Money world

Protests intensified in Bolivia on Thursday against a sharp increase in fuel prices imposed by President Evo Morales’ government.

Thousands of demonstrators marched in La Paz and other cities, calling for the price hikes to be repealed. Some demanded Morales’ resignation.

The higher prices were announced suddenly on Sunday, and it has been the most unpopular measure of Morales’ five-year presidency. It led to an immediate 73 percent jump in gasoline prices and an 83 percent rise in prices for diesel _ and also prompted rapid increases in transport and food prices in the Andean country.

Taxi drivers held a strike that largely paralyzed La Paz on Thursday to denounce the higher prices, and protests were also held in the cities of Cochabamba, Santa Cruz and Oruro.

Demonstrators set afire a car and a tollbooth on Thursday in the city of El Alto, neighboring La Paz. People lined a bridge while protesters raised fists demanding the measure be repealed.

Fuel prices had been frozen for six years, but the government said it could no longer afford to subsidize them, especially since much is smuggled across the border to neighboring countries.

Responding to the protests, Morales’ government has announced steps aimed at mitigating the economic effects _ including 20 percent salary increases for public workers aimed at offsetting higher fuel prices. The government also announced new assistance to rice, corn and wheat farmers intended to increase production and bring down prices faxless payday loans.

Demonstrators have called their protest the “gasolinazo.”

Neighborhood protest leader Claudio Luna said in La Paz that the government’s “message hasn’t met the expectations of the population, and for that reason we’re going to continue the protests.” He said demonstrators want prices lowered back to their former levels.

Bus drivers have also held sporadic protests this week, demanding the government further increase fares. Authorities ordered raises of 60 to 80 percent in public transport fares, but bus drivers argue that isn’t enough to offset the higher costs.

Food prices have also risen 15 percent in subsidized government markets, but that remained much less than in private supermarkets. People seeking bargains lined up at a state-run food store in La Paz on Thursday.

Morales, meanwhile, said in a news conference that he is inviting advisers from Paraguay’s government to help formulate additional measures to lessen the blow of eliminating fuel subsidies.

(This version CORRECTS that protests, not strikes by bus drivers, have largely paralyzed at least four cities)

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Stock indexes pointed to small gains Tuesday ahead of reports on home prices and consumer confidence that are expected to show that the economy is improving.

Economists are anticipating The Conference Board will announce that consumers are feeling more confident about the economy for the third straight month. Analysts expect the index to rise to 55.8 in December. That would be an improvement over November’s 54.1, but still far below the reading of 90 that indicates a healthy economy.

Separately, Standard & Poor’s/Case-Shiller will issue its 20-city index of home prices for October. Prices fell in 18 of the 20 cities in September, signaling that the housing market continues to be weak.

Ahead of the opening bell, Dow Jones industrial average futures rose 9 points, or 0.1 percent, to 11,524. S&P 500 futures rose 3, or 0.2 percent, to 1,256 payday loans lenders. Nasdaq composite futures gained 4, or 0.2 percent, to 2,234.

Shares overseas were mixed. Stock indexes in Hong Kong and Japan each fell less than 1 percent. European shares posted small gains. The Euro Stoxx 50, which tracks blue chip companies in countries that use the euro, rose 0.3 percent.

Trading volumes on Wall Street are expected to be light throughout the week. Many investors have already closed their books for the year and are on vacation until January.

Stock indexes finished Monday mixed on a day marked by the remnants of a blizzard that disrupted travel in much of the Northeast. The Dow Jones industrial average slipped 0.2 percent. The S&P 500 and Nasdaq each rose about 0.1 percent.

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China’s stocks fell for a fourth day and bonds declined after the central bank increased interest rates for a second time since October to tame inflation.

The benchmark Shanghai Composite Index dropped 1.3 percent to 2,799.43 at 2:32 p.m., led by consumer and commodity companies. The yield on the 3.77 percent note due December 2020 climbed seven basis points to 3.88 percent, and the price of the security dropped 0.57 per 100 yuan face amount to 99.10, according to the China Interbank Bond Market.

“This interest-rate increase isn’t probably enough to bring inflation under control,” said Dai Ming, a fund manager at Shanghai Kingsun Investment Management & Consulting Co. “We’ll see more rate increases next year and that’ll keep depressing valuations of stocks. I don’t see any buying opportunities emerging yet.”

The People’s Bank of China increased key one-year lending and deposit rates by 25 basis points on Christmas Day in its second move since mid-October. The benchmark lending rate rose to 5.81 percent, compared with 7.47 percent before cuts from late 2008 to counter the global financial crisis. The deposit rate increased to 2.75 percent, compared with the 5.1 percent annual pace of inflation in November, the highest in 28 months.

China’s stocks pared earlier gains as metal and consumer companies slumped on concern tightening will slow economic growth. Aluminum Corp. of China Ltd. and Zhuzhou Smelter Group Co., the nation’s biggest producers of aluminum and zinc, slid more than 2 percent. Kweichow Moutai Co. and GD Midea Holding Co. dropped more than 3 percent.

Bank Loans

The central bank raised rates for the first time since 2007 in October, and ordered lenders to set aside more money as reserves for the third time in five weeks Dec. 10. Premier Wen Jiabao is seeking to slow gains in property values and consumer prices that are making it harder for families to buy homes and pay for food.

Chinese new bank loans have fallen for two straight months, to 564 billion yuan ($85 billion) at the end of November from 596 billion yuan in September, government figures show. The seven-day repurchase rate, which measures lending costs between banks, has more than doubled in the past two weeks and reached a three-year high of 5.67 percent on Dec. 23. The cash crunch contributed to a 13 percent decline in the Shanghai Composite this year, the biggest drop among the world’s 15 largest equity markets, including a 2 percent loss last week.

Yuan Forwards

Twelve-month non-deliverable yuan forwards strengthened 0.4 percent to 6.4765 per dollar as of 1:06 p.m. in Hong Kong, the highest level since Nov. 22, according to data compiled by Bloomberg. The contracts reflect bets the currency will strengthen 2.3 percent from the spot rate, which was little changed at 6.6270.

“Investors are worried about the times of interest rate hikes next year after the earlier-than-expected rate increase,” said Yang Yongguang, a bond trader at Sealand Securities Co. in Shenzhen. “The 10-year bond yield won’t rise much because banks have a strong demand for bond assets at the beginning of the year.”

The rate increase “is more a signaling tool than anything else,” Yu Song and Helen Qiao, analysts at Goldman Sachs Group Inc., wrote in a Dec. 25 report. “We still expect the government to take a combination of measures to control inflation, including further rate hikes and possibly slightly faster currency appreciation, and believe the heavy lifting of controlling inflation will still fall on quantitative measures.”

Premier Wen said measures to curb the country’s property market weren’t well implemented and reiterated his goal for home prices to return to a “reasonable level” during his term that ends in 2012. The government will also increase the supply of affordable housing and introduce more measures to curb speculation, he said on National Radio yesterday.

Rate Swaps

China’s monetary tightening in 2011 may be mainly in the first half, JPMorgan Chase & Co. and Morgan Stanley said. China may raise rates as many as three times in the first half of next year, according to Morgan Stanley, while JPMorgan forecasts two increases in that period.

One-year interest rate swaps, the fixed rate needed to receive the floating seven-day repo rate, gained three basis point to 3.18 percent, according to data compiled by Bloomberg. The swaps touched 3.1825 percent, the highest since Dec. 10.

The yuan has risen 0.3 percent since Dec. 6, when 30 U.S. senators sent a letter to Chinese Vice Premier Wang Qishan calling for the yuan to “appreciate meaningfully” before President Hu Jintao’s visit to Washington next month. A stronger yuan would help curb a trade surplus that exceeded $20 billion for the fifth time in sixth months, indicating a recovery in international trade from the global financial crisis.

–Zhang Shidong, Judy Chen and Hanny Wan. Editors: Allen Wan, Richard Frost

To contact Bloomberg News staff on this story: Zhang Shidong in Shanghai at +86-21-6104-3040 or szhang5@bloomberg.net; Judy Chen in Shanghai at +86-21-6104-3043 or xchen45@bloomberg.net; Hanny Wan in Hong Kong at +852-2977-6601 or hwan3@bloomberg.net

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ST. LOUIS

Doug Sitton, president of Sitton Construction Group

What are pure construction management services, and how do they benefit the project owner?

Pure construction management is a variety of professional services that can be applied to all construction delivery methods.

In pure construction management, the manager provides value to the project owner by acting as the owner’s principal agent in management of the entire project. He, she or a team of people, is responsible to the owner for managing the project from start to finish and often oversees the general contractor’s construction management.

This process offers the project owner access to the supplementary knowledge, experience and skill needed to ensure project success through project planning, site selection, delivery method selection, budget management, design and construction oversight and more.

Projects done under the pure construction management umbrella don’t necessarily look different on the surface. But when owners dig a little deeper, they can see the importance of expertise independent from the design and construction teams cash advance no faxing.

Pure construction management services provide a variety of value-added benefits. These include skill in all phases of planning, design and construction, plus the ability to lead and manage all project delivery methods without bias for a specific method. These services also help streamline communication and documentation from start to finish, eliminating many of the problems that prove costly to many construction projects. The focus is on maximizing everyone’s performance as a single collaborative team.

Owners must understand and accept their roles as the overall leaders and managers of their projects. The pure construction manager is there to supplement the owner’s resources to ensure the necessary expertise is in place to maximize the construction value delivered.

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Oil prices climbed past $90 a barrel on Wednesday as the government reported a drop in the nation’s crude supplies. Benchmark oil rose 43 cents to $90.25 in midday trading on the New York Mercantile Exchange.

In its weekly petroleum report, the Energy Department’s Energy Information Administration said crude supplies dropped by 5.3 million barrels last week from the week before. That’s more than twice the decline expected by analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos. EIA said gasoline supplies grew by more than 2 million barrels.

“Traders should not be fooled by a big draw from today’s DOE data,” said Stephen Schork, editor of the Schork Report newsletter. While shrinking oil inventories could help support higher prices, he notes that total supplies remain more than 10 percent above the 2004-2008 period.

The average pump price for a gallon of gasoline rose to $3 on Wednesday, according to AAA, Wright Express and Oil Price Information Service. That’s more than 13 cents higher than a month ago and 41 cents above a year ago. The last time gas averaged $3 a gallon was in October, 2008 as prices drifted down from record highs above $4 a gallon in the summer of that year.

Gasoline prices have been rising steadily with oil prices for the past month and many analysts think that trend will continue, with gas stations across the country charging around $3.50 a gallon or more by spring.

Energy consultants Cameron Hanover said oil prices have been climbing and pulling up gasoline prices because investors are optimistic about the economy. Recent developments like the extension of tax cuts and the Fed’s bond-buying stimulus program have convinced many that the economy will improve and, with it, demand for oil and gas.

The economic news Wednesday did not throw much cold water on that. The Commerce Department said GDP rose at an annual rate of 2.6 percent between July and September, slightly below what analysts expected but an improvement from an earlier estimate. And the National Association of Realtors said sales of previously occupied homes rose almost 6 percent in November.

In other trading on the Nymex, heating oil added 0.63 cent to $2.5227 a gallon, gasoline gained 1.11 cents at $2.4096 a gallon and natural gas lost 3.9 cents at $4.020 per 1,000 cubic feet.

In London, Brent crude rose 39 cents to $93.59 on the ICE Futures exchange.

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Blizzards and freezing temperatures shut down runways, train tracks and highways across Europe on Saturday, disrupting flights and leaving shivering drivers stranded on roadsides.

Airports in Britain, Germany, France, Spain, the Netherlands and Denmark reported cancelations or delays to flights.

London’s Gatwick airport reopened late afternoon after 150 employees using dozens of plows worked to clear the runway of 10 centimeters (four inches) of snow, though officials warned flights would be limited and cancelations likely.

Heathrow Airport will remain shut until Sunday after snow and ice forced the closure of runways, according to a statement on its website.

“There are likely to be significant knock-on delays tomorrow (Sunday) and you should contact your airline before traveling to the airport,” the statement said.

Conditions on British roads were treacherous, Automobile Association official Darron Burness said. “One of the biggest problems is that large amounts of snow are falling very quickly on to frozen surfaces, making driving hazardous,” he said.

Hundreds of motorists were left stranded on a major road in northwestern England following a deluge, prompting police patrols to offer food and water to drivers.

Jeremy Clarkson, host of BBC motoring program “Top Gear” said he was among drivers forced to abandon their vehicles close to Oxford, west of London. “It was very bad out there,” he said.

In Italy, the Autostrada of the Sun _ the country’s main north-south highway _ was jammed with hundreds of vehicles, whose chilly occupants slept in their cars, vans or trucks. Though snow had mainly cleared or melted early Saturday, the highway was still closed in one direction, with traffic backed up for nearly 25 miles (40 kilometers).

The snowfall also forced high-speed trains to bypass Florence’s central Santa Maria Novella station, stopping in suburban stations instead.

Paris was sprinkled with a light coat of snow overnight, as many people prepared to set off on their Christmas vacations. More snow was predicted Saturday, leading civil aviation authorities to cancel 15 percent of flights at Charles de Gaulle airport between 4 p.m. (1500 GMT, 10 a.m. EST) and 11 p.m. (2200 GMT, 5 p.m. EST).

Many flights were also canceled in northeastern France, where snow already blanketed the ground, and services were also canceled at the airports in the cities of Nantes and Rennes.

Significant numbers of domestic and European flights were canceled at Germany’s Frankfurt airport as it dealt with the disruption. Germany’s railway operator Deutsche Bahn said it was pressing into service all the trains it could _ though some journeys were subject to delays. “Everything that can roll is rolling,” spokesman Holger Auferkamp told the German news agency DAPD.

The icy weather also swept over large parts of Scandinavia, causing problems particularly in Denmark, where dozens of flights were canceled at the airport in Copenhagen. According to Danish news agency Ritzau, train traffic between Denmark and southern Sweden was also disrupted because of track problems, partly due to the snow, forcing passengers to instead take buses between the two countries.

In Sweden, where media reports suggest the country is experiencing the coldest winter weather this early on in the season since the mid-1800’s, several road accidents were reported, with more than 20 in the Stockholm area alone.

Retailers said the poor weather would likely dent sales on what it traditionally the busiest shopping weekend before Christmas. London’s Brent Cross indoor shopping mall closed its doors early Saturday afternoon.

Elsewhere, a snowman greeted tourists at London’s Camden Market, while traders broke up ice and snow with shovels on the cobblestone paths. Two groups of tourists hurled snowballs at each other across the canal on the edge of the market.

Britain may experience its coldest December on record, weather service forecaster Mark Seltzer said.

“Temperatures will struggle to get over freezing and although the snow should ease off tonight, it will return to eastern areas on Sunday,” he said.

Police in Leicester, central England, said the snowy weather had helped uncover a cannabis factory in the city. Officers raided the premises after spotting that snow had melted on the building’s roof as a result of heat from industrial-strength lights used in the cultivation of the drug.

Horse racing meetings and dozens of soccer games in England and Scotland were called off as a result of the conditions, including a high profile match scheduled for Sunday in London between Chelsea and Manchester United.

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Rogers Communications is prepared to let customers pay to unlock their phones and go. However, it does involve a fee and you have to be at the end of your contract or have paid full freight for your phone.

Breaking a contract early, means you still get hit with a fee.

The cost of living in the U.S. rose less than forecast in November, indicating higher prices for commodities such as fuel aren’t filtering through into other goods and services.

The consumer-price index increased 0.1 percent after a 0.2 percent rise the prior month, the Labor Department said today in Washington. The median estimate of economists in a Bloomberg News survey called for a gain of 0.2 percent. The so-called core measure, which excludes more volatile food and energy costs, also rose 0.1 percent, matching the median forecast.

Retailers such as Target Corp. and Wal-Mart Stores Inc. are discounting merchandise to stoke demand during the holiday shopping season as joblessness lingers near 10 percent. Limited inflation and a stagnant labor market underscore the Federal Reserve’s decision yesterday to stay the course as it pursues record monetary stimulus.

“Inflation is a non-threat right now, there’s a lot of slack in the economy,” said Ryan Sweet, a senior economist at Moody’s Analytics Inc. in West Chester, Pennsylvania, who correctly forecast the rise in the CPI. “Inflation will remain very subdued and tepid over the next several months.”

The measure of consumer prices was restrained by a second straight drop in new vehicle costs, cheaper household furnishings and a decline in natural gas. Airline fares rose by the most since June 2008.

Stock-Index Futures

Stock-index futures held losses stemming from concern Europe’s sovereign-debt crisis may derail the global economic recovery after Moody’s Investors Service put Spain’s credit rating on review for a possible downgrade. The March contract on the Standard & Poor’s 500 Index dropped 0.4 percent to 1,232.5 at 8:42 a.m. in New York. The benchmark 10-year Treasury note rose, pushing down the yield to 3.43 percent from 3.48 percent late yesterday.

Estimates in the Bloomberg survey of 80 economists for the overall CPI ranged from no change to a gain of 0.3 percent. The core rate rose for the first time since July.

In the 12 months ended in November, prices increased 1.1 percent, matching the median projection in the Bloomberg survey.

The core rate increased 0.8 percent in November from the same month last year, exceeding the median forecast for a 0.6 percent gain.

Energy prices increased 0.2 percent from a month earlier, reflecting gains in gasoline and fuel oil. Food prices also rose 0.2 percent in November, led by higher costs for meats and cereals.

Housing Market

The ailing housing market is restraining the consumer price index. Rents, which account for about 40 percent of core consumer prices, have been held in check as foreclosures push more houses into the rental market.

Owners-equivalent rent, one of the categories designed to track rental prices, rose 0.1 percent for a second straight month. Compared with November 2009, owners-equivalent rent was up 0.2 percent.

The cost of medical care increased 0 credit score.1 percent last month. New-car prices declined 0.4 percent, the most since January, Tobacco costs fell 0.1 percent. Air fares increased 3 percent in November.

Apparel costs climbed 0.2 percent in November and were down 0.8 percent from the same month last year.

Fed Stimulus

The ongoing slump in housing, unemployment near 10 percent and a risk of sustained declines in prices are reasons why the Fed last month announced it would buy up to $600 billion in Treasuries through June. Yesterday, officials stood by the pledge.

“Longer-term inflation expectations have remained stable, but measures of underlying inflation have continued to trend downward,” Fed officials said yesterday in their Federal Open Market Committee statement.

The Fed, which has a statutory mandate of fostering maximum employment and price stability, said “the unemployment rate is elevated, and measures of underlying inflation are somewhat low.”

The CPI is the broadest of three monthly price gauges from the Labor Department, because it includes goods and services. Almost 60 percent of the CPI covers prices consumers pay for services ranging from medical visits to airline fares and movie tickets.

A Labor Department report yesterday showed the producer- price index in November increased 0.8 percent and the cost of goods excluding fuel and food rose 0.3 percent, both more than forecast. The cost of goods imported into the U.S., reported last week, rose 1.3 percent from the prior month, the most in a year, and higher than the median estimate in a Bloomberg survey.

Retail Prices

Retailers that are cutting prices are drumming up demand, while those not discounting enough are struggling.

Best Buy Co., the world’s largest consumer-electronics retailer, yesterday slashed its annual profit forecast amid increasing competition from Wal-Mart and Target. Best Buy lost TV sales in the third quarter to “the large discounters” that promoted the least-expensive models, Chief Executive Brian Dunn said on a conference call.

“What has really gone big in home theater so far this season is opening price point, tier-three brands going out at really, really hot prices,” Dunn, 50, said yesterday in a telephone interview. “We don’t feature them.”

Consumers bought cheaper models of flat-panel TVs with screens of 36 inches and smaller for $229 to $299, Dunn said. Rising demand for smartphones and tablet computers also hurt spending on TVs, he said.

For Best Buy, “the U.S. business was pretty miserable,” Joe Feldman, an analyst at Telsey Advisory Group in New York, said yesterday. “Sales are going to places like Amazon, Wal- Mart, Target, Costco and Sears.”

Today’s report showed a 0.4 percent drop in the costs of personal computers.

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Retail sales rose for a fifth straight month in November, as the biggest jump in department store sales in two years gave the holiday shopping season a strong start.

The Commerce Department says retail sales increased 0.8 percent last month. That came after a 1.7 percent gain in October, which was propelled by a huge increase in auto sales payday loans.

Auto sales retreated a bit in November. But excluding autos, sales rose 1.2 percent _ the best showing since last March.

Department store sales jumped 2.8 percent, the strongest advance in two years.

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