Japan's Tepco to sell 20 percent stake in wind power unit:Nikkei (Reuters)

TOKYO (Reuters) – Tokyo Electric Power Co (9501.T) is likely to sell a 20 percent stake in wind power developer Eurus Energy Holdings to trading firm Toyota Tsusho (8015.T) to help raise funds to compensate victims of Japan's nuclear crisis, a newspaper said on Sunday.

Tokyo Electric, the owner of the crippled Fukushima Daiichi nuclear plant, is expected to sell the stake for a little less than 20 billion yen ($262 million) and post a profit of about 10 billion, which will be used for compensation, the Nikkei business daily reported.

The company, better known as Tepco, has issued a statement, saying that it has not made such a decision.

Tepco is still reeling from the radiation crisis at its Fukushima atomic plant triggered by the March 11 earthquake and tsunami in Japan's northeast.

It last month began accepting victims' applications for compensation, but the troubled utility needs to find funds to foot the cost and is seeking help from a taxpayer-funded bailout body.

Eurus Energy, currently owned 60 percent by Tepco and the rest by Toyota Tsusho, is Japan's biggest wind power developer and also operates wind power plants abroad.

Tepco is preparing an extraordinary operating plan, likely to include asset sales, cost cuts and other restructuring measures, and get government approval before receiving bailout funds.

(Reporting by Osamu Tsukimori; Editing by Yoko Nishikawa)

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Greece may need 60 percent bond writedown; EU at odds (Reuters)

BRUSSELS (Reuters) – Private holders of Greek debt may need to accept losses of up to 60 percent on their investments if Greece's debt mountain is to be made more sustainable in the long-term, a downbeat analysis by the EU and IMF showed on Friday.

Euro zone finance ministers threw Greece a lifeline on Friday by agreeing to approve an 8 billion euro loan tranche that Athens needs next month to pay its bills.

But the European Commission, European Central Bank and International Monetary Fund -- the so-called troika -- issued a gloomy report on Greece's ability to pay its debts.

Among three scenarios it examined, the only one that would reduce Greece's debt pile to 110 percent of GDP -- a level still regarded as high -- was one in which private bond holders agreed to a 60 percent haircut.

"To reduce debt below 110 percent of GDP by 2020 would require a face value reduction of at least 60 percent and/or more concessional official sector financing terms," the debt sustainability report, obtained by Reuters, showed.

A footnote explained that the ECB disagreed with including the scenarios in the report, concerned that private sector lenders would refuse to agree to such a steep writedown voluntarily, effectively leading to a fullscale Greek default.

The report also said Greece's debt pile could peak at 186 percent of GDP, from around 160 percent currently.

The euro zone finance ministers said the 8 billion euro tranche, the sixth installment of 110 billion euros of EU/IMF loans agreed last year, would be paid in the first half of November, pending the IMF's sign-off. That should allow Greece to avoid defaulting on its debt this year.

Meeting ahead of a summit of EU leaders on Sunday, finance ministers also indicated that deep divisions between France and Germany over how best to scale up the euro zone's bailout facility to give it more firepower may have been overcome.

France believes the most efficient leverage method would be to turn the European Financial Stability Facility (EFSF) into a bank, allowing it to access ECB liquidity. Germany and others opposed this, and France's finance minister said he was not going to be unnecessarily confrontational over the issue.

"We will not make it a point for definitive confrontation," he told reporters as he left the meeting late on Friday. "What matters is what will work. And what will work is something that is dissuasive and an effective firewall."

Austria's finance minister, Maria Fekter, who arrived at the meeting saying there were seven options on the table for leveraging the EFSF, left the meeting saying there were now two, indicating that some progress had been made.

If France does ultimately drop its insistence on the EFSF being turned into a bank, then the most likely method for scaling up the EFSF is expected to be some form of insurance program aimed at restoring confidence in euro zone debt.

A group of 10 major financial companies, including banks, insurers and global bond fund giant PIMCO, wrote to EFSF chief Klaus Regling on Friday saying partial insurance of sovereign bonds could be a viable means to secure private funding for euro zone states "if implemented in size."

"The ability of the EFSF to potentially write significant amounts of such 'insurance' without any further increase to the existing commitments should be an important element in any comprehensive plan by the European government to address the crisis," the letter, seen by Reuters, said.

By guaranteeing only a portion, perhaps a third or a fifth, of each debt issue, the available EFSF funds could stretch 3-5 times further, increasing it to around 1 trillion euros.

However, analysts are concerned that such a plan could create a two-tier bond market, with bonds that have guarantees trading at a premium to the secondary market -- an outcome that could exacerbate market turmoil. Some analysts believe choosing such an option would be the worst outcome of the summit.

BLIZZARD OF MEETINGS

In a related set of discussions, EU finance ministers will on Saturday meet to discuss the requirements for recapitalizing the European banking system, with the aim of making it more resilient to the possibility of a default in Greece and any wider contagion across the continent.

EU leaders will then meet on Sunday to see if they can agree a comprehensive plan to resolve the two-year-old debt crisis, with another summit scheduled for Wednesday, October 26, because no breakthrough is expected on Sunday.

German Chancellor Angela Merkel, French President Nicolas Sarkozy and Europe's top two officials, European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso, will also meet late on Saturday to try to break the deadlock before Sunday's summit.

Sarkozy appeared isolated after an acrimonious meeting in Frankfurt on Wednesday, when he pushed the idea of turning the EFSF, a 440-billion-euro ($600 billion) fund, into a bank.

Germany, the ECB and the European Commission all argued that the move would violate an EU treaty prohibition on monetary financing of governments.

"The path is closed for using the ECB to ease liquidity problems," Merkel told conservative lawmakers in Berlin, according to participants at the private meeting.

The outcome of the Sunday and Wednesday summits will determine whether investor confidence in the euro area can be restored. It will also influence whether an expected Greek debt write-down triggers a chain reaction of financial turmoil across Europe, hitting French, German and other banks -- and potentially pushing Italy and Spain deeper into the mire.

EU officials say the total amount required to shore up the region's banking system is just short of 100 billion euros. Those banks that cannot raise money on the markets will have to turn to national governments, and finally to the EFSF.

European banks will be required to increase their core tier one capital ratio to 9 percent to help them withstand losses on sovereign debt, banking sources said.

FRENCH RATING IN SPOTLIGHT

An EU source said France, which has presidential and parliamentary elections from April to June and is desperate to keep its top-notch AAA credit rating, was pressing for banks to be given at least nine months to meet the target.

France fears its credit rating could come under threat if the wrong method is chosen to scale up the bailout fund to prevent contagion spreading to Italy and Spain, the euro zone's third and fourth largest economies.

Ratings agency Standard & Poor's said on Friday it was likely to downgrade France and four other states if Europe slips into recession. It was the second agency this week to cast doubt on France's rating after Moody's on Tuesday.

Underlining the threat the euro zone crisis poses to the global economy, U.S. President Barack Obama held a video conference with Merkel and Sarkozy on Thursday, reiterating that he hopes a solution will be in place in time for a summit of G20 leaders in Cannes, France on November 3-4.

(Additional reporting by Andreas Rinke and Madeline Chambers in Berlin, John O'Donnell, Julien Toyer, Jan Strupczewski, Robin Emmott and Luke Baker in Brussels; Writing by Luke Baker; Editing by Janet McBride, Mike Peacock and Peter Graff)

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GE 3Q profit rises 18 percent (AP)

NEW YORK – General Electric Co. said Friday that a surge in its lending business lifted its profit 18 percent in the third quarter, but its stock price fell on concerns about weak contributions from its manufacturing businesses.

GE is a barometer of the economy because it reaches so many industries. It builds everything from jet engines to refrigerators, and its GE Capital lending arm is involved in a variety of businesses including credit cards and real estate.

The company's industrial orders grew 16 percent in the quarter and it has a record backlog of them. However, many of those orders came more than a year ago, and the cost of raw materials and other expenses have risen since. That could erode profits.

"Prices have gone up," said Peter Sorrentino with Huntington Asset Advisors. "It keeps them from hitting" profit targets.

Shares fell 32 cents, or 1.9 percent, to close at $16.31.

The industrial and financial giant reported net income of $2.34 billion, or 22 cents per share, for the three-month period ended Sept. 30. That compared with $1.98 billion, or 18 cents per share, a year earlier. Revenue was flat at $35.4 billion.

Among GE's other businesses, aviation profit increased 7 percent to $862 million, health care grew 5 percent to $608 million and transportation increased 94 percent to $196 million. But profit declined 9 percent to $1.5 billion at its energy infrastructure business.

Meanwhile, GE's lending business is fueling earnings.

The company's overall profit has increased for four straight quarters as falling interest rates sparked a rebound at its GE Capital lending business. Airlines, railroads and other major industries have been taking out more loans for new equipment. Consumer lending is up.

The results are a big improvement from three years ago, when GE booked more than a billion dollars in charges and write downs as it quit the subprime lending market.

With its lending business increasingly healthy, GE decided in September to buy back preferred shares from Warren Buffett's Berkshire Hathaway Inc. for $3.3 billion. Buffett's investment in GE stabilized the company's finances during the U.S. financial meltdown in October 2008.

Still, analysts said, investors remain concerned GE's dependence on its financing side. Nearly a third of GE Capital's portfolio comes from loans in Europe, where a banking crisis may force the company to deal with an increasing number of delayed payments and defaults.

GE says its manufacturing side will generate a larger share of company profits in the future. The company said its industrial businesses should take home bigger profits from the revenue it generates later this year. Operating income also should rise in 2012.

Immelt said he thinks China, Brazil and other developing nations will continue to buy GE equipment and services as their expanding economies require more trains, planes, power plants and factories. The European credit crisis also appears to be a "manageable" situation for the company's lending operation, he said.

Excluding the large dividend payout to Berkshire Hathaway, GE's profit was $3.22 billion or 31 cents per share, matching Wall Street expectations.

Other large industrial companies have announced mixed results. Earlier in the week, United Technologies, which makes jet engines, elevators and other aerospace and building systems components, said third-quarter profits rose 11 percent to $1.32 billion while Danaher reported a 19 percent decline to $523.4 million.

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Chris Kahn can be reached at http://twitter.com/ChrisKahnAP

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56 Percent: The Most Troubling Number About Occupy Wall Street (ContributorNetwork)

A recent poll has shown that far more people are in agreement with the Occupy Wall Street movement than are opposed to it, even though it remains, going into its fourth week on October 14, a vaguely unfocused and amorphous demonstration against a number of things wrong with America and its government. In fact, according to the Time poll, the protest movement has a favorable rating of 54 percent (as opposed to a 23 percent unfavorable rating). However, even though a majority of Americans agree with those holding signs saying "We Are The 99%" and many of its positions -- such as prosecuting corporate executives responsible for the financial meltdown and raising taxes on millionaires -- 56 percent of the poll's respondents said they believe that the demonstrations will have little impact on American politics in general.

In short, most believe that, although the movement is viewed primarily as a positive entity, its impact will be marginal at best. The government -- and Wall Street -- will continue unabated, as it were. As they were.

That should be even more reason for those who are part of the 99 percent -- ostensibly, those whose income is less than a million dollars per year and the greater part of Occupy Wall Street -- to stand with those that are already demonstrating. The status quo remains static due to inaction and continued silence, and a populist movement is only as powerful as the sum of its individual components and their message. The organizers of Occupy Wall Street are fully aware of this -- as are their opposers.

Since its inception in late September, Occupy Wall Street has grown from a small protest in New York to a nationwide movement, with other "Occupy" protests springing up from Boston to Dallas, Tampa to San Francisco. And as the movement's message of being fed up with government inactivity that favors the rich and powerful, a stagnant economy with a limited jobs market, and a top-down economic system that has exaggerated the gap between the haves and the have-nots over the past couple decades, resonated with more and more individuals, the idea has developed to take the message global on October 15.

At the same time, most corporate controlled media ignored the small protest at first, but as the number of protesters grew (as did their list of grievances) and the demonstrations spread across the country, not only did major media begin covering their individual and collective stories, but those opposed to their message began to sound off as well. Fox News Channel, which had been instrumental in the national organization and rapid dissemination of the (so-called grassroots) tea party's conservative message, painted Occupy Wall Street as a disorganized bunch of anti-capitalists and author Ann Coulter compared them to "Nazis." Rush Limbaugh called them "commies," a White House-driven liberal conspiracy. Even Eric Cantor, Republican House Majority Leader, echoed the Fox New charge and called the protesters a "mob."

Needless to say, Fox News (whose shows are produced, owned, and operated by millionaires) and Limbaugh (a multi-millionaire world unto himself) and Cantor (a multi-millionaire representative from the state of Virginia) see the status quo as a good thing. They are part of the 1 percent that Occupy Wall Street sees as holding too much money and power at the expense of the other 99 percent of the people.

The truth of the matter is: The demands of the protesters would do little to affect the lives of the 1 percent, even if they managed to have a major impact on future legislation solving wage disparities and social inequalities. In the end, the demands are being made to alter the system that relegates the 99 percent to forever being 99 percent or living an existence just a couple of paychecks short of being homeless or without the basic necessities of life. The rich will remain rich, regardless. In the nation with perhaps the highest standard of living in the world, the fact that so many are out of work or working underpaying jobs or working two or three jobs to make ends meet is a shame unto itself. That so many feel the need to rise up and say something about is indicative that laws, regulations, and conditions will have to improve to make the plight and the number of opportunities for upward mobility of the 99 percent improve as well.

But resistance to those improvements is guaranteed. Unfortunately, so is the idea that all the efforts of the protesters will go for naught, the status quo unshaken. And the most troubling aspect of it all: The idea that millions of individuals working in popular concert attempting to eliminate the socioeconomic and sociopolitical disparities that now exist within the American way of life will have little effect.

That 56 percent of Americans believe that the movement will have little impact is a sad testament to how ingrained the the idea of the intractableness of the government and inertia within prevailing socioeconomic systems have become. And if that number does not add resolve to the populist movement to endure until they effect positive change in the lives of the millions of people who comprise the 1 percent, then that same 56 percent will assuredly be correct about the impact of the 99 percent.

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