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UK leader promises tax cuts, EU battle

Written By Unknown on Rabu, 01 Oktober 2014 | 23.14

LONDON — Squeezed between insurgent anti-Europeans, a skittish party and suspicious voters, Britain's prime minister promised a tough stance on the EU and tax cuts for millions in a bid to bolster support for his Conservative Party before a national election next year.

David Cameron closed the Conservatives' fall conference in the central English city of Birmingham Wednesday by arguing that four years of austerity under his government had restored Britain to economic health after the Great Recession.

He said that if re-elected he would reduce income taxes for middle-income earners and eliminate them for minimum-wage workers. At the same time, he said, his government would continue to cut public spending, trimming 25 billion pounds ($40 billion) in the two years after the election.

"We want to cut more of your taxes, but we can only do that if we keep on cutting the deficit," Cameron said. "This is common sense."

Polls suggest Cameron's Conservatives trail the Labour opposition before the election in May, though many voters see Cameron as a stronger leader than Labour's Ed Miliband.

The Conservatives have also lost supporters — and two lawmakers — to the populist U.K. Independence Party, which wants Britain to leave the European Union.

In a bid to defuse the UKIP challenge, Cameron vowed to wrest powers back from the EU before holding a national referendum on whether to quit the 28-nation bloc.

"I will go to Brussels. I will not take no for an answer," Cameron said.

Cameron, 47, was chosen as a modernizing leader in 2005 by a party floundering after its 1980s glory days under Prime Minister Margaret Thatcher. He was elected prime minister in 2010.

But his support for liberal causes such as gay marriage has left him mistrusted by traditionalists.

He appealed to small-c conservatives by promising to repeal the Human Rights Act introduced by a previous government, replacing it with a British bill of rights "rooted in our values."

He also sought to reassure undecided voters that his party was a good guardian of the National Health Service. Most Britons rely on the state-funded NHS, and the Tories are sensitive to Labour allegations that they will cut its funding or privatize it.

"For me, this is personal," said Cameron, whose severely disabled son Ivan died in 2009 at the age of 6.

In the most emotional passage of the speech, Cameron said he knew "what it is like when you go to hospital night after night with a sick child in your arms knowing that when you get there, there are people who will love that child and care for that child just as if it was their own."

"How dare they suggest I would ever put that at risk for other people's children?"

Cameron finished by warning that a vote for UKIP, led by Nigel Farage, could hand victory to Labour.

"On the 7th of May you could go to bed with Nigel Farage and wake up with Ed Miliband," Cameron said.


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Dan Gilbert testifies in Detroit bankruptcy trial

DETROIT — Businessman Dan Gilbert has testified during Detroit's bankruptcy trial that the city's high crime rate, poor school system, unemployment and blighted neighborhoods are its major challenges.

The founder of mortgage lender Quicken Loans also said Wednesday that $850 million is needed to wipe out Detroit's blight, which includes tens of thousands of abandoned houses and trash-filled lots.

Gilbert was one of the leaders on a blight removal task force that looked at all city properties.

State-appointed emergency manager Kevyn Orr also is expected to testify Wednesday in the trial overseen by federal Judge Steven Rhodes. Rhodes is to decide if Detroit's plan to remove $7 billion in debt is fair to creditors.

Orr's debt restructuring plan sets aside more than $1 billion for improving city services, including blight eradication.


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Ford adding 1,000 new jobs in Canada

TORONTO — Ford Motor Co. said Wednesday it is adding 1,000 jobs at its plant near Toronto to build the 2015 Ford Edge crossover SUV for the global market.

The new jobs come a year after Ford invested $700 million into the 5.5 million-square-foot assembly in Oakville, Ontario. Two levels of government in Canada contributed about $142 million of the $700 million.

Oakville now makes the Ford Edge and Flex crossover SUVs, as well as the Lincoln MKX and Lincoln MKT. The 2015 Edge will be exported to more than 100 countries from Oakville.

Ontario Premier Kathleen Wynne said the 1,000 new jobs are a direct result of her government's nearly $71 million investment. The federal government also put in $71.6 million.

Canadian Industry Minister James Moore also welcomed the announcement and said his government's investment helped transform the Oakville plant into one of Ford's most advanced facilities globally.

"It demonstrates once again that Canada is a great place to build cars," Moore said in a statement.

The 1,000 new jobs and 300 added last year will bring total employment at the plant to more than 4,000 by the end of 2014. Ford also operates an engine plant in Windsor, Ontario and employs a total of about 6,000 people in Canada. The automaker also said Wednesday it expects to increase spending on Canadian-made auto parts by $200 million a year.

The announcement is good news for Canadian auto workers, whose future looked bleak a few years ago because they were paid higher wages than workers in the U.S. Several auto executives called Canada the most expensive place in the world to build automobiles. But in 2012, the workers agreed to a new contract that cut U.S. automakers' costs in the country.

Canadian auto workers voted in favor of a new cost-cutting four-year contract negotiated with Ford that made Canada more competitive with the United States and other countries for auto assembly.

The contract cut wages for new hires and froze pay for current workers. New hires now get about 20 Canadian dollars per hour, about 60 percent of the top wage paid to longtime union members. The new workers will move up the wage scale and reach the top pay in 10 years.

Ford said there would be significant cost savings realized through the wage structure for new employees. Canada's advantages in the past — a weak Canadian dollar and government health care — had all but vanished compared with U.S. factories. But after hovering around par earlier this decade the more recent depreciation of the Canadian dollar has benefited the Canadian auto sector.


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PBS, CBS are biggest winners at Emmys for news, documentaries

PBS and CBS took home the most Emmys Tuesday night for news and documentaries, while ABC's "Nightline" won three of the awards in various categories - the only other outlet to win more than two awards at the event.

The National Academy of Television Arts & Sciences presented awards to the winners during a ceremony at Jazz at Lincoln Center's Frederick P. Rose Hall in the Time Warner Center in New York City. The event was attended by more than 900 television and news media industry executives, news and documentary producers and journalists. Emmy Awards were presented in 43 categories, including the first-ever categories reserved for news & documentary programming in Spanish.

PBS secured 11 awards, several of them for long-form investigations and features, while CBS took home 10 ,. among them the only Emmy awarded to a broadcast-network morning news program, for an interview between Charlie Rose and Syria's Bashar al-Assad on "CBS This Morning." CBS' "60 Minutes" won five awards, while PBS' "Frontline" and "Independent Lens" nabbed four and three, respectively.

NBC News' "NBC Nightly News with Brian Williams" won the award for outstanding coverage of a breaking news story in a regularly scheduled newscast for its work chronicling the devastation tornadoes had in Oklahoma. CBS News and NBC News shared an award for live, ongoing coverage of the Boston Marathon massacre.

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC


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US construction spending down 0.8 percent

WASHINGTON — U.S. construction spending fell in August, the second decline in the past three months, with housing, non-residential and government projects all showing weakness.

Construction spending dropped a seasonally adjusted 0.8 percent after a 1.2 percent increase in July, the Commerce Department reported Wednesday. The July increase followed a 1.6 percent June decline.

The weakness was apparent in all sectors. Housing construction declined 0.1 percent, reflecting a big drop in spending on remodeling. Non-residential construction fell 1.4 percent while spending on government projects dropped 0.9 percent.

In addition to the August decline, the government revised lower its estimates for activity in the previous two months. This could call into question expectations that building activity will support economic growth in the second half of the year.

Overall construction spending totaled $960.96 billion at a seasonally adjusted annual rate in August, 5 percent higher than a year ago.

Spending on housing totaled $351.7 billion at an annual rate in August, 3.7 percent higher than a year ago. The August decline versus July reflected a 14 percent drop in home remodeling work. Spending to construct new single-family homes rose 0.7 percent and apartment construction was up 1.4 percent.

Spending on non-residential projects totaled $333.3 billion, 9.2 percent higher than a year ago. In August, spending on office buildings, shopping centers and hospital construction all declined from July.

Government building projects totaled $253.4 billion, just 1.9 percent higher than a year ago. Construction activity at all levels of government has been held back by tight budgets. For August, state and local construction spending was down 0.9 percent versus July while federal projects dropped 1.9 percent.

The overall economy went into reverse in the first three months of the year, shrinking at an annual rate of 2.1 percent, in part because of weakness in construction. Housing construction was contracting at a 5.3 percent rate in the first quarter, one of a number of sectors that were hurt by the unusually severe winter.

The economy rebounded in the April-June quarter, growing at an annual rate of 4.6 percent, the best showing in more than two years. Part of the rebound reflected a recovery in residential construction, which grew at an annual rate of 8.8 percent in the spring, the first positive growth after two quarters of declines.

Economists are hoping that construction will continue to grow in the July-September quarter and that will provide support for the overall economy. Economists are forecasting growth of around 3 percent in the gross domestic product for the third quarter but the recent weakness in construction spending could cause revisions in those estimates.


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Pace of US factory activity slipped in September

WASHINGTON — The pace of U.S. manufacturing growth slowed in September, as expectations for hiring and new orders slipped from their August levels.

The Institute for Supply Management, a trade group of purchasing managers, said Wednesday that its manufacturing index fell to 56.6 from 59 in August. Anything above 50 signals that manufacturing is growing.

The decline reverses slightly solid gains in the previous two months, putting the index at a level consistent with annual economic growth of "just above 3 percent," said Paul Dales, senior U.S. economist at Capital Economics. Growth that strong would outpace the 2.3 percent average of the now five-year recovery from the Great Recession.

Other economists said that the drop may reflect a broader slowdown among U.S. trading partners. Europe's ISM manufacturing index shows growth at its slowest pace in 14 months, with Germany actually contracting. Chinese factories are barely registering any growth in their ISM index, while Brazil and Australia are also experiencing contractions, noted Jennifer Lee, senior economist at BMO Capital Markets.

The comments reported by manufacturers surveyed for the index were relatively optimistic.

"We are seeing shipments up, year-over-year, in the 8 to 10 percent range for last couple of months," said a respondent from an apparel and leather firm.

Similarly, a paper products company described their outlook as "very good." Manufacturers have reported growth for the past 16 months, as the sector has helped drive the recovery.

The index's measure of new orders fell to 60 from a reading of 66.7, while the employment component fell to 54.6 from 58.1. The one upside is that customer inventories continue to remain low, suggesting that there will be continued demand from factories.

Despite the pullback in employment in the index, the ISM report listed workers as being in "short supply," along with stainless steel.

This matches separate economic reports showing an increase in job openings but sluggish hiring to fill those positions. In theory, a shortage of workers should help lift wages, which have yet to meaningfully increase.

"But so far, at least, we haven't seen indications that they're boosting wages to try to fill positions," said Ted Wieseman, an analyst at Morgan Stanley.


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New York Times cutting 100 jobs, NYT Opinion app

NEW YORK — The New York Times Co. is launching another round of buyouts and layoffs, telling staff on Wednesday that it must cut 100 newsroom jobs to further reduce costs and focus resources on its digital operations. It's also axing its NYT Opinion app after four months and relegating the NYT Now app to a smartphone-only product aimed at new and younger readers, after the lower-priced subscription products failed to take off as hoped.

The planned cuts represent about 7.5 percent of a total current newsroom staff of 1,330. Buyouts will be offered to an undisclosed number of senior managers in the print, digital and advertising divisions, New York Times publisher Arthur Sulzberger Jr. and CEO Mark Thompson said in a morning memo to employees.

Like other newspapers, The New York Times continues to face a drop in print advertising revenue as readers opt for digital content and advertisers shift more of their spending online. Over the past eight years, overall annual print newspaper ad revenue has fallen 64 percent, to $17.3 billion in 2013, according to the Newspaper Association of America.

Sulzberger Jr. and Thompson said that for the most recent quarter ended on Sunday, total advertising revenue was "roughly flat." That's better than the mid-single-digit-percentage decline it had predicted due to digital advertising gains and a strong print ad showing in September which helped counter a weaker July and August. More than 40,000 net new digital subscribers were added in the latest quarter, the biggest jump since 2012. But profit for the quarter and the fiscal year is still expected to fall from last year because of higher operating costs.

The New York Times said the NYT Now app — which included the paper's top stories and was available online and on the iPhone for $2 a week — struck a chord with younger users, many new to the paper. But it will continue as a smartphone app only while the company tests other, "more intuitive" lower-priced subscription offers. The NYT Opinion app, which included unlimited access to an expanded opinion section on the New York Times website and a mobile app for $1.50 a week, will be shuttered. The company said it will continue to sell separate subscription access to the Opinion section of its website.

Shares rose 82 cents, or 7 percent, to $12.04 in midday trading. The stock had been down 29 percent since the beginning of the year.


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Pepsi to launch soda sweetened with stevia

NEW YORK — There's Pepsi, Diet Pepsi and now, Pepsi True, a midcalorie version of the soda made with natural sweeteners.

PepsiCo Inc. said Wednesday the latest version of its flagship soda will have 30 percent fewer calories than regular and be made with a mix of sugar and stevia, a natural sweetener with no calories.

The drink will go on sale later this month on Amazon.com before eventually being rolled out to supermarkets and other traditional outlets, according to the company. It will come in 7.5-ounce cans, each 60 calories.

As Americans keep cutting back on soda, Coca-Cola and Pepsi have been looking for ways to win back customers by addressing concerns about the high fructose corn syrup in regular soda as well as the artificial sweeteners in diet sodas.

Executives have pushed to come up with formulas with fewer calories using only natural sweeteners. But the bitter aftertaste of some natural sweeteners like stevia has made that a struggle. The solution so far has been to add at least some sugar — and, therefore, some calories.

Diet sodas, by contrast, have no calories, but use artificial sweeteners like aspartame that are seen as processed and fake.

In the meantime, Coca-Cola also is testing a version of its soda in the southeastern U.S. that's made with sugar and stevia. That drink, called Coca-Cola Life, comes in 8-ounce glass bottles and has 60 calories per bottle.

Ali Dibadj, a Bernstein analyst, said in a note Wednesday that interviews with store managers indicated sales of Coca-Cola Life so far seem "satisfactory."

It's not clear what type of demand there will be for midcalorie sodas like Pepsi True and Coca-Cola Life over the long term. Both companies have tested midcalorie versions of their flagship sodas in the past, but those were made with different sweeteners. In 2012, PepsiCo also rolled out Pepsi Next, which has about half the calories of regular Pepsi.

Pepsi Next, which is still on shelves, is made with a mix of three artificial sweeteners and high fructose corn syrup.


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Massachusetts hospital staffing law takes effect

BOSTON — A new state law sets strict limits on the number of patients that registered nurses who work in hospital intensive care units can be assigned to at a given time.

The law, approved by the Legislature in June, took effect this week in Massachusetts.

It requires that intensive care nurses be assigned ideally to just one intensive care patient, but no more than two at any time.

The Massachusetts Nurses Association said Wednesday it had begun airing TV and radio ads to make the public aware of the new nurse patient-ratios and urge patients and families to make sure it was being followed.

The state's Health Policy Commission still has to finalize regulations associated with the new law. The commission has scheduled a hearing for Oct. 29.


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US stocks slide in midday trade; Airlines sink

NEW YORK — U.S. stocks sank in midday trading Wednesday as disappointing economic data in the U.S. and Europe weighed on investors' minds. Airlines stocks fell as investors feared that news of the first case of Ebola being diagnosed in the U.S. would discourage people from traveling.

KEEPING SCORE: The Dow Jones industrial average lost 174 points, or 1 percent, to 16,869 as of noon Eastern time. The Standard & Poor's 500 index lost 14 points, or 0.7 percent, to 1,958 and the Nasdaq composite lost 44 points, or 1 percent, to 4,449.

US DATA IN FOCUS: A closely watched index measuring U.S. manufacturing fell in September. The Institute for Supply Management's survey came in at 56.6, below the 58.5 economists had been looking for. That more than enough offset positive news from the payroll processing company ADP, which showed private employers hired 213,000 workers last month. That was slightly better than the 207,000 workers economists expected, according to FactSet.

EBOLA: News that the first case of Ebola was diagnosed in the U.S. reverberated through several industries. Airlines were among the hardest hit as investors feared people would be discouraged from traveling. American Airlines fell $1.07, or 3 percent, to $34.40 and Delta fell $1.10, or 3 percent, to $35.06.

Drugmakers developing potential vaccines or treatments for Ebola rose. Tekmira Pharmaceuticals jumped $4.39, or 18 percent, to $28.01 after the company said it may start clinical trials for an Ebola drug this year. NewLink Genetics, another company looking into Ebola treatments, rose $1.51, or 7 percent, to $22.93.

GERMANY WEIGHS ON EUROPE: A purchasing managers survey by Markit showed that German manufacturing unexpectedly contracted in September, the latest sign that Europe is being affected by the sanctions on Russia. It was the first time German manufacturing contracted in 15 months.

In European markets, Germany's DAX fell 1 percent, France's CAC 40 lost 1.2 percent and the U.K.'s FTSE 100 fell 1 percent.

ECB LOOMING: Traders are gearing up for Thursday's European Central Bank policy meeting in Naples, Italy. Though no change in policy is anticipated, there will be great interest in what ECB President Mario Draghi says about possible monetary stimulus from the central bank following further weak inflation data.

HONG KONG IN THE SPOTLIGHT: The latest geopolitical issue investors are facing is in Asia, where pro-democracy protests are happening in Hong Kong. Streets in the business district have closed in the biggest threat to Beijing's authority since China took control of the former British colony in 1997. Some banks, schools and stores have closed.

ENERGY: Benchmark U.S. oil rose $1.64 to $92.80 a barrel in New York. The contract dropped $3.41 on Tuesday to $91.16, pushed down by plentiful supplies and a rise in the U.S. dollar against other currencies.

BONDS: U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 2.42 percent from 2.49 percent late Tuesday.


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