Midwest farm land rising steeply in value

Agricultural land value is soaring in the Midwest, with parts of the region surging 25% from last year, according to two recent Federal Reserve surveys. The jump is the highest increase in three decades.

Record farmland prices are also being reported in the northern Plains.

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Surveys released by the Kansas City and Chicago Federal Reserves Tuesday find that despite a struggling U.S. housing market, agricultural land in their districts is booming. And the run-up in prices may have yet to peak, they said.

“District farmland values surged to a record high in the third quarter,” the Kansas City survey said. “Cropland values rose more than 25 percent over the past year, and ranchland values increased 14 percent.”

In particular, Nebraska experienced exceptionally strong gains in the Kansas City District due to bumper crops — especially productive seasons for certain crops — reporting a roughly 40% rise in farmland prices from one year ago.

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The surveys indicate that good credit conditions, successful harvests, and elevated levels of farming income helped to contribute to this large surge in an already strong agricultural property market.

According to the Chicago Fed, farmland values in its district had their largest increase since 1977, jumping 7% from the previous quarter.

Iowa farmland prices led the Chicago Fed’s district, jumping 31% from last year’s 3rd quarter.

0:00 / 2:37 Turning farmland into oil fields

However, not every state in the region had such historic success.

The southern Plains, Oklahoma in particular, saw more modest increases — mainly due to devastating droughts, affecting yields from crops and livestock.  

Industry seeks cleaner fracking fluid

Last summer a Halliburton executive did the unthinkable: He took a big ol’ swig of hydraulic fracturing fluid.

No, he didn’t have a death wish. And yes, he appears to be doing just fine. He did it to prove a point: fracking fluid need not be toxic.

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What the exec drank was a new formulation of fracking fluid made with ingredients sourced from the food industry rather than the chemical industry.

As public concern over the controversial practice of fracking mounts, Halliburton and a host of other companies are racing to fill a major void: finding a way of cracking rock to unlock oil and natural gas that is also environmentally benign.

There are still a host of concerns surrounding fracking that aren’t addressed by changing the fluid or purifying the water. But as more firms bring innovative technologies to market, chances grow that this technology might someday be embraced by the general public.

Fracking fluid from the food industry: Halliburton announced its new fracking formulation earlier this year to relatively little fanfare.

Traditional fracking fluids rely of hydrochloric acids and other chemicals that allow the industry to crack shale rock. The technology has unleashed a boom in domestic energy production, but it’s also raised concerns over water contamination.

Halliburton’s new fracking formula and methods “don’t quite call for the downhole delivery of fruits and vegetables,” the company’s web site reads. “But it does rely on some of the same acids and enzymes present in those items to create one of the most innovative and environmentally safe fracture solutions ever conceived.”

Halliburton (HAL, Fortune 500), which is one of the world’s largest hydrofracking companies, wouldn’t say how many of the wells it works on have used the new formula or how much more it costs compared to a traditional frack job.

But it pointed to a well operated by the El Paso (EP, Fortune 500) natural gas company in North Louisiana as the first last May to employ this new fluid and two other innovative fracking measures designed to protect the environment.

Halliburton is hardly alone in this quest to make fracking safer. And as with any emerging technology, many small, nimble firms are also taking up efforts to clean up the fracking process.

San Diego-based Verenium (VRNM) is a company that makes enzymes primarily for the biofuels and chicken feed market.

But it has recently branched into fracking, developing an enzyme that replaces hydrochloric acid normally used to eat away at guar, a foam the industry uses that initially helps pry the rock open.

Land a job in a North Dakota boomtown

“You spill an enzyme on your hand and nothing happens, it doesn’t eat it off like an acid would,” said Verenium chief executive James Levine. “And it’s not like you have to sacrifice performance, you can get both.”

Levine also wouldn’t elaborate on costs, but said he can deliver a product that’s competitive with anything out there.

He said he has one major fracking firm that’s experimenting with his product, but declined to provide any more details.

He noted that replacing hydrochloric acid with an enzyme doesn’t take all the potentially harmful chemicals out of frack fluid, but it’s a start.

Companies are also working on cleaning up waste water associated with fracking.

In addition to the harmful frack chemicals oil companies put down the wells, they also pull out some pretty nasty stuff.

The water that’s found at the depth the industry drills to is often extremely salty and laced with naturally occurring heavy metals and radioactive isotopes.

0:00 / 2:24 Lady roughnecks in North Dakota man-camps

Disposing of this waste water has been a challenge. Reports have indicated that some frack water has previously been improperly treated before being dumped into rivers that are also used a source for drinking water.

Fountain Quail, a division of Calgary-based Aqua Pure, which bills itself as the “premier recycler of industrial wastewater in North America” says it too is now getting in on the fracking game.

The company has built a small, transportable machine that uses natural gas to boil the waste water from fracking operations.

It’s a closed loop-process, meaning that the steam created is in turn used to reheat the next batch of water, resulting in an efficiency rate 40 times greater than just boiling water on a stove.

The end result is water that meets federal drinking standards, and a solid waste product that can be transported to a proper landfill.

The fracking public relations mess

The clean water can be used again in fracking operations, resulting in what the company says is a 90% reduction in truck traffic serving the drill sites. Truck traffic is a major concern among people living in areas where fracking is widespread.

“Every barrel of salt water that we recycle is a barrel of fresh water that doesn’t have to be taken from the environment,” said Brent Halldorson, Fountain Quail’s chief operating officer.

Halliburton also has a technology that uses electricity as the purification agent.

“Companies are looking at water as a strategic resource, and that’s cascading into innovation,” said Will Sarni, director of enterprise water strategy at Deloitte Consulting. “Sustainability is a huge driver.”

But is it any safer? Environmentalists regard the new technologies as welcome but unproven.

“It’s good news that companies are trying to innovate and develop products that are more environmentally friendly,” said Amy Mall, a policy analyst for the Natural Resources Defense Council. “But we need third party verification of these claims.”

Mall noted that other problems associated with fracking remain, such as the migration of natural gas unlocked by the fracking process up water well holes.

It’s this gas migration, whether caused by the fracking process or not, that’s led to the dramatic images of people’s tap water catching fire.

There have also been recent reports suggesting fracking is behind a series of earthquakes in Oklahoma, England and elsewhere.

Still, for an industry under fire from the public and politicians alike, any attempt to make the process safer is bound to be welcome.  

Wealthy less optimistic about economy

Pessimism toward the U.S. economy — particularly concerning the near future — is rapidly growing among America’s wealthy, according to the PNC Wealth and Values Survey released Wednesday.

“Only 10% of respondents are optimistic about the U.S. economy,” the annual survey said. “Nearly half characterize the U.S. financial system as ‘broken.'”

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In addition, the survey indicates that 76% of America’s affluent are concerned with the U.S. economy specifically over the next six months, a sharp increase from 57% last year.

“The survey captures the anxiety and frustration of the economic and political environment that we are in,” said Thomas P. Melcher, executive VP and managing director of Hawthorn, a division of PNC Wealth Management.

“These results clearly tell us wealthy investors are looking for more positive news to get them back on a more confident path.”

However, the study reports that most of the high-net-worth individuals surveyed have not been hurt by the struggling economy – only 20% of respondents claim their net worth has declined over the past five years and 45% have seen growth.

0:00 / 1:46 ‘I’ve given up thinking about money’

This may be why — despite overall pessimism — 81% of those surveyed remain confident that they will maintain or grow their assets in the long term.

“The bottom line remains: investors should look to the long-term horizon and determine their own risk tolerance,” according to Melcher.  

Some optimism for 2012 labor market

The unemployment rate is expected to remain uncomfortably elevated in 2012: 8.5%, vs. 9.0% this fall. Yet recruiters and hiring managers say the job market won’t be nearly as bad next year as it’s been.

Hiring is picking up in several sectors, led by manufacturers that are benefiting from a weak dollar, and technology firms gearing up to meet growing demand from businesses upgrading their software and systems. Health care remains a hiring stalwart, and even nonprofits, which were hit especially hard by funding cuts in 2009 and 2010, are expected to rebound.

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The market should also turn up for skilled workers and top performers, as companies are having a surprisingly tough time finding them. And if you’re employed, there’s some good news too: 97% of organizations plan pay hikes in 2012 — modest though they may be.

The action plan: Prove to your boss — or a new employer — that you have expertise that’s in demand

Fill the market’s gaps. The shortage of skilled professional workers is a real opportunity. Think you’re lacking a key skill set? Find out if there’s a job-rotation program at your firm. And work toward certification or training in areas of need at your company.
Make Money in 2012: Savings and credit

“It’s not easy to find the time to invest if you’re working or job hunting, but that kind of initiative gives you a clear advantage,” says Geoff Hoffmann, chief operating officer at executive recruiting firm DHR International.

Cover your gaps. If you’re unemployed, you’ll have a hard time landing jobs with big employment gaps on your résumé. So work your network — start with your former employers to land project or consulting work, says Jodi Glickman Brown, CEO of Great on the Job.

Raise your profile. You already know how valuable social media are for job hunting. But they can be used to land a promotion or a better-than-average salary bump as well.
Best Jobs in America

For example, use LinkedIn’s new skills tool to peruse profiles of higher-ups and top performers at your firm to see what experience they highlight.

Don’t know them personally? See if you have mutual connections to meet in person for career advice. Internal networking is hugely valuable: Hiring managers often prefer internal candidates (they’re less costly), and referrals from current employees carry weight.

Greek worries sweep markets

 

A wave of selling swept Wall Street and stock markets around the world Tuesday after Greece said it would let its people vote on an unpopular European plan to rescue the Greek economy.

The Dow Jones industrial average plunged nearly 235 points, or 2.6 percent, by the early afternoon. It sank 276 points the day before. The stocks of major banks, including Citigroup and JPMorgan Chase, were hit hard.

Intense selling roiled markets in Europe. Italy’s main stock index dropped 6.8 percent. France’s fell 5.4 percent and Germany’s fell 5 percent.

The value of the dollar rose, and bond prices jumped so dramatically that analysts said they were stunned. Analysts said the bond action reflected fears that the turmoil in Greece would tear at the fabric of Europe’s financial system.

“The Greek referendum puts the connections between European countries at risk, from free-trade agreements to the common currency,” said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

The prime minister of Greece said unexpectedly Monday that he would put the European rescue plan to a binding vote, the first referendum to be held in Greece since 1974.

The plan requires banks that hold Greek national bonds to accept 50 percent losses to help keep the Greek economy afloat. It also beefs up a European bailout fund and requires banks to strengthen their financial cushions.

International creditors have demanded that Greece enact painful tax increases and drastic cuts in public welfare programs, and Greeks have shown their hostility to those measures in violent protests and strikes.

If the European rescue falls through and Greece defaults on its debt, the ripple effect would be global. Europe could fall into recession, hurting a major market for American exports, and banks could severely restrict lending.

“The market is being held hostage by a random event that is overshadowing everything else,” said John Canally, an economist at LPL Financial. Canally noted that U.S. manufacturing continued to expand in October and that builders spent more on projects for the second straight month.

The Dow was down 232 points, or 1.9 percent, to 11,724 at 1:30 p.m. Eastern. It had been down as many as 320 points at midday.

The S&P 500 was down 28, or 2.3 percent, to 1,225. The Nasdaq composite fell 68, or 2.5 percent, to 2,616.

Pfizer Inc. was the only company in the Dow stock to rise. It gained 2 percent after its quarterly results beat Wall Street’s estimates.

In the United States, the market sank Monday before the surprise Greek announcement. MF Global Holdings, a securities firm led by former New Jersey Gov. Jon Corzine, was driven into bankruptcy in part because it held European debt.

The selling accelerated after the Greek announcement, and the U.S. market opened Tuesday with a drop of almost 300 points.

Some of the selling in stocks came because investors were eager to lock in profits after an almost uninterrupted rally in October. The Dow had its best month in nine years, and the Standard & Poor’s 500 index its best in 20 years.

In the bond market, the yield on the 10-year Treasury note sank to 2.02 percent from 2.16 percent late Monday, a steep drop. Bond yields fall when their prices rise as investors buy assets that are considered to better hold their value during a slowing economy. The dollar rose to $1.36 for every euro.

The yield on the 30-year Treasury bond sank from 3.38 percent Friday to 3 percent Tuesday.

“That’s the biggest change that I’ve seen in my career,” LeBas said. “It’s obscene.”

The yields of Italian debt spiked to their highest level this year, another sign that investors are concerned that the debt crisis could spread to the larger economies of Europe. The yield on 1-year Italian government bonds soared 48 percent to 5.17 percent.

The yield on the 10-year German bund plunged to 1.78 percent, a 23.5 percent fall from the day before. The German economy is seen as the strongest in Europe and the most likely to repay its debt.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

See full article from DailyFinance:http://srph.it/sa20tq

Consumers still not confident about the economy

A newpoll from Bankrate.comshows that only 17% of Americans feel better off financially than they were a year ago.

Bankrate.com’s monthly Financial Security Index fell from 93.9 to 92.8 in October, its second lowest level this year. According to Bankrate.com, anything below 100 is a clue that in general, people are feeling less financially secure compared to 12 months ago.

“The weak economy, ailing housing sector and volatile stock market continue to undercut consumers’ feelings of financial security,” said Greg McBride, CFA, senior financial analyst for Bankrate.com, in a prepared statement. “Americans’ feelings about their savings, debt and net worth continue to erode.”

How does your financial situation compare to a year ago
I am doing better.\r\nI am about the same.I am starting to struggle.I am much worse.I am thinking about bankruptcy.Vote

Just how low folks are feeling? Only 11% of Americans said they were more comfortable with their savings now that a year ago, which was a new low. And when it comes to debt, only 20% said they were more comfortable than they were 12 months ago. That percentage has dropped monthly since June.

Meanwhile, 19% said their net worth was higher than this time last year, compared to some 30% who said their net worth had dipped.

Seniors are the group that’s most earnestly crying the blues: 34% of those ages 50-64 surveyed, said they feel less secure in their jobs; 56% said they feel less comfortable with their savings, and only 5% are more comfortable. Nearly 40% of retirees say their overall financial situation is worse than a year ago, and a mere 7% are feeling things are better.

 

Economists say consumer confidence has been shaken by persistent weakness in the job market and the sustained slump in the real estate industry.

 

William “Joey” Smith, an economist with the University of West Georgia, said only when jobs come back will the housing industry bounce back.

“Job growth is needed for the housing sector to rebound,” he said. The rate of foreclosures has declined in most areas, but is still at a rate that causes concern, he says, and that only adds to the economic uncertainty that plagues the nation. Smith spoke at UWG’s annual economic forecast breakfast in Carrollton, Ga.

 

 

See full article from DailyFinance:http://srph.it/unO4Wd

Bank of America Drops Plan for Debit Card Fee

Bank of America has abandoned plans to begin charging debit card holders five dollars a month to use their cards, a proposal which drew intense consumer and political backlash since announced in late September.

“We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee,” said Bank of America co-COO David Darnell said in a written statement. “Our customers’ voices are most important to us. As a result, we are not currently charging the fee and will not be moving forward with any additional plans to do so.”

The company’s move may bring the closing chapter to a public relations campaign from major U.S. banks that has lasted more than a year, during which financial titans insisted that last year’s Wall Street reform bill had made debit cards unprofitable for banks, forcing them to charge new monthly fees.

After Congress required the Federal Reserve to crack down on the fees retailers pay banks to accept plastic, banks insisted the rules would leave them with no choice but to impose new charges on consumers. When BofA rolled out its new debit card fee, the company’s spokespeople portrayed the move as part of an inevitable industry-wide response to the fee limits that was dictated by basic economics.

“This is not just a question for us, it’s for all banks,” BofA spokesperson Ann Pace told HuffPost in late September. “The price of a debit card was previously determined by the amount and type of transactions. We were able to pass some of these costs along to merchants, but because of regulatory changes, we are adjusting our pricing to reflect today’s economics.”

Bank of America CEO Brian Moynihan also defended the fee in October, saying that the bank “has a right to make a profit.” But retreating from the fee will likely help the bank keep customers. One-third of consumers said they would leave their bank if it started charging a debit card fee.

A month later BofA and other banks seem to have rethought those economics.