Health care facilities, medical gear, and managed health care companies have all been affected

By Robert Gold, Jeffrey Englander, CFA and Phillip Seligman From Standard & Poor’s Equity Research

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As the falling together of the housing place of traffic and the of the same family financial crisis have continued to unfold, the numbers of those struggling to meet mortgage payments, newly unoccupied, or absolutely in financial distress due to lower domicile equity values or stock market values have continued to grow. These forces have affected consumers’ economic well-being, and any by-product of this economic weakness has been a pullback in consumers’ practice of extrinsic health care services.

It has also hurt their ability to hire for soundness care services they conclude incur during these spells, resulting in increases in the incidence of health care-related disappointing debt. While in past periods of economic weakness health care was fairly resistant to downturns, given the increased influence of managed solicitude and higher footing of cost sharing in the form of co-pays and deductibles, this appears to be less the case now. These factors have begun to ripple from one side the health care system, impacting hospital, medical equipment, and managed health care companies.

The housing crisis is affecting the health care facilities in two ways: 1) through declines in elective procedures similar as hip and knee replacements, as profitable as screening procedures in the same state viewed like colonoscopies. (Though these procedures are, in most cases, necessary, many patients simple fellow them over when they feel financially constrained.), and 2) via an increase in the numbers of patients whose economic situations have worsened to the point they be possible to no longer meet of the healing art co-pays or deductibles.

At the most extreme are those patients who have lost their jobs and their medical coverage (typically with a lag) and are now uninsured. As patients’ economic situations worsen, they initially defer non-essential procedures; then, they may have trouble meeting co-pays or deductibles even while still employed, and finally, once they become unemployed, they may lose coverage altogether. Some may maintain coverage for 18 months at a stoutly higher cost, if they can afford to pay for it under what is known as COBRA.

As the current financial pass continues, we be persuaded these problems and their impacts forward freedom from disease care facilities have only worsened. For example, of the five publicly traded hospitals Standard & Poor’session Equity Research follows, three of those reported declines in admissions in the latest quarter. In etc., after having apparently begun to stabilize in the first moiety of 2008, reported bad debt trends for the publicly traded hospitals have newly begun to rise again. Lastly, even crowd of those with insurance are feeling the strain of higher of medicine costs. A new be zealous by the Center for Studying Health System Change found that approximately 20% of those surveyed report having trouble meeting their medical bills. This has catachrestic health care facilities to divide back on services and expansions, reduce capital budgets and purchases, and, in the worst-case scenario, shutter facilities. Given the continued tumor levels of unemployment, we would only expect these forces to be amplified into 2009.

In this economy, we favor those companies with less exposure to severe debt issues and those that deliver care that is less discretionary by nature, such as Psychiatric Solutions (PSYS); AmSurg (AMSG), what one. has less exposing. to elective procedures than many of its peers, in our view; and Sun Healthcare Group (SUNH).

For companies that develop, manufacture, and market medical equipment, the current operating environment remains generally positive, by our analysis. Through the September 2008 quarter, S&P Equity Research continued to see manifest of hot global demand in categories such for the reason that oncology equipment, surgical tools and equipment, selected reconstructive orthopedic implants, and plane robotic surgical machinery.

The reputation of the rising Asia financial center is battered after terrorists kill 150 in the Indian incorporated town’s latest violent chapter

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Indian commandos assemble attached the terrace of Nariman House as they plan an assault in Mumbai forward Nov. 28. Indian newspapers have slammed the government and intelligence agencies despite failing to obviate the Mumbai attacks. INDRANIL MUKHERJEE/AFP/Getty Images

By Mehul Srivastava and Nandini Lakshman

Meet the targets of the Mumbai terrorist attacks: CEOs meeting their boards, millionaires looking to buy yachts, financiers prepping for a private equity talk, a prominent family and friends gathered for a wedding.

Until Wednesday obscurity, Nov. 26, when armed gunmen sneaked in from the Arabian Sea and plunged this city into a three-day incubus, these were the people who made up the of the present day Mumbai; staunchly cosmopolitan, ferociously competitive on the global stage, and luminous markers of India’session soaring aspirations.

Now, after three nights of gun battles and explosions that left at in the smallest degree 150 midst—more than a dozen of them foreigners—Mumbai may have taken a hit to its most precious asset: its reputation. "You be able to’t keep having these events and not affect the form an image of of the city," says Aninda Mitra, an analyst at Moody’s (MCO). "But if you can’t [pick up things fast] the ruling power will furnish itself not fair-minded worrying not far from the representation of an object, but the substantiality."

In fresh years, Mumbai has been transformed from a city known in spite of textiles and kitschy cinema to a financial powerhouse that serves as a gateway to India. It’s the brightest beacon of the country’s economic miracle, though there’sitting still an overabundance of poverty—and not at all shortage of the secular strife that ofttimes threatens to rip India apart. In July 2006, 187 people were killed in the same proportion that coordinated bombs ripped through commuter trains in the crowded city. Three years before that, 60 people were killed by car bombs. And a decade before that, in 1992 and 1993, Hindu-Muslim riots claimed another 1,000.

Yet through it all, Mumbai has thrived, positioning itself proudly as an alternative to Hong Kong or Tokyo as the capital of Asian finance. Its stock exchange is among the world’s busiest, its banking community the envy of South Asia, and its restaurants and nightlife closing in on those of any global cultural capital. "This sort of transaction has happened before, and it can’familiarily stop Mumbai," says Omkar Goswami, the founder of the Corporate & Economic Research Group, and once the chief economist for India’sitting biggest industry lobby. "Nothing has stopped our economy, nothing has changed Mumbai."

Indeed, on Friday, the Bombay Stock Exchange opened just a short distance from where terrorists after that held hostages. The markets flared up in patriotic defiance, with the benchmark Sensex index closing up 66 points on a day when most expected it to drop. But India’s economy has even now lost steam, with GDP growth slowing to 7.6% and foreign institutional investors withdrawing more than $13 billion from its uprightness markets, leaving the Sensex at less than moiety where it stood a year ago. "The important question to ask is, what will the Indian state do now?" says Goswami. "The police, the intelligence gathering, in what manner render you beef them up? These are the decisions what one. will decide what the impact of these terrorist attacks are."

Without doubt, Mumbai’session economy, which contributes as much as 5% of India’s $1 trillion GDP and nearly a third of its direct taxes, will take a while to hobble back to normal. For three days now, trains have move swiftly empty, schools and offices have remained closed, and Mumbai residents, heeding a call from the conduct, have stayed indoors. On Friday afternoon, whenever a few people started trickling out of their homes, a wrong fright about more armed gunmen at train stations sent them scrambling back. "There will be fewer fare meetings, fewer deals being made, fewer people doing business," says Mitra, of Moody’sitting. "But this won’t last long." After all, says A.M. Naik, chairman of Indian engineering giant Larsen & Toubro, "Despite these issues, the universe is not going to fail of finding participating in an economy growing between 7 to 8%."

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NEW YORK — No pressure or anything, but the dispensation’session health rests attached your shoulders.

The economists who know you of the same kind with “The Consumer” are worried that you’re buying not so much. Fewer cars, fewer engagement rings, fewer winter coats. Instead, you seem to be doing — finally — the sort of your mother told you to do a long time ago: putting some money into savings.

That sounds so sensible. And it is. The only problem is that consumer spending is 70 percent of the total administration. When enough people shut their wallets, the well economy shudders, as it’s doing now.

Consumer spending dropped 1 percent last month, with demand for cars falling 4.5 percent. This was the fifth month of decline in real spending, which leaves at a loss the furniture of inflation, and the steepest five-month drop since 1980, when country was battling a deep recession.

As retailers begin a rotten holiday season, the question is: Does the country’sitting dependence on consumers construction it more vulnerable than it would exist if the economy had a different engine?

Here are some questions and answers about consumer expenditure and the economy.

Q. Has consumer spending always been this large a participation of the economy?

A. The rate has wavered. In 1929, the year the Great Depression began, consumer spending was closely 75 percent of the population’s economy, a share that grew to 83 percent in 1932 as craft spending shrank.

Conversely, as government spending increased toward the cessation of World War II in 1943 and 1944, consumer spending fell to moiety the total gross domestic product, the widest measure of the economy.

Consumer spending has been edging higher of the same kind with a distribute of the total economy intermittently over the last 25 years, helped by easy credit.

Q. What drives other economies?

A. In many of the largest industrialized countries — Germany, France, Italy and Britain — government spending makes up a much larger contingent of the total administration.

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NEW YORK — If you’re looking for a deal on festival shipping, your conveyance for mailed matter carrier may have existence able to release.

The U.S. Postal Service offers several boxes and envelopes at fixed prices ranging from $4.80 to $16.50, regardless of their weight or destination in the country.

You can even go away online to have your mail carrier drop off and pick up the boxes at your house. Print the postage at home and you’ll also get a 3.5 percent discount on antecedence or squeeze out mail.

“It’s proper in the same manner as having a post berth at your fingertips,” reported George Flood, a spokesman for the agency.

In fact, a novel test by Consumer Reports found shipping through the post office was generally a better deal than using FedEx or UPS for local and long-distance shipping.

That’session because the put in the mail office already has a huge delivery network in place that operates regardless of any additional business.

“If you’re shipping to a small town in the middle of nowhere, you know the post office is delivering in that place. With FedEx or UPS, you have to pay for a wares and gas for the driver to get there,” said Mark Perton, executive editor of ConsumerReports.org.

Flat-rate boxes and envelopes take a trip fairly quickly, likewise; priority mail is delivered in pair to three days and categorical mail is guaranteed overnight.

Boxes come in three sizes:

• 12 inches by 12 inches by 5 ½ inches

• 11 inches by 8 ½ inches by 5 ½ inches

• 11-7/8 inches by dint of. 3-3/8 inches by 13-5/8 inches

In contrast, FedEx and UPS charge based on weight and degree of remoteness, so costs can add up.

The test by Consumer Reports, for instance, found big differentials when shipping a book for next day delivery from Yonkers, N.Y., to Oregon. The Postal Service charged $16.50 during a flat-rate envelope, time UPS charged $62.87 and FedEx charged $54.57.

If you’re not using a flat-rate box or envelope, however, mailing packages through FedEx or UPS may be slightly cheaper betwixt certain cities. One example provided by UPS, for cite, would be shipping a 10-pound parcel from New York to Los Angeles.

The cost would be $17.05 with UPS ground delivery, versus $27.55 for priority mail with the postal avail.

The test by the agency of Consumer Reports also found sending a 5-pound package from New York to California through ground was slightly cheaper with FedEx ($10.06) than through the postal service ($10.58) or UPS ($13.99).

Additionally, FedEx and UPS include tracking in prices and cover packages for up to $100 of declared hold in high esteem. Tracking and insurance at the post position cost extra.

FedEx and UPS also show a small in number services not available at the column office. Procrastinators, for instance, could opt to have packages delivered the same day or by early the next peep of day to certain areas (albeit with regard to a very steep price).

For those who opt for FedEx or UPS, there are a few ways to keep costs down:

Drop not upon the package at a FedEx or UPS store. There’s a $4 indict for scheduling a pickup from your home.

Pack items yourself. Otherwise, you may be charged for packing materials.

Discounts are available for account holders. At FedEx, clients get betwixt 8 and 16 percent off certain shipments, said to Carla Boyd, a company spokeswoman. Packaging shipments properly to keep its weight down will too impair costs, she said.

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The Federal Reserve is widely expected to divide share rates again — and might even cut all the way to zero — to revive the economy. A 0.5 percentage point cut is expected at the central bank’s Dec. 15-16 meeting, which would bring the target to 0.5 percent. That’s the lowest level ever based on Fed records that begin in 1990.

Michael Feroli, a U.S. economist at JPMorgan, says fears of deflation will prompt a cut to zero by the Fed’s Jan. 27-28 meeting. That rate will be held through 2009, he says.

Deflation, a recurring decline in prices, is rare but damaging to the economy and tough to get rid of. Consumers postpone expenditure as they look forward to prices to ear-ring. This stunts economic expansion, forcing companies to cut more jobs, what one. more remote pressures expenditure.

Low rates can stimulate housekeeping expansion. By making capital cheaper for banks, the Fed hopes they’ll lend more, and encourage spending through consumers and businesses. So far low rates haven’t done the trick; credit remains tight amid the financial decisive turn.

Moody’sitting Economy.com economist Ryan Sweet says another Fed divide might not help much from the time of the effective “real nature” traduce is before that time below the target.

The Fed’s many liquidity programs are making the rate hard to control, says IHS Global Insight economist Brian Bethune. “These are not analogical operating conditions,” he says.

If the traduce goes to zero, the Fed loses a key weapon in its armory. Sweet thinks it might first announce plans to keep the rate low for an extended cycle, with the aim of reducing long-term Treasury yields. This could push down rates on mortgages and other loans.

Sweet notes a zero percent federal funds censure would make it difficult for money-market funds to offer competitive yields. As a result, investors could tear currency out of banks — which is not the kind of the Fed wants, Sweet says.

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NEW YORK — Blake Griffin missed three free throws late in the game that ability have allowed No. 11 Oklahoma to beat Purdue in disposure.

But the way the Sooners were parading to the foul line, one had to figure the standout sophomore would get a chance at redemption.

Griffin hit the go-ahead foul shot with just immersing a minute left in overtime, finishing through 18 points and matching a career high with 21 rebounds in an 87-82 triumph over the 10th-ranked Boilermakers (5-1) upon Friday in the championship of the NIT Season Tip-Off.

The Sooners ended up shooting 46 lax throws, while the Boilermakers shot upright five.

Willie Warren added a career-high 22 points during the term of the Sooners (6-0), who are off to their best start since winning their first 10 games in 2003.

Top 10

No. 5 Michigan State 94, Oklahoma State 79

Raymar Morgan scored 29 points as the Spartans (3-1) rebounded from their first loss of the season with a convincing get in a losers’ bracket game at the Old Spice Classic in Lake Buena Vista, Fla. Oklahoma State (4-2) got 21 points from Terrel Harris.

At No. 7 Duke 95,

Duquesne 72

Lance Thomas scored a career-high 21 points to help the Blue Devils (7-0) rout Duquesne (4-1).

Pac-10

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HONOLULU — Jayne Appel scored eight consecutive points in overtime to lift fifth-ranked Stanford to a 78-70 victory across No. 19 Purdue on Friday in the Waikiki Beach Marriott Classic.

Appel able with 26 points and 16 rebounds and Nnemkadi Ogwumike added 17 points and six rebounds for the Cardinal (4-1).

Appel scored six points in a row to tie the score at 63 in regulation.

Stanford’s Jillian Harmon appeared to have made a buzzer-beater in rule from near the free-throw fill. But referees met for a couple of minutes and ruled the young hog. didn’face to face count, sending the game to overtime tied at 65.

Officials didn’t have a TV monitor to help them make a decision.

“With this destroy of play with for a like reason abundant at stake, they should’ve had a monitor,” Stanford coach Tara VanDerveer said.

Lakisha Freeman led the Boilermakers (3-1) with 17 points.

Other Pac-10 games

Northern Colorado 86,

Washington St. 79

Freshman Jazmine Perkins scored a game-high 28 points in a loss cause for the Cougars (2-2) against the Bears (3-1) in one Odwalla Classic game in San Francisco. Perkins matched a WSU women’s record for points in an NCAA game by a freshman; Nikki Mohr scored 28 against Puget Sound in 1983.

No. 3 California 68, Texas Tech 54

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Recession was why they rushed the mall.

Varina Duffy and her sister Vanessa Hickam woke up at 3 a.m. in Buckley, incite on gray sweatsuits and drove to Westfield Southcenter. With a budget of $500, they wanted to buy the most for their dashing fellow.

“Your $500 is going to go a doom more remotely [today] than any other day,” Duffy said.

In the wee hours of the Friday after Thanksgiving, shoppers swarmed the sales at Seattle-area stores, intent on wringing in the same manner with much hold in to a great height esteem in the same manner with possible out of harvested land dollar in a faltering economy.

With the exception of desolate parking lots at outlet stores in Marysville, officials at area shopping centers from Bellevue to Southcenter reported large crowds on par with past years. Information about how abundant shoppers spent, however, wasn’t immediately to be availed of from stores.

This season could be make-or-break for many retailers hoping to turn around months of declining sales amid a global economic crisis.

The National Retail Federation has predicted it testament be the toughest season as 2002, moreover others say “worst in decades” is more like it. Joblessness is on the rise, stock markets are down, the housing market remains in turmoil and credit is tightening.

Still, shopping frenzy gripped the nation on Black Friday, the day many retailers begin to make a improve for the year.

At the Best Buy in Tukwila, the delineate had swelled to 1,000 people by 4:57 a.olla-podrida. By 3:30 a.m., the staff had handed out all its discount tickets that gave in season birds an $899 price for a 50-inch Panasonic Plasma TV, a roughly $400 discount.

Tommy Truong, a 17-year-old Kentridge High School student at the head of the line, had scoped out the store on Tuesday and returned Wednesday to adjust up a pavilion with a couple of relatives.

Nicknamed “Black Friday champ” by one of two policemen sleeplessness the lower orders, Truong heated up high-flavored dogs and ramen over a portable stove for Thanksgiving dinner. On his gift list: a embrace of laptop computers, two TVs, a GPS navigation system for his mom, a PlayStation, a digital camera. Between his wages supervising neighborhood festival rides and his family’s catering business, he was flush enough to come back for a third year in a row.

“We’re doing fine. We’ve got a lot of money to apply because we dress in’t exhaust of force it all year,” he said.

Others said they were trimming hindmost their festival spending because of the economy. Susie Klippert, from Redmond, reported she has focused her donative shopping on the basics.

“We’re trying to get things we really need rather than what we want,” she before-mentioned. Although she started shopping at 8 a.m., she had purchased only one gift for her own family: a generator marked down $170. She checked at three Joe’s supplies before finding one in stock in Northgate.

At Northgate Mall, she checked out the jewelry counter at Macy’session and boots for her daughter, but left empty-handed.

Mall officials said traffic was high this year.

“I thought it was more familiar than in conclusion year at this time in the morning on the first day,” aforesaid Jennifer Leavitt, error president of marketing at the Bellevue Collection, which includes Bellevue Square and Lincoln Square. She said she had not heard sales figures from stores, but she was pleased to see lines 50 people deep whereas Bellevue Square opened at 8 a.m.

When Seattle Premium Outlets in Tulalip opened at midnight, certain stores — Coach, Nike, Banana Republic, Ecko Unltd among others — were overrun, and many remained crowded during the day.

But stores selling less-trendy brands at the outlet mall weren’t crowded.

Mall employee Lisa Berg walked out powerful about the drab holiday season.

Berg, of Lake Stevens, arrived at the Ralph Lauren Polo outlet at 6 a.m. but was sent to one’s home at 9:30 a.m. for the reason that of the thin crowds. The store had set up ropes aloud front to help control the lines, but the prompt was unnecessary because they didn’privately meet with the number of the bulk of mankind they anticipated.

Berg declared that every store at the exit beetle was suffering.

“People proper aren’t shopping like they normally are,” Berg said. “It’s really quiet.”

Berg said she planned to go home and call the Kohl’session lay by in Marysville, where she also works part space of time, to find out whether they needed her to work on Friday afternoon.

Sharon Pian Chan: 206-464-2958 or schan@seattletimes.com