Who gets what from a litre of oil in the G7?

(http://www.opec.org)

This graph illustrates the wide regional variations in prices of different energy products. However, this is not due to differences in crude prices, but to widely varying levels of taxation in the major consuming nations. The blue portion of the bar shows how much of the end price goes to oil producers, the yellow is what goes to refineries, and the red indicates the amount attributable to government taxes. Tax levels can range from relatively low in USA to very high in many European countries. In the UK, for example, the government receives substantially more from taxation than what OPEC gets from the sale of its oil.

Gisele Bundchen Doesn't Want to Be Paid in Dollars

Gisele Bundchen Doesn't Want to Be Paid in Dollars

Monday , November 05, 2007

Gisele Bundchen wants to make a lot of money — just not in dollars.

The supermodel is insisting that she be paid in almost any currency but the U.S. dollar, Bloomberg reports.

Like billionaire investors Warren Buffett and Bill Gross, the Brazilian supermodel, who Forbes magazine says earns more than anyone in her industry, is at the top of a growing list of wealthy people who have concluded that the currency can only depreciate because Americans are living beyond their means.

Even after the dollar lost 34 percent since 2001, the biggest investors and most accurate forecasters say it will weaken further as home sales fall and the Federal Reserve cuts interest rates.

The dollar plummeted to its lowest ever last week against the euro, Canadian dollar, Chinese yuan and the cheapest in 26 years against the British pound.

(http://foxnews.com)

PetroChina first to reach $1,000bn cap

PetroChina first to reach $1,000bn cap

By Geoff Dyer in Shanghai

Published: November 5 2007 10:28 | Last updated: November 5 2007 10:28

PetroChina became the first company in the world to be valued at more than $1,000bn Monday after a dramatic stock market debut in Shanghai that saw its shares nearly triple in early trading.

Shares in the oil and gas company, which raised $9bn from the world’s biggest initial public offering so far this year, surged to Rmb48.60 at the start of trading from an offer price of Rmb16.70.

After slipping back during the day, the shares closed 163 per cent higher at Rmb43.96 in Shanghai, giving the company a market capitalisation more than double the value of the second-largest company, Exxon Mobil, which was worth $488bn at the close of trading on Friday in New York.

PetroChina sold 4bn shares in Shanghai, equivalent to just 2.2 per cent of its expanded share capital. Parent company China National Petroleum still owns 86 per cent of the shares. PetroChina’s Hong Kong shares, where the company listed in 2000, dropped 8.2 per cent to HK$18.

The massive demand for the PetroChina offering is the latest sign of the stock market frenzy in mainland China where share prices have increased almost six fold over the past two years. PetroChina attracted $456bn of subscriptions from retail and institutional investors in China.

However, the surge in the company’s share price was greeted by some analysts as a further sign that a dangerous bubble is developing in the mainland stock market, created by a mixture of capital controls and substantial liquidity. The company’s mainland shares are now trading at a premium of around 150 per cent to its Hong Kong shares.

Although large first-day jumps are commonplace in mainland Chinese IPOs, the scale of the increase in PetroChina shares surprised analysts who had been expecting a 100 per cent increase.

The PetroChina listing is the largest ever in the mainland market, surpassing China Shenhua Energy’s September IPO, which raised $8.9bn. A string of other Chinese companies are planning to raise money in the Shanghai market. Panzhihua Iron and Steel Group, the country’s 15th-largest steel mill, said Monday it intended to raise $1bn from a mainland listing, while SouthWest Securities, a brokerage in Chongqing, said it was considering a listing to bolster its capital.

The PetroChina debut did not prevent the Shanghai market from dropping 2.48 per cent to 5,634 points in the face of official comments warning investors to be cautious about both the mainland and Hong Kong markets. Regulators have urged mainland investment funds to moderate the amount of new money coming under management and have told funds planning overseas investments to limit the amount of money allocated to Hong Kong because of the recent surge in prices there.

Copyright The Financial Times Limited 2007
(http://ft.com)

Got $500,000? The U.S.Awaits

WSJ Friday Nov 2,2007 B1

Got $500,000? The U.S. Awaits

Government’s EB-5 Program Offers foreign Investors Green Cards for Job Creation
By Miriam Jordan

An obscure immigration program is pumping millions of dollars from foreign investors into dilapidated inner cities and employment-starved rural areas across the US. These investors aren’t focused on financial returns, however: They’re in it to get green cards.

… For a $500,000 investment in a distressed area, a foreigner and his immediate family become eligible for conditional green cards. They become permanent a few years later upon evidence that the investment has created at least 10 jobs for US. Workers.

… “The EB-5 program is one of the most complex and heavily scrutinized immigration programs” says Stephan Yale-Loehr … an expert on EB-5 visas.

… If jobs are being created in exchange for visas through a process you can verify, I don’t think we cab object to it.” Says Ira Mehlman, a spokeman for the Federation for American Immigration Reform, which calls for clamping down on both legal and illegal immigration.

In UK, immigrants fill 50% new jobs

1 Nov 2007, 0000 hrs IST,PTI

LONDON: It's official. More than half of all new jobs created in UK during the last decade have been snapped up by immigrants. According to figures released on Tuesday, out of 2.1 million jobs created under the Labour Party government since 1997, 52% went to 1.1 million migrant workers, the media reported here on Wednesday. The data came just days after a government study had revealed that "migrant workers are both higher paid and more reliable than their British counterparts, and contributed six billion pounds to economic growth last year". (http://timesofindia.com)

Disney supplier accused of labor abuse

Wed Oct 31, 3:10 PM ET

Hundreds of people are making stuffed Walt Disney toys at a factory in southern China up to 16 hours a day with only a few days off a month, a Hong Kong-based labor activist group said Wednesday.

"During the peak season, before Christmas, workers at the factory start at 8 a.m. and don't finish until midnight," said Jenny Chan, an activist with the Hong Kong-based Students and Scholars Against Corporate Misbehavior.

Chan said the Tianyu Toys factory in the southern Chinese city of Dongguan regularly holds back workers' wages for up to 45 days, and paid overtime of 40 cents an hour, less than half the rate set by Chinese labor laws.

She said this prompted a mass strike in September, but that management had only increased overtime pay to 47 cents an hour.

Alannah Goss, spokeswoman for Walt Disney Co. (Asia Pacific) Ltd., confirmed that Tianyu Toys supplied goods to some of its licensees, but declined to give specific details or comment on the allegations.

"The Walt Disney Company and its affiliates deal with claims of unfair labor practices very seriously, and investigates all allegations thoroughly," she said in an e-mail response to The Associated Press.

Tianyu's general manager rejected the allegations of labor violations, but would not reveal details about staff wages.

"I don't want to comment in detail. Our factory strictly adheres to local labor regulations. I'm the general manager here and I haven't heard any of our workers complaining about the factory," Man Wong said.

The activist group has previously accused factories in southern China that are churning out goods for Disney and other global brands of overworking laborers and skimping on pay and benefits.

About a dozen activists demonstrated outside Hong Kong Disneyland on Tuesday night to protest alleged labor abuses at the Tianyu factory.

(http://news.yahoo.com)

Chrysler to eliminate 11,000 jobs (Not reported by FOX or CNN yet)

By John Reed in London

Published: November 1 2007 15:21 | Last updated: November 1 2007 15:21

Chrysler said it was eliminating up to 11,000 jobs – or 14 per cent of its workforce – as it cuts shifts at several North American assembly and engine plants to match a slimmed-down vehicle lineup and slower-than-expected US demand for cars.

The cuts at the carmaker come on top of 13,000 job losses announced in February under Chrysler’s three-year Recovery and Transformation Plan. They mark the first big restructuring announcement by Chrysler’s new management team since buyout group Cerberus Capital management bought the lossmaking company from Germany’s Daimler in August.

“The market situation has changed dramatically in the eight months since Chrysler established the Recovery and Transformation Plan as its blueprint,” Bob Nardelli, Chrysler’s chairman and chief executive officer said in a statement.

Chrysler this week said it was eliminating four slow-selling vehicles – the Crossfire sports car, PT Cruiser Convertible and Pacifica crossover, and Dodge Magnum station wagon from its lineup.

It has revised downward its forecast for total US vehicle sales from 17.2 m in February to 16m to 16.5m this year as demand for new cars slows.

Chrysler said it was eliminating shifts at five North American assembly plants which, combined with other “volume-related manufacturing actions,” would lead to a reduction of 8,500 to 10,000 blue-collar jobs through 2008.

The automaker also said it planned to reduce salaried workers by 1,000 and contract workers by 37 per cent, in addition to slashing overtime hours and reducing purchased services due to reduced volume.

Its current workforce totals about 77,000.

“We have to move now to adjust the way our company looks and acts to reflect a smaller market,” said Tom LaSorda, Chrysler’s vice-chairman and president. “That means a cost base that is right-sized and an appropriate level of plant utilisation.”

The shift cuts will affect Chrysler’s assembly plants in Belvidere, Illinois; Toledo, Ohio; and Brampton, Ontario, and its Sterling Heights and Jefferson North plants in Michigan, the company said.

Chrysler plans further reduction at engine, stamping and other plants which it has not yet identified, the company said.

The carmaker is currently reviewing its product and marketing plans, and in recently concluded contract talks with the United Auto Workers union it committed to spend more than $15bn on products, plants and engineering through 2011.

Following Chrysler’s and General Motors’ agreement of four-year contracts with the UAW, Ford Motor is now negotiating with the union on its own agreement, which may see further job cuts announced at the rival carmaker.

Copyright The Financial Times Limited 2007

(http://ft.com)

Oil prices in Euro

(http://europe.theoildrum.com)

Fed Rate Cut Could Help Send Oil Prices to $100

Fed Rate Cut Could Help Send Oil Prices to $100

By Jeff Cox | 31 Oct 2007 | 01:24 PM ET

Expectations that the Fed will cut interest rates, combined with an unexpected drop in crude supplies last week, could finally send oil prices over $100 a barrel.

The Fed is widely expected to approve a quarter-point cut in short-term borrowing rates this afternoon, a move that could further weaken the dollar and act as an enticement to buy oil.

Because oil is priced in dollars, a weaker U.S. currency makes oil cheaper for those in other countries to convert their currency and buy crude. That increased buying sends oil prices even higher.

In the meantime, a report on oil supplies showed crude stocks down 3.9 million barrels, news that stunned a market looking for an increase of 600,000 barrels.

It all adds up to more price pressure on oil

NYMEX CRUDE OIL FUTURES Front Month US%40CL.1 94.19 3.81 +4.22% BIS

Quote | Chart | News | Profile | Add to Watchlist

[US@CL.1 94.19 3.81 (+4.22%) ], which surged to a record high of $93.80 on Monday and is just below that level today. Some analysts believe the $100 threshold is now well within sight of speculators who have been aggressively betting up oil prices.

"I think that's entirely possible," said Randy Ollenberger, managing director at BMO Capital Markets. The Fed rate cut "is going to lead to further weakness in the US dollar. There's obviously going to be a great correlation between oil prices moving higher and the dollar moving lower."

Analysts generally have oil fundamentals calling for a price between $75 to $80 a barrel.

But a rash of speculation driven primarily by geopolitical tensions has kept prices inflated. Javad Yarjani, an Iranian oil official with the Organization of Petroleum Exporting Countries, warned of an oil "bubble" that would pop.

Today's supply data, though, indicated that the oil rally could have more legs.

"Everybody wants to pick a number," said Mike Theesfeld, a trader with HPR Commodities.

"I wouldn't be surprised to see $95."

(http://www.cnbc.com)

Fed cuts rates to 4.5%

Citing turmoil in the housing market, Fed chair Ben Bernanke and Co. lower a key short-term rate by a quarter of a percentage point to keep the economy on track.
October 31 2007: 2:18 PM EDT

NEW YORK (CNNMoney.com) -- The Federal Reserve lowered the target for a critical short-term interest rate by a quarter of a point Wednesday, citing continued concerns about the housing market crunch.

The widely-expected move comes on the heels of a half-point rate cut by the central bank in September and leaves the federal funds rate at 4.5 percent, its lowest level since April 2001.

The federal funds rate, an overnight lending rate for banks, is important to the economy since it influences how much interest consumers pay on credit card debt, home equity lines of credit and auto loans. It also impacts how much it costs corporations to borrow money.

Weakness in the housing market and problems with subprime mortgages, loans made to those with less-than-perfect credit, have led to billions of dollars in writedowns at major financial institutions. For this reason, most investors believed the Fed would lower rates again in order to ensure that there is little spillover from the mortgage meltdown into the broader economy.

But some market observers have expressed concerns that with oil prices rising above $90, inflation may still be a threat. So the Fed could be making a mistake by lowering interest rates further, some maintain.

(http://money.cnn.com)

O'Neal walks with $161.4M

O'Neal walks with $161.4M
Merrill Lynch says the former executive will receive a package of stocks, options and retirement benefits as compensation.

October 30 2007: 6:24 PM EDT

NEW YORK (AP) -- Merrill Lynch's departing chief executive, Stan O'Neal, will walk away with $161.5 million in stock, options and retirement benefits, the company said Tuesday.

O'Neal left with a $131.4 million equity package of stock, options and restricted stock. His restricted stock and restricted stock units will continue to vest on their original schedules, the company said.

He also has retirement benefits worth $24.7 million, while his deferred compensation stands at $5.4 million, according to the company. He will be entitled to an office and an executive assistant for up to three years.

O'Neal's restricted stock and options holdings mean he could do even better if the stock rises under a new CEO, said James F. Reda, a compensation consultant. A $10 jump in the stock under new management could mean $30 million for O'Neal.

O'Neal, the second-highest paid Wall Street CEO in 2006, retired from Merrill Lynch & Co. on Tuesday, almost a week after the investment bank reported its largest-ever quarterly loss. The $2.24 billion loss was precipitated by a $7.9 billion third-quarter writedown, as the company revalued assets backed by shaky mortgages. O'Neal's ouster was expected after the loss.

There is some precedent for such an ironic windfall. After Michael Eisner was ousted as CEO at The Walt Disney Co. in 2005, he made another $100 million when the company's stock price improved under his replacement, Reda said.

"It's a funny dynamic," Reda said.

But Reda questioned both the size of O'Neal's package and why Merrill made O'Neal, 56, eligible for retirement even as he ran the company. The policy guaranteed O'Neal so much money that "he was basically indifferent," Reda said.

O'Neal's parting wealth comes after he spent five years as Merrill's (Charts, Fortune 500) CEO, earning nearly top dollar. O'Neal's 2006 pay was approximately $48 million, second on Wall Street only to the $54.3 million earned by Goldman Sachs Group Inc. CEO Lloyd C. Blankfein.

(http://money.cnn.com)