Stocks heading up: A boost in durable goods orders provides some lift, but traders are still waiting for the Federal Reserve's decision on interest rates. Dow is up 100 in early trading.
Is recovery stalling?: The Architecture Billings Index edged up only slightly in May, a sign that demand for design services remains sluggish. The index stands at 42.9 - anything above 50 would indicate improving demand, and that level hasn't been reached since January 2008. (Reuters)
Budget gimmicks: The Legislature is set to vote on a Democratic plan to plug the state's $24-billion budget deficit, even though it's unlikely to pass. The package, according to the LAT, is filled with bookkeeping maneuvers that promise no real spending reform (what a surprise!).
One of the Democrats' ideas is to issue state employees' June 2010 paychecks at 12:01 a.m. on July 1 -- one minute into a new fiscal year -- instead of June 30. By producing 11 months' paychecks instead of 12, the state would spend $1.2 billion less next year but would have to repeat the ploy yearly. Another short-term patch is a Schwarzenegger proposal, approved by the joint committee, to defer $1.7 billion in school funding until the next fiscal year. School districts would still have to run state-mandated programs in the coming year, but they wouldn't get paid until the next. The nonpartisan Legislative Analyst's Office likened that idea to racking up credit card debt.
Cerritos gets the prize: The EPA says it has an especially high cancer risk because of air pollution: More than 1,200 in 1 million, or 34 times the national average. A new report predicts the concentrations of 124 different hazardous air pollutants, which are known to cause cancer, respiratory problems and other health effects. (USA Today)
More U.S. help for automakers: Nissan gets $1.6 billion in loans from the Energy Department to work on getting battery-powered vehicles to the mass market. The automaker will have the capacity to make more than 100,000 electric cars a year at its plant in Smyrna, Tenn., by 2013. From the WSJ:
Ford Motor Co., meantime, received $5.9 billion in Energy Department loans to help retool plants in Illinois, Kentucky, Michigan, Missouri and Ohio to produce 13 fuel-efficient models, including 5,000 to 10,000 electric ones a year starting in 2011. And Tesla Motors, a California start-up that makes a $109,000 electric sports car, gained approval for a $465 million loan, and said it will use most of the money to develop an affordable family sedan.
New spat over Mozilo: Republican Congressman Darrell Issa wants to ramp up an investigation into Countrywide Financial's "Friends of Angelo" program that provided cut-rate home loans to government VIPs (including Democratic Sen. Christopher Dodd). But the Democratic chairman of a key House committee says there are bigger priorities. The SEC has charged former CEO Angelo Mozilo with civil fraud. (WSJ)
Sea Launch files Chapter 11: The Long Beach-based rocket venture that is 40 percent owned by Boeing (and includes Russian, Norwegian and Ukrainian partners) said lower demand for taking commercial satellites into space and a recent arbitration ruling led to the bankruptcy filing. (LAT)
Korean Air thinking big: The Asian-based carrier is bucking the cutback trend by placing a $300-million order for new jet engines and stepping up its marketing campaign. The airline's president told the LAT that the economy "will get better very soon, and we want to be ready for it."
The airline has been better known for flying friends and family of residents between South Korea and Southern California, where the largest population of South Koreans outside the country resides. But in recent years, Korean Air has been one of the few foreign carriers adding flights at LAX, hoping to attract more Chinese and American passengers flying to Asia. At LAX, Korean Air is the busiest Asian carrier with five to six departures a day, all of them operated on jumbo jets such as the Boeing 747 and 777 aircraft. In all, it has a fleet of 126 airliners, most of them wide-body jets.
Digital Domain suit begins: Former president Brad Call alleges that the Venice-based visual effects shop pressured him to falsify financials to attract investors. The company has countersued, charging that Call poisoned other employees' attitudes. From Variety:
While the financial picture for the entire vfx industry is gloomy, DD's finances are more exposed than most, having filed SEC disclosures in preparation for a hoped-for IPO. The documents reveal that the company, founded in 1993 by Scott Ross, helmer James Cameron and creature wiz Stan Winston, has never turned a profit despite having a thriving commercials division for much of its existence to supplement its feature work. (Cameron and Winston cut ties to Digital Domain in 1998.)