All Blog Posts from Econwatch

The H1N1 (swine) flu might not just be harmful to young children or people suffering from chronic illnesses. Companies — or at least those accused of capitalizing on fears of the pandemic flu — might also suffer from bouts of shivers and fatigue during the final quarter of the year.

The Kellogg Company finds itself as one of those businesses. USA Today reported Monday that critics accuse the company of attempting to increase sales of its cereals during flu season by promoting them as a way to boost children's immune systems.

Compared to other claims made on cereal boxes, "this one belongs in the hall of fame," the director of Yale University's Rudd Center for Food Policy and Obesity told the newspaper.

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Although the border separating the United States and Canada might be considered the most peaceful in the world, the weakening American dollar has caused an economic war of sorts between businesses selling products to their respective neighboring countries.

The Wall Street Journal highlighted Monday how the weak greenback is hurting a Canadian Christmas tree grower ($). Although Matthew Wright grows his Balsam firs in Canada's Nova Scotia province, most of the 14,000 trees he sells every year are sent to the United States and paid for in U.S. dollars. With the Canadian dollar — or "loonie" as it's called there — considered a stronger currency than the buck, that means Wright makes less of a profit on each of the trees he sells.

"Mr. Wright can't raise prices; competition from U.S. Christmas-tree growers is too fierce. Nor can he lower costs; he's already paid for fertilizer, pesticide and labor in Canadian dollars," the Journal reported. "Since Christmas trees only sell in November and December, the exchange rate during those months can make or break Mr. Wright's year."

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CBSNews.com Editor In Chief Dan Farber and CBS Moneywatch.com Editor-at-Large Jill Schlesinger spoke Monday morning about the major stories expected to happen this week in business news.

One major focus this week will be on four financial services companies that received taxpayer funds from the Troubled Asset Relief Program, or TARP. The companies are expected to file quarterly earnings reports with the government. Farber and Schlesinger also talk about the relationship between deflation, inflation and gold prices, which Schlesinger wrote about for Moneywatch Monday.

Check EconWatch next Monday for another summary of what's expected in the week's business news.


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The bad economy has caused renters to vacate their apartments in the largest numbers in more than 20 years, according to a report released Tuesday.

The report from Reis Inc., a property research firm in New York, says the rate of empty apartments across the country hasn't been this high since 1986, Bloomberg News reported. The vacancy rate increased to 7.8 percent at the end of the third quarter, the report from Reis says.

At the same time, rent prices decreased but not by as much. How much tenants pay each month decreased by 2.7 percent. Even the amounts landlords advertised decreased by 1.8 percent.

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In the United Kingdom, media consumers who want to avoid being overwhelmed by advertisements only need to turn on their televisions. TV, after all, isn't the major pipeline for exposing ads to British shoppers any more.

New figures from the first six months of 2009 show that advertising on the Web has overtaken TV ads in the U.K. and has become the largest medium for commercials, according to a report in The Wall Street Journal Wednesday.

Research from the Internet Advertising Bureau and Pricewaterhouse Coopers show that sales for Internet ads increased 4.6 percent from the first half of 2008 to $2.78 billion, earning the medium a market share of 23.5 percent. Sales of TV commercials declined 16.1 percent to $2.63 billion, reducing it to the No. 2 spot with a market share of 21.9 percent.

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At first glance, alumni of the University of California-Berkeley and the University of Kansas might think their respective colleges have entered the mortgage business with words such as "financing," "interest" and "annual payment" appearing in fundraising letters. And they'll be right.

Fans of the Cal Bears and Kansas Jayhawks can buy individual seats in the schools' football stadiums, according to a report in the Wall Street Journal Tuesday. Supporters can buy the seats and pay down a mortgage-like agreement with interest over decades-long periods.

For Cal, selling its seats will help the football team cross the goal line in a 25-year-long fundraising campaign to overhaul Berkeley's Memorial Stadium. Up until now, the program has raised $125 million. If it sells 3,000 seats, the team estimates it will pass its goal of $300 million.

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Bank of America has until noon on Monday to comply with a demand for information from a panel of the U.S. House of Representatives about the bank's merger with Merrill Lynch near the end of 2008.

The House Committee on Oversight and Government Reform wants to know when BofA knew about Merrill's catastrophic losses that made it available for a merger, when the government committed a second dosage of public bailout money to the bank and what legal advice the bank received about disclosing information to shareholders, according to a report in Monday's New York Times.

BofA agreed to take over Merrill in September 2008 as investment bank Lehman Brothers was preparing to file for bankruptcy during the height of the financial crisis. It was later disclosed that Merrill paid executives $3.6 billion in last-minute bonuses before Bank of American took over in January with the knowledge of BofA executives.

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If there's a silver lining in the economic downturn, it's that food prices are rising at a slower pace than last year. However, that silver lining comes with a price. As The Wall Street Journal reported Friday, American farms — which account for about 13 percent of the country's gross domestic product — are losing profits.

The U.S. Agriculture Department projected in a report Thursday that profits at farms will fall 38 percent this year, the newspaper reported.

"It is safe to say that the global recession has finally shown up on the doorstep of the agriculture economy," said an agricultural economist at Wells Fargo & Co. told the paper.

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The Wall Street Journal reports Monday that the investment firm Goldman Sachs Group Inc. provides select clients with advice that contradicts what its traders tell the rest of its customers.

Once a week for the past two years, Goldman analysts gather in what's called a "trading huddle" to talk about short-term changes in individual stocks or the market at large. The paper leads with an example where analysts gave one stock a "neutral" rating spread to its entire clientele last year while traders called about 50 top customers to say the stock was likely to go up.

Giving a select group of clients preferential treatment made at least one former Goldman investor felt like he was left out in the cold.

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A move the national car rental agency Enterprise Rent-A-Car took to save millions of dollars could end up costing the company in the end following a report that the company sold thousands of Chevy Impalas without a standard safety feature.

The Kansas City Star reported Saturday that Enterprise "deleted" side-curtain air bags from the roughly 66,000 Impalas it sold after renting them out. The company also admitted to selling 745 Impalas without the airbags that were bought though online advertisements saying the cars included the safety feature.

“There’s definitely a glitch in the system,” Enterprise’s vice president for corporate communications told The Star after the paper asked about the Web postings. “We’ll make it right with our customers. … None of this is intentional.”

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