BC-MCT-BUSINESS-BJT _ business editors (2200 words)

Associated Press Modified: January 27, 2011 at 8:10 pm •  Published: January 27, 2011
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McClatchy-Tribune News Service

Business Budget for Thursday, January 27, 2011

Updated at 9 p.m. EST (0200 UTC)

Adds CPT-LINKEDIN-IPO:LA, CALIF-INSURERS:LA, CPT-VERIZON-TERREMARK:LA

Corrects TANKERS:WA

Updates FINANCIALCRISIS:WA

This budget is now available on MCT Direct at http://www.mctdirect.com, with direct links to stories and art. See details at the end of the budget.

TOP STORIES

Panel: Negligence, risk-taking fueled economy's near-collapse

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Even after home prices began their long descent in early 2006 — a hard-to-ignore stop sign — the U.S. financial industry created $1.7 trillion in home mortgage-backed securities and other exotic products tied to the loans' performance, Phil Angelides, the Democratic chairman of the Financial Crisis Inquiry Commission, told a news conference.

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GM decides not to borrow $14.4 billion from US

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The move is part of GM's plan to eliminate most of its debt and fully fund its pension plans. After receiving $50 billion in government aid in 2008 and 2009, the post-bankruptcy company has prioritized self-sufficiency, design chief Ed Welburn said Thursday at the Washington auto show.

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Networking site LinkedIn files for public stock offering

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The Mountain View, Calif., company, which has been valued at more than $2.5 billion on one private share exchange, is one of several social networking sites whose public offerings have been widely anticipated in recent months.

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Blowing whistle on health care fraud proves lucrative

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But it wasn't filling prescriptions that made Ven-A-Care of the Florida Keys Inc. such a success.

Tiny Ven-A-Care has developed a lucrative niche market: blowing the whistle on drug companies that overcharge Medicare and Medicaid — and collecting tens of millions of dollars in reward money.

Unlike most whistle-blowers who help the government with one case after they encounter wrongdoing, Ven-A-Care has filed suits alleging fraudulent conduct against dozens of drug companies supplying pharmacies and health care providers.

1100 (with trims) by Andrew Zajac in Washington. MOVED

ARCHIVE ILLUSTRATION

Obama's clean-tech vision meets with skepticism

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But after getting a surprisingly extensive shout-out in Obama's State of the Union address — he sees clean tech as the country's best chance to seize its "Sputnik moment" — industry officials this week were less than enthused and questioned whether the ambitious targets were even attainable.

900 (with trims) by Tiffany Hsu in Los Angeles. MOVED

PHOTO

REAL ESTATE STORIES

Report names cities hit hardest by foreclosures

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Nationwide, one in every 45 homes received a foreclosure filing in 2010, according to RealtyTrac. Foreclosure activity increased in 149 of the nation's 206 areas with a population of 200,000 or more.

450 by Amy Hoak in Chicago. MOVED

Mortgage help can turn into disaster

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Thousands now face a stark choice: Go deeper into debt, or foreclosure.

Lenders routinely approved short-term "trial" loan modifications that reduced payments for desperate borrowers under the umbrella of the Obama administration's Home Affordable Modification Program. But lenders continued to count the mortgages as delinquent or in default.

Now instead of granting permanent modifications, lenders often are reinstating the original loan terms and demanding big back payments.

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Low costs — and spring fever — expected to spur home buyers

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A recent survey of 3,500 U.S. homeowners and renters conducted for the National Association of Realtors by Harris Interactive found that 60 percent of those who would like to own a house worry about job security and creditworthiness.

That said, some real estate agents say they think the market may be rebounding because prospective buyers fear interest rates are permanently back on the upward trajectory and they need to get in the game.

750 by Alan J. Heavens in Philadelphia. MOVED

MORE BUSINESS NEWS

Dimon v. Sarkozy: Bank CEO, French president clash over regulations

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''It's important for people to take a deep breath ? too much would be too much," hampering the economy and affecting jobs, Dimon said during the question-and-answer portion of Sarkozy's address at the annual gathering.

Sarkozy responded he didn't dispute that regulations need to be "flexible," but blasted the banks for defying "common sense" and undertaking a variety of "hair-raising" tactics that had contributed to the financial crisis, ultimately resulting in "tens of millions of unemployed."

450 by William L. Watts in Davos, Switzerland. MOVED

Senators slam Air Force over $35 billion tanker contract

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At a hearing of the Senate Armed Services Committee, Sen. Claire McCaskill, D-Mo., called the incident "a debacle" and asked what punitive action had been taken. She said those involved in the error should be fired.

Sen. John McCain, R-Ariz., called it "a fiasco" and part of an ongoing "saga of mismanagement."

700 (with trims) by Rob Hotakainen in Washington. MOVED

Airlines cancel more than 2,000 flights as storm rakes Northeast

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It's been a particularly bad winter for airlines, with an earlier blizzard grounding more than 9,000 flights from Jan. 10 through Jan. 12, and knocking back industry profits by up to $145 million, according to one estimate.

350 by Christopher Hinton in New York. MOVED

Applications for jobless benefits rise as South's snow melts

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Snowstorms earlier in January forced unemployment offices in Alabama, Georgia, North Carolina and South Carolina to open for fewer hours and to process fewer claims, a Labor Department spokesman said. Efforts by those states to reduce the backlog contributed to the spike in new claims, but did not account for all of the increase, he said.

600 by Jeffry Bartash in Washington. MOVED

Taco Bell fires back after lawsuit questions 'seasoned beef' content

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''The lawsuit is bogus and filled with completely inaccurate facts," says a statement attributed to Greg Creed, president and chief concept officer of Taco Bell Corp. He said the beef is "just like the quality beef you would buy in a supermarket and prepare in your home."

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Verizon bolsters cloud services with $1.4 billion Terremark buy

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Verizon offered $19 a share in cash_

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Tesla to build all-electric SUV

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Although the vehicle will be the size of a small SUV, Tesla said it would offer a much larger interior because the electric drive train and components will take up less space than a conventional gasoline engine and transmission.

Tesla also is working with Toyota to develop an electric version of the RAV4 compact sport utility vehicle. It will go on sale in 2012.

300 by Jerry Hirsch in Los Angeles. MOVED

Crude tactics rile Texans

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But that was before a Canadian company, TransCanada Corp., came forward with a plan to build a 1,700-mile pipeline to carry heavy, high-pollutant oil from the tar sands under the boreal forests of northern Alberta, across the American heartland, through scenic ranchlands in the piney woods of east Texas and on to refineries near Houston and Port Arthur.

For many in Texas — who are holding meetings, passing out leaflets and hosting neighborhood talks with, of all people, the Sierra Club — the Keystone XL pipeline is a barrel too far.

1800 (with trims) by Kim Murphy in Port Arthur, Texas. (Moved as a national story.) MOVED

PHOTOS, GRAPHIC

3 insurers agree to delay rate increases

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Aetna, Anthem Blue Cross and PacifiCare agreed to delay the increases for people with individual policies. Unaffected are workers insured through their employers.

550 by Stephen Ceasar and Duke Helfand in Los Angeles. MOVED

Live Nation settles class-action lawsuit over fees, reduces earnings estimate

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The lawsuit, originally filed by two individual plaintiffs in Los Angeles Superior Court in 2003 and granted class-action status in September, accused Ticketmaster of misleading customers when it tacked on $14.50 to $25 in delivery fees. The suit alleged that Ticketmaster suggested that the fees simply covered the cost of delivering the tickets, but were in fact designed to boost the company's profit.

250 by Alex Pham in Los Angeles. (Moved as an entertainment story.) MOVED

Stocks edge higher but fail to clear hurdles

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The Dow closed up 4.46 points at 11,989.83. The measure hasn't closed above 12,000 since June 19, 2008.

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FIXTURES

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5/8 2011, McClatchy-Tribune Information Services.

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