CANADA STOCKS-TSX sinks as growth fears intensify - Reuters UK CANADA STOCKS-TSX sinks as growth fears intensify - Reuters UK

Friday, June 1, 2012

CANADA STOCKS-TSX sinks as growth fears intensify - Reuters UK

CANADA STOCKS-TSX sinks as growth fears intensify - Reuters UK

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John Edwards gets off scot free in financial infidelity trial + slideshow - Examiner

The John Edwards trial, a prime example of financial infidelity linked to sexual infidelity, has ended in an acquittal and mistrial.

The end result is that after a 2- year investigation that cost taxpayers over $2 million dollars, a 4-week long trial, and 9 days of jury deliberation, Edwards gets off scot free.

As Time magazine observes, no other case of this type has grabbed headlines like the Edwards case.

This is the most noteworthy case of sexually-related financial infidelity to ever make the news. See Schwarzenegger and 3 Other High Profile Cheating Husbands Guilty of Financial Infidelity.

ABC News, which provided in-depth day-to-day coverage of the John Edwards trial, aptly points out that all of the improprieties Edwards was being tried for were either directly or indirectly linked to his extramarital affair with campaign videographer Rielle Hunter, his former mistress and mother of his 4-year-old daughter Quinn. 

Yet ironically, Edwards and his mistress, Rielle Hunter – the two people around which the trial revolved, were never called to the stand to testify. See Best Articles with background Information on John Edwards - Rielle Hunter Affair

Hunter's name was on the witness list for both the prosecution and defense.

PHOTOS: Rielle Hunter, the Mistress Who Destroyed John Edwards’ Life

Jury Deadlocked Over Fine Points of the John Edwards Trial

With one of the donors of the almost $1 million dollars in question now deceased (Fred Baron) and the other donor (Bunny Mellon) a 101-year-old recluse unable to testify, the prosecution’s case was heavily dependent on the testimony of former Edwards aide, and Andrew Young and his wife. See John Edwards Sex Tape His Aides Wanted To Sell Was Worth Millions.

The question was not IF the money was spent on his mistress Rielle Hunter to cover her medical and living expenses and hide her from public view at the peak of Edwards’ failed presidential campaign.

The question was WHY the money was spen.

Was it to hide Edwards’ affair with Rielle Hunter (who was pregnant at the time) from Elizabeth Edwards, his cancer-stricken wife; or to preserve his image as a “family man” in order to further his presidential campaign. See Best Articles with background Information on John Edwards - Rielle Hunter Affair.

Also at issue was whether or not Edwards himself masterminded and directed the financial deception, or knew that it was taking place.

The National Enquirer, which was nominated for Pulitzer Prize for exposing the John Edwards-Rielle Hunter affair, called the Edwards trial a “hotbed of lies.”

With contradictory testimony from the Youngs, and confusing and damning testimony from other witnesses, commented that the choice before the jury came down to choosing which liar to believe. See John Edwards Sex Tape His Aides Wanted To Sell Was Worth Millions.

Since Edwards had previously proven himself to be a consummate liar and expert manipulator in other matters related to his extramarital affair, it was difficult for the jury to determine which of the many witnesses in the Edwards trial was actually telling the truth. See John Edwards Tries to Marry Rielle Hunter to Keep Her from Testifying in Court and John Edwards Lied to Us Before, Should We Believe Him Now about Rielle Hunter?

PHOTOS: Scenes from John Edwards Trial

The  Financial Infidelity - Sexual Infidelity Link in the Edwards Trial

When extramarital affairs are involved, financial infidelity is often linked to sexual infidelity. ref

The John Edwards trial is probably the most high profile, most noteworthy case of sexually-related financial infidelity to ever make the news since the term was coined to describe the unique form of infidelity which is characterized by lies and deception related to financial matters and how money is being spent. See Schwarzenegger and 3 Other Cheating Husbands Guilty of Financial Infidelity

The Edwards trial was far more than the case of a cheating husband using family funds to wine and dine his mistress or buy her a few gifts. See Best Articles with background Information on John Edwards - Rielle Hunter Affair

PHOTOS: Rielle Hunter, the Mistress Who Destroyed John Edwards’ Life

PHOTOS: Scenes from John Edwards Trial

This was sexually-related financial infidelity on a grand scale, which went far beyond the common “garden variety” case of a cheating husband trying to conceal his use of family funds to finance and maintain his extramarital affair.

According to ABC News, Young testified he was informed that concealing Edwards’ affair from the media and hiding Edwards pregnant mistress was "the most important job on Edwards campaign.

CNN referred to the John Edwards trial as a political soap opera, perhaps because it involved an arrogant and opportunistic presidential candidate having an extramarital affair, a high-profile cheating husband, a jealous mistress, a love child, a suspicious and terminally-ill wife, financial deception, a once loyal aide spilling political secrets, a sex tape, a tell-all book, and cover-ups and subterfuge at every turn. See John Edwards Sex Tape His Aides Wanted To Sell Was Worth Millions and Best Articles with background Information on John Edwards - Rielle Hunter Affair. 

PHOTOS: Scenes from John Edwards Trial

John Edwards Gets Off Scot-Free

The bottom line is that the 8 man-4 woman jury found Edwards NOT GUILTY on one charge.

The judge declared a mistrial after the jurors became deadlocked, and failed to reach a verdict on the other 5 charges, which included conspiracy and making false statements.
Edwards was facing a maximum of 30 years in prison and a $1.5 million fine, but now he gets off scot-free.

PHOTOS: Scenes from John Edwards Trial


*** © copyright 2012 Ruth Houston / All Rights Reserved.

Ruth Houston is a New York-based infidelity expert who is frequently called on by the media to comment on high profile infidelity and popular infidelity issues in the news. She is the founder of, the author of  Is He Cheating on You? - 829 Telltale Signs, and publishes the Infidelity News and Views blog. Ruth also writes the Celebrity Infidelity column at and the National Infidelity column at To interview infidelity expert Ruth Houston, or have her speak at your next event, call 718 592-6029 or e-mail

For more information or slideshows on the John Edwards trial, the John Edwards – Rielle Hunter affair, or John and Elizabeth Edwards, see the following articles at

PHOTOS: Scenes from John Edwards Trial

Best Articles with background Information on John Edwards - Rielle Hunter Affair

PHOTOS: Rielle Hunter, the Mistress Who Destroyed John Edwards’ Life

John Edwards Sex Tape His Aides Wanted To Sell Was Worth Millions

Rielle Hunter Freaks Out Over John Edwards Accompanying Elizabeth Edwards To Japan

As America Mourned Elizabeth Edwards, Rielle Hunter Envisioned Marrying John

As John Edwards Prepares for Elizabeth’s Funeral, Rielle Makes Wedding Plans

Sex tape of Rielle Hunter and John Edwards worth MILLIONS

John Edwards Tries to Marry Rielle Hunter to Keep Her from Testifying in Court

John Edwards Tries to Trick Rielle into Marriage to Save His Own Skin

Elizabeth Edwards Got Her Revenge on John Edwards Before She Died 

With money to spend, Dodgers will seek pitcher, hitter (and keep eye on Hamels) - CBS Sports


The financial power of the Dodgers' new ownership group could really be seen on next winter's free-agent market, where the team is expected to go all-out in an effort to sign Cole Hamels.

"They love him, and they're saying they'll do whatever it takes to get him," said one rival club official, who speaks regularly to Dodgers people.

But the Dodgers will likely try to flex their financial muscle on the July trade market, too.

With their team sitting in first place in the NL West, Dodgers officials have sent out word that they will try hard to acquire both a starting pitcher and a hitter before the July 31 non-waiver deadline.

"The one thing that won't be an obstacle for them is money," the rival official said.

The Dodger farm system hasn't had nearly as good a start as the parent club, so the team is limited in terms of prospects who would be coveted trade chips. The solution for the Dodgers could be to go after players with bigger contracts, and offer to take on more of the money.

One position player the Dodgers have scouted is third baseman Kevin Youkilis, who the Red Sox intend to trade. Youkilis is pricey, with a $12 million contract this year and a $13 million option (with a $1 million buyout) for 2013.

As colleague Jon Heyman wrote this week, the trade market looks to be strong in starting pitching. As of now, it's believed that the Dodgers are looking at multiple pitchers who could be available.

One pitcher the Dodgers could have strong interest in: Ryan Dempster of the Cubs. Before the Dodgers got Ted Lilly from the Cubs two summers ago, they initially tried for Dempster.

The Dodgers rotation has been one of the game's best for the first two months of the season, with a 3.07 ERA that ranks just behind the Nationals' MLB-leading 2.95. But Ted Lilly just went on the disabled list, and the Dodgers seem to have some concerns that the rest of their starters won't maintain their early season success.

Offensively, the Dodgers could use immediate help, with star center fielder Matt Kemp back on the disabled list and expected to miss a month. Youkilis would be a fit, because the Dodgers have been getting almost no offense out of third base.

US STOCKS-Dow turns negative for year after jobs report - Reuters UK

Fri Jun 1, 2012 6:08pm BST

* May payrolls report well short of expectations

* China PMI falls, adding to global growth fears

* Mining stocks rare gainers as gold prices jump

* Dow negative for 2012, S&P finds support

* Indexes down: Dow 1.7 pct, S&P 1.9 pct, Nasdaq 2.2 pct (Updates to afternoon trading)

By Ryan Vlastelica

NEW YORK, June 1 (Reuters) - U.S. stocks plunged on Friday after a troublingly weak jobs report added to fears about a global economic slowdown and sent the Dow into negative territory for the year.

The report was the latest in a string of bearish data, and came alongside signs of slowing in China's economy. The benchmark S&P, hovering around its 200-day moving average, posted its biggest daily decline since December and was on track for its fourth weekly loss of the last five.

The Labor Department said employers created a paltry 69,000 jobs last month, the weakest in a year, while the unemployment rate rose to 8.2 percent. Economists polled by Reuters had expected non-farm payrolls to increase 150,000.

China's economy showed signs of a broadening slowdown as its official purchasing managers' index fell to 50.4 in May from April's 13-month high of 53.3, signaling a deeper-than-forecast deterioration in demand at home and abroad.

"Risks are elevated when you see numbers like this, especially when coupled with weak data from overseas," said Brad Sorensen, director of market and sector analysis at Charles Schwab in Denver. "There's a concern the global economy is slowing."

Data released later in the session was less bleak. U.S. construction spending rose 0.3 percent in April as private residential construction increased at the fastest pace in six months.

The Institute for Supply Management said its index of national factory activity slipped to 53.5 from 54.8 in April, just missing expectations for 53.9, but the new orders gauge improved to its highest level in over a year.

The Dow Jones industrial average was down 212.26 points, or 1.71 percent, at 12,181.19. The Standard & Poor's 500 Index was down 25.16 points, or 1.92 percent, at 1,285.17. The Nasdaq Composite Index was down 60.98 points, or 2.16 percent, at 2,766.36.

The benchmark S&P index moved closer to its 200-day moving average at 1,284.75, a significant technical level which could trigger more selling if breached.

In Europe, Markit's Eurozone Manufacturing Purchasing Managers' Index dropped to 45.1 in May from 45.9 in April.

Investor concern has been rising about the stability of Spain's banking system and the euro zone as a whole, at the same time U.S. data has shown tepid economic growth.

The worries sent the benchmark S&P 500 index down 6.3 percent in May and investors fleeing to safe-haven government securities.

Banking shares dropped on Friday, with JPMorgan Chase & Co down 3.2 percent to $32.10 and Bank of America Corp down 4.1 percent to $7.05. The KBW bank index declined 4.1 percent.

More than four-fifths of stocks traded on both the New York Stock Exchange and the Nasdaq were lower while all 10 S&P sectors fell. Gold prices climbed more than 3 percent, creating one of the few bright spots on Wall Street. Newmont Mining surged 7.7 percent to $50.80 while Freeport-McMoRan Copper & Gold rose 1 percent to $32.37.

Homebuilders were among the weakest of the day, comprising the top three percentage decliners on the S&P 500. Pulte Group Inc plunged 11 percent to $8.34 while D.R. Horton Inc lost 9.2 percent to $15.08 and Lennar Corp was off 8.3 percent at $25.03.

(Editing by Dave Zimmerman)

Stocks Skid 2%, Dow Negative for 2012; Vix Soars - CNBC

Stocks suffered their worst day of the year, with the Dow tumbling into negative territory for 2012, after a disappointing jobs report in addition to dismal data from China and Europe fueled fears over the health of the global economy.

Whether the stock selloff continues through the summer "really depends on the government," said Doug Roberts, managing partner at Channel Capital Research. "If [the Fed] starts making news about QE3, than you can start to see this [selloff] is going to be relatively short-lived."

The Dow Jones Industrial Average plunged 274.88 points, or 2.22 percent, to end at 12,118.57, led by H-P [HPQ  Loading...      ()   ] and AmEx [AXP  Loading...      ()   ].

The S&P 500 tumbled 32.29 points, or 2.46 percent, to finish at 1,278.04. The Nasdaq plummeted 79.86 points, or 2.82 percent, to close at 2,747.48. Both the S&P and Nasdaq entered correction territory from their 2012 highs.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, surged more than 10 percent to close above 26.

For the week, the Dow dropped 2.70 percent, the S&P 500 declined 3.02 percent, and the Nasdaq erased 3.17 percent.

All 10 S&P sectors finished negative for the week, led by energy.

The U.S. added just 69,000 new jobs in May while the unemployment rate grew to 8.2 percent, fueling speculation that the Fed might be prompted to intervene with another round of quantitative easing. Economists polled by Reuters had expected nonfarm payrolls to increase 150,000 and the jobless rate to hold steady at 8.1 percent.

"It's painfully obvious the economic recovery in the U.S. isn't just slowing down, it's pulling up the emergency brake," said Todd Schoenberger, managing principal The BlackBay Group.

Also on the economic front, construction spending rose a less-than-expected 0.3 percent and the Institute for Supply Management's manufacturing index also came in light at 53.5—still in expansion territory but reflective of a slowdown.

"We think it is increasingly likely the Fed will announce another round of QE at the Aug. 1 or Sept. 13 meeting," Michelle Meyer, senior economist at Bank of America Merrill Lynch, told clients in a note. "The Fed will not sit idle as the economy slows." (Read More: Why More Fed Easing Might Not Help Much Now)

Bond yields found new historic depths, with the 10-year Treasury note yield dropping below 1.5 percent and the 30-year bond touching its all-time low, while energy prices hit three-year lows as well and metals including gold surged.

Adding to woes, China's slowdown worsened in May as its factories saw a further deterioration in demand at home and abroad. The darkening outlook was underlined by data showing the fourth monthly decline this year in exports from South Korea, as shipments to the United States, Europe and China all fell.

Oil prices fell to their lowest since October 2011, while gold surged more than 4 percent to trade above $1,620 an ounce, logging its biggest one-day gain in more than two years as investors rushed to the yellow metal as a safe-haven.

Gold mining stocks were sharply higher, with Barrick Gold [ABX  Loading...      ()   ] leading the way and Newmont Mining [NEM  Loading...      ()   ] topping the S&P 500 performers.

European shares finished sharply lower amid lingering fears over the debt-ridden economies of Greece and Spain.

This comes after Spain unveiled Thursday that almost 100 billion euros ($123.25 billion) had left the country in the first three months of the year and the head of the European Central Bank (ECB) lambasted its handling of Bankia, the nation's troubled lender.

Meanwhile, Facebook [FB  Loading...      ()   ] tumbled to finish in negative territory, plummeting nearly 27 percent from its market debut of $38 a share. The social networking giant posted the biggest two-week loss of any IPO deal worth over $1 billion since 1995.

Groupon [GRPN  Loading...      ()   ] .o>slumped after the IPO lock-up on the stock sales by insiders of the company ended. Insiders are typically prevented from selling for six months after an IPO.

Beacon Federal Bancorp [BFED  Loading...      ()   ] was also a rare stock trading in positive territory, after the company said it will be acquired by Berkshire Hills Bancorp [BHLB  Loading...      ()   ] for $132 million.

And Hughes Telematics [HUTC  Loading...      ()   ] soared on news that Verizon [VZ  Loading...      ()   ] would buy the company for $612 million in cash, or $12 a share to beef up its enterprise business.

—By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

On Tap Next Week:

MONDAY: Factory orders; Earnings from Dollar General
TUESDAY: ISM non-mfg index; earnings from Hovnanian
WEDNESDAY: Weekly mortgage apps, ECB announcement, productivity and costs, oil inventories, Fed's Beige Book, Fed's Lockhart speaks, Fed's Lockhart speaks, Fed Basel III vote
THURSDAY: Bank of England announcement, jobless claims, Bernanke speaks, quarterly services survey, Fed's Lockhart speaks, Fed's Kocherlakota speaks, consumer credit; Earnings from Lululemon Athletica, JM Smucker
FRIDAY: International trade, wholesale trade, Fed's Kocherlakota speaks, Chesapeake annual meeting

More From

US stocks sink on dismal economic data - YAHOO!

US stocks were sucked deeply into global economic downdrafts this week, as growth stalled across major economies and data from four continents painted an increasingly grim picture for the rest of the year.

A big loss on Friday sent the Dow lower than it started 2012 for the first time, while the other major indices were near to giving up hard-wrought gains since January.

The blue chips of the Dow ended the holiday-shortened week at 12,118.57, down 3.3 percent for the four days and 0.81 percent off for the year.

The broader S&P 500 gave up 3.0 percent in the week to 1,278.04, while the Nasdaq lost 3.2 percent, ending at 2,747.48.

While Greece, Spain and the return to crisis of the eurozone was a constant dark cloud over trade, more data showing China's slowdown, and figures confirming that the US remained stuck in its sluggish growth mode, were what really turned US investors into bears.

On Friday, industrial activity indices in both countries showed slowing, and US jobs data for May came in as a real disappointment, with new jobs creation of a meager 69,000 positions less than half what was expected.

"It's an ugly day for US stocks, as a disappointingly weak report on May payrolls has thoroughly rattled investors," said Elizabeth Harrow of Schaeffer's Investment Research.

In addition, investors' hopes for a sign that China will move to stimulate growth were dashed when the government signaled that no such plan was in the works.

Stocks sensitive to spending by American and Chinese consumers and industries took solid hits during the week: commercial banks, fast food franchisers like Yum Brands and McDonald's, heavy equipment vendor Caterpillar and even Apple, the market leader by size.

The bad news also sent crude oil prices plunging and US government bond yields to new lows.

"I don't want to say we are at the panic stage, but investors are hard on selling off," said Peter Cardillo of Rockwell Global Capital.

US investors also still struggled with the debacle of Facebook's May 18 initial public offering: on Friday, the stock closed at $27.72, 27 percent below the IPO price of $38. At least nine class action lawsuits have been filed against Facebook, its underwriters and the Nasdaq market over how the offering was handled.

Economists debated the meaning of the week's data but most argued that the negative mood in the markets was excessive.

"The increase in Treasury prices and the decline in crude oil prices likely reflect the market's ever-growing pessimistic view that the US economic recovery is stalling along with Eurozone weakness," said Wells Fargo Securities.

"While weaker-than-expected economic data may give merit to this argument, we contend there is likely a bit of noise in the data and continue to expect moderate economic growth."

The coming week will be lighter on data, though eyes will be on Federal Reserve Chairman Ben Bernanke for any signal the bank might be more open to add stimulus to the economy after demurring since the beginning of the year.

Attention will also focus on developments in China, the world's second-largest economy, and the eurozone.

"The pervasive gloom is almost certain to provide a platform for bears to promote the possibility of a double-dip recession, further declines in home prices, global depression or similar enticing topics. Expect the bearish rhetoric to pick up sharply," said Dick Green of

Stocks see worst day of the year after weak jobs report -

Richard Drew / AP

Trader John Panin, left, and specialist Frederick Edwards work on the floor of the New York Stock Exchange Friday. Stocks fell sharply Friday after the release of a dismal report on U.S. job creation.

A gloomy U.S. jobs report and signs of a global economic slowdown hammered Wall Street Friday, wiping out the stock market’s gains for 2012 and leaving investors wondering where to turn.

The Dow Jones industrial average sank 275 points, or 2.2 percent, chalking up its biggest one-day drop since November. The market index closed down 0.8 percent for the year and off 2.7 percent for the week.

Market participants had expected to see a mildly negative employment report Friday, but they “hadn’t discounted the kind of numbers we saw this morning,” Barton Biggs, a hedge fund manager at Traxis Partners, told CNBC Friday.

Biggs also warned that the chance of a “mild double-dip recession” is now about 40 percent.

“I’m not that bearish about the economy and the market, but am I ready to step in in a big way? No,” he said.

Friday’s jobs report from the Labor Department showed the U.S. economy created only 69,000 jobs in May, the fewest in a year, as the nation’s unemployment rate rose to 8.2 percent from 8.1 percent in April -- the first increase in 11 months.

The government also said the economy created far fewer jobs in the previous two months than first thought, revising numbers down to show 49,000 fewer jobs created.

Friday’s steep market drop spooked investors. The VIX index, a measure of investor fear, rose to levels not seen in five months. And the value of government bonds and gold soared as investors sought safe places to park their money.

The weak U.S. outlook added to a growing global sense of gloom. New data from the euro zone Friday showed unemployment in the region was 11 percent in April -- the highest level since records began in 1995. And there are signs that manufacturing in China -- a driver of global growth in the recession -- is slowing.

Many had looked to the U.S. as a bright spot of growth in the global economy, but Friday’s jobs report added more evidence to the view that growth in the U.S. is slowing, suggesting weaker corporate earnings ahead and weighing on stock prices.

Related: Recession storm clouds threaten global economy

Stocks saw their worst month in two years in May, ending more than 6 percent lower, as investors worried about Europe’s ongoing debt crisis. The downturn in the aggregate U.S. market has shaken some $1 trillion out of investors’ pockets.

Investors will have to put up with more uncertainty in June, analysts say, as the fate of the euro zone waits to see the outcome of Greece’s elections on June 17.

Greece, which unleashed the financial turmoil in the euro zone, will go to the polls for a crucial second election on June 17 that may determine whether it remains a member of the currency union. Investors are concerned about the unknown consequences of a Greek exit, fearful that it may precipitate the disintegration of the euro zone.

Despite the market downturn Friday and global economic fears, Peter Sorrentino, senior portfolio manager at Huntington Asset Management, counsels that investors can still find value in the market.

“We’re seeing stock prices back down where they were at the beginning of the year, but earnings are still there,” he told CNBC, noting that company balance sheets are very strong, as corporations have spent years paying off debt and raising cash to record levels.

Sorrentino added that, after Friday’s downturn, bargains can still be found in the agriculture and energy sectors.

Shares of Facebook continued to slide below their initial public offering price of $38, closing down 6 percent at $27.72.

Are there any bright spots in the market?

Cincinnati Financial Corporation Declares Regular Quarterly Cash Dividend - Yahoo Finance

CINCINNATI, June 1, 2012 /PRNewswire/ -- Cincinnati Financial Corporation (CINF) today announced that the executive committee of its board of directors has declared a 40.25-cents-per-share regular quarterly cash dividend, payable July 16, 2012, to shareholders of record as of June 20, 2012.

(Logo: )

Steven J. Johnston, president and chief executive officer, commented, "We manage capital to support the profitable growth of our business while also returning capital to shareholders, primarily through dividends. The consistency of our dividend record reflects the board of directors' favorable long-term outlook. Improved insurance underwriting results in recent quarters, along with exceptional financial flexibility, strengthen our ability to consistently reward shareholders with increased value over time."

Cincinnati Financial Corporation offers business, home and auto insurance, our main business, through The Cincinnati Insurance Company and its two standard market property casualty companies. The same local independent insurance agencies that market those policies may offer products of our other subsidiaries, including life and disability income insurance, annuities and surplus lines property and casualty insurance. For additional information about the company, please visit


Safe Harbor Statement

This is our "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995. Our business is subject to certain risks and uncertainties that may cause actual results to differ materially from those suggested by the forward-looking statements in this report. Some of those risks and uncertainties are discussed in our 2011 Annual Report on Form 10-K, Item 1A, Risk Factors, Page 26.

Factors that could cause or contribute to such differences include, but are not limited to:

  • Unusually high levels of catastrophe losses due to risk concentrations, changes in weather patterns, environmental events, terrorism incidents or other causes
  • Increased frequency and/or severity of claims
  • Inadequate estimates or assumptions used for critical accounting estimates
  • Recession or other economic conditions resulting in lower demand for insurance products or increased payment delinquencies
  • Declines in overall stock market values negatively affecting the company's equity portfolio and book value
  • Events resulting in capital market or credit market uncertainty, followed by prolonged periods of economic instability or recession, that lead to:
    • Significant or prolonged decline in the value of a particular security or group of securities and impairment of the asset(s)
    • Significant decline in investment income due to reduced or eliminated dividend payouts from a particular security or group of securities
    • Significant rise in losses from surety and director and officer policies written for financial institutions or other insured entities
  • Prolonged low interest rate environment or other factors that limit the company's ability to generate growth in investment income or interest rate fluctuations that result in declining values of fixed-maturity investments, including declines in accounts in which we hold bank-owned life insurance contract assets
  • Increased competition that could result in a significant reduction in the company's premium volume
  • Delays or performance inadequacies from ongoing development and implementation of underwriting and pricing methods or technology projects and enhancements expected to increase our pricing accuracy, underwriting profit and competitiveness
  • Changing consumer insurance-buying habits and consolidation of independent insurance agencies that could alter our competitive advantages
  • Inability to obtain adequate reinsurance on acceptable terms, amount of reinsurance purchased, financial strength of reinsurers and the potential for non-payment or delay in payment by reinsurers
  • Inability to defer policy acquisition costs for any business segment if pricing and loss trends would lead management to conclude that segment could not achieve sustainable profitability
  • Events or conditions that could weaken or harm the company's relationships with its independent agencies and hamper opportunities to add new agencies, resulting in limitations on the company's opportunities for growth, such as:
    • Downgrades of the company's financial strength ratings
    • Concerns that doing business with the company is too difficult
    • Perceptions that the company's level of service, particularly claims service, is no longer a distinguishing characteristic in the marketplace
  • Actions of insurance departments, state attorneys general or other regulatory agencies, including a change to a federal system of regulation from a state-based system, that:
    • Impose new obligations on us that increase our expenses or change the assumptions underlying our critical accounting estimates
    • Place the insurance industry under greater regulatory scrutiny or result in new statutes, rules and regulations
    • Restrict our ability to exit or reduce writings of unprofitable coverages or lines of business
    • Add assessments for guaranty funds, other insurance related assessments or mandatory reinsurance arrangements; or that impair our ability to recover such assessments through future surcharges or other rate changes
    • Increase our provision for federal income taxes due to changes in tax law
    • Increase our other expenses
    • Limit our ability to set fair, adequate and reasonable rates
    • Place us at a disadvantage in the marketplace
    • Restrict our ability to execute our business model, including the way we compensate agents
  • Adverse outcomes from litigation or administrative proceedings
  • Events or actions, including unauthorized intentional circumvention of controls, that reduce the company's future ability to maintain effective internal control over financial reporting under the Sarbanes-Oxley Act of 2002
  • Unforeseen departure of certain executive officers or other key employees due to retirement, health or other causes that could interrupt progress toward important strategic goals or diminish the effectiveness of certain longstanding relationships with insurance agents and others
  • Events, such as an epidemic, natural catastrophe or terrorism, that could hamper our ability to assemble our workforce at our headquarters location
  • Difficulties with technology or data security breaches, including cyber attacks, that could negatively affect our ability to conduct business and our relationships with agents, policyholders and others

Further, the company's insurance businesses are subject to the effects of changing social, economic and regulatory environments. Public and regulatory initiatives have included efforts to adversely influence and restrict premium rates, restrict the ability to cancel policies, impose underwriting standards and expand overall regulation. The company also is subject to public and regulatory initiatives that can affect the market value for its common stock, such as measures affecting corporate financial reporting and governance. The ultimate changes and eventual effects, if any, of these initiatives are uncertain.


Stocks plummet after disappointing jobs, manufacturing reports - Los Angeles Times

Stocks tanked Friday morning amid a host of sour economic news that showed slower-than-expected job growth and manufacturing.

The Dow Jones industrial average plunged more than 200 points, down 1.6% to 12,188.8 in morning trading in New York, erasing its gains for the year after the two reports were released.

Standard & Poor’s 500 index was down 25 points, or nearly 2%, to 1,285.2. Nasdaq saw a 58-point slide, down 2% to 2,769.8.

The first piece of bad news came when the Labor Department said employers added just 69,000 jobs in May, less than half of what analysts were anticipating and the smallest gain in a year. The unemployment rate rose for the first time in nearly a year, to 8.2% in May.

Then the Institute for Supply Management said its index of American factory activity came in under expectations, dipping to a level of 53.5 in May from 54.8 in April.

On the plus side, the group’s index for new orders showed a 13-month high. The Commerce Department showed construction spending rising. Though personal income growth lagged, consumer spending was up, according to the department.

But investors were spooked nonetheless. They fled to the safety of U.S. government bonds and gold. Treasury prices soared, sending bond yields down to record lows. The price of the safe-haven precious metal jumped 3% to a morning high of $1,616.80 per ounce after falling in recent weeks to the mid-$1,500s.

June gloom indeed.


U.S. jobs report takes on outsize significance

Europe debt crisis dragging world economies down

Unemployment rises to 8.2% in May as job growth stalls again

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