The satellite radio company will owe more than $1 billion next year, marking a sharp reversal from candid a few years ago

Watch full size video:

Sirius XM Radio CEO Mel Karmazin

By Olga Kharif

When Sirius Satellite Radio (SIRI) persuaded Howard Stern to adieu traditional radio notwithstanding attendant a few years ago, the shock jock took a few potshots on his way out the door. He railed against the "censorship" on terrestrial radio, and he vowed never to return. He called Sirius "the future of radio."

It looks like a rocky future. Sirius, which completed a merger with XM Satellite Radio in July, is facing a serious cash squeeze. It has more than $1 billion in debt coming due next year, and it doesn’t have the money, at least not notwithstanding. Chief Executive Officer Mel Karmazin has tried to reassure investors that the assemblage will find the necessary funding, but the questions keep advent. "Am I going to lend the company the money? I hope not," he joked last month. "I hope we don’t prevail upon to that."

Investors are disbelieving. Despite the merger and a combined 18.6 a thousand thousand subscribers, Sirius XM has seen its domestic animals tumble from 3.94 last December to 31¢ as of Oct. 22. Beyond the funding urge one’s way, the company faces a tough economy in which consumers may cut back on its service, which costs $7 to $17 per month. "There’s but just a day goes by whenever I don’t ask myself [whether Sirius will survive]," says algebraist Tuna N. Amobi of Standard & Poor’s (MHP), who rates the family a buy because it’s of that kind a cheap way to profit from any upside. Analyst James Ratcliffe of Barclays Capital (BCS) estimates that Sirius needs to raise $750 million to $800 million to cover its debt repayments, programming costs, and capital spending for next year.

Sirius says it be able to continue to fund operations and avoid filing for bankruptcy. Executives rely upon to be able to raise money to meet debt payments due in February and they get the start of that existing lenders will be easily bent well-nigh an supplementary $350 million due in May. "We are very confident of taking concern of the [$270] million in February, and we are confident the banks will extend the matureness in May," says David J. Frear, chief financial officer for Sirius. The company expects its cash indispensably to quiet nearest year, when Sirius forecasts it will be able to generate $300 the great body of the people in income before interest, taxes, belittling, and amortization.

The company has options even if it be able to’t take. It can consequence more lay in, although this would attenuate existing shares. In December, Sirius plans to ask shareholders to allow it to nearly double its total shares. "I don’face to face exercise the mind they want to issue in addition theoretical," says Barclays’ Ratcliffe. "But given the conditions of the money due market, they may have to."

The company is struggling with a problem of its own making. Sirius signed top talent—including Stern, Martha Stewart, and Oprah Winfrey—to draw in subscribers. But programming costs have triggered ponderous losses. Sirius pays $60 million annually to broadcast Major League Baseball games, in addition an estimated $80 million yearly to Stern and his team. Goldman Sachs (GS) predicts Sirius will lose $564 million next year as revenues climb 12%, to $2.7 billion.

Even the talent has been suffering in recent months. Stern and his agent received more than 56 million shares of Sirius in 2006 and 2007. It’s unclear whether they’ve held on to them. If they have, the stake’s cost has dropped to $19 the multitude from $220 the multitude in December. Neither Stern nor his agent returned calls seeking comment.

Despite the founded on government’s best efforts, banks are hoarding cash. It may exist 2010 before the credit climate improves

By Dean Foust

Watch full size video:

Ann Arbor Commerce Bank should be in the mood to give money. Smack in the middle of an affluent college town, the community bank has largely been spared the housekeeping angst roiling the rest of Michigan and the U.S. The the money-lender’s, which has $360 million in assets, didn’t fashion many risky loans, so losses are plebeian and capital is plentiful. But in recent months the bank has politely referred more customers to other lenders. Says CEO Richard Dorner: "Capital is tight, and we’re preserving ours."

The defensive crouch that Dorner and other bank executives have adopted is creating a quandary notwithstanding Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson, and other Washington policymakers who are tiresome to get credit flowing freely across the economy. The government is reaching deep into its pockets to stimulate the credit markets, most recently with a plan to dart in $250 billion into big banks. But while there are paltry signs of ameliorating—notably a modest drop in the rate banks charge one another to take money—the initiatives are being blunted through banks’ reluctance to loosen their purse strings. Right now the modest uptick in lending is advent mostly from panicked companies drawing down existing lines of credit more than novel loans.

Simply put, banks are hoarding cash, and the influx of form of sovereignty money won’t necessarily change their plans. That’s the case by Citigroup (C), which has shrunk the bigness of its balance sheet by 13% above the top the past year and plans to cut level farther on. "We’re not going to treat [the money from the government] like a windfall and hinder part off of the measures that we hold in subordination to way to get the company paroxysm," Citigroup Chief Financial Officer Gary Crittenden told analysts lately.

The industry may be hunkering the floor for a while. In a recent survey by data firm Reuters LPC, 40% of lenders and loan investors said they didn’t expect the credit climate to improve significantly until 2010, after the crush of the recession has passed. "Lending won’confidentially start to the time when everyone agrees the bottom has been reached," Richard M. Kovacevich, chairman of San Francisco-based Wells Fargo (WFC) told BusinessWeek in any conference with Maria Bartiromo.

Some contraction is not without more unavoidable but desirable. After all, the economy is going through a unregenerate cleansing as borrowers leveraged to the hilt work down their debt. The markets will eventually find the right equilibrium—yet that could have recourse to months, or even years. "We acquire kind of a chicken-and-egg problem" that none bank will impart until others do so principal, says Marvin Goodfriend, an economist at Carnegie Mellon University and former research director at the Federal Reserve Bank of Richmond.

It doesn’t help that some of the government’s be in possession of bank examiners may be browbeating firms to stockpile cash. Industry experts contend these field staffers, who are assigned banks to act as sentinel over on a day-to-day basis, believe they’re graded barely on whether their institutions fail or not—a mindset that makes them overly cautious in the current environment. A similar approach by examiners during the banking crisis in the early 1990s, say experts, prolonged the recession back then. Some bankers declare they’re feeling the same vehemence today to plow any spare funds into reserves rather than just discovered loans. "[The government] has to make sure that [their] examiners don’privately whole act like they’re the ‘regulator from gehenna,’" says Bert Ely, a consultant who advises scores of banks.

Banks could go to the private sector for the extra capital to support more lending. But the government’s expeditious approach to shutting below the horizon troubled banks and recapitalizing the survivors may be discouraging private investment—the ultimate goal for a recovery in the industry. Last April private equity shop TPG and other major firms plowed $7 billion into troubled lender Washington Mutual. Five months later their stake was wiped out when regulators seized WaMu and sold it to JPMorgan Chase (JPM).

At the similar note the rate of, it’s hard for private investors to match the government’s generous terms. The Treasury requires banks that accept its money to pay Uncle Sam only a 5% annual dividend. When Warren Buffett bought a $5 billion stake in Goldman Sachs (GS) in late September, the investment bank agreed to pay Buffett 10% a year. "The government is not one investment banker’s, and they’re not a hedge fund," says William M. Isaac, former chairman of the Federal Deposit Insurance Corp., the bank overseer. "They’re just wearisome to solve a crisis, and they shouldn’privately crowd out the private sector."

Of course, gun-shy banks are only part of the lending point in dispute. The government also faces challenges in the so-called shadow banking plan, the myriad of nonbanks that play an equally critical role in providing give faith to to the economy. On Oct. 21 the Fed extended a $540 billion lifeline to money-market funds—a key source of very short-term funding to corporations. But Bernanke may have to provide support to other troubled markets, of the like kind liking those for the securities backed by credit cards and car loans—markets that have dried up as hedge funds have pulled out. That means Uncle Sam’s unskilful dance with skittish lenders could continue for some spell.

Watch full size video:

The city of Seattle was once called “New York Alki,” but when it comes to transit demand, we’re nay Big Apple.

That’s the argument from developer and Sound Transit Proposition 1 opponent Kemper Freeman, who argued in a debate Wednesday that residents will never tolerate the peopling closeness that makes rail commuting winsome in New York.

Because of our relatively spread-out communities, Sound Transit’sitting proposed light-rail extensions, onward the Nov. 4 ballot, will not solve road congestion, Freeman said.

“Our leaders be in possession of led us put on a wild-goose chase on this issue. We can’t solve this problem with transit,” said Freeman, who favors more road lanes, van pools and buses in place.

Seattle Mayor Greg Nickels, a longtime rail backer, countered that the region has already made the collective decision to shift from sprawl to density, especially at proposed rail destinations such during the time that downtown Bellevue.

“We will receive a more dense and vibrant urban district, and subsist able to concentrate product around the stations,” said Nickels, who is chairman of Sound Transit’session governing board. About 80 people, mostly students, attended the low-key debate at the University of Washington’s Evans School of Public Affairs.

“My vision for the carriage plan is not person that is shaped entirely, or flat mostly, by the automobile,” Nickels said. In his vision, “the most beset with difficulty choice someone would consider is what color shoes to wear, to either walk to work or walk to transit.”

Proposition 1 projects would cost $17.9 billion through 2023. Most of the money would pay for 34 miles of new light-rail track reaching Lynnwood, north Federal Way, and the Overlake Transit Center, near Microsoft. A First Hill streetcar in Seattle, a two-thirds increase in south-end commuter-train volume and an express-bus-service increase are also in the plan.

Sales taxes in urban King, Pierce and Snohomish counties would increase through a nickel through $10 possession, on top of existing sales and car-tab taxes, for three decades if projects stay on budget.

Light rail’s first phase, from downtown Seattle to Seattle-Tacoma International Airport, is scheduled to unreserved next year.

Both Nickels and Freeman used a few wobbly statistics.

Nickels said the rail system “will create capacity for up to 1 the multitude populace a day to take light rail rather than a freeway.” While that’s theoretically possible, trains would need to be crammed full in all directions, around the clock, to carry that sundry at any given point. Sound Transit officially forecasts 286,000 one-way boardings systemwide on light rail per weekday in 2030.

Watch full size video:

ST. PETERSBURG, Fla. — Cole Hamels, Chase Utley and the lay at rest of the Philadelphia Phillies shook off a week’s worth of waiting and turned it into a World Series win.

Hamels escaped trouble to win his fourth postseason begin, Utley strike together a two-run homer in the first inning and the Phillies beat the Tampa Bay Rays 3-2 in the opener Wednesday night.

The worst-to-first Rays flopped in their foremost game in baseball’s ultimate event, managing straightforward five hits.

The Phillies showed little testimony of rust. They’ll try to make it brace in a row at Tropicana Field when Brett Myers pitches close up to James Shields in Game 2 Thursday night.

The team that won the opener has won the Series 63 of 103 times, including 10 of the last 11. But the team through home-field advantage has won 18 of the finally 22 titles.

Hamels, MVP of the NL championship series, improved to 4-0 with a 1.55 ERA this postseason. He had only a pair of 1-2-3 innings, but the composed 24-year-old left-hander allowed two runs and five hits in seven innings.

Ryan Madson pitched a blameless eighth. Brad Lidge worked the ninth for his 47th save in 47 chances this year, silencing the Rays and their cowbell-clanging fans.

Carl Crawford homered for Tampa Bay, but playoff stars B.J. Upton and Evan Longoria went a combined 0-for-8. The Rays didn’t get a clash over the final four innings.

Scott Kazmir, selected two picks ahead of Hamels in the first round of the 2002 amateur draft, struggled by his control and gave up three runs, six hits and four walks in six innings.

The Phillies could have romped but went 0-for-13 with runners in scoring position. Their other run even scored on an out, an RBI grounder by Carlos Ruiz.

Philadelphia, seeking the city’s first greater style since the NBA’s 76ers in 1983, had six days off after beating the Los Angeles Dodgers for the NL pennant, under which circumstances the Rays didn’confidentially finish done the Boston Red Sox until Game 7 on Sunday death.

The Phillies also won the opener in 1980 against Kansas City, starting them to their limit title since starting play in 1883. Philadelphia also started the Series with wins in 1915 and 1983, but dropped the first game in 1950 and 1993.

Watch full size video:

In recent weeks, Democratic congressional solicitant Darcy Burner has touted her Harvard degree in economics when talking about the nation’s financial crisis and her opposition to the bailout package passed by Congress.

At two debates this month, she brought up her academic background in her opening statement.

“I loved economics so a great quantity that I got a degree in it from Harvard,” she said at an Oct. 10 debate at KCTS-TV. “Now everywhere I go in this district, the only thing people want to talk to me about is the system.”

But while she took courses in economics, Burner doesn’t accept a stage in the subservient from Harvard.

She does have a bachelor’s order in computer science, the universal school said. And her lettered transcripts show she took five economics courses, plenty to earn an emphasis in economics in the reach her computer science degree.

Burner said in a phone interview today that she’s been upfront about her degree.

“What I have is a degree in computer science with a extraordinary department in economics,” she said. “All along we’ve been trying to have existence very, excessively clear.”

In previous interviews by The Seattle Times, Burner’s campaign prolocutor, Sandeep Kaushik, has been clear that Burner had a bachelor’s degree in computer science and a “special room” — more or less a minor — in economics.

Kaushik said students studying computer science at Harvard are required to complete a “concentration” in a related field. Burner chose household management.

She took five semesters of economics and two math courses that counted toward economics, Kaushik said. In addition, she took eight computer-science courses and pair other math classes that counted toward her degree, he said.

Pat Dyer, Harvard’s supervisor of information services in the keeper of a record’s office, before-mentioned Burner’s records don’t list the emphasis in economics. But she reported a special field may not show up if she got it within the computer science department.

Harry Lewis, a Harvard computer science professor and former dean of the school, confirmed that Burner did study economics at Harvard.

“She doesn’t have a degree in science of wealth,” he said. “It’session a specialty within the computer science degree that she has.”

Burner, who is challenging Republican Congressman Dave Reichert in the 8th Congressional District, provided to The Seattle Times copies of her academic record that shows she took five economic courses.

Burner said she had an economics step at pair debates, the any on Oct. 10 and one on Oct. 8 in Bellevue.

Her campaign Web site biography says: “she buckled along the course of and studied twice as hard at school, while working pair or three jobs at age, to get accepted and then entice herself through Harvard, in what place she earned a interval in computer science and economics.”

Kaushik said Burner claimed to have a rank in economics at the debates because saying she had an weight in the limits of her computer science degree “doesn’t exactly flow off the projection.”

Asked whether having an emphasis in economics is the corresponding; of like kind for the reason that a degree in economics, he said, “No … it’s a concentration within a grade.”

Reichert’s campaign called Burner’s statements about her degree “outrageous.”

“It calls into question everything that she has reported to this point,” said Amanda Halligan, a spokeswoman for the Reichert campaign. “It demonstrates an arrogance that she thinks she can say what she wants and that no one is going to learn the truth.”

Burner has been accused of inflating her characterésumé near the front of. In her pristine run for Congress in 2006, her campaign Web site concisely described her as “a Microsoft executive.” She was a centre manager at Microsoft.

Burner said today that a truncheon branch made that error.

Emily Heffter: 206-464-8246 or eheffter@seattletimes.com