CONSUMER SPENDING FLAT . . .: Consumers were tightfisted with their money amid soaring gasoline costs in August, making overall spending flat in August, the Commerce Department reported Thursday. But July's increase in consumer spending was 1.1 percent, higher than the 0.8 percent initially reported, as consumers overcame their worries about energy costs and a sluggish jobs market. Americans' income, the fuel for future economic growth, increased by 0.4 percent in August after a 0.2 percent rise the previous month. August's showing was the highest since May, which recorded a 0.5 percent increase. The spending and income figures are not adjusted for price changes.
. . . BUT JOBLESS CLAIMS RISE: Hurricane-related disruptions last week sent applications for jobless benefits to their highest level in seven months. The number of U.S. workers filing first-time applications for unemployment benefits rose by 18,000 to a seasonally adjusted 369,000 for the week that ended Sept. 25, the Labor Department reported. That marked the highest level since the week of Feb. 7. Jobless claims have risen in five of the six weeks since the hurricanes began to strike Florida in mid August. The four-week average of claims, as a result, has moved steadily higher. Last week it stood at 343,500 - a two-month high.
PALL AEROPOWER WINS CONTRACT: Pall Aeropower Corp. of Clearwater has been awarded a Defense Department contract for $7.5-million for production of various mechanical pumps, filters, manifolds and valves used by aircraft in all branches of the armed forces. The contract is for one year, with four one-year options. Pall was one of three companies competing for the work.
TAMPA CHAMBER HONORS COMPANIES: The Greater Tampa Chamber of Commerce on Thursday honored three companies as its small businesses of the year. The winners were Keep Me in Stitches (five to 20 employees), Martin Litho Inc. (21 to 50 employees) and Matthews Construction (51 to 250 employees). The chamber chose Bank of Tampa president Jerry Divers as its outstanding small business leader.
TAIT TO START AIRLINE: David Tait, who helped Sir Freddie Laker and billionaire Richard Branson start airlines, is about to begin a carrier of his own. Tait, 57, a former executive at Laker Airways Inc. and Branson's Virgin Atlantic Airways, has formed a company called Spitfire Aviation Partners Corp. to raise money for a long-haul airline, according to documents filed with the U.S. Securities and Exchange Commission. The airline will fly long-haul routes, including international trips, Tait said, adding that he would provide fuller details in an announcement in two to three weeks.
KMART CONSIDERS ATLANTA: Kmart Holding Corp. is considering moving its corporate headquarters to Atlanta. The company, based in Troy, Mich., has been searching in Michigan and out of state for a new headquarters, and a decision is expected within a few weeks. There are 2,200 headquarters employees but the company is looking for space for about 1,000.
SEC INVESTIGATES DELPHI, EDS TRANSACTIONS: The Securities and Exchange Commission is investigating transactions between auto supplier Delphi Corp. and Electronic Data Systems Corp., its longtime supplier of information technology services. In an 8-K filing with the SEC on Wednesday, Delphi said the investigation centers around the accounting treatment of $46-million in payments made and credits given by EDS to Delphi in 2000 and 2001, and $40.5-million in payments Delphi made to EDS for IT services in 2002 and 2003. Delphi, the world's largest automotive supplier and a former General Motors Corp. division, said it received a subpoena from the SEC in July and a formal order of investigation from the federal regulatory agency in August.
EARNINGS
PepsiCo Inc.: PepsiCo Inc., the world's No. 2 soft-drink maker, said third-quarter earnings increased 35 percent, boosted by sales in Asia and lower taxes. The company's Frito-Lay snacks unit will close four U.S. plants, shedding 780 jobs. Pepsi will take a pretax charge of about $160-million, most of it in the fiscal fourth quarter, for the closings.
