Monthly Archives: August 2009

Students will Draft Recommendations on Drafty Airport Building

By Rachel Pritchett
Engineering students from Washington State University soon will be poking around the aging Bremerton National Airport terminal building looking for ways to improve its energy efficiency.
The investigation is part of the students’ work toward their master’s degrees in mechanical engineering, according to a statement from the Port of Bremerton, which runs the airport.
Cary Bozeman, the port’s chief executive officer, hailed the new arrangement between the port and WSU as a kick-off to a new sustainability initiative at the port.
“This is a win-win for the port and WSU,” he stated.
The graduate students should have plenty to work with.
The 10,400-square-foot terminal building has eight different heating and air-conditioning systems, but employees still have to use space heaters under their desks in the winter. Likewise in summer, they swelter.
The building was constructed four decades ago and enlarged in 1988.
The partnership is not costing the port money, except for a few incidentals, like lunch.

Is the Recession Ending, Finally???

WASHINGTON (AP) — The economy shrank at an annual rate of 1 percent in the spring, a better-than-expected showing and more evidence that the recession is drawing to a close.
Many analysts believe the economy is growing in the current quarter, but they caution that any rebound will not be accompanied initially by rising employment. Jobless claims figures released Thursday were better than expected, but remain well above levels associated with a healthy economy.
Americans may see little benefit from a recovery if jobs remain scarce and consumer spending stays too low to fuel a strong economic rebound.
The Commerce Department’s new estimate for the gross domestic product was unchanged from the initial figure it released last month. The drop, while representing a record fourth consecutive decline, was far smaller than the previous two quarters. It also was stronger than the 1.5 percent decline that private economists expected.
The report Thursday found that businesses slashed their inventories more than first reported and cut back more sharply on investment in new plants and equipment. But those reductions were offset by revisions that showed smaller dips in consumer spending, exports and housing construction.
The 1 percent rate of decline in the April-June quarter followed decreases of 6.4 percent in the first quarter and 5.4 percent in the final three months of 2008, the sharpest back-to-back declines in a half-century. The four straight quarterly declines in GDP, which measures the country’s total output of goods and services, mark the first time that has occurred on government records that date to 1947.
The recession that began in December 2007 is the longest since World War II, and the deepest in terms of the drop in the GDP, which is down 3.9 percent from its previous peak.
But economists are heartened that the decline slowed to 1 percent in the spring. Many analysts think that the government’s $787 billion economic stimulus plan and the Cash for Clunkers program to boost car purchases will lift GDP growth to around 2 percent in the current July-September quarter.
However, the return to economic growth will not mean more jobs, at least at first. Economists believe the unemployment rate, currently at 9.4 percent, will keep rising through the spring of next year.
The Labor Department said Thursday that first-time unemployment claims fell to a seasonally adjusted 570,000, from an upwardly revised 580,000 the previous week. The tally of those continuing to claim benefits dropped to 6.13 million from 6.25 million, the lowest level since early April.
The weekly figures remain far above the roughly 325,000 that analysts say is consistent with a healthy economy. New claims last fell below 300,000 in early 2007.
White House economic adviser Christina Romer earlier this week said the unemployment rate is likely to keep rising and hit 10 percent this year. That could discourage consumer spending and weaken any recovery. Economists expect the unemployment rate inched back up to 9.5 percent in August as another 220,000 jobs were lost, down a bit from 247,000 in July. That report is scheduled for release next week.
On Wednesday, reports showed that new home sales jumped almost 10 percent from June, while orders for durable goods like appliances, planes and computers rose nearly 5 percent in July, the third increase in the past four months.
Still, it remains unclear whether the growth can be sustained. Though the increases in housing sales and manufacturing last month were dramatic, they came from extraordinarily low levels and were fueled by temporary government programs like Cash for Clunkers and tax credits for home sales.
On Wall Street, stocks fell as analysts said the market was running out of reasons to move higher without more convincing signs of an economic recovery. The Dow Jones industrial average lost more than 70 points in morning trading, and broader indices also dropped.
The government makes three estimates of the economy’s performance for any given quarter. Each new GDP estimate is based on more complete information.
Economists had expected that the second look at GDP for the spring would show the economy contracting at a 1.5 percent rate because they believed companies had cut back more sharply on their inventories.
While inventories were cut more than initially estimated, that weakness was offset by upward revisions in other areas.
The government found that consumer spending, which accounts for about 70 percent of total economic activity, fell at an annual rate of 1 percent in second quarter, a slight improvement from the 1.2 percent decline reported last month. Residential construction and exports also were revised to show smaller declines.
Federal Reserve Chairman Ben Bernanke said last week the economy appeared to be “leveling out,” and was likely to begin growing again soon. President Barack Obama appointed Bernanke to another 4-year term Tuesday.
The clunkers program, which provides consumers rebates of up to $4,500 for turning in old gas-guzzlers for fuel-efficient cars, has helped spur activity in the auto and related industries. The economy also has been helped by stabilization in the housing sector, as sales of new and existing homes have risen for four straight months.

Thursday Stocks Rise After Slow Morning Start

Dow now at 9,564, up 21 points

NEW YORK (AP) — Investors are putting the brakes on the market’s recent rally despite more signs that the economy might be stabilizing.
Stocks fell Thursday, but were off their lows at midday, after a seven-day winning streak sent the Dow Jones industrials to another high for 2009 the day before. The declines were wide-ranging, with the sharpest losses in energy, technology and health care stocks.
Analysts say the market has been running out of reasons to move higher and is now looking for more convincing signs of recovery in the economy before resuming its upward march.
“Some would argue the market is a little bit ahead of itself,” said Jim Herrick, director of equity trading at Baird & Co.
The latest economic data failed to excite investors. The Labor Department said first-time jobless claims fell 10,000 last week to 570,000, just shy of economists’ expectations for 565,000.
Workers continuing to file for benefits, however, fell more than expected, declining to 6.13 million from 6.25 million in the previous week. It was the lowest level for continuing claims since early April.
Meanwhile, a Commerce Department report showed the nation’s economy shrank at a 1 percent annualized rate in the second quarter. The updated figure was unchanged from an earlier, preliminary reading on the nation’s gross domestic product, which measures the value of all goods and services produced within the U.S. Economists were expecting GDP to be revised to a 1.5 percent decline.
The Dow fell 6.65, or 0.1 percent, to 9,536.87, after earlier falling as much as 84 points. The Standard & Poor’s 500 index fell 4.96, or 0.5 percent, to 1,023.16, while the Nasdaq composite index fell 18.08, or 0.9 percent, to 2,006.35.
About three stocks fell for every one that rose on the New York Stock Exchange, where volume came to a light 600.4 million shares, compared with 548.1 million at the same time on Wednesday.
Volume has been extremely light as many traders take vacations, adding to the market’s recent choppiness. Trading has been erratic even amid data showing improvements in housing and consumer confidence. Investors are worried about extending the market’s impressive spring and summer rally, in which stocks have risen more than 45 percent off of 12-year lows since early March.
Analysts say temporary pullbacks are healthy for the market and provide buying opportunities for investors who have yet to jump back in after the devastating selling of last fall and early this year.
“There is just too much cash sitting on the sidelines,” said Phil Orlando, chief equity market strategist at Federated Investors. “You get one of these four or five percent moves down and suddenly you get a surge of money in stocks.”
On Thursday, energy stocks fell as oil prices slid 49 cents to $70.94 a barrel on the New York Mercantile Exchange.
Gains in some troubled financial stocks helped to offset the market’s losses. Shares of American International Group Inc. surged 23 percent, rising $8.74 to $46.43. CIT Group Inc. jumped 11 percent, adding 14 cents to $1.41.
Boeing Co. rose after saying its long-delayed 787 aircraft will be ready for its first flight by the end of this year. Shares jumped $4.03, or 8.4 percent, to $51.85.
Bond prices were little changed following a strong auction of seven-year notes.
The yield on the benchmark 10-year Treasury note rose to 3.45 percent from 3.44 percent late Wednesday.
Elsewhere in corporate news, luxury homebuilder Toll Brothers Inc. said it lost $472.3 million in its fiscal third quarter due to a tax-related allowance and a write-down. Toll Brothers would have been profitable had it not been for the charges. The company has said there are signs of improvements in some markets.
Shares fell 19 cents to $22.95. Other homebuilders also fell after recent gains. DR Horton Inc. fell 39 cents, or 2.8 percent, to $13.40.
In other trading, the Russell 2000 index of smaller companies fell 7.30, or 1.3 percent, to 576.72.
The dollar was mixed against other major currencies, while gold prices inched higher.
Overseas, Asian stocks fell after China said it would cut investment in some industries. Japan’s Nikkei stock average lost 1.6 percent, while China’s main index fell 0.7 percent.
Britain’s FTSE 100 fell 0.4 percent, Germany’s DAX index fell 0.9 percent, and France’s CAC-40 lost 0.5 percent.

SEED Board Dissolved

The Port of Bremerton has announced that a nonprofit board to oversee the now-defunct SEED program has been dissolved.
The board never really got going before the project was shelved.
SEED stands for the port’s once-wished-for Sustainable Energy and Economic Development program that called for a business incubator building to spawn clean business. The board would have overseen the incubator.
Jon Kroman, one of the board’s members, said they may informally explore other ways to bring clean-tech to Kitsap.

Rachel Pritchett

Look What’s Growing Out Back Where They Sell Outbacks

By Rachel Pritchett
It’s not a sight you see every day.
But there it is, a well-tended garden brimming with corn, beets, yellow squash and cukes right out back behind Peninsula Subaru and Suzuki in Gorst.
No, all these leafty vegetables aren’t here to help out the ailing auto industry. These carrots, peas and zucchini are headed to South Kitsap Helpline, to help feed the really poor.
Not surprising, it’s the only known community garden growing at a local auto dealership.
“We’re doing the right thing,” said Peninsula president and owner John Dionas. He got the idea recently when he was in attending a Subaru of America corporate meeting in New Jersey, spotted the corporate garden, and thought why not here.
The fenced, good-sized garden sits on a grassy area on the shore of Sinclair Inlet that’s hard to see from the highway.
Called “Peninsula’s Love Garden,” it’s a delight to customers and staffers who wander out from the showroom to find themselves in an oasis amid the constant stream of cars, fumes, and businesses that is Gorst.
It’s tended by two or three Peninsula employees headed by Carol Clinefelter.
“It creates good morale with the company,” Dionas said.
Employees have been harvesting for a couple of weeks now, and believe there’s still time for some more.
It’s going to be permanent, said Dionas, who’s also active in charity in the Gig Harbor area, where he lives.
“We’ll do it every year.”

Wednesday Stocks Waver After Six-Day Climb

Now 10 off at 9,529

NEW YORK (AP) — Stocks drifted Wednesday as positive reports on home sales and factory orders failed to galvanize buyers.
An increasingly cautious mood has gripped the market in recent days, following a period of fervid buying this spring and summer that sent stocks up more than 45 percent since early March. While economic data is improving, investors are now questioning whether the market can go much higher without clear evidence of economic growth.
“The general consensus seems as though the market is ripe for some sort of pullback at some point,” said Andrew Frankel, co-president of Stuart Frankel & Co. “We seem to be floating up on air.”
With trading volume and news flow tapering down amid Wall Street’s annual summer slowdown, analysts say there are few near-term catalysts that could spur the market higher.
Stocks seesawed without a clear direction Wednesday despite a Commerce Department report that said new home sales rose 9.6 percent in July for the fourth straight monthly increase. Sales rose to 433,000, the strongest pace since September and well above the 390,000 figure economists expected.
The latest sign of improvement in housing didn’t do much to impress investors, however, who have already factored in a recovery in the long-suffering home industry. Some of the latest gains can also be attributed to a federal tax credit for first-time home owners currently set to expire in November, and the industry has been pressing Congress to extend it.
Separately, the Commerce Department said orders for goods expected to last at least three years rose 4.9 percent in July — the biggest jump in two years and more than the 3 percent increase economists had expected.
However the overall increase was driven by a surge in orders for transportation equipment, which benefited from the government’s recently expired Cash for Clunkers program that drove thousands of people to trade in older vehicles for new cars. Excluding transportation goods, orders rose 0.8 percent, just short of analysts’ expectations.
In midafternoon trading, the Dow rose 9.52, or 0.1 percent, to 9,548.81. The Standard & Poor’s 500 index fell 0.12, or 0.01 percent, to 1,027.88, and the Nasdaq composite index fell 1.24, or 0.1 percent, to 2,022.99.
Declining stocks outnumbered advancers by about 3-to-2 on the New York Stock Exchange, where volume came to a relatively light 653.4 million shares, down from 730.8 million shares at the same time on Tuesday.
In other trading, the Russell 2000 index of smaller companies slipped 0.33, or 0.1 percent, to 582.89.
Shares of homebuilders surged for a second day after the housing data showed the supply of new homes on the market shrank to the lowest level since April 2007. If supply is decreasing, builders may need to ramp up production.
Hovnanian Enterprises Inc. rose 42 cents, or 9.2 percent, to $4.99, tacking on to its 6.5 percent jump the day before. Lennar Corp. rose 44 cents, or 2.9 percent, to $15.41. Both stocks are at their highest levels since October.
Retail stocks were mostly higher after a handful of upbeat earnings reports. Shares of Dollar Tree Inc. rose $2.59, or 5.4 percent, to $50.49 after the company posted a 51 percent jump in its second-quarter profit as its deeply discounted goods attracted cash-strapped consumers.
Sharp declines in industrial and material stocks also weighed on the market as commodities prices dropped again. A long rally in commodities prices that started earlier this year has been sputtering in recent weeks amid concerns of waning demand from China.
Oil prices fell further Wednesday after the government reported an increase in crude supplies. The same report a week ago, which showed an unexpected decline, touched off a rally in crude that sent prices to a 10-month high. Oil fell 63 cents to $71.42 a barrel on the New York Mercantile Exchange.
Government bond prices were slightly lower evern after an auction of $39 billion in five-year notes attracted favorable demand. The yield on the benchmark 10-year Treasury note rose to 3.46 percent from 3.44 percent late Tuesday.
The dollar rose against other major currencies. Prices for gold and other metals fell.
Overseas, Japan’s Nikkei stock average rose 1.4 percent. Britain’s FTSE 100 declined 0.5 percent, Germany’s DAX index fell 0.6 percent, and France’s CAC-40 lost 0.3 percent.

Port of Bremerton Candidates to Square Off

The two candidates now in the running for a seat on the Port of Bremerton board of commissioners will be featured in a community forum in Port Orchard the morning of Sept. 9 at Bayview Java and Deli.
Lynn Horton and Roger Zabinski will square off on the issues at 8 a.m. in the event sponsored by the Port Orchard Chamber of Commerce. Breakfast and coffee will be served starting at 7:30.
No reservations are needed. For further information, call the chamber at (360) 876-3505.

Parking at Port Orchard Marina When There’s an Event


A Port Orchard Marina tenant told Port of Bremerton commissioners Tuesday he was upset that the marina parking routine was upset during the recent Cruz classic car show.
The port apparently moved tenant spaces next to the port building, but the man said police directing cars didn’t tell him. Further, the man said, the event should be out at the Kitsap County Fairgrounds.
Commissioner Larry Stokes shot back that the event draws people and their money from all over, and that marina tenants ought to think about getting some community spirit.
The man said his marina contract includes parking.
Stokes said the inconveniences is only for a day.
CEO Cary Bozeman broke up the public confrontation, saying he’d contact the man directly.

That’s pretty much what passed for news at the port meeting Tuesday evening.

Rachel Pritchett

Tuesday Stocks Rise on Improved Consumer Sentiment

Now up 80 points to 9,589

WASHINGTON (AP) — Consumer sentiment rose more than expected in August and expectations hit the highest level since the recession began, indications that Americans’ pessimism about the economy may be lifting.
The housing sector also showed signs of life as a national measure of home prices posted its first quarterly increase in three years.
The New York-based Conference Board said Tuesday its Consumer Confidence index rose to 54.1 from an upwardly revised 47.4 in July. Economists surveyed by Thomson Reuters had expected a slight increase to 47.5.
Still, the index is well below 90, the minimum level associated with a healthy economy. Anything above 100 signals strong growth.
Economists closely monitor confidence because consumer spending accounts for about 70 percent of U.S. economic activity. Consumer sentiment — fueled by signs the economy is stabilizing — has recovered a bit since hitting a record-low of 25.3 in February.
Many analysts expect the economy to grow 2-3 percent in the current July-September quarter, spurred by a more stable housing market and the Cash for Clunkers program, which has boosted auto sales.
But economists worry that without healthier consumer spending, the recovery may weaken next year.
The housing slump and a weak job market have made consumers reluctant to spend. But the outlook for jobs is improving, the Conference Board said, with fewer respondents saying positions are “hard to get,” and more claiming they are “plentiful.”
Consumers’ expectations for the economy over the next six months rose to 73.5 from 63.4 in July, the highest level since December 2007, when the recession began. The consumer confidence survey was sent to 5,000 households and had a cutoff date for responses of August 18.
Sal Guatieri, an economist at BMO Capital Markets, said the jump in the expectations index meant consumers likely will spend more in the months ahead.
“It won’t be a smooth ride, but with consumer confidence now tracking higher, the groundwork for a sustainable recovery appears to be in place,” he wrote in a note to clients.
The housing sector also received positive news. The Standard & Poor’s/Case-Shiller’s U.S. National Home Price Index rose nearly 3 percent in the second quarter from the January-March period, the first quarterly increase in three years. Home prices, while still down almost 15 percent from last year, are at levels last seen in early 2003.
The reports, along with President Barack Obama’s reappointment of Ben Bernanke as Federal Reserve chief, sent the financial markets higher. The Dow Jones industrial average rose 70 points in morning trading, and broader indices also gained.
Obama said Tuesday that his administration’s $787 billion stimulus package, and the extraordinary efforts by Bernanke to pump trillions of dollars into the financial system, have helped turn the economy around.
“Our auto industry is showing signs of life,” Obama said. “Business investment is showing signs of stabilizing. Our housing market and credit markets have been saved from collapse.”
Jobs are a weak spot, however, and could limit future consumer spending if Americans remain concerned about layoffs or declining wages.
Still, the Labor Department reported earlier this month that the unemployment rate dipped for the first time in 15 months, and workers’ hours and pay rose slightly in July. The unemployment rate slipped to 9.4 percent, from 9.5 percent, while July job losses slowed to a total of 247,000, the fewest in a year and a big improvement from June’s 443,000.