CSX Rail Car Accident Sparks Calls for Reform

May 1, 2014 8:30am

Morning Money Memo…

AP train fire kab 140501 16x9 608 CSX Rail Car Accident Sparks Calls for Reform

In this image made available by the City of Lynchburg, shows several CSX tanker cars carrying crude oil in flames after derailing in downtown Lynchburg, Va., Wednesday, April 30, 2014. (AP Photo/City of Lynchburg, LuAnn Hunt)

The latest explosion involving train cars carrying large amounts of crude oil may help lead to tougher U.S. safety regulations.

“This is another national wake-up call,” Jim Hall, a former chairman of the National Transportation Safety Board, said of the crash in Lynchburg, Va. CSX Tanker cars derailed and caught fire along the James River. “This is just an area in which the federal rule making process is too slow to protect the American people.”

The U.S. Transportation Department announced that it has sent a proposed package of safety rules to the White House for review.

Last week at a two-day safety forum in Washington, Deborah Hersman, the outgoing head of the NTSB warned the Obama administration that it needs to take steps immediately to protect the public from potentially catastrophic accidents even if it means using emergency authority.

“We are very clear that this issue needs to be acted on very quickly,” Hersman told reporters. The NTSB says there have been eight significant oil train accidents in the U.S. and Canada in the past year involving trains hauling crude oil, including several that resulted in spectacular fires.

The amount oil being moved by rail in the U.S. has quadrupled in less than a decade.

Solid company earnings and a positive jobs report from the payroll firm ADP helped lift the stock market for a third straight day.

For the first time this year the Dow Jones index closed at a record high after gaining 45 points Wednesday. The S&P 500 rose nearly 6.

The Federal Reserve said it would reduce monthly bond purchases by another $10 billion, but also reaffirmed its plan to keep short-term interest rates low to support the economy “for a considerable time” after its bond purchases end.

Global consumer confidence has returned to levels last seen before the recession more than six years ago. The Nielsen Global Survey says U.S. confidence rose to its highest since early 2007.

“We do see that there are a lot of positive effects – not just what’s happening in the U.S. but what’s happening in other parts of the globe,” says Venkatesh Bala Chief Economist at the Cambridge Group. Confident consumers spend more, increasing trade and lifting jobs. “It’s something that we don’t necessarily always focus upon, but it’s really important,” says Bala.

The auto industry is announcing April sales figures today and they’re expected to show a gain compared to last year. “Another solid month of sales” is how Kelley Blue Book senior analyst Alec Gutierrez describes the data.

Sales of new cars and trucks are expected to increase 8.5 percent to nearly 1.4 million in April, which would make it the best April for the industry since 2005, according to JD Power and Associates.

Jurors in San Jose, Calif., are continuing deliberations in a closely watched patent trial involving the world’s two top smartphone makers. Apple accuses Samsung of copying iPhone features in creating its line of smartphones. Samsung has counter-sued, claiming Apple ripped off its technology in creating the iPhone.

Richard Davies Business Correspondent ABC News Radio abcnews.com Twitter: daviesnow

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