Morning Business Memo:
After a federal bankruptcy court judge delayed plans by Hostess Brands to liquidate and sell off its assets, the company and one of its biggest unions will go back to the bargaining table today. Company executives and the Bakery, Confectionery, Tobacco Workers and Grain Millers Union will meet with a mediator to try to narrow their differences. The maker of Twinkies, Ho Ho’s, Ding Dongs and Wonder Bread cited a crippling strike by the union as a reason for its plan to go out of business and sell its assets. “Many people, myself included, have serious questions as to the logic behind this strike,” said Judge Robert Drain, who urged mediation. “Not to have gone through that step leaves a huge question mark in this case.” In an interview following the hearing, Hostess CEO Gregory Rayburn said that there is enormous financial pressure to come to an agreement with the union today.
Is France the next problem nation in the European debt crisis? The ratings firm Moody’s Investors Service downgraded France, stripping it of a AAA credit rating due to concerns over its prospects for economic growth and its exposure to Europe’s financial crisis. Moody’s lowered France’s rating one notch to Aa1. It kept the rating outlook negative, meaning it could face future downgrades. The ratings agency said it’s becoming increasingly difficult to predict how resilient France will be to future euro-area shocks. The move came days after The Economist put a picture of French baguettes tied to a stick of dynamite on its cover, with the headline “The Time-Bomb at the Heart of Europe.”
Shaking off the post-election blues. US stocks got off to a positive start for the week with optimism about fiscal cliff talks. In the latest session, the Dow rose nearly 208 points, or 1.7 percent. Other stock averages were up at least 2 percent yesterday. Analysts say the feeling is that perhaps President Obama and Congress could reach a budget deal to avoid tax hikes and spending cuts due to kick in on January 1.
More US consumers are using their credit cards after pulling back since the 2008 recession. Consumers with a good credit history may qualify for some new rewards and low interest credit cards “There are a lot of deals out there that can literally save you hundreds of dollars this holiday season,” says John Kiernan of Cardhub.com. The credit card industry has been targeting consumers with different types of cards depending on their needs. “That depends on whether you pay your bill in full every month and therefore should get rewards or whether you going to need a little extra time to pay off increased expenses you’re going to have.”
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc