May 31, 2007

Menu Foods: Will Survive Recall of Tainted Pet FoodComments (0)

Filed under: business — admin @ 11:33 pm

OTTAWA—Menu Foods Income Fund insisted Thursday that it will survive the fallout from a huge recall of contaminated pet food that is expected to cost at least C$45 million ($42 million), as more customers cancel orders and lawsuits mount.

Executives said they were confident that a bigger line of credit will help see the company through the recall, expanded several times and dubbed one of the largest in North American history.

Menu Foods has recalled at least 60 million packages of pet food after reports of 14 animal deaths. It said the foods contained contaminated imported from .

“Menu’s been in business and at various sizes and at different scales for 35 years and the intent will be that we will continue to be around,” Chief Executive Paul Henderson said on a conference call to discuss first-quarter results.

He pointed to a recently-increased bank facility, to US$50 million from US$30 million. The company also has a facility for US$85 million in senior secured notes.

Menu Foods also expects to once again begin shipping many of the recalled pet food brands in the second quarter and into the third quarter.

“All of those things essentially will see us, in my opinion, through the recall,” Henderson said.

Cormark Securities analyst Aleem Israel agreed, saying Menu Foods has survived hard times in the past. He cited problems in 2005 when rising costs led the company to breach its bank covenants.

“He’s (Henderson) been in the situation where his back was against the wall,” he said from Toronto. “They were very good at managing their way out of that.”

But it won’t be easy for Menu Foods to find its footing again.

The C$45 million recall cost excludes the impact of lower sales and any lawsuits exceeding the company’s insurance. Menu Foods now faces nearly 90 lawsuits in North America, Henderson said.

The company also said it expects to borrow more money because of the recall at higher interest rates under an amended credit agreement.

“Both of these changes are expected to increase the fund’s financial expenses going forward,” the company said in a statement. Company executives were unable Thursday to estimate the impact of higher interest costs.

In its first-quarter, Menu Foods posted a net loss of C$17.51 million, or 91.8 Canadian cents a unit, compared to profit of C$1.3 million, or 73 Canadian cents a unit, in the prior-year period. Sales slumped to C$64.5 million, from C$93.9 million.

No distributions were declared during the quarter and the board will not consider resuming them “for the foreseeable future”.

The company said it expects second-quarter sales and operating results will be “adversely affected” by the recall.

Israel said he is not concerned by small customers who have canceled orders because the biggest customers need Menu Foods’ capacity.

Menu Food units dipped 12 Canadian cents to C$4.01 on the Toronto Stock Exchange Thursday.

Forex - Euro falters after unexpected German retail sales slumpComments (0)

Filed under: fx — admin @ 11:32 pm

LONDON (Thomson Financial) - The euro faltered in early trade after an unexpected decline in German retail sales dented sentiment while a jump in area-wide money supply figures went by hardly noticed.

German retail sales were down 0.7 pct in March from February, confounding predictions of a 0.9 pct increase.

The sharply out of line figure took the wind out of the euro’s sails. Last week, the single currency hit a fresh all-time high of 1.3682 usd.

Stuart Bennett at Calyon said while the data sent the euro lower, it is not likely to put off the European Central Bank (ECB) from hiking interest rates to 4.00 pct in June as widely expected.

The euro’s next test came in the form of M3 money supply figures for March, which came in much higher than expected. Due to favourable base effects, the annual rate was predicted to slow to 9.8 pct from of 10.0 pct in February. In the event, M3 jumped to 10.9 pct, taking markets by surprise.

Marios Maratheftis at Standard Chartered said the key thing is that the euro has failed to sustain a break higher despite weak US data last week and that today’s lacklustre performance is due to this failure.

He said the euro has succumbed to profit taking and position squaring.

To add the mix today, euro zone inflation data is due out at 10 am BST, with a slight slowing predicted. Euro zone inflation is expected to ease to a provisional 1.8 pct in April from 1.9 pct in March, taking it back to the level seen in January and February.

Over in the US, the dollar also faces key tests.

“Data releases this week will provide a key test for the currency, especially given the prospects for another batch of soft figures over coming days,” said Mitul Kotecha at Calyon.

The US April employment report at the end of the week will be in focus.

“We look for a below consensus payroll gain of 75,000 compared to an increase of 180,000 in March,” said Kotecha.

“If there is a single release that could prompt the euro to sustain a break higher, then a disappointing jobs report expected on Friday could be the trigger for the move,” added Kotecha.

Up for release today are consumer spending and income which are seen rising by 0.5 pct and by 0.7 pct respectively in March. Meanwhile the Chicago Purchasing Manager’s Index is seen falling to 53.2 in March from 61.7 in February.

The pound, meanwhile, was softer despite yet another strong housing market report, this time from property website Hometrack.

Hometrack revealed house price rises of 0.7 pct month-on-month in April and by 6.8 pct year-on-year in April, but suggested higher interest rates and growing affordability pressures are starting to have an impact on the rate of growth.

Later today, the GfK’s April consumer confidence barometer is predicted to show a slight decline, reflecting higher inflation and interest rates.

London 0815 GMT Sydney 0343 GMT

US dollar

yen 119.60 up from 119.52

sfr 1.2080 up from 1.2045

Euro

usd 1.3595 down from 1.3645

yen 162.68 down from 163.02

sfr 1.6425 down from 1.6438

stg 0.6820 down from 0.6836

Sterling

usd 1.9939 down from 1.9964

yen 238.45 down from 238.56

sfr 2.4096 up from 2.4039

Australian dollar

usd 0.8264 down from 0.8282

stg 0.4146 down from 0.4149

yen 98.84 up from 98.965

sivakumar.sithraputhran@thomson.com

ss/vlb

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Rate risk falls with inflationComments (0)

Filed under: realty — admin @ 11:32 pm

INFLATION is expected to fall in 2007, which will take pressure off interest rates and ease pressure on households hit by three interest-rate rises last year.

The Reserve Bank of Australia (RBA) said today with recent falls in oil prices and the unwinding of the banana price increases, the annual headline consumer price index (CPI) rate was expected to fall below 2 per cent in mid-2007 compared to 3.3 per cent in the December quarter.

The RBA said in its quarterly statement on monetary policy that underlying inflation was expected to move down to 2.75 per cent, from an earlier forecast of around 3 per cent.

The forecasts are good news for homebuyers, who were hit with three interest rate rises in 2006, which took the official cash rate to 6.25 per cent and standard variable lending rates over 8 per cent, their highest level in six years.

The RBA sets interest rates to keep inflation between 2 and 3 per cent.

But while the central bank expects inflation to fall back within its 2 to 3 per cent medium-term target range, inflation will still hover at the upper end of that band, highlighting the risk that inflation pressures will remain, keeping the bank with an interest-rate tightening bias.

“These forecasts represent a modest downward revision to the inflation forecast contained in the previous statement … and the likelihood that recent falls in world oil prices will result in some dampening effect on cost pressures and inflation expectations,” the RBA said.

In its last statement in November, the central bank forecast underlying inflation would continue to run at about 3 per cent.

The quarter-on-quarter headline CPI rate fell by 0.1 per cent in the fourth quarter – the first fall in eight years – reflecting a sharp fall in petrol prices and a partial unwinding of a spike in banana prices.

Analysts said interest rates were likely to remain on hold, possibly for all of 2007, but a rate cut was unlikely.

“Overall, this statement is slightly more optimistic that the bank may have ’seen off’ the inflation pressures that were evident in the first half of 2006,” said Bill Evans, global head of economics with Westpac Bank.

“However, much more evidence will be required before it can be confident, and with forecasts still to be in the top half of the target range, there is no evidence that the bank may be considering cutting rates.

By the same token, this is not a statement from a central bank who feel that higher rates may be necessary in the near term. We have no reason to change our view that rates are on hold in 2007,” Mr Evans said.

Higher rates hit homeowners hard in 2006, forcing home vendors to drop their prices while a rising number of home owners are finding their mortgage is worth more than their home.

Around two thirds of the 1894 people surveyed in December by NEWS.com.au - or 68 per cent - expected house sellers would be forced to sell for less as a result of higher interest rates.

And over half the respondents, or 59 per cent, said the combined impact of three rate rises in 2006 had made it more difficult to make home loan repayments.

Nicki Bourlioufas is the business editor of NEWS.com.au

Mistaken identityComments (0)

Filed under: business — admin @ 11:32 pm

There was a moment when Claudia, as a young gay man living with the person she describes as the love of her life, was “blissfully happy”. Now, approaching 50 and medically retired from her successful career as an opera singer and performer, she is full of regrets. “I feel I was railroaded into having a sex change,” she says, “when I should have been enabled to live happily in my own skin.”

Claudia, who does not wish to reveal her surname, is one of a growing number of male-to-female transsexuals who regret undergoing gender-reassignment surgery. In 1985, after a consultation with psychiatrist Russell Reid that she says lasted only 45 minutes, she was diagnosed as transsexual and referred for surgery. Reid, until his retirement last year, was the UK’s best-known expert in gender identity disorders (GIDs). During more than 20 years of practice, Reid was responsible for assessing whether those wishing to change sex fitted the criteria for treatment. On Monday, after a case lasting three years, the General Medical Council’s disciplinary committee ruled that Reid had prescribed hormones to five of his patients too soon, and referred them for genital surgery without properly assessing their mental and physical suitability.

The complaints were made by four doctors at the gender clinic at Charing Cross hospital based on the cases of five male-to-female transsexuals. Claudia was keen to be a complainant, but the GMC ruled that due to minor inconsistencies in her recollection of the consultation with Reid 20 years previously, and because they had sufficient witnesses with similar complaints, she would not be included in the disciplinary case against Reid. She is, however, currently pursuing a civil claim for damages against him.

Growing up in a tough working-class neighbourhood in the east end of Glasgow, Claudia was, she says, constantly reminded of the worst aspects of manhood, and had no desire to become like the men she encountered every day.

“The women wore the trousers in my family,” she says, “with my mother and grandmother keeping things together.” The men in the neighbourhood, meanwhile, “battered each other, got drunk, and molested children”. Anything less than macho and violent, recalls Claudia, and you were not considered a “real man”.

From primary school onwards, Claudia was bullied for being effeminate, and called a “he/she”. “I grew up believing I could never live my life as a ‘real’ man. I never for one moment thought I was a little girl trapped in a boy’s body; I just did not want to be the sort of boy I was expected to be.”

Claudia was “terrible at all sports”, had no friends and felt totally segregated. “I was battered every single day at primary school, and it only got worse at secondary school,” she says. “I learned all about the rage of young men, and the last thing I wanted to do was become one.”

By the time Claudia had her first real relationship, she was 18 years old and very sexually inexperienced. She met Martin (not his real name) in 1976 when she was at hairdressing college and he at Strathclyde University.

“He was beautiful,” Claudia recalls, “like a cross between Jesus and George Best.” They soon became lovers and moved in together in Glasgow. Martin, however, insisted he was heterosexual and referred to Claudia as “a woman with a penis.”

Claudia had begun to dress as a woman in order to stop the homophobic bullying she endured on a daily basis. “I looked so androgynous,” she says, “I had two choices. One was to butch up, the other to dress as a woman.”

With Martin as her manager (he was from a family of musicians), Claudia’s love of singing and performing became a lucrative career for them both. In her early 20s Claudia began touring abroad with her show. She soon found that her days of being bullied for her appearance were not over. On her way from Paris to the Hague, a border guard took exception to Claudia dressing in a feminine manner when her passport confirmed she was male. “He had a wobbly, and really battered me,” says Claudia. “When I got home Martin said we had to ‘fix it’ once and for all.”

Under increasing pressure from Martin, who insisted Claudia was “really a woman”, she decided to undergo hormone treatment as a first step in the direction of a complete sex change.

Having been prescribed hormones by a psychiatrist in Glasgow, Claudia began to live as a woman, just before moving to London with Martin in 1985. Hearing from friends in the close-knit transsexual community that one of the only surgeons who carried out gender-reassignment surgery was about to retire, she made an appointment with a psychiatrist to whom many of her friends referred as “Uncle Russell” - Reid - who was then based at Charing Cross.

Claudia says that during the 45-minute consultation, Reid asked her how she was earning her living; how long she had been taking hormones; and whether she had played with dolls as a child. Claudia explained that her life was bound up with her boyfriend, who was also her manager. She told him she wanted to change sex because she was living with a man who was not gay and that he was having affairs with women.

“Warning bells should have been ringing for him there and then,” says Claudia. “Even I was aware at the time that those reasons weren’t good enough.” However, Claudia was convinced her troubles - with bullying, and her relationship with Martin - would be over if she changed sex.

“Martin slept with women the whole time I was with him,” says Claudia, “and would say, ‘If you were a girl, this wouldn’t be happening,’ and of course I believed him.” A year after the surgery, Martin left Claudia.

“If I had been properly assessed, it would have been obvious that sex-change surgery was inappropriate for me,” says Claudia. “I was desperately unhappy and was going for a sex change because I felt under pressure from my boyfriend.” No searching questions were asked about her background and no warning or preparation were given as to the impact of such life-changing surgery. That surgery took place just three months after her consultation with Reid.

Since the case against Reid began, many in the transsexual community have spoken in support of him. Websites serving the gay and transgender communities are full of comments about how Reid has shown phenomenal support to numerous transsexuals. He “has saved the lives of many trans people, treated them with respect and left them with the dignity they deserve,” reads one post. Many others wrote in, agreeing.

Claudia’s world, however, began to crumble soon after the surgery. “My body was not my own any more,” she says, “and it turned out not to be the success I had been led to believe it would be, in more ways than one.” She found sex difficult, as the surgery had not been entirely successful. In pain and discomfort, her confidence was at rock bottom and her desire for sex nonexistent.

Soon after her change, Claudia became sucked into the world of transvestism and transsexualism, even though it felt “alien” to her. “I was by then a very successful opera singer and drag performer,” she says, “but as soon as I had my surgery I lost all confidence. Rather than going on stage in character, I was there as this thing. There is a huge leap from being a cross-dresser to being a transsexual.”

When Claudia’s relationship with Martin broke down, so did her professional and home life. Soon afterwards, she suffered a breakdown. Claudia moved in with her mother in Glasgow, and it was then that she first sought help for depression. “Before the breakdown I was in total denial that the cause of the problems was the sex-change operation and its consequences.”

In 1995 Claudia suffered a sexual assault, an event she found deeply traumatising. At first police, not realising Claudia was a transsexual, were sympathetic. When the forensic examiner realised, however, everything changed. “Policemen would come into the room I was in, just to have a look at me. Some would laugh. It was then that they stopped taking the attack seriously. “It was during her recovery that Claudia had the opportunity to reflect further on how drastic a mistake it had been to have sex-change surgery to correct her psychological problems.

After reading the novel The Silence of the Lambs, which includes an account of a man who wanted to have a sex-change operation but was not referred for one because he did not meet all the criteria, Claudia realised that she had not met them either. “It was only on reading that book that I realised that there were any criteria in place for assessing patients for sex change,” she says, “and that psychiatrists had to take account of these before referring somebody for such a drastic life-changing operation.”

Before being prescribed hormones, patients seeking to undergo gender-reassignment surgery should be able to display demonstrable knowledge of the effects of hormones on the mind and body, and their benefits and risks. Three months before taking hormones, patients should be advised to undergo a period of psychotherapy. Before surgery is considered, the general guidelines stipulate that patients should live full time in their desired gender role for at least a year to see how they cope with work, family, friends and relationships. “I neither lived properly as a woman,” says Claudia, “or had counselling to prepare me for what was coming.” In 2004 another of Reid’s former patients, the businessman Charles Kane, complained that he had been referred for gender-reassignment surgery after living as a woman for only a month.

Despite being an optimistic person, Claudia is dreading growing old alone. “I’ll never have a relationship. Who’s going to want me when they could get a real woman?” she says. “I am not a woman, I am a sex change, and men know that.” For Claudia to live as a woman with a partner, she believes she would have to reinvent her past life and pretend she grew up as a woman, something she is not prepared to do. “It is not possible to integrate and ‘pass’ in the same way that it used to be, because of all the raised awareness. People know what to look out for.”

Claudia is not bitter about her experiences, but would like an apology from Reid, and some financial compensation to reflect that fact that her sex change ruined her career and personal life. She would also like to help prevent other troubled young men going through the same traumatic experiences.

“I fundamentally regret having had surgery. I could have lived as a woman without mutilating my body, but no one talked to me about the possibility,” she says. “I could have been enabled to live happily as a gay man. Instead I was put in this box - transsexual - simply because I did not conform to what psychiatrists think a real man should be.”

What does Claudia miss about being a man? “Standing up to pee for convenience. Not waiting for the double take when an admirer first clocks me. And I miss having the newly acquired acceptance of my male body. I had just found some when I had the surgery.”

As gender-reassignment surgery becomes more commonplace in the UK, with more than 400 operations carried out each year, and since the recent implementation of the gender recognition bill, which allows those who have had reassignment surgery to change their passports and birth certificates to reflect their new sex, society seems to be becoming more accepting of a person’s right to decide to change their gender. For Claudia and others who regret having surgery, this is not good news.

“If we allowed people to be as they wish, whether that is a man being camp and feminine or a woman butch and unadorned,” says Claudia, “then the need to chop up healthy bodies to achieve that acceptance would diminish”.

Japanese Yen Slides FurtherComments (0)

Filed under: fx — admin @ 11:32 pm

The Japanese Yen continues to slide against the both USD and the Euro, despite Japans purportedly strong economy. The release of dovish inflation data was music to the ears of Japans Central Bank, which seems intent on leaving interest rates frozen at .5% for as long as Japans economy will support it. Meanwhile, volatility is way below its historical average, and traders remain committed to the carry trade. In addition, currency futures prices indicate that traders believe the Yen will fall further in the near-term. Bloomberg News reports:

In times of low volatility and plenty of cash, people tend to put on carry trades, said Meg Browne, a senior currency strategist.

Read More: http://www.bloomberg.com/apps/news?pid=20601101&sid=ainRRK7BuHnI&refer=japan

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