 euros per 1,000-euro face amount, to 95.56. The two-year yield jumped 61 basis points, the most since Jan. 29, to 6.35 percent.

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Japan’s economy probably grew at the fastest pace since the first quarter of 2008 as a global trade revival fueled demand for the nation’s exports.

Gross domestic product rose an annualized 3.6 percent in the three months ended Dec. 31, following a 1.3 percent expansion in the third quarter, according to the median forecast of 23 economists surveyed by Bloomberg News. The Cabinet Office report is due on Feb. 15 at 8:50 a.m. in Tokyo.

Nissan Motor Co. and Canon Inc. are among companies benefitting from stronger global demand as countries poured more than $2 trillion into their economies to spur growth. Those gains have failed to reach consumers at home, where wages are tumbling and household outlays have been propped up by government incentives that are starting to wear off.

“Japan may be able to stave off a double-dip recession given exports have done better than expected,” said Takahide Kiuchi, chief economist at Nomura Securities Co. in Tokyo. “Still, it’s questionable whether a recovery in domestic demand without the stimulus is possible and the economy is still highly dependent on overseas demand, underscoring the fragility of the recovery.”

Gains in the Nikkei 225 Stock Average stalled this year after a 19 percent advance in 2009, a reflection of concerns about the strength of the global recovery. The yen is the only currency that has gained against the dollar since Dec. 31 among 10 major currencies tracked by Bloomberg, threatening exporters’ profits.

Asia spearheaded Japan’s revival at the end of 2009. Shipments to the region surged 31 percent in December, the fastest pace in almost a decade, helping China overtake the U.S. as Japan’s largest foreign customer on an annual basis. Demand from the U.S. is also improving after the nation’s GDP expanded the most in six years last quarter.

‘More Resilient’

“The Asian economy is growing at a fast pace while the U.S. economy is picking up, a sign the global recovery is becoming more resilient,” said Yoshiki Shinke, senior economist at Dai- Ichi Life Research Institute in Tokyo.

Nissan, Japan’s third-largest carmaker, this week forecast a return to profit for the year ending March 31, citing government incentives that boosted sales in China and Japan. Canon, the world’s largest camera maker, is predicting its biggest annual profit increase in a decade amid revived global demand.

Japan’s economy expanded 0.9 percent from the previous quarter, the survey showed. Overseas shipments increased 5.3 percent in the fourth quarter from the previous three months, analysts surveyed said ay day loans. Net exports, or shipments minus imports, added 0.5 percentage point to growth.

Calculation Change

The Cabinet Office said last week that it will change the way it calculates exports and imports on a seasonally adjusted basis to account for the anomaly created by the financial crisis in 2008. The announcement prompted economists to cut their annualized GDP forecasts by about 1 percentage point.

The faster growth may not be enough to convince Prime Minister Yukio Hatoyama that the recovery is sustainable. The premier, facing upper house elections in July, is implementing a 7.2 trillion yen ($80 billion) stimulus package that his administration estimates can boost growth by about 0.7 percentage point next fiscal year.

Even if GDP is strong, “Hatoyama may compile an additional stimulus as he wants to lure voters ahead of the election, especially when his popularity is sliding,” said Susumu Kato, chief economist for Japan at Calyon Securities in Tokyo.

‘Long Way’

Central bankers aren’t confident that growth is durable. Kazuo Momma, the Bank of Japan’s top economist, this month said “there is still a long way to go” before the expansion becomes sustainable. Governor Masaaki Shirakawa and his policy board will hold a rate-setting meeting two days after the GDP report is released.

Japan’s wages slumped at a near-record pace in December, when household sentiment fell to a six-month low. In a sign that stimulus measures are fading, retail sales fell 1.2 percent in December on a seasonally adjusted basis, the largest drop a year, as customers purchased fewer cars and appliances.

Nevertheless, consumer spending probably contributed to the growth in the fourth quarter. The 0.3 percent increase predicted by economists would be a third of the pace of the previous quarter. Capital investment may rise 1.5 percent, the first positive reading in seven quarters.

Economists including Calyon’s Kato said the business investment figure may be revised down when the government updates the GDP report next month to reflect additional data.

“The domestic economy remains fundamentally weak as the positive cyclical loop between income and expenditure has yet to kick in,” said Ryutaro Kono, chief economist at BNP Paribas in Tokyo. “Although we believe the worst is over for corporate earnings, the return on capital remains so low that companies will continue to restrain labor costs for some time.”

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A Stanford University scientist who has co-founded three biotech firms offered five tips for successful business strategies to participants at the Moffitt Cancer Center’s Business of Biotech conference.

It’s important for scientists whose work is being commercialized by newly formed biotech companies to know their role, and be willing to step aside, said Gary Nolan, who sits on the board of directors of Nodality Inc., the firm he most recently co-founded. He’s also professor of microbiology and immunology at Stanford University School of Medicine and director of the Stanford NHLBI Proteomics Center.

He also said the founders of startup biotech firms should hire managers they can trust. The founders should remember that they no longer own the technology that’s the basis of a new firm because they sold it. Nolan advised that “there’s lots you can get for free,” such as legal services, by offering stock in a newly formed firm. And he cautioned against promising anyone anything, advising, “make them work for it.”

Nolan was the keynote speaker at the biotech conference Feb. 1, the fourth such event hosted by the H. Lee Moffitt Cancer Center & Research Institute.

A principal aim of the conference is to foster a life science cluster in Tampa Bay, said Jarrett Rieger, director of Moffitt’s Office of Technology Management and Licensing.

“It’s one thing to have discovery that could be monumental. It’s quite another thing to deliver it,” said Dr. William Dalton, president and chief executive of Moffitt.

Moffitt is playing a critical role in that delivery, he said.

Also attending the conference was H. Lee Moffitt, former speaker of the Florida House of Representatives, who was instrumental in funding the now 24-year-old organization that now bears his name.

“I constantly pinch myself that we’ve come as far as we have,” Moffitt said.

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UPS announced plans to cut 1,800 jobs as part of a restructuring plan intended to streamline the company’s domestic management structure.

The cuts will eliminate management and administrative positions across the country, UPS (UPS, Fortune 500) said in a statement Friday. Approximately 1,100 employees will be offered voluntary separation packages; other impacted workers will receive severance benefits and access to support programs.

"The decision to reduce our workforce is difficult and we appreciate the significant contributions of those who will be affected by this change," said Scott Davis, UPS chairman and chief executive. "But we believe this will allow us to sharpen our focus on profitable growth while being even more nimble in serving our customers."

UPS said the restructuring plan, which takes effect in April, will reduce the number of districts in the company’s small-package operation to three from five and the number of regions to 20 from 46. The consolidation does not involve closing operating facilities.

The announcement came the Atlanta-based company said its expects to beat its earnings estimate for the fourth quarter of 2009. The company previously projected it will earn between 58 cents and 65 cents per share during the final quarter of last year. Analysts polled by Thomson Reuters expect earnings per share to fall to 63 cents, a 24% decline compared to same period in 2008.

UPS said it expects to incur a charge in 2010 as a result of the restructuring plan, but said it will be offset by cost savings.

Shares of UPS were up more than 5% in early trading.  

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European industrial output fell for the first time in six months in October, led by a slump in demand for consumer goods. Employment declined in the third quarter.

Production in the economy of the 16 euro nations dropped 0.6 percent from September, when it gained 0.2 percent, the European Union’s statistics office in Luxembourg said today. Economists forecast a decline of 0.7 percent, the median of 30 estimates in a Bloomberg survey showed. Euro-region employment fell 0.5 percent in the third quarter from the previous three months, according to a separate report by the office.

The euro-region economy may struggle to gather strength after emerging from the worst recession in more than six decades in the third quarter as a stronger euro hurts exports just as rising unemployment erodes consumer spending. In Germany, Europe’s largest economy, investor confidence dropped in November.

“Today’s figures confirm the previous picture of an economy that is staggering, rather than bounding, back toward health,” said Colin Ellis, an economist at Daiwa Securities SMBC Europe Ltd. in London. “Further job losses are likely in the months ahead.”

European payrolls fell 2.1 percent in the third quarter from the year-earlier period, today’s data showed. October output dropped 11.1 percent from a year earlier after declining 12.8 percent in September.

Benchmark Bond

The euro fell against the dollar after the data and traded at $1.4648 at 10:35 a.m. in London, up 0.2 percent on the day, after reaching $1.4685 earlier. The yield on the German 10-year benchmark bond dropped 0.2 basis point to 3.18 percent.

European companies may keep spending plans on hold as the euro’s ascent makes their goods less competitive abroad. The single currency has gained 18 percent against the dollar since mid-February. Europe’s jobless rate has risen to 9.8 percent, the highest since December 1998.

“There are increasing signs that demand is weakening a little bit after an initial surge,” said Christoph Weil, an economist at Commerzbank AG in Frankfurt. “It’s a recovery with a foot on the brake one hour payday loan. Indicators will continue to point upward, but we’ll see a phase of disillusionment.”

European output of non-durable consumer goods dropped 1.6 percent in the month after rising 0.7 percent in September, today’s report showed. Production of durable consumer goods fell 1.4 percent, while energy output slipped 0.3 percent. Production of capital goods such as factory machinery was unchanged.

‘On Probation’

“I should like to warn against overly great optimism,” Martin Winterkorn, chief executive officer of Volkswagen AG, Europe’s largest carmaker, said earlier this month. “It would be premature now to call the end of the crisis. The recovery that’s emerging right now is a recovery on probation.”

The global economy is gathering strength after central banks cut interest rates to near zero and governments pledged $2 trillion in stimulus measures. The European Central Bank said on Dec. 3 it expects the euro region to expand about 0.8 percent in 2010 instead of a previously forecast 0.2 percent. In 2011, the economy may grow 1.2 percent, the bank said.

Daimler AG, the world’s second-largest maker of luxury cars, said on Dec. 7 that the Mercedes-Benz cars unit’s fourth- quarter sales will rise “significantly.” Alstom SA, which makes high-speed trains and energy-generation equipment, sees “some businesses doing better and they will eventually rebound,” CEO Patrick Kron said on Dec. 2.

Emergency Financing

ECB President Jean-Claude Trichet said on Dec. 3 that the bank will scale back its emergency financing operations next year after the economy emerged from the recession. The recovery will “likely be uneven,” he said that day.

“It’s very clear that there won’t be any easy and rapid recovery in the world economy,” ECB council member Erkki Liikanen told Bloomberg News in an interview on Dec. 11. The recovery is “slow and shaky.”

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The city of Denver anticipates saving at least $11 million a year because 322 employees accepted a retirement incentive offer, Mayor John Hickenlooper announced Tuesday.

But the city also plans to fill about half of the positions left vacant by the retirements "to avoid interruption of vital services to the community," a statement from the mayor's office said.

Hickenlooper proposed the voluntary retirement incentive program for senior Denver workers in August as a way to cut the cash-strapped city’s payroll costs.

The offer was for workers covered by the Denver Employees Retirement Plan. Eligible employees needed to be either at least 65 years old, or at least 55 years old with their age and years of city service adding up to 75 or more.

Hickenlooper offered those workers $500 a month for 30 months after their retirement.

There were 932 employees eligible for the retirement incentive program, and 322 took the offer.

"The retirement incentive program was a win-win for the city and for employees who chose to accept the offer," Hickenlooper said in the statement. "… We are grateful for the service these employees provided to our community and wish them well in the next chapter of their lives."

The retirements also will help the city reduce the number of workers it intends to lay off to trim the budget, officials said.

When the proposed city budget was released in September, officials anticipated 176 layoffs. Now, they expect fewer than 80 workers to be let go.

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Italian business confidence rose to the highest in more than a year in November on expectations that exports will help the recovery gather pace after the worst recession in six decades.

The Isae Institute’s manufacturing sentiment index climbed to 78.8 from a revised 77.4 in October, the Rome-based research center Isae said today. The reading compared with a median forecast of 78 in a Bloomberg News survey of 16 economists.

“The data confirms a positive trend for the output, a further sign that the worst is over,” said Silvio Peruzzo, an economist at Royal Bank of Scotland in London. “However, manufacturers need to rely on exports while domestic demand remains weak due to the growing unemployment.”

Italy emerged from the recession in the third quarter as the global recovery helped exports increase 6.6 percent in September from the previous month. The country posted a trade surplus in October compared with a deficit from a year earlier, national statistics institute Istat said today. After previously forecasting 0.7 percent growth for 2010, Finance Minister Giulio Tremonti said on Nov. 24 the economy may expand by “more than 1 percent” next year.

“Greater confidence is due to an improved outlook for orders, especially from abroad, and rising expectations on short-term production,” Isae said in today’s report. “Inventories remain below levels considered normal.”

Stimulus Spending

Government stimulus measures across Europe helped auto sales recover from a global decline caused by the recession. In Italy, they benefited the country’s biggest manufacturer, Fiat SpA. Sales of the Turin-based automaker rose 15 percent for the month of October.

Incentives to trade in old cars for newer models are due to be phased out and unemployment is still rising, which may weigh on consumer spending. Italy’s jobless rate climbed in the second quarter to a seasonally adjusted 7.4 percent, and will rise to 8.5 percent next year and 8.7 percent in 2011, the Organization for Economic Cooperation and Development said on Nov. 19.

Consumer confidence unexpectedly rose in November as optimism on economic growth outweighed concerns on the outlook for the labor market, Isae said yesterday. Manufacturers were more pessimistic about the job market than consumers, today’s report showed. A sub-index measuring expectations on employment fell to minus 17 in November from minus 16.

Isae conducted its latest survey of 4,000 companies between Nov. 2 and Nov. 18. The research center revised its October reading from an initial 77.1.

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Despite rising fears of the U.S. falling into another recession, a survey of top economists found them more optimistic about growth in the fourth quarter of this year and throughout 2010. But job seekers will have to wait a little longer for employers to start hiring again.

According to the November survey by the National Association of Business Economics, 48 top forecasters now expect the economy to grow at a 3% annual rate during the last three months of this year, up from their prediction of 2.4% growth in October.

The economists also raised their forecast for growth during every quarter of 2010. They now expect a 3.2% rise in economic activity over the course of the next four quarters, up from their previous estimate of 3%.

But the outlook isn’t as good for the record 31 million Americans unable to find full-time jobs.

The economists pushed back their expectations for when U.S. payrolls will start to grow again to the second quarter of 2010. They previously had predicted a gain of 12,000 jobs a month in the first quarter.

The nation’s unemployment rate hit 10.2% in October — higher than expected. The continued problems in the labor market, combined with disappointing reports about housing and retail sales recently, have raised concerns about a so-called "double dip" recession pay day advance.

Despite this, the majority of experts surveyed by NABE said they felt the economy was on track and did not additional help from the government.

Asked if there should be another round of economic stimulus, only 15% said that would be appropriate, while 40% said they would leave the stimulus package approved early this year unchanged.

The other 45% said they would like to see a cut in the stimulus money already approved but not yet spent. Along those lines, 55% of the economists said they are extremely concerned about the amount of federal debt over the next five years

Still, the economists surveyed were slightly more optimistic about a recovery in housing and the likelihood that consumer spending would increase. They were also more bullish about the stock market, forecasting that the S&P 500 will reach 1,199 at the end of 2010, a gain of about 10% from Friday’s closing level. 

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Salt River Project will build a 20-megawatt photovoltaic facility southeast of Phoenix that will come online in 2011.

The solar power station, to be built by Iberdrola Renewables, will be capable of powering about 4,500 homes.

SRP and Iberdrola have a partnership that extends to the Dry Lake Wind Farm, a 63-megawatt wind farm built on a combination of public and private land.

Mark Bonsall, SRP’s associate general manager for commercial and customer services, said the project is another step to bring renewable projects online.

"We are actively pursuing this project because it is not only good for SRP, but it is good for our customers and for the environment," said Bonsall. "We want to be in a position to offer our customers a new, lower-cost solar energy option by giving them the opportunity to purchase the green power directly from this solar facility payday loan companies. SRP will utilize whatever output may not be subscribed by our customers, if any."

Because it is a quasi-government entity, SRP is not required to meet the Arizona Corporation Commission’s requirement to have 15 percent of its power provided through alternative forms of energy by 2025. Still, SRP officials have said they intend to honor those standards.

The agreement will call for Iberdrola to own the power plant and sell the power to SRP, from which individual homeowners could buy into the deal.

The transaction is expected to go before the SRP Power Committee at its meeting in December and before SRP’s full board of directors in January 2010.

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Alison Cooper is set to become the youngest female chief executive of a FTSE 100 company as she looks to put sales growth at the top of her agenda for the world’s No 4 cigarette group Imperial Tobacco Plc

Cooper, 43, was widely tipped to take over the top job at the maker of Lambert & Butler and Gauloises cigarettes next year after shadowing current CEO Gareth Davis for eight months.

Davis is set to retire next May, the day before his 60th birthday.

“Alison has worked closely on all the big deals with Gareth so the transition at the top of Imperial would appear to be very smooth,” said one tobacco industry analyst.

When she takes over, Cooper will join three other female CEOs of Britain’s top 100 companies, and become the second woman to run a big tobacco company following Susan Ivey at United States-based Reynolds American Inc.

In her ten years at Imperial, Cooper has worked closely on the two big acquisitions that transformed Imperial into a world tobacco player - Reemtsma and Altadis — but as big tobacco deals start to dry up her emphasis will be on sales growth.

“Imperial’s highlights have been on acquisitions and cost control, now we will look for growth with our expanded business in different geographies,” Cooper said on a conference call.

She is set the join Angela Ahrendts at luxury goods group Burberry Group Plc, Cynthia Carroll at mining group Anglo American Plc and Marjorie Scardino at publishing group Pearson Plc as female CEOs at FTSE 100 groups.

Davis has led Imperial since its demerger from the sprawling Hanson empire in 1996 where he embarked on a series of acquisitions to put the cigarette maker on a faster growth path than its arch British rival Gallaher no credit check payday loans.

Accountant-trained Cooper was appointed No 2 to Davis in March in a new role as chief operating officer, and with Davis long expected to retire around his 60th birthday it seemed only a matter of time before she got promoted.

Davis had dropped heavy hints about his hopes that his successor would come from within the Bristol-based cigarette maker because of the challenges and stoicism needed in a industry under attack from anti-health groups and governments.

“I am a massive advocate of internal succession,” Davis said in May soon after Cooper’s appointment as his number two.

Cooper has been at the heart of expansion of Imperial Tobacco buying Germany’s Reemtsma in 2002 and Franco-Spanish Altadis in 2008 which transformed Imperial into the world’s number four cigarette company from a largely domestic player.

Cooper joined the maker of Embassy and Richmond cigarettes in 1999 from accountants PricewaterhouseCoopers after having worked with Davis and his team for a number of years. She became group financial controller in 2001, before becoming director of finance and planning in 2003.

Cooper, married with two daughters, became sales and marketing regional director for Imperial’s Western Europe region in 2005 and, two years later, joined the four-strong Imperial executive board in a new role as corporate development director. 

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