Dollars and Sense 1-21-13

Updated: Monday, January 21 2013, 06:31 PM EST
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KALAMAZOO, Mich. (NEWSCHANNEL 3) - Chipolte Mexican Grill says it may raise prices later this year as the cost of ingredients continues to rise.

Josh Roe has that story and more in tonight's Dollars and Sense.
Dollars and Sense 1-21-13
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Last Update on October 13, 2015 07:30 GMT


SEATTLE (AP) -- Nearly seven years after Bernie Madoff's investment empire was revealed to be a $17.5 billion fraud, the battle by investors to recover their losses ramps up with jury selection that began Monday in a case in Seattle.

A Washington state investment company is seeking to pin about $100 million of its losses from Madoff's crimes on auditor Ernst & Young.

FutureSelect Portfolio Management of Redmond and some related firms, headed by hedge fund manager Ronald Ward, lost a total of about $129 million in the pyramid scheme. In court papers, the company alleges that Ernst & Young would have uncovered the scheme if it had taken even the most basic steps to verify Madoff's assets -- something the auditing firm denies it had any obligation to do.

The case was initially dismissed, then revived by an appeals court. Washington state's Supreme Court denied a bid by the defendants to have the case transferred to New York or to apply New York law, which would not have allowed the lawsuit. Ernst & Young is the only defendant so far heading to trial; most of the others have reached confidential settlement agreements.


BEIJING (AP) -- China's imports fell by an unexpectedly wide margin in September in a new sign of weakness in the world's second-largest economy.

New customs data shows imports plunged 20.4 percent from a year earlier to $145.2 billion, worse than August's 5.5 percent decline and analysts' expectations of a decline of about 15 percent. Exports shrank 3.7 percent, though that was an improvement from the previous month's 13.8 percent decline.

Weakness in trade has fueled doubts Beijing can hit its economic growth target this year of about 7 percent.

Much of China's slowdown over the past five years was self-imposed as the ruling Communist Party tries to steer the economy to more self-sustaining growth based on domestic consumption. But the past year's unexpectedly deep decline has raised fears of politically dangerous job losses.

The government has cut interest rates five times since November and pumped money into the economy through spending on public works construction. Economic growth held steady in the quarter ending in July at 7 percent. But that was the lowest rate since the 2008 global crisis.


WASHINGTON (AP) -- Traders will be focusing on corporate earnings this week as they try to assess the impact that slowing global growth is having on company profits.

Johnson & Johnson gets things going this morning, reporting its quarterly financial results before the market opens. CSX and JP Morgan Chase issue their results after the market closes.

Overall, earnings are forecast to slide by 5.3 percent, compared with the same period last year, as overseas demand weakened. But much of that decline is due to a big slump in energy company profits. S&P Capital IQ forecasts earnings in the energy sector slid by 66 percent.

Still, some analysts are confident that the outlook for companies will improve next year, as demand revives overseas and improving consumer confidence boosts the U.S. economy. Scott Wren at the Wells Fargo Investment Institute, says this earnings season will be a "confirmation process," showing inflation is low and the economy is growing moderately, but "fairly dependably."

Also on the schedule, for this afternoon, Treasury releases federal budget data for fiscal year 2015.


NEW YORK (AP) -- Transit experts say a planned $29 billion infusion into New York City's transportation network will help but not completely overhaul the massive system.

A deal was brokered over the weekend that includes $2.5 billion from the city and $8.3 billion from the state.

The Metropolitan Transportation Authority's five-year modernization plan funds 1,000 new subway cars, more real-time countdown clocks and track repairs.

But many transportation experts argue that the capital-spending program is mostly a maintenance plan rather than a blueprint for a robust transportation system for a 21st-century global city.

Local officials have said more ambitious plans aren't possible without significantly more federal funding.

Gov. Andrew Cuomo (KWOH'-moh) and Mayor Bill de Blasio (dih BLAH'-zee-oh praised it Monday as improving straphangers' commutes.


SAN FRANCISCO (AP) -- Abbott Vascular's dissolving heart stent has passed its first major test.

In a large, one-year study published online by the New England Journal of Medicine, doctors found the Absorb stent performed as well as a conventional stent.

Stents are tiny mesh cages that keep blood vessels from reclogging after artery-opening procedures. They are used on about 850,000 people each year in the United States alone.

The stents available now in the U.S. are permanent metal implants. Abbott's Absorb stent, which is already sold in Europe, works like dissolving stitches. It's made of a material that degrades over several years. It performed as well as but not better than a conventional stent for preventing reclogging in the one-year study.


MILWAUKEE (AP) -- A jury in Wisconsin is weighing whether the owners of a gun shop should be held financially responsible for a crime committed with a weapon purchased at their store.

Two Milwaukee police officers are suing the shop for several million dollars after they were shot by a suspect using a gun purchased at Badger Guns by a straw buyer. Lawyers for the officers told jurors there were several tipoffs that should have been sufficient to cancel the sale, including improperly marked forms and the behavior of the buyer and the eventual recipient, who was too young to buy the weapon.

Attorneys defending the owner and operators of Badger Guns and its predecessor, Badger Outdoors, said in closing arguments Monday that their clients were not negligent but were duped by the straw buyer.

Authorities have said more than 500 firearms recovered from crime scenes had been traced back to Badger Guns and Badger Outdoors, making it the "No. 1 crime gun dealer in America."

Washington Times