FDIC seeking alternatives to credit-rating agencies

Federal regulators have taken a first step toward eliminating the use of credit ratings in rules for banks, under a mandate of the new financial overhaul law. The head of the Federal Deposit Insurance Corp. said Tuesday it won’t be easy to come up with a replacement.

The FDIC board voted to take public comment for 60 days on alternatives to relying on credit rating agencies to assess the risk of investments. The Federal Reserve and the Treasury’s Office of the Comptroller of the Currency published the document requesting comment with the FDIC.

The landmark law enacted last month calls for reducing the influence of the three big rating agencies: Moody’s Investors Service, Standard & Poor’s and Fitch Ratings.

 

Disney profits up 40 percent with help from ‘Toy Story 3’

The Walt Disney Co. said net income for the latest quarter jumped 40 percent from a year ago, thanks to a huge boost from ESPN and a turnaround at its movie studio because of “Toy Story 3.”

Disney said Tuesday that fiscal third-quarter net income was $1.33 billion, or 67 cents per share. That’s up from $954 million, or 51 cents per share, a year ago.

Revenue rose 16 percent to $10 billion, from $8.6 billion.

 

Long waits on tarmac down sharply this year

Only three flights sat on the tarmac for more than three hours in June, compared with nearly 300 a year ago, the government said Tuesday. But airlines didn’t cancel more flights to avoid potentially massive fines — up to $27,500 per passenger — for those long delays.

All the flights that exceeded the limit were operated by United Airlines. All were flying out of Chicago’s O’Hare airport June 18, when thunderstorms and strong winds battered the area. United later canceled two of the three flights that were held up.

United said in a statement that the weather kept employees from safely loading and unloading aircraft at a few points during the day. The airline said it gave passengers on the flights food, drinks and regular updates.

It also provided compensation to customers on the canceled flights. All those steps are required by the DOT.

 

Market stages mild rally after Federal Reserve acts

The stock market had a half-hearted comeback Tuesday after the Federal Reserve announced it would take small steps to stimulate the economy.

The Dow Jones industrial average, down about 100 points before the Fed announced its plans, recovered to a loss of 54. The other major indexes also bounced off their lows.

But investors were still cautious: The Dow was able to briefly show a gain, but fell back again as traders recognized that the Fed’s moves, while welcome, would be small and won’t cure the economy’s problems.

Losing stocks were ahead of advancers on the New York Stock Exchange by almost 3 to 1. Stocks considered safe bets in a weak economy, including health care and consumer products companies, were among the gainers.