BUSINESS BRIEFS
Service sector hit record low last month, execs say
Associated Press
WASHINGTON — Worker productivity slowed in the summer while wage pressures increased, but both developments were better than expected and are unlikely to raise inflation alarms at the Federal Reserve.
Meanwhile, the U.S. service sector, which includes hotels, retailers and other industries, shrank more than expected in November, even after a report earlier this week showed the U.S. has been in a recession for a year. The Institute for Supply Management, a trade group of purchasing executives, said yesterday that readings for new orders, employment and prices all hit the lowest levels on records dating back to 1997.
CONSUMERS STILL AREN'T SPENDING
WASHINGTON — The country's economic picture has darkened further as Americans hunkered down heading into the holidays, forcing retailers to ring up fewer sales and factories to cut back on production.
The Federal Reserve's new snapshot of business conditions nationwide, released yesterday, suggested the economy was sinking deeper into recession.
The Fed didn't use the word "recession," but just two days earlier the National Bureau of Economic Research declared what many Americans already knew in their bones: that the country had been suffering through one since last December.
OIL PRICES NEAR THREE-YEAR LOWS
SIOUX FALLS, S.D. — Oil prices wavered near three-year lows as investors weighed falling global demand and a government report showing an unexpected decline in U.S. crude inventories.
Light, sweet crude for January delivery fell 17 cents to settle at $46.79 a barrel on the New York Mercantile Exchange. Crude dipped to $46.26, the lowest level since May 20, 2005, when it traded at $46.20.There are growing signs that crude, which has fallen $100 per barrel since mid-July, is rattling oil producing nations.
LEHMAN UNIT SOLD TO MANAGEMENT
NEW YORK — A group of managers and employees has won an auction to buy Lehman Brothers Holdings' prized investment management unit, which includes the Neuberger Berman money management business.
The bid from the Neuberger Berman group beat out two other competing bids, one of which came from the private equity firms Bain Capital Partners and Hellman & Friedman.
The size of the winning bid wasn't disclosed, but Bain and Hellman's bid had previously valued the unit at $2.15 billion. Lehman Chief Operating Officer Jim Fogarty said the management group's bid offered greater value than other bids and had more certainty of closing.
RATINGS FIRMS WILL GET NEW RULES
WASHINGTON — Federal regulators yesterday adopted new rules designed to stem conflicts of interest and provide more transparency for Wall Street's credit-rating industry, widely faulted for its role in the subprime mortgage debacle and ensuing credit crisis.
The action by the five-member Securities and Exchange Commission was another government response touching on the global financial crisis set off by mortgage securities.
The commissioners voted unanimously at a public meeting to adopt the new rules, most of which will take effect in about 60 days.
