Adeltrud Laught blog

U.S. "X Factor" to offer large record deal for winner

NEW YORK (Reuters Life!) – Acerbic British music judge and entrepreneur Simon Cowell said on Monday that the winner of the first U.S. version of the television singing competition, "The X Factor," will receive a $5 million record deal.

The new talent show on Fox television will start auditions for solo artists and vocal groups aged 12 and above in Los Angeles on March 27 before hosting more auditions in Chicago, Dallas, Miami, New York, New Jersey and Seattle.

Cowell said the winner would receive a record deal with Syco, a joint venture between Sony Music and Cowell, and the same label tied to Scottish singer Susan Boyle.

"We are going to put our money where our mouths are with the $5 million recording contract. I'm doing this show in America because I genuinely believe we can find a superstar," Cowell said in a statement.

Britain's "The X Factor", which launched in 2004, won the talent show category at Britain's National Television Awards two weeks ago beating "Britain's Got Talent."

(Reporting by Christine Kearney, editing by Patricia Reaney)

Germany suspends payments to global health fund

GENEVA – Germany says it will halt all payments to a $21.7 billion global health fund until it gets answers about serious corruption allegations raised in articles by The Associated Press.

The country's development ministry said its pledge of euro200 million ($270 million) for 2011 will be withheld from the Global Fund to Fight AIDS, Tuberculosis and Malaria pending a full investigation by Germany into the corruption that the fund's own investigators are turning up.

German Development Minister Dirk Niebel said the serious questions raised in two AP articles on Sunday and Monday require a thorough investigation.

"I take the allegations of corruption and breach of trust carried by media against the Global Fund very seriously, and I expect that the fund will promptly clear them up," said Niebel. "I have halted all further payments to the fund until it is fully cleared up."

The AP reported Sunday that the fund's new investigative unit has found that high percentages of some contract money for health care were eaten up by corruption.

Germany is the fund's third largest government donor behind the U.S. and France, having pledged euro600 million ($816 million) for 2011-13.

The Global Fund, created in 2002, was set up to get money directly into the hands of nations and groups fighting those diseases, bypassing traditional cumbersome U.N. bureaucracy. It spends about $3 billion a year and claims to have saved 6.5 million lives by delivering AIDS and TB treatment and handing out millions of insecticide-treated malaria bed nets.

A ministry spokesman said Wednesday that Germany was demanding the fund shed more light on $34 million in losses due to forged documents, improper bookkeeping and other widespread fraud and said Germany has summoned a Global Fund representative to discuss the reports.

"We obviously are looking very closely at the (donated) money now. It's the money of German taxpayers, so we have to make sure that it was rightly used," a ministry spokesman told the AP, speaking on condition of anonymity in line with German government policy.

Global Fund spokesman Jon Liden told the AP that donors are reacting to what he called misleading media reports.

"Germany has been kept fully informed about all the activities of our inspector general as well as the immediate and firm steps the Global Fund has taken to stop misuse and recover funds," said Liden.

He said the fund will answer any questions Germany may have in talks next week in Bonn.

"We are confident we can reassure the German government about the solidity of our procedures and the safety of their contributions," he said. "We believe we have pretty good controls over the money, and it's pretty exceptional what's been going on in Mali and Mauritania. These are very exceptional and sensational situations."

The AP reported that the fund's investigators had examined a tiny fraction of the grant money dispersed so far and found "pervasive fraud" with up to 67 percent losses due to faked invoices and other requests for payment for AIDS, TB and malaria work in the western Sahara nation of Mauritania, where the U.N. Development Fund manages the programs.

The fund also halted grants to neighboring Mali worth $22.6 million, after the fund's investigative unit found that $4 million was misappropriated. Half of Mali's TB and malaria grant money went to supposed "training events," and signatures were forged on receipts for per diem payments, lodging and travel expense claims.

The fund says Mali has arrested 15 people suspected of committing fraud, and its health minister resigned without explanation two days before the audit was made public.

Niebel, of Germany's pro-business Free Democrats, has been less enthusiastic about the Global Fund than his Social Democratic predecessor. He also has not yet asked for next year's euro200 million donation to the fund to be set aside in his ministry's budget.

The fund's inspector general, John Parsons, has a team of auditors who examine spending and launched a new investigative unit in 2008 to follow up on potential wrongdoing. Last fall, he named Robert Appleton as its leader, a highly decorated ex-U.S. federal prosecutor and former U.N. anti-corruption task force chairman.

Sweden also said last year it was withholding its financial pledge to the Global Fund for 2011-13. Last week, the fund's executive director, Dr. Michel Kazatchkine, a French immunologist, flew to Stockholm to try to assure officials there the problems would be fixed.

Swedish Development Minister Gunilla Carlsson said there had been progress toward addressing Swedish concerns in that meeting.

Since Tuesday, the fund has been greeting all visitors to its website with a statement reacting to the AP stories and detailing how fund money is protected. The statement notes that the money lost to corruption represents just 0.3 percent of the $13 billion the fund has dispersed since it was created.

Fund officials say their board has approved $2.7 billion in grant money to be managed by the U.N. Development Program, or about 12 percent of $21.7 billion in grant money that the fund's board has approved to date.

But the fund's investigators aren't provided with UNDP's internal audit reports, handicapping their ability to more closely examine the spending. UNDP says it releases some information about those reports but is reconsidering that policy.

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Associated Press reporter Juergen Baetz contributed to this report from Berlin.

S&P ends at 29-month high; techs, commodities lead

NEW YORK (Reuters) – The S&P 500 closed at a 29-month high on Wednesday led by gains in tech and commodity shares, as investors largely ignored the U.S. Federal Reserve's lukewarm economic assessment.

The stock market had little reaction to the Fed, which said high unemployment still justifies a $600 billion bond-buying program that has helped equities rally in the last few months.

Strong earnings continue to support further gains in stocks. The technology sector was led higher by network equipment maker Juniper Networks (JNPR.N), whose quarterly sales beat Wall Street's expectations. Shares rose 6.4 percent to $37.05.

"We seem to have gone back to focusing on the basics -- the economy and the earnings. Earnings are coming in good and the economy is taking baby steps forward," supporting the stock market, said Jack Ablin, chief investment officer at Harris Private Bank in Chicago.

"The technology sector especially is the leading sector in the broad market and its performance is impacting the rest of the market."

Commodity shares got a boost after Allegheny Technologies Inc (ATI.N) forecast stronger sales in 2011, helped by higher base prices for metals. The stock surged 11.8 percent to $65.29.

The S&P materials sector index (.GSPM) rose 2.1 percent.

The Dow Jones industrial average (.DJI) edged up 8.25 points, or 0.07 percent, to end at 11,985.44. The Standard & Poor's 500 Index (.SPX) advanced 5.45 points, or 0.42 percent, to 1,296.63. The Nasdaq Composite Index (.IXIC) gained 20.25 points, or 0.74 percent, to 2,739.50.

The Dow rose above the psychologically important 12,000 for the first time since June 2008, but ended slightly lower as the 30-stock average was held in check by Boeing Co

(BA.N).

Boeing shares fell 3.1 percent to $70.02 after the U.S. plane maker posted a drop in quarterly profit and offered a disappointing forecast.

Thomson Reuters' latest data showed 69 percent of the 144 S&P 500 companies that have reported earnings so far have exceeded estimates.

The S&P 500 index continues to show overbought readings in various short-term technical indicators after last week's decline released some selling pressure.

Short-term support kicks in at 1,284, its 14-day moving average, while the 1,300-1,305 area, which are closing highs reached in August 2008, could result in resistance.

Fortinet (FTNT.O) shares jumped 16.9 percent to $39.65 a day after the network security systems prover reported market-beating quarterly results.

QUALCOMM UP LATE, STARBUCKS DROPS

After the bell, Qualcomm Inc (QCOM.O) shares jumped 4.3 percent to $54.11 after the company raised its forecast for 2011 revenue and predicated robust second-quarter revenue.

But Starbucks Corp (SBUX.O) shares slid 2 percent to $32.40 in extended trade after the company forecast full-year earnings below analysts' expectations due to rising coffee prices.

The Reuters-Jefferies CRB Index (.CRB), which tracks 19 commodities, including coffee, rose 1.6 percent for the day.

Late on Tuesday, U.S. President Barack Obama's call for a lower corporate tax rate also supported equities, as any move in that direction is seen as a boost to profits.

In the latest economic data, new U.S. single-family home sales rose in December to their highest level in eight months. The PHLX housing index (.HGX) advanced 1.2 percent, with Hovnanian Enterprises Inc (HOV.N) adding 7.6 percent to $4.80.

Trading volume was 8.10 billion shares on the New York Stock Exchange, the American Stock Exchange and Nasdaq, down from last year's estimated daily average of 8.47 billion shares.

Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 7 to 3. On the Nasdaq, about 20 stocks rose for every seven that fell.

(Reporting by Angela Moon; Editing by Jan Paschal)

Boeing says 2011 profit hurt by 787, defense cuts

MINNEAPOLIS – Boeing Co. said on Wednesday that its 2011 profit will be hurt by delays to its new 787 and higher pension expenses.

The airplane builder and defense company also said its fourth-quarter profit fell 8 percent to $1.16 billion. Revenue dropped 8 percent to $16.55 billion.

Boeing shares fell $2.55, or 3.5 percent, to $69.69 in morning trading.

Boeing is being hit by several tough-to-manage forces. The 787 is running three years late, and earlier this month it pushed back delivery of the plane from February until at least July. Pension expenses are rising. And the Pentagon as well as overseas governments are tightening defense spending. Half of Boeing's revenue is from defense and space-related work.

It plans to deliver 485 to 500 airplanes in 2011. That includes 25 to 40 of the new 787s and its revamped 747, split about equally between the two planes.

Boeing aims to make 10 787s per month by the end of 2013, Boeing Chairman, President, and CEO James McNerney said on a conference call with analysts.

"The underlying operating engine of this company is running very well," he said.

Boeing now says it expects to make $3.80 to $4 per share for 2011 on revenue of $68 billion to $71 billion. Its pension expense will rise from $1 per share last year to $1.58 per share this year. If not for the higher pension expense, its 2011 profit would be closer to the $4.59 per share expected by analysts surveyed by FactSet.

For the fourth quarter, Boeing's profit worked out to $1.56 per share, down from $1.75 per share a year earlier. Not counting special items, Boeing said it would have earned $1.11 per share, which is about what analysts estimated.

Revenue for Boeing's commercial airplane division fell 11 percent to $8.18 billion. The operating profit from commercial planes dropped 39 percent to $627 million.

Its defense and space business revenue fell 5 percent to $8.17 billion. Operating profits dropped 2 percent to $816 million.

Flyers playoff hero Leighton back in minors

PHILADELPHIA – Michael Leighton wore an orange-and-black uniform, crouched in goal under the Philadelphia Flyers' 2009-10 Eastern Conference championship banner and heard 18,000 fans cheering for him in the NHL arena.

Leighton was back on the ice where he felt he belonged.

While the setting of his greatest professional moments were fit for a triumphant homecoming, the circumstances left Leighton realizing how removed he is from resuming his NHL career. This start wasn't for the Stanley Cup finalist Flyers, it was for the Adirondack Phantoms, the Flyers' AHL affiliate, against the Wilkes-Barre Scranton Penguins on Friday night.

Leighton played his first regular-season game in Philadelphia since he started Game 6 of the finals against the Chicago Blackhawks in June.

He has no idea when — or if — he'll be back in Philly this season wearing a Flyers sweater.

"I think he knows the only way back up here is to come down, do well in practice and win games, and have a chance to go back up again," Phantoms head coach Joe Paterson said.

The 29-year-old goalie's comeback may not be that simple.

Back when training camp opened, Leighton was the Flyers' No. 1 goalie. He earned the job after a stellar postseason run that earned him a $3.1 million, two-year contract over the summer, his first real taste of financial security. Leighton was the first Flyers goalie with three shutouts in one playoff series, shutting down Montreal in the Eastern Conference finals before leading the Flyers within two victories of their first Stanley Cup championship since 1975.

After a series of starts and stops, his career at last was skating toward the right direction.

"That's the hardest part," Leighton said, "You sign a contract and you're happy. You want to be in Philadelphia, you want to be the No. 1 guy."

What Leighton failed to reveal when he signed his new deal was that his back had been bothering him since the playoffs. He felt worse during summer workouts but believed he could play through the discomfort. It didn't work.

Leighton was injured in a preseason game against Toronto and needed back surgery to fix a bulging disc.

He had numbness in his left leg; pain and weakness in his foot. Only now is Leighton feeling like his old self.

"It's to the point now where I'm comfortable playing," he said.

His recovery from surgery had more obstacles than simply rehabilitation.

Sergei Bobrovsky, plucked as a free agent last summer from Russia's Kontinental Hockey League, emerged as a starter after a strong training camp. The 22-year-old was the youngest Flyers goaltender to start an opener when he beat the Pittsburgh Penguins on Oct. 7. Brian Boucher, who opened the playoff run as the starting goalie before getting hurt, returned as the reliable backup. Bobrovsky had 19 wins and Boucher 11 entering Saturday's game against New Jersey.

There was no room in a crowded net for Leighton.

In Leighton's only start this season with the Flyers, he made 32 saves, but was shaky in the win. It was his first action, other than two rehabilitation stints in the AHL.

With no use for three goalies, Flyers general manager Paul Holmgren placed Leighton on waivers earlier this month.

"I talked to Holmgren when he sent me down, and he said, 'It's not you, the other guys are playing well and we don't have time to work you back in,'" Leighton said.

Holmgren tried to trade Leighton and found no takers. Forced to ride buses with Adirondack, Leighton still isn't sure he wants to be traded.

"I don't know what my answer is," he said. "I obviously want to be in the NHL, but I want to be in this organization. I love it here. It'd be a tough call. I want to be in the NHL, but I'd like to be a Philadelphia Flyer."

Leighton lives in a hotel room in Glens Falls, N.Y., "trying to pass the days," while his family stays in Windsor, Ontario. He's used to the routine after bouncing around the league since being drafted by Chicago in 1999.

"I've done it before, so it's not like if a guy's in the NHL his whole life and then gets to the minors, he might think differently," Leighton said. "I don't mind playing three games in three nights, sitting on a bus, playing cards, having fun. I like just hanging out with the guys. It's not that different for me."

Leighton's potential return is complicated by the waiver wire. The Flyers would put him on re-entry waivers, meaning any team could claim him for half the remaining value of the contract, leaving Philly on the hook for the other half.

Calling him up is a big gamble for the Flyers — which leaves him stuck with the Phantoms.

"I can't think about that right now," he said.

Leighton was at the Wells Fargo Center on Thursday with some of his Phantoms teammates to watch the Flyers beat Ottawa. He texts his former teammates, but admits feeling left out of the fun being had by a team sitting atop the standings.

He made 38 saves against Wilkes-Barre in a 4-2 victory and tipped his mask to an appreciative crowd.

On Sunday, the Flyers are in Chicago for a Stanley Cup rematch.

The game will rekindle memories for Leighton of the packed crowds and nerve-racking moments of that series — while he's watching on TV.