| High anxiety: Wall Street waits for Fed to make move on rate cut
In the 20 years Mike Marcotullio has worked on Wall Street, he's seen historic market reversals that pushed weaker men to the brink of despair. Like Jan. 23, when the Dow whipsawed 625 points in one day, fueling drama on the trading floor that ranked up there with the fallout from the crisis in the Long Term Capital Management hedge fund in 1998 and the technology bust of 2000 and 2001. "There has been a lot of fear, panic and insecurity in the markets and the U.S. economy based on the housing decline," said Marcotullio, senior principal in American Capital Partners, an investment bank in New York City. This week, the stock market has been buoyed by hopes Federal Reserve Board Chairman Ben Bernanke will announce a one-half percentage point decrease in the Fed's key rate today, and until he does, stocks will still be subject to wild swings, fueled by concern the unfolding housing crisis could lead to more write-downs in the financial sector and tip the country into recession.
APS parent ekes out profit
The parent company of Arizona Public Service Co. will cut 300 jobs and likely will ask for a utility-rate increase after a difficult three months that nearly dragged profits into the red, officials said Wednesday. While it took in more revenue from more customers using more energy, the costs of building infrastructure to meet demand as well as the costs of delivering electricity sank APS finances, officials said. The job cuts planned for the current quarter - 200 workers and 100 vacant positions - will save APS parent Pinnacle West Capital Corp. $7 million before taxes on salaries and benefits, Chief Financial Officer Donald Brandt said. .
Internet failure hits two continents
There were concerns in India that an Internet slowdown could affect trading patterns at the country's two major exchanges, the National Stock Exchange (NSE) in Delhi and the SENSEX exchange in Bombay. Rajesh Chharia, president of India's Internet Service Providers' Association, explained that some firms were trying to reroute via Pacific cables and that companies serving the eastern US and the UK were worst affected, AP added. Besides the Internet, the outage caused major disruption to television and phone services, creating chaos for the UAE's public and private sectors. The Du internal memo called the situation in Dubai "critical" and stated that the cable's operators did not know when services would be restored. .
How the rate cut will affect you
What is the impact of two rate cuts in two weeks? The cut was expected, so it did not send stocks into a high. Like last week's cut, the move leads to lower interest rates for mortgages and other borrowing. But much of the impact is psychological, intended to boost people's confidence in the economy, the value of their homes and the returns on their stocks. That can have a tangible effect, from more spending on home renovations to improving the health of pension funds. "The market will follow with the confidence that the consumers are going to get moving again and not feel like they have to put a padlock on their wallets," said Allan Pelkonen, a senior financial adviser at the Melville office of Ameriprise Financial.
Which consumers win? Homeowners with equity lines of credit should see some relief in their bills.
Truell not ready to pension off idealism
Edmund Truell leads the way into the Macaroni room at his London headquarters. No, that's not a spelling error, even though his Pension Corporation is trying to take over Marconi, or Telent as the once great GEC is now known. The adjacent meeting rooms are called Gentoo and Adelie: all three are named after breeds of penguin. Private equity firms face stringent new disclosure rules Unions approve investment in 'asset strippers' Property fears send price of debt plummeting Macquarie surfs the credit storm .
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