Starbucks CEO fears political dysfunction

  • Updated: January 14, 2013 - 7:35 PM

Starbucks Corp. CEO Howard Schultz urged retailers Monday to jump into the political fray and help bring an end to gridlock in Congress. Schultz, in an impassioned speech at the National Retail Federation's 102nd annual convention in Manhattan, said political "dysfunction" poses the biggest threat to businesses. Schultz did not prescribe any specific policy changes but instead spoke broadly about the need for what he called authentic leadership. "The greatest threat to our businesses is the fracturing of the middle class," he said.

Former Nortel execs acquitted of fraud

A court in Ontario acquitted three former senior executives of the failed Nortel Networks on Monday in a complex and protracted fraud case. Prosecutors had charged that the three -- former chief executive Frank A. Dunn, former chief financial officer Douglas C. Beatty and the former controller, Michael J. Gollogly -- manipulated cash reserves to create profitable quarterly results that triggered substantial bonus payments. Justice Frank Marrocco accepted defense arguments that, at most, the executives engaged in excessively aggressive accounting and not a criminal conspiracy to enrich themselves. Four years ago, Nortel filed for bankruptcy. Following a prolonged sale of its assets, it is now little more than a shell company with $9 billion in cash, the subject of a dispute among debt holders, former employees and pensioners.

Snoopy gets out of the banking business

Insurance giant MetLife Inc., which uses Peanuts characters as its corporate mascots, on Monday closed a deal to sell its banking assets. GE Capital Retail Bank, a subsidiary of General Electric Co., acquired MetLife Bank's $6.4 billion in deposits and its online banking operation, the companies announced. Financial terms of the deal were not released. The move came after MetLife Bank's federal regulator, the Office of the Comptroller of the Currency, approved the transaction last month. MetLife said it has already started the process for deregistering as a bank holding company.

UPS drops bid for Dutch shipper

United Parcel Service announced Monday that it would withdraw its $6.9 billion takeover offer for TNT Express, a Dutch shipping company, after European antitrust authorities told UPS they would block the deal. The deal for TNT Express would have given the U.S. company a larger presence in European and emerging markets. UPS had faced difficulties with European regulators, who feared the takeover would hamper competition. To appease antitrust concerns, UPS had agreed to sell a number of business units and to grant access to some of its airline network to rivals. TNT Express also said it would sell its own airline operations as part of the antitrust concessions. The company had been locked in negotiations with European regulators since November, but was told late last week that its concessions did not meet authorities' demands.

Investors pull out of stock funds

Investors pulled money from stock mutual funds in 2012 for the sixth year in a row, despite the stock market's strong performance. Bond funds attracted the most cash since 2009. Industry consultant Strategic Insight said on Monday that a net $90 billion was withdrawn from U.S. stock funds last year, including $26 billion in December -- while the Standard & Poor's 500 returned 16 percent. Stock fund withdrawals have exceeded deposits for 10 straight months. The total withdrawn last year was the most since 2008, when the financial crisis hit. Bond funds attracted $317 billion last year. More than $1.1 trillion has been added to bond funds since 2007.

Oracle says software flaw fixed

Oracle says it has released a fix for the flaw in its Java software that raised an alarm from the U.S. Department of Homeland Security last week. Late Thursday, the federal agency recommended that Internet users disable Java software in Web browsers to avoid potential hacking attacks. Java allows programs to run within websites and powers some advertising networks. Users who disable Java may not be able to see portions of websites that display real-time data such as stock tickers, news, weather updates and ads. Oracle says the patch was released Sunday. The company recommends that users update Java immediately. The patch sets Java's default security level to "high" so it prompts users and gives them a chance to decline malicious software before it loads onto computers.

Swatch buys Harry Winston for $1 billion

Switzerland's biggest watch maker, Swatch Group AG, will pay about $1 billion to acquire Canada's Harry Winston watch and jewelry brand, officials from both companies said Monday. The Biel, Switzerland-based company has agreed to pay $750 million to acquire the brand from Toronto-based Harry Winston Diamond Corp. and will also assume as much as $250 million in debt, a joint statement said. The acquisition includes the Harry Winston production company in Geneva. Harry Winston Diamond Corp.'s chairman, Robert Gannicott, said his company, which supplies rough diamonds to the global market, would change its name to Dominion Diamond Corp. The deal is subject to regulatory approval.

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