Contribution limits for 401(k)s and other plans may decrease next year

It's starting to seem like retirees and those saving for retirement can't catch a break.

First comes news that there won't be any cost-of-living increase for Social Security beneficiaries in 2010. Next we learn that beer prices are rising. And now we find that the maximum amount that you're allowed to contribute to your retirement plans may decrease next year.

"If recent inflation patterns continue into September, it's possible there will be a decrease in the statutory limits on qualified retirement-plan contributions and benefits for 2010," according to a report released by Mercer, the consulting firm, this week.

According to Mercer, the limits for defined-contribution and defined-benefit plans -- including the amount you can sock away in your 401(k) -- are adjusted each year according to a statutory formula based on inflation. And depending on actual inflation levels for August and September, Mercer said the formula could produce limits for 2010 that are lower than those currently in effect for 2009.

If that occurs, Mercer said employers will be looking to the IRS to decide whether the limits will remain unchanged or be reduced for 2010.

Presently, you can sock away up to $16,500 in your 401(k) on a pre-tax basis or $22,000 if you're age 50 and older. But given what's happened to inflation of late, Mercer said Uncle Sam could reduce the amount

NEW YORK (AP) -- Oil fell below $70 a barrel Monday as a steep drop in China's stock market raised doubts about the strength of the U.S. and global economic recovery.

Benchmark crude for October delivery lost $3.18 at $69.56 a barrel on the New York Mercantile Exchange. The contract on Friday added 25 cents to settle at $72.74, after falling from near $75 earlier in the week.

China raised some red flags last week as government officials seemed to suggest they would cut back on bank lending in coming months, essentially removing one of the stimuli they have added to the Chinese economy, said PFGBest analyst Phil Flynn.

The Shanghai Composite Index plunged 6.7 percent on Monday, adding to a nearly 3 percent drop on Friday, on concerns of a tightening in bank lending.

"The market is concerned whether or not the Chinese government can engineer a soft landing," Flynn wrote in his morning report. "How will the futures markets react as they start to remove this historic stimulus?"

Major refiner China Petroleum & Chemical Corp. fell by the daily maximum 10 percent after the company said it does not expect to significantly boost production, while PetroChina, the Shanghai index's heaviest weighted share, fell 6.7 percent.

Oil has traded near $70 a barrel for most of the last few months as investors struggle to gauge how

LOS ANGELES (AP) -- The Walt Disney Co. is buying Marvel Entertainment Inc. for $4 billion in cash and stock, bringing such characters as Iron Man and Spider-Man into the family of Mickey Mouse and WALL-E.

Under the deal, which was announced Monday and is expected to close by the end of the year, Disney will acquire the rights to 5,000 Marvel characters. Many of them, including the Fantastic Four and the X-Men, were co-created by the comic book legend Stan Lee.

Disney CEO Robert Iger said Marvel's comic books, TV shows, movies and video games amounted to "a treasure trove of content." Iger said the deal would bring benefits like the ones Disney got from buying "Toy Story" creator Pixar Animation Studios Inc. for $7.4 billion in stock in 2006.

"The acquisition of Marvel offers us a similar opportunity to advance our strategy," Iger said, and "to build a business that is stronger than the sum of its parts."

For Marvel, Iger said being in the Disney camp would mean better global distribution and better relationships with retailers to sell its products. Another storied comic book maker, DC Comics, has been under the wings of a major studio since 1969, when Warner Bros. bought the home of Superman, Batman and Wonder Woman.

Marvel Chairman Mort Handel called Disney "a perfect home for our great collection of characters."

One point of the deal is to help Disney appeal to young men who have flocked to theaters to see Marvel

NEW YORK (AP) -- Intel Corp. raised its third-quarter revenue forecast above Wall Street's expectations Friday, citing strong demand for its chips and giving another signal that business is improving for one of the world's biggest technology companies. Intel shares rose 4 percent.

The leading maker of computer microprocessors now expects sales of $8.8 billion to $9.2 billion. Its last guidance, which came July 14, was for revenue in the range of $8.1 billion to $8.9 billion.

Analysts polled by Thomson Reuters were expecting $8.55 billion in revenue before Friday.

Santa Clara, Calif.-based Intel also said it expects the quarter's gross profit margin to be in the upper half of the range it previously forecast.

Because it gets most of its revenue from selling chips that are the "brains" of personal computers, Intel is indicating that PC makers are loading up on new chips faster than even it expected. While that suggests PC makers believe demand for the computers they're building will be strong, it doesn't necessarily mean they're selling briskly yet.

Intel is benefiting from the fact that PC makers had burned through a lot of their inventory, instead of buying new chips, as the financial crisis worsened. Now they have to restock ahead of what they're hoping will be a healthy back-to-school and holiday season.

Consumer demand for PCs is stabilizing or improving slightly from deeply depressed levels, as shown in the latest quarterly results from the world's top two PC makers, Hewlett-Packard Co. and Dell Inc. But the PC

SAN JOSE DE LAS LAJAS, Cuba (AP) -- Cuban rum maestro Jose Navarro's taste buds sing when he sips Havana Club, the sweet spirit distilled in this farming town south of the capital.

"It has to be Cuban," said Navarro, the oldest of the island's nine certified rum experts. "Havana Club can't exist anywhere else."

But another Havana Club does exist, one made by Bermuda-based rum giant Bacardi Ltd. A variety of Cohiba cigars, once rolled exclusively for Fidel Castro, is produced by Swedish Match North America of Virginia, and a Miami firm offers its own version of Cubita, a top Cuban coffee.

Washington's 47-year-old trade embargo has kept Cuban products out of the U.S. -- but hasn't prevented companies from using the communist island's brand names.

As the U.S. and Cuba consider better ties, such trademark issues would have be settled before any easing of the embargo. The fight between Bacardi and the Cuban government for the Havana Club name already has played out in the U.S. courts and Congress for more than a decade -- and is now before Spain's high court.

But the battles are about so much more than brand names. They are charged with 50 years of emotion over Fidel Castro's 1959 revolution and expropriation of private companies as he implemented socialism. They are also rooted in the future as U.S. corporations face the specter of new competition from Cuban

It may have been written off as a hopeless case less than a year ago, but the stock of the American International Group shot up to $50 on Thursday, capping a fourfold gain in the last two months.

For all the optimism taking hold in the markets these days, it is hard to find a tangible explanation.

"Who would want to buy a stock that's still 80 percent owned by the government?" wondered William T. Fitzpatrick, an equity analyst at Optique Capital. Shares ended the day at $47.84, a gain of 27 percent from the previous close of $37.69.

Yes, the company has named a new chief executive, who comes from a solid background at MetLife, and yes, he has said that A.I.G. will pay back the government for its bailout sooner rather than later. The giant insurer has been moving to change the names of key business units and working to disentangle its bewildering structure. It even reported a profit in its latest quarter.

But none of that really explains the recent gains. Speculation swirls daily that some deal may be in the works, that short sellers are being squeezed out of their positions, or that the company's former chief executive, Maurice R. Greenberg, may be poised to make a comeback in the role of consultant. The new chief executive, Robert Benmosche, has been fueling some of the interest, as he talks about seeking

HOUSTON (AP) -- Oil prices approached $75 a barrel Monday for the first time in 10 months amid growing optimism that the world's economies are on the mend.

Benchmark crude for October delivery rose 48 cents to settle at $74.37 a barrel on the New York Mercantile Exchange. Oil last topped $75 in October and on Monday, prices came within 19 cents of that mark.

Natural gas rebounded strongly from new seven-year lows Monday, yet still traded below $3 per 1,000 cubic feet because of a huge glut and very little demand from major industrial customers.

Expectations that demand for energy will grow, at least for oil and gasoline, were spurred Friday by Federal Reserve Chairman Ben Bernanke, who said the U.S. economy is reviving. Bernanke's remarks and signs of improvement in the U.S. housing market sent stock markets higher, and that carried over into the new week.

Even before Bernanke spoke, however, prices already had begun to rise on a large and unexpected drawdown in U.S. oil supplies. One factor that might be keeping crude below $75 is the possibility that last week's storage report was an aberration, given that demand for now remains weak.

Equity and energy markets have been rising and falling in tandem for weeks and at the start of this week,

TRENTON, New Jersey (AP) -- Shares of Irish drugmaker Warner Chilcott PLC jumped more than 26 percent Monday on news it will more than triple its revenue and dramatically expand its product lines by buying Procter & Gamble Co.'s prescription drug business for $3.1 billion.

Warner Chilcott, which specializes in women's health and dermatology products, will get a portfolio with $2.3 billion in annual sales, boost its offerings in women's health with a blockbuster osteoporosis treatment and get a toehold in the urology and gastroenterology markets.

The deal also brings the Ardee, Irish company an unspecified number of Procter and Gamble's prescription drugs in development and manufacturing facilities in Puerto Rico and Germany.

Just the top drug that Warner Chilcott gets in the deal, Actonel for osteoporosis, with more than $1 billion in annual sales, exceeds the company's 2008 revenue of $938 million. Warner Chilcott also gains colitis drug Asacol HD, bone drug Didronel and Enablex for overactive bladder.

"The acquisition of the P&G pharmaceutical brands and employee talent is a transformational, strategic move for us," said Roger Boissonneault, Warner Chilcott's president and chief executive.

Warner Chilcott's products include some well-known oral contraceptives -- Loestrin 24 FE, Femcon FE and Ovcon -- plus multiple treatments for menopause symptoms such as hot flashes and vaginal dryness, including Femhrt, Femring and Estrace. It also sells skin products such as acne treatment Doryx, Pyridium

If you're a small-business owner, you're by definition a risk-taker. The danger, however, of being comfortable with taking leaps of faith is that you can sometimes overlook smart and simple ways to minimize the damage if your leap ends in a fall.

Here are seven ways to do just that.

1. Be cash-conscious

"The number-one risk for most small businesses is improper cash-flow management," says Scott Lovingood, CEO of The Wealth Squad Inc., a small-business consultancy in Riceville, Tenn. "Calculate every month how much money you have on hand and how long it will last if your income dries up. Also evaluate monthly your total accounts payable and the number of days accounts are outstanding because a slowdown in accounts payable will lead to cash-flow crunches."

Avoid those crunches by creating a contingency plan and setting aside three to six months of operating costs in reserves. "In the contingency plan, ask where your business would be three to six months from now if you lost your biggest client," explains Lovingood. "Which expenses could you cut? Which would you have to keep paying? That number of three to six months is variable because you could have cash-flow problems for various reasons. Losing a key customer could take away 50 percent of your revenue, but it might also take away 50 percent of your expenses."

CHICAGO (AP) — Media conglomerate Tribune Co.. announced a definitive agreement Friday to sell all but a 5% stake in the Chicago Cubs and Wrigley Field to the billionaire Ricketts family, capping a tortuous process that began nearly 2,5 years ago.

Tribune valued the transaction at about $845 million.

"Our family is thrilled to have reached an agreement to acquire a controlling interest in the Chicago Cubs, one of the most storied franchises in sports," said Joe Ricketts, who founded the Omaha, Neb.-based online brokerage TD Ameritrade Holding Corp. "The Cubs have the greatest fans in the world, and we count our family among them."

Tribune had announced on Opening Day in 2007 that the marquee baseball franchise and historic ballpark would be sold at the end of that season. But the process was slowed by CEO Sam Zell's efforts to maximize sale profits, the collapse of the credit markets and Tribune's 2008 bankruptcy filing.

The Ricketts family, tentatively selected as the winning bidder last January, had agreed to pay about $900 million for the team, Wrigley and a 25% stake in Comcast SportsNet Chicago, which broadcasts many Cubs games.

But that total was renegotiated, with Tribune retaining a small stake for legal reasons.

The sale figure exceeds the record $660 million paid for the Boston Red Sox in 2002, although that deal did not include a ballpark.

The successful bid was led by Tom Ricketts, 43, a Chicago investment banker and Joe Ricketts' son. He is

WASHINGTON (AP) -- Last year, as the gravest financial crisis since the Great Depression shook the banking system, Ben Bernanke seemed nearly as beleaguered as the institutions themselves.

The Federal Reserve chief had initially underestimated the crisis -- and then seemed to inject new risk by unleashing breathtaking sums of money to fight it. Now, a strengthening economy is raising Bernanke's standing just as President Barack Obama must decide whether to reappoint him.

His supporters say Bernanke, 55, a scholar of the Great Depression, has the knowledge and ability to guide a sustainable recovery without igniting inflation. And they argue that without his bold interventions, the global financial crisis could have been much worse.

"He has risen to the occasion admirably after what you might argue was a slow start," says Alan Blinder, a Princeton professor who was Fed vice chairman in the mid-1990s. "His performance merits reappointment."

Bernanke, having just wrapped up the Fed's annual conference in Jackson Hole, Wyo., remains under pressure to help speed a recovery. Joblessness, now at 9.4 percent, is expected to hit double digits this year. Yet his riskiest task is to decide when and how to unwind the Fed's emergency rescue programs without endangering the economy.

His critics see failures in Bernanke's performance. They say he overplayed his hand by swelling the Fed's

Recessions are a tough business. No matter what our instincts or advisors may tell us, chances are that our investments will suffer during a recession, whether we're too late in getting out of them, or too late to get back in. Below we expose some of the prevailing myths about recession investing, which carry one common theme among them: recessions are quite deft at rewriting old rules and breaking old patterns.

Myth No.1 - I need to be in the safest stocks to make any money.

This myth is only true before the recession takes hold. Safer, defensive stocks will tend to decline less than more cyclical names like financials, basic materials and retail stocks. But once the recession is in, the "safe" stocks may actually underperform because as soon as the market begins to rally forward again, it will be the most beaten down names that rise the fastest. So while that steady grocery store stock you held all the way through the recession may go up 10%, the beaten down bank stock may run 50% during a rebound.

So remember, once the recession is in, the most important decision is whether or not to be in the market at all (asset allocation). Once that choice is made, it's generally best to stay the course by participating in the broad market.

Myth No.2 - Bonds are the safest place to be.

This is not necessarily true. Bond prices move in the opposite direction of yields, so if you hold individual bonds and the rate of inflation rises dramatically (which can occur coming out of a recession), the price of

NEW YORK (Reuters) - U.S. stocks have entered a new bull market, and the S&P 500 index could rise as much as 10 percent from current levels by the end of this year, Goldman Sachs strategist Abby Joseph Cohen said on CNBC on Thursday.

Goldman Sachs sees the benchmark Standard & Poor's 500 index in a range of 1,050-1,100 toward year-end, said Cohen, the firm's senior investment strategist and president of its Global Markets Institute. That range, she said, "is where we should be toward the end of this year.

"We do think the new bull market has begun," Cohen said. "It may prove it began in March of this year."

Stocks have recovered sharply since hitting 12-year lows in early March, with the S&P 500 index now up 47 percent since trading as low as 666.79 points in March. In early afternoon trade on Thursday, the S&P was off 0.53 percent at 997.44 points.

Cohen also said she expects the labor market to improve, but in "an erratic way.

"It appears job losses are slowing, and there is some job creation going on," she said. But "we have many more months of difficult labor situation ahead, even if the recession, using GDP or industrial production, is almost over."

The U.S. labor market has remained weak even as other parts of the economy have improved, with the unemployment rate at just under 10 percent. Friday's July employment report from the Labor Department

Some investors rely purely on mathematics when deciding which stocks to buy or investments to make. But many investors make those decisions relying to a considerable degree on imagination and faith, too.

These "story" investors envision a future path for the world, sometimes improbable, build a case for it, and then think, "How can I make money on that?"

Here are five such broad scenarios that many investors are considering today, at a moment when the economy and financial markets seem to be at a key transition point, from recession to uncertain recovery.

Some of these scenarios are in competition with each other, but all have their adherents, and all present opportunities.

1. The Jobless Recovery

In this widely held view, the recession might end soon, but businesses will be slow to hire again, resulting in a "jobless recovery." Abysmal for workers, this might not be catastrophic for stocks. Unemployment rose for more than a year after the 1990-91 recession, but stocks rose, too.

Companies that provide stuff and services that unemployed people need to survive are more likely to thrive than those offering more luxurious fare. This group includes consumer-staples providers like Procter & Gamble and Kraft Foods, discount retailers like Wal-Mart Stores, drug makers like Pfizer and utilities like Duke Energy.

More surprisingly, some analysts also believe technology and telecommunications firms can survive in a jobless recovery, too. Mobile devices are increasingly staples, and tech can help businesses boost

Forgoing the family road trip for a homebound vacation may not save you the money you'd hoped if it means running the AC full blast all summer.

Even with oil and other commodity prices dropping because of the recession, average residential electricity prices are expected to rise 4.7% this year compared to last year, and another 3.3% next year, according to the Energy Information Administration's Short-Term Energy Outlook. Reducing your home electricity use can save you money and shrink your carbon footprint. The typical home releases about twice the carbon dioxide every year that the typical car does, according to the Alliance to Save Energy.

Here's how to prevent your electricity bills from escalating even as prices climb.

Fine-Tune Your Equipment

Arrange an HVAC inspection. Hire a certified technician to check that your heating, ventilation and air-conditioning system is operating at peak efficiency. Leaking ducts, for example, could reduce the unit's energy efficiency by as much as 20%, says Ronnie Kweller, a spokeswoman for the Alliance to Save Energy. An inspection will usually set you back $50 to $100, but that could be offset by the energy savings you'll reap over time. Plus, if you schedule your appointment before contractors are swamped with repair requests, you could snag a 10% early bird discount.

Shop for size. If you're in the market for a new room air conditioner, use Energy Star guidelines to assess how powerful a unit you need. A too-powerful unit not only wastes energy, it is actually