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Current Events in January 2008

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    Netflix To Deliver Movies Straight To TV Sets

    Wal-Mart quietly abandons its movie-download service

    As Wal-Mart sneaks quietly out of the online movie business, Netflix, the video rental company that pioneered renting movies by mail, now wants to bypass the U.S. Postal Service and send those videos directly to your TV, in high-definition, using an Internet connection.

    Netflix and TV set manufacturer LG Electronics, announced a joint project to develop a set-top box for consumers to stream movies and other programming from the Internet to HDTVs -- bypassing the need to use a personal computer. The companies say they hope to roll out the new technology in the second half of 2008.

    Wal-Mart quietly closed its movie-download service Dec. 21. Hardly anyone noticed, illustrating the retail giant's failure to make much of a dent in the business. In 2005, Wal-Mart gave up on trying to run a DVD rental service similar to that offered by Netflix.

    Netflix said the technology collaboration supports its core strategy of offering a multi-dimensional, or "hybrid," service that gives its more than 7 million members a variety of ways to receive movies and TV series for one monthly fee.

    The company did not specify how much it would charge for the service.

    Netflix subscribers currently have the ability to watch movies online, but must do so on their computer monitor.

    With the availability of the networked LG product planned for later this year, Netflix said its subscribers will be able to watch movies streamed from the Netflix Web site on their large-screen home theater HDTVs as well.

    Currently, mail subscribers may choose from among more than 90,000 titles delivered on DVD. The online service currently offers more than 6,000 titles, the company said.

    "Internet to the TV is a huge opportunity," said Netflix Founder, Chairman and CEO Reed Hastings.

    Fade to black

    Wal-Mart had launched its online movie business in February 2007, offering about 3,000 films and TV episodes. Its downloads were not usable on standard DVD players or on iPods, which analysts said hurt sales.

    In its little-noticed Web site notice announcing the abandonment of the service, Wal-Mart said customers who had already bought movies would be able to continue watching them.

    AOL also abandoned its online movie service recently. That leaves Apple's iTunes and Amazon.com to compete with the new Netflix offering.

    As Wal-Mart sneaks quietly out of the online movie business, Netflix, the video rental company that pioneered renting movies by mail, now wants to bypass t...

    Consumers Fall Behind In Third-Quarter Loan Payments

    Higher gas prices, slumping home values blamed

    Consumers fell behind on loan payments in a number of categories in the third quarter, according to the latest numbers from the American Bankers Association.

    The bankers blamed much of the decline on problems caused by higher oil prices and slumping home values.

    Delinquencies for home equity lines of credit the lowest delinquency rate category rose seven basis points to 0.84 percent. Delinquencies for closed-end home equity loans rose 29 basis points to 2.28 percent and property improvement loan delinquencies went up 14 basis points to 1.60 percent.

    The number of delinquent accounts in the composite ratio, which tracks eight closed-end installment loan categories, increased 17 basis points to 2.44 percent.

    The lone bright spot was credit card delinquencies, which fell 21 basis points to 4.18 percent of accounts in the third quarter (seasonally adjusted). The ABA report defines late payments as 30 days or more overdue.

    "Credit card holders continued to improve on-time payments during the third quarter despite obvious stress in the housing market," said James Chessen, ABA chief economist. "Modest income and job growth helped ease consumers' financial stress even as they worried how to pay for the rising costs of gas, food, and energy."

    The fact that credit card repayment rates continue to improve as mortgage repayments worsen may seem contrary to conventional wisdom, Chessen said.

    "Consumers facing mortgage resets may be under financial pressure, but they still want to keep up with other payments," Chessen said. "They still need to heat their homes, put food on the table and fill their cars with gas."

    "Consumer loans directly related to the housing market were hit the hardest," Chessen said. "We anticipate delinquency rates will continue to rise on these types of loans in the fourth quarter of 2007 reflecting continued weakness in the housing sector."

    Get help fast

    "Any borrower experiencing financial stress should seek out their lender promptly as it's important to address the problem early when more options for help are likely to be available," Chessen recommended.

    ABA advises consumers to review their finances often and watch for the warning signs of overextended credit:

    • Paying only the minimum payment month after month;

    • Being out of cash constantly;

    • Being late on important payments such as rent or mortgage;

    • Taking longer and longer to pay off balances; and

    • Borrowing from one lender to pay another.

    For others having trouble paying down debts, ABA advises consumers to take action - sooner rather than later - to solve debt problems with the following tips:

    • Talk with creditors hiding only makes the problem worse;

    • Don't charge more purchases until your problems are solved;

    • Avoid bankruptcy it's a short-term solution with long-term consequences; and

    • Contact Consumer Credit Counseling Services at 1-800-388-2227.

    Consumers Fall Behind In Third-Quarter Loan Payments...

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      Antibiotic Leads to Tendon Ruptures

      Public Citizen sues FDA seeking faster action

      Despite long-standing evidence that fluoroquinolone antibiotics can cause tendon ruptures, the Food and Drug Administration (FDA) has failed to increase its warnings to patients and physicians about the dangers of the medicines, Public Citizen told a federal court today.

      Public Citizen sued in the U.S. District Court for the District of Columbia, asking the court to force the FDA to act upon a petition the consumer group filed with the agency 16 months ago.

      The FDA has failed to respond to the petition, which asked the agency to put a black box warning on fluoroquinolone antibiotics (such as Cipro, Levaquin and others) to make doctors and patients more aware of the risk of serious tendon injury before tendons actually rupture.

      The petition also urged the FDA to send a warning letter to physicians, as well as require an FDA-approved medication guide to be dispensed when prescriptions are filled.

      Public Citizen contends that the FDA is violating the Administrative Procedure Act by not acting upon the petition.

      Stronger warnings could lead to earlier intervention and prevent needless injuries by allowing doctors to switch patients to other antibiotics, said Dr. Sidney Wolfe, director of Public Citizens Health Research Group.

      While the FDA sits idly by and ignores the problem, more people will suffer serious tendon ruptures that could have been prevented, Wolfe said.

      The current warning is buried in a long list of possible adverse reactions and is far too easy to miss.

      Injuries reported

      From November 1997 through December 2005, the FDA received 262 reports of tendon ruptures, mainly of the Achilles tendon, 258 cases of tendinitis and 274 cases of other tendon disorders in patients using fluoroquinolone antibiotics.

      An additional 74 tendon ruptures have subsequently been reported to the FDA for a total of 336. Because only a small fraction of cases are typically reported to the FDA, the actual number of ruptures and other tendon injuries attributable to the antibiotic is much higher.

      Antibiotic Leads to Tendon Ruptures...

      New Rule Limits Lithium Batteries in Carry-on Baggage

      Batteries can start hard-to-fight fires

      Under a new rule that took effect yesterday, passengers can no longer pack loose lithium batteries in checked luggage on aircraft.

      There have been at least nine fires involving lithium batteries on airplanes or in cargo destined for planes since 2005, federal safety records indicate.

      Passengers are still allowed to carry the batteries in checked baggage if they are installed in electronic devices, or in carry-on baggage if stored in plastic bags.

      Common consumer electronics such as travel cameras, cell phones, and most laptop computers are still allowed in carry-on and checked luggage.

      But the rule limits travelers to bringing only two extended-life spare rechargeable lithium batteries, such as laptop and professional audio/video/camera equipment lithium batteries in carry-on baggage.

      Doing something as simple as keeping a spare battery in its original retail packaging or a plastic zip-lock bag will prevent unintentional short-circuiting and fires, said Krista Edwards, Deputy Administrator of the U.S. Department of Transportations Pipeline and Hazardous Materials Safety Administration.

      Series of fires

      Lithium batteries are considered hazardous materials because they can overheat and ignite in certain conditions, and there has been a series of fires and meltdowns involving laptops, cell phones and other electronic devices in recent years.

      In 2006, a man in South Venice, Fla. blamed his Dell laptop for burning down his house. Last year, a Macbook was blamed for a house fire in Australia.

      In one of the most celebrated cases, a Dell laptop was blamed for setting fire to a pickup truck parked in a remote mountainous area in Nevada last August. The fire not only destroyed the truck but set off a box of ammunition its outdoorsman owner had left in the glove compartment while he went fishing.

      Fires hard to fight

      Safety testing conducted by the FAA found that current aircraft cargo fire suppression system would not be capable of suppressing a fire if a shipment of non-rechargeable lithium batteries were ignited in flight.

      This rule protects the passenger, said Lynne Osmus, Federal Aviation Administration (FAA) assistant administrator for security and hazardous materials. Its one more step for safety. Its the right thing to do and the right time to do it.

      Two kinds

      Lithium batteries come in two forms. The lithium metal batteries are single-use and the lithium-ion can be recharged. Both store energy that generates intense heat in the event of a short circuit, if metal touches both terminals or if internal seals fail.

      In many cases, low-cost or counterfeit batteries lack safeguards against short circuits. More than 4 million lithium batteries of all sorts have been recalled in recent years.

      Bulk shipments of lithium metal batteries were banned on passenger flights in 2004, in part because fires in those batteries are especially hard to extinguish.

      New Rule Limits Lithium Batteries in Carry-on Baggage...