The Daily Herald from Arlington Heights, Illinois on March 8, 2008 · Page 318
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The Daily Herald from Arlington Heights, Illinois · Page 318

Arlington Heights, Illinois
Issue Date:
Saturday, March 8, 2008
Page 318
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SATURDAY, MARCH 8, 2008 DaflyHetald Oliitumirs Wenthir 4,5 Busine SFXTIION 3 Market recap Wall Street suffers through another week of selling — Page 2 Coming Sunday Old Orchard becomes the first area mall to ban smoking outdoors Big Picture Kmart to offer medication deals HOFFMAN ESTATES — Kmart is planning to offer aspirin and other common medications made under its private label brand for $1 with the purchase of new or refilled prescriptions at its stores. Kmart, a unit of Hoffman Estates-based Sears Holdings Corp., said the program is launching in Florida this month and will spread to other states in April. Boeing considers tanker deal protest CHICAGO — Boeing Co. said late Friday it will give "serious consideration" over the weekend to filing a formal protest of the Air Force's decision to award a $35 billion tanker contract to European Aeronautic Defence and Space Co. and Northrop Grumman Corp. Following a debriefing by Air Force officials Friday, Chicago-based Boeing said reports of it losing the competition by a wide margin are inaccurate. Boeing assessing 787 schedule CHICAGO — Supply chain troubles and production problems may force Boeing Co. to further delay the first flight of its new 787 jetliner, some analysts said Friday. Boeing said it's evaluating the schedule but its goal is still to power up the plane in early April and send it on its first flight by the end of June. Investors, worried, sent shares of Boeing down $2.91, or 3.7 percent, to $76.60 Friday. Price-fixing movie will film in Decatur DECATUR — Film crews working on a movie about price fixing at agricultural processor Archer Daniels Midland in the 1990s will come to Decatur this spring. A spokeswoman for "The Informant" says parts of the movie will be filmed in Decatur in April and May, The movie is based on the 2000 book of the same name by Kurt Eichenwald and stars Matt Damon as an ADM executive who was an informant for the FBI. Decatur-based ADM was fined $100 million for conspiring to fix the prices of food additives lysine and citric acid. Three ADM executives, including informant Mark Whitacre, were sent to prison. Local Focus Motorola's exec leaves company SCHAUMBURG — Motorola Inc. Friday said Stu Reed, formerly^ the president of Motorola's Mobile Devices unit, has decided to leave the company, effective immediately. Motorola Chief Marketing Officer Kenneth "Casey" Keller left last week. Reed and his team launched a number of key initiatives important to the Mobile Devices business that the company will continue to drive and expand upon, Motorola said in a statement. Motorola has been preparing to sell the Mobile Devices business. Alcatel-Lucent cuts some area positions NAPERVILLE — Alcatel- Lucent said it issued layoff notices to some workers at its Naperville and Lisle campus Thursday but declined to provide specifics. "It was not a large number of people," Alca- tel-Lucent spokeswoman Mary Lou Ambrus said. Since Lucent Technologies merged with Paris-based Alcatel, it aimed to eliminate 10,000 jobs worldwide by 2009. Ambrus said the campus has about 4,000 employees and contractors. U.S. job market weighs down economy Asiaintfd /Vw WASHINGTON — Dangerous cracks in the nation's job market are deepening. Employers slashed jobs by the largest amount in five years — and hundreds of thousands of people dropped out of the labor force — an ominous sign that the country is falling toward a recession or has already toppled into one. For the second straight month, nervous employers got rid of jobs nationwide. In February, they sliced payrolls by 63,000, even deeper than the 22,000 positions cut in January, the Labor Department reported Friday. The grim snapshot of the country's employment climate underscored the heavy toll the housing and credit debacles are taking on companies, jobseekers and the economy as a whole. "It sounds like the recession bell is ringing for the U.S. economy, although it is still faint," said Stuart Hoffman, chief economist at PNC Financial Services Group. The worsening situation will prompt the Federal Reserve to cut a key interest rate deeply — perhaps by as much as three-quarters of a percentage point — at its next meeting March 18, or possibly sooner, to help brace the teetering economy, analysts predicted. Factories, construction companies, mortgage brokers, real-estate firms, retailers, temporary-help firms, child day-care providers, hotels, educational services, accounting firms and computer designers were among those shedding jobs. All those cuts swamped job gains at hospitals and other healthcare sites, bars and restaurants, legal services and the government. "Losing a job is painful, and I know Americans are concerned about our economy; so am I," said President Bush. "It's clear our economy has slowed." The unemployment rate actually dipped slightly from 4.9 percent to 4.8 percent, as 450,000 people left the labor force for any number of reasons. Economists thought many people probably gave up looking for work. To relieve persistent credit problems, the Federal Reserve announced Friday it will increase the amount of loans it plans to make available to banks this month to $100 billion. The Fed already has provided $160 billion in short term loans to cash-strapped banks since December. The Fed, in another step, said it will make $100 billion available to a broad range of financial players through a series of separate transactions. Cattle rustlers still roam High beef prices, drug addictions increase thefts By REBECCA BOONE Assmiatr BUHL, Idaho — Two guys and a four-door sedan. That's all it took for cattle rusders to relieve dairy owner Pete Wiersma of three valuable calves. Once the province of outlaws and the bane of hardscrabble ranchers who grazed their cattle on the open range, cattle rustling has never gone away. Like the livestock industry, it's only gotten more efficient. In general, cattle rustling tends to increase whenever beef prices are high, said Larry Hayhurst, head of the Idaho State Patrol division of brands. Because the price of cattle feed has been relatively high this year — making the cattle more expensive to raise and lowering the potential profit — the theft reports should be on a downswing. But in rural dairy regions — where milk cows can nearly always fetch a high price and ASSOCIATED I'RESS PHOTOS A pair of calves peek out from pens belonging to dairy owner Pete Wiersma in Buhl, Idaho, where thieves stole three yearling heifers. Cattle rustling has never gone away. methamphetamine use is becoming as much a part of the landscape as grain silos and milking barns — the rustling reports seem to stay fairly constant. The Idaho State Police gets between 300 and 500 reports of lost or missing cattle a year, Hayhurst said. The Dairy owner Pete Wiersma checks on his calves in Idaho. Anywhere between 300 to 500 head of cattle and around 25 horses are reported lost or missing each year in the state. numbers have been consistent for about a decade. "Most of the rustlers are stealing for the money, the profit — whether it be to put food on the table or to trade for drugs," said Idaho State Police brand inspector Sean McCarthy. "The dealers tell dairy workers, 'You go out and •you steal me five, 10 or 15 head of calves, we'll supply you with meth so you can either deal or use. They'll turn around and sell the calves to Joe Blow dairyman at say, something like last week's top sales yard price of $2,600 a head. It adds up pretty quick" Investigators believe many stolen cattle go unreported, sometimes because livestock owners don't discover the thefts right away or because they decide to just chalk the losses up to a tax write-off. "In the last three months we've had 16 calves reported stolen off of four dairies, but there's probably more than that that have been stolen that the owners aren't aware of," said Sgt. Daron Brown, charged with investigating rural crime in the dairy-laden southern Idaho county of Twin Falls. "What's easier to steal? They don't come with serial numbers." Most states west of the Mississippi rely on brands — marks seared into the hide of livestock animals — to show ownership of animals. But not all livestock owners brand their animals. Dairy owners, in particular, tend not to brand their catde for at least the first year or so, said Hayhurst. "A brand on an animal is the only return address on that animal. Every one of those dairymen is probably missing calves, and they may not even know it," Hayhurst said. Anywhere between 300 to 500 head of cattle and around 25 horses are reported lost or missing a year in Idaho alone, he said. In California, 1,275 See CATTLE on PAGE 2 McDonald investors expect small gain McDonald's Corp. may report a bit of a bounce in U.S. February sales after a slow turn of trie year, but the twin challenges of higher food costs and a slumping domestic economy will keep improvement modest, analysts and investors say. The Oak Brook-based hamburger chain is due to report global same-store sales Monday morning and company watchers hope improved U.S. results will put an end to speculation that previous softness, in December particularly, had more to do with the economy than weather. Analysts and investors arc looking for U.S. sales-growth of anywhere from 1 percent to more than 4 percent from a year ago, excluding the Leap Year impact, which added a day of sales. "I don't necessarily think the U.S. is going to be weak, but I don't think we're going to get knocked over with a big number," said Scott Rothbort, president and founder oi LakeView Asset Management in New Jersey. Deutsche Bank Securities analysts are targeting same- store sales growth of 1.5 percent in the U.S., 5 percent for Europe and 5 percent for the combined Asia/Pacific, Middle East and Africa regions. Their forecast excludes the Leap Year impact, which is expected to boost results by about 4 percentage points. Other analysts are more bullish. UBS Securities analyst David Palmer is eyeing U.S. February same-store sales growth of 8 percent, including a roughly 4 percentage point Leap Year lift and improving fast-food trends. CEOs involved in mortgage crisis defend their pay Associated Pivss WASHINGTON — Three corporate executives called in for a shaming by Democratic lawmakers Friday defended raking in hundreds of millions of dollars despite contributing to a subprime mortgage crisis that has their companies reeling from losses and the nation on the edge of recession. "There's a complete disconnect with reality," said Rep. Henry Waxman, a California Democrat and chairman of the House Oversight and Government Reform Committee. But the CEOs testifying before the committee — Angelo Mozilo of Countrywide Financial Corp.; Stanley O'Neal, formerly of Merrill Lynch & Co; and Charles Prince, formerly of Citigroup Inc. — defended their pay as appropriate. As our company did well, 1 did well," said Mozilo, founder of Countrywide, the nation's largest mortgage lender and a key player in the subprime problem. "But when our company did not do well, as in 2007, my direct compensation and the value of my holdings declined materially, which is as it should be." Republicans on the committee generally agreed. "This is a hearing in search of bad guys," said Rep. Darrell Issa, a Republican from California. "All of you complied with the transparency rules and the best practices rules." The hearing was the second held by Waxman on the issue of executive pay, which Forbes magazine said averaged $15.2 million for the CEOs in the largest 500 U.S. companies in 2006, an increase of 38 percent in one year. . He questioned how all three CEOs could profit handsomely at a time when their Companies were losing billions of dollars and stock values were plunging. "You're in the middle of an enormous debacle," Waxman said. "It seems like everyone is hurting except for you." Committee figures showed Countrywide suffered a $1.2 billion loss in the third quar- ter of 2007 and then lost another $422 million in the fourth quarter. By the end of the year, the company's stock had fallen 80 percent from its five-year peak in February. During the same period, Mozilo received a $1.9 million salary, $20 million in stock awards contingent upon performance and sold $121 million in stock. Some of those stock sales occurred at the same time the company was borrowing $1.5 billion to repurchase its shares. Mozilo related how he had started Countrywide in 1969, sitting in the kitchen of his small New York apartment. He said his direct compensation and the value of his stock holdings declined substantially last year and he had not received, and will not receive, a bonus for 2007 and 2008. Mozilo also said he would give up some $37 million in severance pay if Bank of America proceeds with plans to acquire Countrywide. The lawmakers also asked ASSOCIATED PRESS Richard Parsons, from left, chairman of Citigroup's compensation committee; E. Stanley O'Neal, former chairman and CEO of Merrill Lynch; John Finnegan, chairman of the compensation committee for Merrill Lynch; and Angelo Mozilo, founder and CEO of Countrywide Financial Corp., arrive Friday to testify before a Capitol Hill hearing in Washington, D.C. why Citigroup, which saw its stock fall 48 percent at the end of 2007 compared with a year earlier, would award Prince a cash bonus worth $10.4 million after he stepped down as CEO last November. He also received $28 million in unvested stock and options and $1.5 million in annual perquisites upon his departure. I'm proud of my accomplishments," Prince said, speaking of his contributions over almost three decades to Citigroup's growth and the financial company's efforts to assist homeowners facing foreclosure.

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