A man leaves with a prospectus of the Mapletree Greater China Commercial Trust real estate investment trust (REIT) at a marketing booth in Singapore, in this March 4, 2013 file picture.

Credit: Reuters/Edgar Su/Files

By Nishant Kumar and Elzio Barreto

HONG KONG | Fri May 10, 2013 5:32am EDT

HONG KONG (Reuters) - As central banks print cash to boost moribund economies, investors in Asia wanting to hedge against rising prices are dumping gold and doubling down on property.

They are driven by the search for yield as surprisingly benign inflation dims the appeal of bullion, but it's a risky play given lofty valuations for real estate.

The trend is most visible in the frenzy around real estate investment trusts (REITs) in Asia, where issuance ex-Japan more than quadrupled to $4.33 billion through early May from the same period last year and valuations are at their highest since before the 2008 financial crisis.

"I have been saying for the last two years that REITs are a good inflation hedge," said Charlie Chan, one of the best-known hedge fund managers in Asia, who made a killing by betting on them in 2012.

"They are easier to value, you get what you see and you own the building and if there is inflation, the building price will just go up," added Chan.

His $200 million hedge fund returned 63 percent last year and is up a further 35 percent in 2013. Asia hedge funds, by comparison, returned 10 percent last year and are up about 9 percent this year, according to Eurekahedge figures.

REITs such as Cambridge Industrial Trust made up more than half his portfolio at one point last year, Chan said.

Since REITs hold various kinds of properties, from factories to shopping malls and hotels, they benefit from higher rents when economies boom and prices rise.

Unlike gold, which doesn't pay any dividend, REITs also provide a steady flow of income. Yields for REITs in Asia stand at 4.4 percent on average, according to data from StarMine.

Spot gold fell 13 percent this year to May 7. By comparison, the MSCI Asia Pacific REITs index rose 14 percent, according to data from Thomson Reuters Datastream.

"Yield-hungry investors are increasingly being squeezed out of the sovereign bond markets by central bankers everywhere," said David Baran, co-founder of hedge fund Symphony Financial Partners in Tokyo. "REITs are an increasingly compelling asset class."

NEW OFFER FLOOD

REIT indices in Singapore and Hong Kong rose 13 percent and 17 percent respectively year-to-date, with both reaching all-time highs in the past two weeks.

In response to the red-hot demand, companies are flooding the market with new offerings.

Mapletree Greater China Commercial Trust is a prime example, raising $2.06 billion in Singapore's largest ever REIT IPO in February. The 5.6 percent yield offered saw institutional investors bid nearly 30 times the units on offer.

Issuance of REITs in Asia ex-Japan has more than quadrupled so far in 2013 from the same period last year to $4.33 billion, according to Thomson Reuters data, and there is no sign of a slowdown given a $4 billion pipeline in the coming two to three months from IPOs alone.

Assets under management at real estate funds investing in Asia and Japan rose to a record $55 billion and $20 billion respectively at the end of March, data from Lipper showed.

With billions more expected from follow-on deals, 2013 looks to be the biggest year for REIT issuance since at least 2007.

"Suddenly, you see a lot of REITs coming on to the market and we are seeing a lot of companies that are in the radar because they are paying better yields," said Jalil Rasheed, a Singapore-based investment director at Invesco Asset Management.

COSTLY PROPERTY

Investors are stretching valuations, with the Bank of Japan adding fuel to the fire, with the purchase of 133.8 billion yen ($1.35 billion) of REITs since its asset buying scheme began in December 2010.

As much as 92 percent of the REITs listed in Asia have gained over the last year, with Japan Hotel Reit Investment Corp and Industrial & Infrastructure Fund more than doubling, buoyed by Prime Minister Shinzo Abe's aggressive fiscal and monetary expansion policies.

The IBES MSCI AC Asia Pacific REITs index now trades at 1.3 times book value, its highest since February 2008 and meaning investors are paying 30 percent more than the value of the underlying property.

The biggest REIT in the region by market value and trading volume, Westfield Group, trades at a record 1.6 times forward 12-month book value, 71 percent above the five-year median, according to data from StarMine. The second-most liquid, Nippon Building Fund, trades at 1.8 times or nearly 80 percent above its five-year median value.

Investors hope to tap into hotel room rates and rental rates on buildings and shopping malls that continue to soar.

Hong Kong's Swire Properties said it increased rents by up to 82 percent in the three months to March on properties such as One Island East and Cityplaza as supply remains tight.

"Regulatory measures have largely targeted the residential market. The commercial space - office buildings, shopping malls and hotels - remains buoyant," said Michael Smith, head of real estate investment banking in Asia ex-Japan at Goldman Sachs in Singapore.

"The beauty of these REIT structures is that it's a very pure exposure to commercial real estate."

($1 = 98.9400 Japanese yen)

(Reporting by Nishant Kumar and Elzio Barreto; Additional reporting by Umesh Desai and Chikafumi Hodo; Editing by Wayne Arnold and Michael Urquhart)

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By Linda Stern

WASHINGTON | Wed May 8, 2013 2:38pm EDT

WASHINGTON (Reuters) - Just when you may have thought that federal tax policy was set - that January's "fiscal cliff" deal meant you could go about your financial life with multi-year certainty - Washington is again talking of comprehensive tax reform.

Both key congressional committee heads - Senate Finance chair Max Baucus, a Democrat, and Dave Camp, the Republican chair of the House Ways and Means Committee - have hinted that the impending debt-ceiling increase could be the tree upon which a new tax code hangs.

The reform they are envisioning would jettison many tax breaks and use that revenue to lower tax rates. But it's one thing to agree on a concept and another to shake hands on all the details. Virtually every line of tax code has its own constituency, a fact made evident in a 558-page summary of opinions on various tax code measures published Monday by the Joint Tax Committee (here).

That means the smart money is still betting against personal income-tax reform. The more Congress talks about it, the more those constituencies will pony up political contributions, but it's not clear whether anyone except politicians will benefit.

Taxpayers, meanwhile, have to plan their finances so they are protected under the new rules and under a radically reformed system, in the unlikely case one emerges.

Here are some ways to make the most of the income-tax system, now and later.

- Max out your tax breaks. In general, a tax deduction is worth more now than later. That is especially true if tax rates get lowered in the future, even if your specific deduction is preserved. Direct as much of your money toward those items - health savings account contributions, retirement-plan savings, charitable donations, energy-efficient appliances - that will get you the break. Note that if you earn over $250,000 ($300,000 for joint filers), your deductions will be limited, so learn how they work beforehand.

- Keep your retirement savings tax-diversified. Even if you have a tax-deferred 401(k) account, put money into a Roth Individual Retirement Account if you qualify. (You have to make under $112,000 as a single filer and under $178,000 as a couple filing jointly to contribute to a Roth.) If you make too much, you can still pay into a traditional but nondeductible IRA and then transfer the money to a Roth later. That will give you some flexibility to manage your tax hit when you get to the withdrawal stage of retirement.

- Make a multi-year charitable donation. If you normally give a set amount of money, consider doubling or tripling it this year and putting it into a donor-advised charitable fund. That will give you the donation this year but allow you to dole out the money over a few years. You can set up such a fund through one of the major investment companies like Fidelity Investments, Charles Schwab Corp, T. Rowe Price Group Inc or Vanguard. (Most community foundations - nonprofits designed to steer charitable contributions to local organizations - also will set up personal charitable funds.)

- Be careful about your investments. Several categories of investments have long benefited from special tax breaks. That includes municipal bonds, which pay interest not subject to federal taxes, life insurance policies and annuities that allow tax deferral until the money in them is used, and good old-fashioned stocks and other securities that are subject to preferential tax treatment on their gains.

All of those breaks are on the table, though their backers have been able to protect them in one round of tax revisions after another. It may make sense to sell winning stocks and take capital gains when you can, instead of carrying those gains year after year - they may be subject to higher tax rates in the future. Be more judicious about buying annuities, permanent life insurance policies and other insurance products that charge high fees and might not be good investments without their tax benefits. That tax deferral could disappear or become worthless (if rates fall), so if you are using insurance as an investment, make sure it performs well and has low fees.

You can stick with muni bonds for now if you are in a high tax bracket and they make sense. But watch Washington carefully to make sure all the talk doesn't turn into fast tax reform action. If it does, be prepared to switch out of munis and other tax-protected investments and into other taxable choices.

(Linda Stern is a Reuters columnist. The opinions expressed are her own. The Stern Advice column appears weekly and at additional times as warranted. Linda Stern can be reached at linda.stern@thomsonreuters.com; She tweets at www.twitter.com/lindastern .; Read more of her work at blogs.reuters.com/linda-stern; Editing by Prudence Crowther)

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By John Wasik

CHICAGO | Fri May 10, 2013 8:25am EDT

CHICAGO (Reuters) - If you're willing to take on more risk, it's a good time to move beyond corporate and government bonds in the incredibly challenging search for yield.

While attention has been on the record-setting stock market - the Dow Jones Industrial Average closed above the symbolic 15,000 on Tuesday and kept climbing - bond yields have been heading south. The benchmark 10-year U.S. Treasury is yielding around 1.8 percent after hitting 2 percent in early March.

An "in-between" portfolio that focuses on yield from non-traditional sources while owning dividend-rich stocks is one approach to find income. This strategy is based on the reality that bond yields probably won't rise much in the next year or so. You'll have to venture into alternative investments if you want to boost your income stream.

I've searched for some of the best exchange-traded funds (ETFs) that offer income and appreciation. The following ETFs focus on four key themes: Global stock dividends, master limited partnerships (MLPs), high-yield bonds and real-estate investment trusts (REITs).

Dividend-paying stocks, for example, can outpace inflation. In January 2009, the S&P 500 Index dividend yield was 3.24 percent while the Consumer Price Index was a negative 0.34 percent, according to dividend.com.

That doesn't always happen. Even so, cash-rich companies are in a better position to raise dividends - something bond payers can't do.

This mix is not risk-free. It may get hit as hard in a stock market sell-off, which is why these funds should comprise no more than 15 percent of your total holdings.

HIGH-DIVIDEND GLOBAL STOCKS

The PowerShares International Dividend Achievers ETF gives you a selection of dividend payers from around the world. If something happens to the torrid U.S. market, you have a little insulation.

The fund, which yields just above two percent, holds brand-name non-U.S. stocks like Vodaphone and Nippon Telegraph and Telephone.

It's posted an annualized return of nearly 14-percent during the three years through May 8, and is up 20 percent for the past year through that date. The trade-off, however, is that the fund is more volatile than the S&P 500.

MORTGAGE REITS

REITs that invest in mortgages have done well since 2008, thanks to low financing rates, although they are not well known. The iShares FTSE NAREIT Mortgage PlusCapped Index invests in major REITs like Annaly Capital Management, which buys mortgage pass-through certificates and obligations.

This specialized REIT borrows money to buy mortgage-backed securities. Like all REITs, it must pass through 90 percent of its income to shareholders.

Currently, the iShares fund is yielding 11 percent. The downside is that it trades like a stock, and its risk is roughly the same as the S&P 500. It's up 24 percent through May 8, and has averaged an annualized gain of 15 percent during the past three years.

MASTER LIMITED PARTNERSHIPS

Until recently, you could only buy these vehicles through brokers, often paying steep commissions. Now that they're being packaged in ETFs, they are worth considering for their high yields, which range from 7 percent to 16 percent.

The Alerian MLP ETF, up 15 percent in the past year through May 8, holds an index of energy partnerships that mostly invested in pipeline companies. With an almost 6-percent yield, the fund probably won't move in lockstep with common stocks, but it's prone to declines if oil prices slide. The ETF is less than two years old, so it's too young to have risk measures.

HIGH-YIELD BONDS

Unlike their government counterparts, "junk" bonds give you the trade-off of lower credit ratings in exchange for higher yields. Rated "B" and lower, these are companies that still need to sell debt, but pose a higher risk of default.

Packaged within an ETF such as the Peritus High-Yield ETF, you can find some diversification from credit risk. Although it is actively managed and has a much higher expense ratio than its peers - 1.35 percent annually versus 0.4 percent for a similar indexed fund - the Peritus fund sports an 8 percent yield.

It is up 13 percent for the year, besting its benchmark by 2 percentage points, which is a significant advantage in the bond world.

As a backstop, keep a close eye on interest rates with all of your bond holdings.

"Be tactical so that you can be ready for the eventual rising interest-rate environment," advises John Zhong, chief executive officer and founder of MyPlanIQ.com, a portfolio service.

(The author is a Reuters columnist. The opinions expressed are his own.)

(Editing by Lauren Young and Bernadette Baum)

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A bagpiper plays in central Glasgow May 14, 2007.

Credit: Reuters/Marcelo del Pozo

By Mark Meadows

FORT WILLIAM, Scotland | Fri May 10, 2013 5:56am EDT

FORT WILLIAM, Scotland (Reuters) - Often voted the world's greatest train journey, the voyage from Glasgow to Fort William and Mallaig in the Scottish highlands defies superlatives thanks to its stunning views and wild landscapes.

Several of the stations have no villages to accompany them, they are just stopping off points for hikers or skiers. But it is not all wilderness, with Fort William a decent-sized town packed with food and drink options.

Reuters correspondents with local knowledge help visitors get the most out of a weekend trip in the area.

FRIDAY

12:21 p.m. - Don't even think about driving, the train is the only way to go on the near four-hour trip from Glasgow Queen Street to Fort William. Just sit back, relax and take in the breathtaking scenery (www.scotrail.co.uk/).

Glasgow - the perfect arrival point by air - is a large industrial city but still has its charms, especially George Square adjacent to the train station. Pick up some snacks for your journey nearby.

The modest train heads out of the city and along the Clyde river before turning and heading into the mountains, passing the famously idyllic Loch Lomond.

2:30 p.m. - Grab a drink from the frequent trolley which makes its way through the carriages as the train rattles past evocative sounding stations like Bridge of Orchy and Corrour, the highest railway station in Britain.

At 408 meters above sea level, there is nothing at Corrour except one station building, swamps, towering hills and wild deer. There is not even a proper road.

4:09 p.m. - The train trundles into Fort William with Britain's highest peak, Ben Nevis, 1,344 meters high in the background. The town on a lake is full of small guest houses but also has bigger chain hotels like the always comfortable Premier Inn (www.premierinn.com).

7 p.m. - A walk down Fort William's High Street, with the mountain breeze coming in off the lake, will freshen you up ready for dinner.

There are numerous options including decent Indian and Chinese restaurants but to sample some of the local cuisine, head to a pub like the Grog and Gruel (www.grogandgruel.co.uk), which serves Scottish classics like smoked salmon but with a twist. The selection of local beers is also huge.

SATURDAY

10 a.m. - Breakfast at your hotel and if you do not fancy the long climb up Ben Nevis, then it is back to the train station - this time for a shorter two-and-a-half-hour round trip to the small coastal port of Mallaig.

12:12 p.m. - The train sets off around the loch for a picture perfect view of Ben Nevis with Fort William beneath.

The best is yet to come through with the train heading to Glenfinnan, site of the mainland invasion by British monarch pretender "Bonnie Prince Charlie" in 1745. A monument visible from the train marks the spot on the banks of Loch Shiel, with stunning mountains rising up out of the water on both sides.

Harry Potter fans will recognize the viaduct at Glenfinnan from its use in the blockbuster films when the "Hogwarts Express" passes over, and such is the beauty of the place that the train crew will hand out free postcards detailing the view.

1:34 p.m. - Mallaig is a sleepy seaside town where you can catch a ferry to the Isle of Skye, but ignore the actual harbor at your peril. For in the shallow waters live a family of seals who often pop up to say hello.

A small handful of eateries are available for lunch in Mallaig including the An Cala cafe, which offers wifi and delightful scones plus a late Scottish breakfast cooked to order.

4:05 p.m. - After a wander round the small windswept harbor trying to catch a glimpse of that elusive seal, it is time to get back on board the train and retrace the route back to Fort William, crucial if you missed any photographs on the way there.

8 p.m. - Back in Fort William there is plenty of choice for a second dinner, with two large supermarkets belying the remote setting for those who are self-catering.

SUNDAY

11:40 a.m. - After a Scottish breakfast which differs from the English variety with the addition of black or white pudding (cooked blood with a meat and oatmeal filler), it is back to Fort William station one last time for the trip back to Glasgow.

Make sure to sit on the opposite side of the train from your trip up in case you missed something like a sheer rock face, plunging stream or a group of wild deer led by the most elegant of stags, antlers and all.

1 p.m. - Grab a sandwich and a surprisingly decent bottle of wine from the drinks trolley as the marvelous mountain countryside rolls on by. The trip is nearly over so savor every last look.

3:31 p.m. - You arrive back in Glasgow with plenty of time to catch a flight home and take a quick flick through your photos as you remember a journey of a lifetime.

(Editing by Paul Casciato)

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By Randall Palmer

OTTAWA | Wed May 8, 2013 12:47pm EDT

OTTAWA (Reuters) - Canada is more than ever a nation of immigrants, with one in five Canadians born outside the country, according to a 2011 survey released by Statistics Canada on Wednesday.

That 20.6 percent proportion of people born abroad, up from 19.8 percent five years previously, is far bigger than in most other rich industrialized countries.

Statscan said 12.9 percent of U.S. residents were born outside the country, and 11.5 percent of people in Britain. Australia's rate is higher, at 26.8 percent.

But the federal agency also admitted that it was "difficult to anticipate the quality level of the final outcome" of its survey after changes were made in the way it sought information.

In the past, Statscan sent a mandatory long-form census to 20 percent of the population. But the Conservative government abandoned that approach in favor of a voluntary national household survey, which went to one in three Canadians.

Statistics Canada assumed only 50 percent of those who got the survey would respond to a voluntary questionnaire, while the mandatory form had a much higher response rate.

The government argued the mandatory long census was too intrusive, and its decision prompted the resignation in 2010 of Statistics Canada's chief statistician, who said the decision could endanger the survey's usefulness. Business groups and social activists also said Statistics Canada needed the fuller information of the long-form census so it could assist them with planning and funding.

Canada, with a population of 32.9 million in 2011, aims to take in about 250,000 immigrants each year, partly because of a low birth rate among its citizens. Immigration brought in 1.2 million people between 2006 and 2011, and a total of 6.8 million people in Canada were born outside the country.

Almost 57 percent of the immigrants in the 2006-11 period came from Asia, with the Philippines topping the list, followed by China and India.

The survey also shows that the number of Muslims in Canada is rising strongly, while fewer people identify themselves as Christian and more say they have no religious affiliation.

The number of Christians fell to 67.3 percent of the population in 2011 from 77.1 percent in 2001, while the number with no religious affiliation rose to 7.9 million from 4.9 million in 2001.

The Muslim population nearly doubled during the decade to 1.05 million. Muslims now make up 3.2 percent of the population, up from 2.0 percent in 2001.

(Editing by Peter Galloway)

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By John Wasik

CHICAGO | Fri May 10, 2013 8:25am EDT

CHICAGO (Reuters) - If you're willing to take on more risk, it's a good time to move beyond corporate and government bonds in the incredibly challenging search for yield.

While attention has been on the record-setting stock market - the Dow Jones Industrial Average closed above the symbolic 15,000 on Tuesday and kept climbing - bond yields have been heading south. The benchmark 10-year U.S. Treasury is yielding around 1.8 percent after hitting 2 percent in early March.

An "in-between" portfolio that focuses on yield from non-traditional sources while owning dividend-rich stocks is one approach to find income. This strategy is based on the reality that bond yields probably won't rise much in the next year or so. You'll have to venture into alternative investments if you want to boost your income stream.

I've searched for some of the best exchange-traded funds (ETFs) that offer income and appreciation. The following ETFs focus on four key themes: Global stock dividends, master limited partnerships (MLPs), high-yield bonds and real-estate investment trusts (REITs).

Dividend-paying stocks, for example, can outpace inflation. In January 2009, the S&P 500 Index dividend yield was 3.24 percent while the Consumer Price Index was a negative 0.34 percent, according to dividend.com.

That doesn't always happen. Even so, cash-rich companies are in a better position to raise dividends - something bond payers can't do.

This mix is not risk-free. It may get hit as hard in a stock market sell-off, which is why these funds should comprise no more than 15 percent of your total holdings.

HIGH-DIVIDEND GLOBAL STOCKS

The PowerShares International Dividend Achievers ETF gives you a selection of dividend payers from around the world. If something happens to the torrid U.S. market, you have a little insulation.

The fund, which yields just above two percent, holds brand-name non-U.S. stocks like Vodaphone and Nippon Telegraph and Telephone.

It's posted an annualized return of nearly 14-percent during the three years through May 8, and is up 20 percent for the past year through that date. The trade-off, however, is that the fund is more volatile than the S&P 500.

MORTGAGE REITS

REITs that invest in mortgages have done well since 2008, thanks to low financing rates, although they are not well known. The iShares FTSE NAREIT Mortgage PlusCapped Index invests in major REITs like Annaly Capital Management, which buys mortgage pass-through certificates and obligations.

This specialized REIT borrows money to buy mortgage-backed securities. Like all REITs, it must pass through 90 percent of its income to shareholders.

Currently, the iShares fund is yielding 11 percent. The downside is that it trades like a stock, and its risk is roughly the same as the S&P 500. It's up 24 percent through May 8, and has averaged an annualized gain of 15 percent during the past three years.

MASTER LIMITED PARTNERSHIPS

Until recently, you could only buy these vehicles through brokers, often paying steep commissions. Now that they're being packaged in ETFs, they are worth considering for their high yields, which range from 7 percent to 16 percent.

The Alerian MLP ETF, up 15 percent in the past year through May 8, holds an index of energy partnerships that mostly invested in pipeline companies. With an almost 6-percent yield, the fund probably won't move in lockstep with common stocks, but it's prone to declines if oil prices slide. The ETF is less than two years old, so it's too young to have risk measures.

HIGH-YIELD BONDS

Unlike their government counterparts, "junk" bonds give you the trade-off of lower credit ratings in exchange for higher yields. Rated "B" and lower, these are companies that still need to sell debt, but pose a higher risk of default.

Packaged within an ETF such as the Peritus High-Yield ETF, you can find some diversification from credit risk. Although it is actively managed and has a much higher expense ratio than its peers - 1.35 percent annually versus 0.4 percent for a similar indexed fund - the Peritus fund sports an 8 percent yield.

It is up 13 percent for the year, besting its benchmark by 2 percentage points, which is a significant advantage in the bond world.

As a backstop, keep a close eye on interest rates with all of your bond holdings.

"Be tactical so that you can be ready for the eventual rising interest-rate environment," advises John Zhong, chief executive officer and founder of MyPlanIQ.com, a portfolio service.

(The author is a Reuters columnist. The opinions expressed are his own.)

(Editing by Lauren Young and Bernadette Baum)

View the original article here

By Toni Clarke

Fri May 10, 2013 1:33pm EDT

n">(Reuters) - The Food and Drug Administration has approved a new drug to treat chronic obstructive pulmonary disease, a condition often associated with smoking that can include emphysema, chronic bronchitis, or both.

The drug, Breo, is an inhaled treatment made by British drugmaker GlaxoSmithKline Plc and Theravance Inc of the United States. It consists of a corticosteroid, fluticasone furoate, which reduces inflammation, and a novel long-acting beta-agonist, called vilanterol, which is designed to open the airways. The product is inhaled through a palm-sized device called Ellipta.

COPD is the third-leading cause of death in the United States, according to federal data.

Theravance shares were up 11 percent to $34.78 in afternoon trading. Glaxo's U.S. shares rose 1.95 percent to $51.69.

Breo, or Relvar as it would be called if approved outside the United States, will compete with GlaxoSmithKline's twice-daily asthma and COPD drug Advair, a roughly $8 billion-a-year drug that contains the steroid fluticasone propionate and the long-acting beta-agonist salmeterol.

Analysts on average expect the drug to generate annual sales of $559 million by 2015, according to Thomson Reuters data.

Breo would also compete with AstraZeneca Plc's twice-a-day Symbicort, an inhaled combination of the corticosteroid budesonide, and the long-acting beta-agonist formoterol. Glaxo and Theravance are hoping the once-daily delivery of Breo will make their drug more attractive to patients.

The drug carries a boxed warning, the most serious possible, about the risk of long-acting beta-agonists in increasing the risk of asthma-related death.

"The safety and efficacy of Breo Ellipta in patients with asthma have not been established and it is not approved for the treatment of asthma," the FDA said in a statement.

Potentially serious side effects associated with Breo include a heightened risk of pneumonia and bone fractures, the FDA said. The most common side effects reported by patients were inflammation of the nasal passage, upper respiratory tract infections, headache and oral candidiasis, also known as thrush.

The approval, which follows a more favorable-than-expected review by an FDA advisory panel, could increase investor optimism about another, potentially more profitable, COPD drug the two companies are developing called Anoro. The drug is an inhaled combination of vilanterol and umeclidinium, a long-acting muscarinic receptor antagonist, which works to relax the airways and improve lung function.

Analysts expect Anoro, if approved, to generate peak annual sales of nearly $1.4 billion, according to Thomson Reuters.

The approval of Breo comes just weeks after Theravance said it would split into two publicly traded companies, separating the more advanced respiratory drugs it is developing with Glaxo from its other operations. The move fueled speculation that Glaxo, which owns 27 percent of Theravance, could eventually buy Theravance's most lucrative products.

After the split, the company holding the respiratory drugs franchise will be called Royalty Management Co. The second company, called Theravance Biopharma, will focus on development of drugs for rare diseases.

Shares of Theravance rose as high as $35.80 earlier in the day.

(Reporting by Toni Clarke in Washington; Editing by Matthew Lewis, Steve Orlofsky and Carol Bishopric)

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A Bank of America sign is seen outside of a branch in Greenville, South Carolina January 18, 2012.

Credit: Reuters/Chris Keane

By Karen Freifeld

NEW YORK | Fri May 10, 2013 5:54pm EDT

NEW YORK (Reuters) - Bank of America Corp (BAC.N) has fired back at New York Attorney General Eric Schneiderman after he threatened to sue the bank for violating the terms of a $25 billion settlement designed to end mortgage servicing abuses.

In a letter to Schneiderman, lawyers for Bank of America said they were "surprised and disappointed" the attorney general thought the bank engaged in "flagrant violations" of the timeline to process mortgage modifications.

The lawyers also said Schneiderman cannot sue until the bank has an opportunity to cure any alleged violations.

"Bank of America has not committed any potential violations ... let alone failed to cure those potential violations," attorneys Meyer Koplow and Theodore Mirvis, of Wachtell, Lipton Rosen & Katz, wrote in the May 7 letter. Reuters obtained a copy of the letter on Friday.

Schneiderman announced on Monday that he planned to sue Bank of America and Wells Fargo & Co (WFC.N) for violating the terms of last year's National Mortgage Settlement, which was brokered between five major banks and 49 attorneys general.

Schneiderman did not say how the other three banks - JPMorgan Chase & Co (JPM.N), Citigroup Inc (C.N) and Ally Financial Inc - were performing.

He said Bank of America had 129 violations since October and Wells Fargo had 210 and that their tardiness put homeowners at greater risk of foreclosure.

On Friday, Wells Fargo said it was committed to abiding by the settlement.

"We expect that a constructive pathway may still develop with the New York AG," the bank said in a statement.

Asked about the Bank of America letter, Schneiderman's spokesman, Damien LaVera, said: "At least Bank of America will respond to one New Yorker promptly."

LaVera said the attorney general has "the right to bring a suit against parties that violate the servicing standards and will do so."

Schneiderman has said he would seek injunctive relief and an order requiring the banks to comply with the settlement. His statement did not say he was seeking damages or penalties.

It is unclear how far he can take his efforts because they come outside the primary channel authorized by the settlement to address any potential violations. The settlement's monitor is authorized to first work with a servicer to correct any potential violations and sue only if the errors are not fixed.

Bank of America said that, under the terms of the settlement, the attorney general's office has no right to commence an enforcement action and requested that the notice of intent be publicly withdrawn.

The bank's letter asked for evidence of any violations so it could provide remediation to homeowners without waiting for any "adversary process."

(Reporting By Karen Freifeld. Editing by Andre Grenon)

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An American flag flutters in the wind next to signage for a United States Social Security Administration office in Burbank, California October 25, 2012.

Credit: Reuters/Fred Prouser

By Mark Miller

CHICAGO | Thu May 9, 2013 3:29pm EDT

CHICAGO (Reuters) - Robin Brewton, who advises clients on Social Security benefit strategies, has boosted retirees' financial security with a single question: Are you divorced?

It is a little-known fact: If you're divorced, it's possible to claim Social Security spousal and survivor benefits from your ex. It is a strategy that can dramatically boost your benefits - and it will be important for more retirees in the years ahead.

Brewton is vice president of client services at SocialSecuritySolutions.com, which advises clients on benefit strategies. One client, whom Brewton declined to name to keep her privacy, saw her monthly benefit rise to $2,200 from the $900 she'd anticipated when Brewton alerted her about the divorced spouse rules.

Her client was a divorced senior who never earned much money during her working years. At retirement, she was set to file for her meager $900 monthly Social Security benefit - until she learned she could claim for a survivor benefit on her deceased ex-husband's earning record.

That turned out to be the difference between living in poverty and a much more comfortable retirement: the client's late ex was a high-earning physician, and she is collecting a $2,200 monthly benefit.

The Social Security Administration reports that in 2011, 6.7 percent of all beneficiaries receiving spousal benefits were divorced; 10.4 percent receiving survivor benefits were divorced. But the divorce rate among adults ages 50 and older doubled between 1990 and 2009, according to a study published last year by the National Center for Family & Marriage Research at Bowling Green State University.

"Many older people who go through a divorce think that once it's final, they have no claim to any Social Security benefit from their ex-spouse," says Brewton. "Women, especially, will be able to have higher benefits and enjoy a better standard of living if they make the call to the Social Security Administration and ask about their eligibility for a divorced spouse benefit."

Spousal and survivor benefits are among Social Security's most valuable features for married couples. You can claim half of a spouse's benefit if you are at full retirement age (currently 66), assuming that is higher than your own full benefit. And, you're entitled to 100 percent of a deceased spouse's benefit.

If you're divorced, you can take advantage of most of those same benefits, if you are currently single, and have been married to your ex at least ten years; at least 62 years old, which is the minimum Social Security eligibility age; and not already receiving a benefit greater than the divorced spouse's benefit.

You can file for spousal benefits even if your ex isn't receiving his or her own benefits - so long as your divorce has been final for two years. Eligibility for an ex's benefit is lost if you remarry, and you can't file for benefits on your new spouse's earning record until you've been married to that person at least one year.

Filing for a divorced spouse benefit is a completely private affair between you and the Social Security Administration. The Social Security Administration doesn't report to your spouse that you've inquired - or filed for benefits - on his or her record.

You'll need to prove you were once married by visiting your local Social Security office with paperwork in hand. Be prepared to show a birth certificate; proof of citizenship; W-2 forms or self-employment tax returns for the last year; your final divorce decree; and your marriage certificate.

The story of Brewton's client illustrates the most simple example of how can the divorce rules help boost benefits. Here are two hypothetical examples of ways the rules can benefit a divorced spouse, provided by SocialSecuritySolutions.com; all the amounts are shown in today's dollars without cost of living adjustments.

GROW YOUR OWN BENEFIT

Vicky divorced at age 58, and is projected to have a monthly Social Security benefit of $1,094 at full retirement age. Her ex-husband's full retirement benefit is $2,410. At age 66, Vicky can claim a spousal benefit of $1,205 each month until age 70. When she reaches age 70, Vicky's own benefit will have grown to about $1,444 through delayed filing; at that point she can switch to her own higher benefit. Assuming Vicky lives to age 90, the cumulative lifetime difference between starting her own benefit at age 66 and this strategy is $89,328.

(This strategy won't work if Vicky filed for the spousal benefit before her own retirement age; in that situation, she wouldn't be able to choose which benefit to collect; she'd automatically receive whatever benefit is higher at that point - which is her own.)

SPOUSE SWAPPING

Diane was married to Phil for 15 years and to Jim for 21 years. Phil was the higher earner, with a full retirement benefit of $2,442. Jim's full retirement benefit was $2,136. Diane's own full retirement benefit was only $963.

Diane began by collecting half of Phil's benefits at age 66 - $1,221. Her plan was to switch to her own benefit at age 70 when it would have grown to $1,271.

But before she reached age 70, Jim passed away. He had waited until age 70 to begin his own benefits, meaning they had grown to $2,819. Diane was eligible to collect the surviving divorced spouse benefit of $2,819 - an increase in monthly benefits of $1,598 over what she was collecting on Phil's earnings record. That is a lifetime difference of more than $383,000, if she lives to be 90.

"You can switch back and forth with multiple ex-spouses," says Jim Blankenship, a financial planner who specializes in Social Security benefits. "It's sort of the Elizabeth Taylor scenario."

The Hollywood star actually stayed married to just one of her seven husbands long enough to meet Social Security's ten-year rule - Richard Burton. Their 1964 marriage did last more than ten years - and they tied the knot a second time for about 9 months in 1975.

Both of those marriages could have been added together under the Social Security rules.

(The writer is a Reuters columnist. The opinions expressed are his own.)

(Follow us @ReutersMoney or here; Editing by Tim Dobbyn) For more from Mark Miller, double-click: link.reuters.com/qyk97s

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By Suzanne Barlyn

Thu May 9, 2013 4:17pm EDT

n">(Reuters) - The top securities regulators on Thursday warned individual investors about pension purchasing companies that persuade retirees and military veterans to sign over pension checks in return for lump-sum payments, as regulatory concerns about the practice mount.

Individuals who receive monthly pension payments could be targets of salespeople offering an immediate lump sum in exchange for some or all of their future pension payments, the U.S. Securities and Exchange Commission and Financial Industry Regulatory Authority wrote in a joint alert.

Pension recipients who sign over their payments to so-called "factoring" or "pension advance" companies, will almost always receive lump-sum payments that are lower than the present value of their future income streams, the SEC and FINRA wrote. The companies also target individuals who are receiving payments for settlements of personal injury lawsuits, according to the regulators.

The investor alert follows a probe opened by New York's main banking regulator into pension advance companies. The state's Department of Financial Services, at the direction of New York Governor Andrew Cuomo, has subpoenaed 10 companies involved in the business, the governor said on Tuesday.

Cuomo accused the companies of "preying" on retirees and veterans by advancing sums that may actually be disguised, high-cost loans.

Individuals who are thinking about selling the rights to their pensions should consider the value of the lump-sum payment compared to the future income stream - a figure that most states require pension advance companies to disclose, the regulators wrote.

The deals also involve transaction costs, which can include everything from brokerage commissions to notary fees, according to the joint SEC-FINRA alert.

The SEC and FINRA also warned investors about buying the rights of someone else's pension or personal injury settlement.

Companies pushing such investments are advertising yields from 5.75 percent to 7.75 percent, the regulators said. That may be appealing in the current low interest-rate environment, but the securities can be expensive and difficult to sell, according to the alert.

(Reporting by Suzanne Barlyn; Additional reporting by Jonathan Stempel; Editing by Linda Stern and Chris Reese)

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n">(Reuters) - Children's television series "Sesame Street" said on Friday it was adding a third Spanish-speaking character to its cast and will put a special focus on Hispanic heritage in its upcoming season, in an acknowledgement of changing U.S. demographics.

Bilingual character Armando, who will be portrayed by 26-year-old Puerto Rico-born actor Ismael Cruz Cordova, will debut in September on the long-running series of people and puppets that airs on public broadcaster PBS.

"Like his character 'Mando,' Ismael represents a culturally fluid and deeply layered new generation of Hispanic-Americans," Carol-Lynn Parente, executive producer of "Sesame Street," said in a statement.

"He has a passion for creative expression and a warmth that comes right through the camera," Parente added.

"Sesame Street" previously added two bilingual Spanish-speaking actors and one bilingual puppet, Rosita. Puppet Ovejita, who only speaks Spanish, appears occasionally.

The United States is on a path to becoming a "majority minority" nation as minority babies topped 50 percent for the first time in 2011, with Hispanics the largest and fastest-growing minority group.

"Sesame Street," which is entering its 44th season, is produced by the non-profit Sesame Workshop in New York.

(Reporting by Eric Kelsey; Editing by Piya Sinha-Roy and Vicki Allen)

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By Toddi Gutner

NEW YORK | Fri May 10, 2013 9:00am EDT

NEW YORK (Reuters) - As a successful Wall Street investment banker, Kathryn Swintek is skilled in the art of doing deals.

That's why Swintek has used her own funds to provide seed capital to early-stage companies throughout her career. But three years ago, she teamed up with Golden Seeds, a large angel investor network, for some extra support.

"As a solo investor, deal access is 'catch as catch can,' while in a group, deal flow is more consistent and plentiful," says Swintek, now one of the network's nine managing partners. "The other informed perspectives are valuable."

Overall, there are more than 330 angel groups in the United States and Canada that are active in start-ups, and funding hit $22.9 billion in 2012 - up 1.8 percent from 2011, when investments totaled $22.5 billion, according to the University of New Hampshire Center for Venture Research. Some 67,030 entrepreneurial ventures received angel funding in 2012.

Swintek considers her foray into angel investing as part of a well-rounded asset-allocation strategy. The minimum investment may not seem that high at first - many angel groups require only $25,000 invested in one deal per year.

But don't let that lure you into thinking that angel investing is for everyone. You must first be an accredited investor with a minimum net worth of $1 million - excluding your home - or earn an annual income of $200,000 or $300,000 if married and filing jointly.

Angel investing takes an enormous amount of time - up to hundreds of hours on screening deals and doing due diligence - along with a stomach for risk. Plus, just 10 percent of deals have a likelihood of success.

Of 10 deals, a reasonable number of investments for an angel portfolio, investors can expect to "get a nice return on one, get their money back on four, and lose everything on three or four," says Jeffrey Sohl, director of the Center for Venture Research, and a professor of entrepreneurship at the University of New Hampshire.

What is considered a "nice return?" About a 20 percent to 30 percent annual return over a five-year period, Sohl says. Every investor expects to find the next Google, but the odds are extremely low, he warns.

Still interested in diving into angel investing? Here are a few things to consider before you join a network.

CHOOSE YOUR GROUP WISELY

Each angel group is a little bit different. Perhaps most important is to share the same vision as the group. Are you interested in investing only in technology, women-owned companies or healthcare and life sciences?

You'll also want to join a group in your area. Boston, New York, Silicon Valley, Southern California and Washington, D.C., are active cities and regions.

Larger groups typically see more deals because these groups are often the first stop for an early-stage company. One of the largest, Tech Coast Angels, based in Southern California, has invested over $120 million in more than 200 companies. It asks members to invest a minimum of $50,000 annually, typically two rounds of $25,000 each.

Another group, New Vantage, based in McLean, Virginia, has invested $50 million in more than 55 primarily mid-Atlantic-based companies.

Get to know the group's expectations for financial and time commitment. Go to a few events of several different groups and get a feel for the dynamic and their due-diligence process.

For a well-rounded portfolio, you need to be able to consistently invest between $150,000 and $300,000 - which shouldn't reflect more than 5 percent to 10 percent of your total investment portfolio, financial advisers say.

You can expect your capital to be tied up between five and seven years before there is a liquidity event, such as a buyout, initial public offering or other exit strategy, Sohl says. In other words, this essentially needs to be money you can afford to do without.

GET EDUCATED

Some groups offer educational courses for a fee. Golden Seeds, for example, offers two courses to accredited investors outside their network for $350 each. You'll learn how to screen deals, conduct due diligence, understand deal structure and negotiation, perform post-investment monitoring, and know about state tax credit and government incentives for angel investing, among other topics.

Maverick Angels, in Agoura Hills, California, offers free seminars for members and prospective members.

For more information, tap resources like the Angel Capital Association, National Capital Angel Organization, The Kauffman Foundation or the Center for Venture Research.

BIG TIME COMMITMENT

There are many reasons people become angel investors - to mentor entrepreneurs, get into a company on the ground floor, or learn about the private equity world. Universally, they are all willing to commit their time.

Prepare to spend 40 to 50 hours to do due diligence on at least one company the group is considering or to attend networking or screening events.

Most angel groups will take a deep dive into a company's business model, marketing plan, technology platform, capital structure, competition, and financial performance along with the quality of management team.

At Golden Seeds, there are generally five to 10 members, each with representative expertise in each key area, including marketing, technology, finance and the relevant industry knowledge, who comprise a deal team on any given transaction.

Among the nascent companies funded by Golden Seeds, which backs women entrepreneurs, are Bespoke Global, an ecommerce platform for custom home furnishings, and HitFix, an entertainment web platform focusing on hard news.

All investments are making positive progress, with Bespoke and HitFix generating revenues that are growing year over year.

The process for angel investors to select companies to back generally requires two months before it is complete. Deal team members have many meetings and frequent calls with management in the course of due diligence.

(Editing By Lauren Young and Jan Paschal)

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German Finance Minister Wolfgang Schaeuble attends the G20 finance ministers meeting during the Spring Meeting of the International Monetary Fund and World Bank in Washington, April 19, 2013.

Credit: Reuters/Yuri Gripas

BERLIN | Sun May 12, 2013 2:21am EDT

BERLIN (Reuters) - Germany's finance minister has signaled his opposition to any move by the European Central Bank to buy asset-backed securities to help indebted states, telling his party it would amount to "covert state financing", according to German magazine Spiegel.

Spiegel said in its edition published on Sunday that Wolfgang Schaeuble made the comment during a meeting of his Christian Democrat (CDU) party last Wednesday, telling those present the purchase of asset-backed securities (ABS) by the European Central Bank (ECB) would infringe European rules.

German newspaper Die Welt, citing a central bank source, said last Wednesday a majority of ECB Governing Council members seemed to be in favor of the central bank buying ABS.

ECB policymaker Yves Mersch said on the same day, however, the ECB would not subsidize markets with asset purchases.

A spokesman for the German finance ministry said it never commented on internal party discussions.

At the start of May, the ECB said it had set up a task force with the European Investment Bank (EIB) to assess ways to unblock lending to small and medium-sized enterprises (SMEs), for example by promoting a market for ABS based on SME loans.

ABS would allow banks to pass some credit risk on to other investors, enabling them to lend more and so potentially boost growth.

The move to promote ABS is controversial, particularly in Germany, as during the financial crisis such securities became toxic due to the default of housing loans that underpinned them.

(Reporting by Alexandra Hudson; Editing by Mark Potter)

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Pacific Investment Management (PIMCO) founder and co-chief investment officer Bill Gross plays golf on the first hole at Pebble Beach Golf Links before the start of the AT&T Pebble Beach Pro-Am in Pebble Beach, California, February 8, 2012.

Credit: Reuters/Robert Galbraith

By Jennifer Ablan and Dan Burns

NEW YORK | Fri May 10, 2013 4:56pm EDT

NEW YORK (Reuters) - Circle the date, market mavens: April 29, 2013. AKA, the day the bond bull died. Age 31 years, 7 months.

That, at least, is the call from Bill Gross, who is known on Wall Street as "the Bond King."

Gross, the manager of the world's largest bond fund, the Pimco Total Return Fund, with $289 billion in fixed-income assets, set the Wall Street Twittersphere alight early Friday with this 62-character missive: "The secular 30-yr bull market in bonds likely ended 4/29/2013."

Moreover, Gross says it's over for more than just Treasuries, the cornerstone of the $38 trillion U.S. bond market. The upward run is finished for "all bonds," he said in a follow-up email to Reuters, including low-quality corporate debt, or junk bonds, whose yields fell below 5 percent this week for the first time.

The "price peak refers not to Treasuries but to all bonds, including a weighted amount of high-yield debt. Thus the 4/29 date will not exactly correspond to a bottom in 10-year Treasury yields, for instance," Gross said.

He said his call is a "gut feeling" that the bull market in fixed income ended on April 29.

The date was a Monday, and the yield on the benchmark 10-year Treasury note, which moves in the opposite direction to the note's price, dropped to a fraction above 1.65 percent, right around its low of the year. Since then, Treasuries have had a rotten start to May, with yields rising 0.22 of a percentage point, briefly topping 1.92 percent on Friday.

April 29 was also the day before U.S. Federal Reserve policy makers convened their latest two-day meeting, which ended with a statement signaling the central bank stood ready to increase the pace of its unconventional monetary policy, a bond-buying program called quantitative easing, if needed to boost the sluggish economy.

While Gross's commentary is widely followed by investors, not all of his calls have been spot on. In 2011, he had one of his worst years ever by betting that yields would rise with an inflation threat that never materialized, thus selling all of his holdings in Treasuries.

Last summer, he mused that the "cult of equities" was dying. The benchmark Standard & Poor's 500 Index is up 18.8 percent since then.

To be fair, Gross' declaration is more a culmination than a revelation. He has been growing ever more bearish on the prospect for bonds since the Fed took short-term interest rates essentially to zero at the end of 2008 and the central bank then began hounding investors out of safe assets through its three QE programs, each more aggressive than the one before.

Gross, a 69-year-old former Navy officer and one-time professional card player, has been a bond market fixture for 42 years. He co-founded the Pacific Investment Management Co. in 1971, only to endure a decade-long bear market in bonds that took the yield on the 10-year Treasury to a peak of around 15.8 percent on September 30, 1981. The yield on two-year notes had peaked earlier that month at an even higher level: 16.95 percent.

Since then, though, the bond market's been a gravy train.

According to Bank of America/Merrill Lynch Fixed Income Index data, a broad basket of U.S. fixed income securities, including Treasuries, corporate bonds and mortgage-backed securities, has delivered a total return of 1,420.5 percent since the beginning of October 1981. That was right after yields hit their highs, and the campaign to beat back inflation led by Paul Volcker, then the Fed chief, finally began paying off.

While that's less than half the total return on stocks - the S&P 500 generated a total return, including reinvested dividends, of 3,144 percent over the same run - bond investors have enjoyed three decades of consistent gains with far less volatility.

Gross launched the Total Return Fund in May 1987, and it has delivered a total return of 694.5 percent since inception, outperforming the 506 percent return on U.S. bonds more broadly in the same period.

Gross cautioned that his call for a top in the market does not mean the bottom will fall out imminently.

"A bear market is not in the cards until growth and inflation threaten current Fed policies," Gross said in his email to Reuters.

The economy has been limping along since the recession ended, generating gross domestic product growth of better than 3 percent in just three of the past 15 quarters. Inflation, meanwhile, has been running just over 1 percent, roughly half of the Fed's target level.

"We expect prices to stop going up but not to start going down," Gross said.

In fact, Gross just increased his Treasury holdings in the Total Return Fund to 39 percent from 33 percent in March. Gross has said that he likes bonds within the five-year and shorter maturities as they will "do best based on continuing policy rate."

And bonds also continue to attract investor cash, even with yields near record lows. U.S. mutual funds investing in taxable bonds took in a record $8.88 billion in the latest week, according to fund tracking firm Lipper, a unit of Thomson Reuters.

(Reporting By Jennifer Ablan and Dan Burns; Editing by Chizu Nomiyama and Leslie Adler)

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American immigration reform won’t cost taxpayers an arm and a leg as some opponents say. But maybe the real worry is that it will be bad for the 12% of Americans without a high-school degree. Giving unauthorized workers legal status and giving more low-skilled foreign workers temporary visas could force down wages and take away jobs for low-skilled Americans. Right?

It might be easier if we talk about manicures.

The manicure business in the US has been driven by immigrants. It’s low-skilled, low-capital service work. For instance, Vietnamese immigrants and their families make up nearly 80% of manicurists in California, and 40% of manicurists across the nation.

So you could say that foreign manicurists have taken the jobs of hard-working American hand-and-foot maintainers, but the reality is more complicated. A study in California (pdf) found that between 1987 and 2002, 35,700 Vietnamese manicurists went to work there. But they didn’t exactly put native-born workers out of business. For every five Vietnamese who entered, two non-Vietnamese workers were displaced—but the authors are quick to note that most of that effect came from workers choosing not to enter the profession, rather than people who already worked as manicurists losing their jobs.

Why was this possible? Because the immigrants were—wait for it—innovators in the manicure space. They developed the idea of the standalone nail salon that reduced costs, “making a once-exclusive service commonplace.” That meant more nails to paint, not just more workers per nail. The benefits of immigration accrued to people who got their nails painted, to the new immigrants, and even to the remaining non-Vietnamese manicurists.

While nail-care business might not be the perfect stand-in for all low-income work, it does reflect what economists find more broadly: When new immigrants come, it does mean new competition for similarly-skilled local workers, but the new immigrants may also create opportunities that lead to more investment, which maintains wage growth and leads to economic growth. Indeed, with more immigration, average wages seem to rise, not fall.

But the American workers most similar to low-skilled immigrants are uneducated Americans. Economists looked at how immigration affected them between 1990 and 2006, when a lot of unauthorized workers were coming into the country. If they assumed every new immigrant had the exact same abilities as a native worker (which obviously isn’t true, starting on the language front), the effect of immigration on the wages of native workers who didn’t finish high school fell 0.6% over 16 years, while those of everyone else improved. In a more accurate simulation, they found that less-educated natives saw their wages increase by 0.3% due to immigration, and average wages increased 0.5%. That’s not so bad at all.

And, of course, immigrants coming to the United States see huge increases in their wages and productivity, but most Americans aren’t taking that into account when considering the bill.

Which makes this a good opportunity for a correction: Actually, the most similar worker to a low-skilled immigrant is another recent low-skilled immigrant. This group faces the largest downward pressure on wages from increased immigration. That could mean that low-skilled services performed by recent immigrants, from nail care to landscaping or child care, will remain cheap if the immigration bill passes. That depends, too, on how many currently undocumented immigrants move up the path to citizenship and better jobs.

But high school dropouts face bigger problems than new immigrants—they lack basic education when those skills have never been more important—which probably should have been obvious from the beginning.

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Michael Madigan, speaker of the Illinois Representatives, listens to the State of the State address in the House Chambers of the Illinois State Capitol in Springfield, Illinois February 1, 2012.

Credit: Reuters/Sarah Conard

SPRINGFIELD, Illinois | Thu May 9, 2013 7:31pm EDT

SPRINGFIELD, Illinois (Reuters) - The Illinois Senate on Thursday passed a labor union-backed bill to reduce the state's nearly $100 billion unfunded public pension liability, giving lawmakers dealing with America's worst-funded state retirement system a second option.

The 40-16 vote in the Democrat-controlled chamber sends the measure to the House, which last week passed a more comprehensive pension fix pushed by Democratic House Speaker Michael Madigan. Democrat John Cullerton, the Senate president, is chief sponsor of the bill the Senate approved on Thursday.

It was unclear which plan would prevail or whether some combination of both might pass before the spring legislative session ends on May 31.

Even as the Senate debated its version of pension reform, Madigan in the House held a hearing focused on a proposal to shift the cost of paying pensions from the state to local school districts, universities and community colleges.

Some state lawmakers and school officials have raised concerns the move would result in higher tuition and property tax hikes.

"This is going to happen. There will be a new plan. School districts are going to pay the pension costs for teachers and the others," Madigan said, adding he will release his proposal next week.

Costs arising from pension underfunding, caused by years of skipping or skimping on payments, are threatening the delivery of core state services such as education and health care. The pension crisis has pushed Illinois' credit rating to the lowest level among the states.

Cullerton, the Senate president, is in no hurry to bring the House version of pension reform - Madigan's proposal - to a vote in the Senate, said Rikeesha Phelon, Cullerton's spokeswoman.

A bill similar to Madigan's was soundly defeated in March, Phelon noted. "We first need to know that the vote count has changed" before taking up the Madigan bill, she said.

Cullerton's plan, negotiated with union officials, offers current workers and retirees a choice in how reductions in pension or health benefits would affect them.

"We feel that this bill obviously has strong sound constitutional principles. Other versions of pension reform are risky, and we know there's going to be litigation for sure," Cullerton said during debate ahead of the vote.

Cullerton's bill, however, would only shave the unfunded liability by as much as $15.7 billion and bring the system to a 90 percent funded level in 30 years. Madigan's bill calls for unilateral changes in pension benefits that are expected to cut $30 billion from the liability and uses savings over time to fully fund the system by 2044.

Senate Republicans, who largely voted against the measure, argued that Cullerton's bill does not go far enough to shore up the sagging pension system for teachers outside of Chicago, higher education workers, lawmakers, and state employees.

"This bill doesn't do enough to change the trajectory of our pension funds and you will be back here reliving this nightmare," said State Senator Matt Murphy.

Cullerton has said Madigan's bill would save Illinois nothing if unions were to prevail in an expected court battle. Unions have threatened a lawsuit to test whether the measure violates state constitutional protections against diminishing or impairing public worker retirement benefits.

Groups representing retired teachers and state workers have threatened lawsuits to challenge Cullerton's plan, too, but legal observers say Cullerton's approach is less vulnerable to a challenge.

Under Cullerton's plan, current workers would be given choices involving changes in cost-of-living adjustments for pensions, higher contributions, and the use of future raises to determine pension payments. In return for any concessions they make, workers would have access to state-sponsored health care in retirement.

Incentives offered in the Cullerton plan - called "considerations" in pension parlance - are designed to persuade workers to accept reductions in their pension benefits. The tradeoff would address the constitutional ban on reduction of pension benefits because retirees would actively select a consideration in return for giving up part of their promised pension.

The Cullerton plan does have some similarities to Madigan's bill. Like that measure, it also requires the state to make timely and adequate pension contributions and also exempts pension changes from collective bargaining.

(Reporting By Joanne von Alroth, additional reporting by Karen Pierog in Chicago; Editing by Greg McCune, David Greising, Toni Reinhold and Carol Bishopric)

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Lawyer Howard Weitzman speaks to the media outside of Superior Court in Los Angeles July 6, 2009.

Credit: Reuters/Eric Thayer

LOS ANGELES | Wed May 8, 2013 6:40pm EDT

LOS ANGELES (Reuters) - The attorney for Michael Jackson's estate on Wednesday described as "outrageous and pathetic" a fresh claim of child molestation against the dead pop star, made by one of his close friends.

Choreographer Wade Robson, who testified in defense of the "Thriller" singer in a 2005 child sex abuse trial, filed a creditor's claim against Jackson's estate last week, alleging he had been abused by the singer when he was a minor, according to sealed legal documents seen by celebrity website TMZ.com.

"Mr. Robson's claim is outrageous and pathetic," Howard Weitzman, the attorney for Jackson's estate, said in a statement.

Robson, 30, developed a friendship with Jackson as a child and slept over at the singer's Neverland Ranch home in Southern California on several occasions when he was a minor.

He made his claim for damages against the singer's estate almost four years after Jackson's June 2009 death. Details of his allegations were not publicly available.

Robson's attorney, Henry Gradstein, accused Jackson of brainwashing and intimidating Robson to keep him from coming forward.

"Last year, on a career trajectory that was off the charts, he (Robson) collapsed under the stress and sexual trauma of what had happened to him for seven years as a child," Gradstein said in a statement on Wednesday.

He added that Robson had no financial motive and did not request a specific amount of damages in his claim.

Jackson was tried and acquitted in 2005 on molestation charges involving another minor. Robson testified at that trial in defense of the singer.

"This is a young man who has testified at least twice under oath over the past 20 years and said in numerous interviews that Michael Jackson never did anything inappropriate to him or with him," Weitzman said.

Robson, an Australian, worked as a choreographer for pop singer Britney Spears and former boy band 'N Sync in the late 1990s and appeared as a judge on the U.S. TV dance competition "So You Think You Can Dance."

He also appeared as a dancer in Jackson's 1991 music video for the single, "Black or White."

Jackson's estate is in the process of settling dozens of claims from creditors and others who had dealings with the King of Pop during his long career.

An unrelated wrongful death suit, brought by Jackson's family against concert promoter AEG Live, is in its second week of trial in Los Angeles.

(Reporting by Eric Kelsey; Editing by Jill Serjeant and Mohammad Zargham)

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French Social Affairs and Health Minister Marisol Touraine (C) arrives at Roger Salengro hospital in Lille, May 11, 2013, where the patient with confirmed case of the SARS-like coronavirus is treated.

Credit: Reuters/Pascal Rossignol

PARIS | Sun May 12, 2013 6:43am EDT

PARIS (Reuters) - A second case of a new SARS-like coronavirus has been diagnosed in France, the Health Ministry said on Sunday, in what appeared to be a case of human-to-human transmission.

The new infection was found in a patient who had shared a hospital room with the only other confirmed sufferer in France, the ministry said in a statement.

Health experts are concerned about clusters of cases of the new coronavirus strain, nCoV, which started in the Gulf and has spread to France, Britain and Germany. But there has so far been little evidence of sustained human-to-human transmission.

Professor Benoit Guery, head of the Lille hospital's infectious diseases unit, said the second infection suggested that airborne transmission of the virus was possible, although the ministry noted that the roommates had had "close and prolonged contact".

"The transmission chain is becoming clearer," Guery told BFM Television.

France's second case was confirmed in a 50-year-old man who had shared a hospital room in Valenciennes, northern France, with a 65-year-old who had fallen ill after returning from Dubai and was later diagnosed with the disease.

Both men are now in hospital in the nearby city of Lille, where they are being kept in isolation.

Health officials screened 124 people who had come into contact with the first confirmed case, and carried out laboratory tests on at least five, including three health professionals.

All came back negative except his former hospital roommate, who had shared a room with him between April 27 and 29, the ministry said.

French health authorities are now broadening their screening effort to include anyone who has been in contact with the second confirmed case.

The latest diagnosis brings the number of cases confirmed globally to 34, after Saudi Arabia said two people admitted to hospital there in April had tested positive for the disease.

(This story is corrected with total number of people screened in paragraph 8 to 124, not 24)

(Reporting by Nicolas Delame; writing by Laurence Frost; Editing by Kevin Liffey)

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A man takes a bath in Biarritz beach, southwestern France, January 10, 2007.

Credit: Reuters/Regis Duvignau

By Beth Pinsker

NEW YORK | Wed May 8, 2013 1:17pm EDT

NEW YORK (Reuters) - When Barbara Grover and her husband received an inheritance they were not expecting five years ago, they planned a luxurious family trip.

Rather than plowing the money back into retirement savings, the Grovers took their two daughters as well as their spouses and children along on an eight-day safari in Tanzania.

Total cost for 11 people: around $65,000.

"It's a lot of money, there's no way to get around that part," Grover said. But considering that price included 11 flights, two guides, almost all meals and an unforgettable experience spending time with her kids and grandkids, she said it was a bargain.

Now Grover, who lives in Pittsburgh, is plotting another family adventure - to take her whole brood on a cruise around the Galapagos Islands next year. The route is one of the most popular with multigenerational family groups like hers, which is why Grover had to nail down plans a year in advance in order to secure a ship.

Industry analysts say the increase in popularity in multigenerational travel is being driven by spry baby boomers who are gathering up their dispersed kin to spend quality time together.

A soon-to-be-released survey from MMGY Global, a travel industry research company, finds that around 5.5 percent of all vacation trips now consist of grandparents, parents and children traveling together. However, there is not a great deal of historical data to compare the growth overall in the industry in recent years.

Travel agents and hotel groups say bookings of large family groups are increasing. Preferred Hotel Group, for instance, says traffic to its dedicated family travel website (preferredfamily.com) is on track to double this year over last year. In 2011, a company survey found that 40 percent of active leisure travelers had taken a multigenerational trip that year.

WHO PAYS?

On many of these excursions, grandparents foot the bill for the whole group. The price tags can be exorbitant. For the Grovers, part of the impetus for the Galapagos trip - which could cost up to $90,000 - comes from the need to take required minimum distributions from their individual retirement accounts.

The Internal Revenue Service requires distributions after age 70-1/2.

It is possible to travel on the cheap, too.

Jon Andre, a certified financial planner with Financial Management Group in Cincinnati, Ohio, had a client who for her 70th birthday, took her whole family on a $500 ziplining expedition at a resort in southern Ohio.

"She was getting a little agitated that her grandkids were spending most of their time inside in front of TV," he says.

WHERE TO GO

Judy Gross and her husband, who live in Blue Bell, Pennsylvania, find that their budget of around $30,000 works best for a beach resort for their brood of 10. They typically travel during winter vacation or spring break. Most recently they all went to the Turks & Caicos islands in the Caribbean.

"The hardest thing for me is the grandchildren want to go someplace different every year," says Gross, who turns 70 in June.

Showing up at a vacation destination with 10 people of varying ages and interests can be chaotic. Gross highly recommends all-inclusive meal plans. On their last trip, the self-titled chief executive officer of her family only pre-booked three days of meals for the family, which made it difficult and expensive to organize meals on the remaining days.

Hotels are increasingly changing to accommodate groups like this, trying to be more family-friendly with villas and suites, says Preferred Hotel Group's Michelle Woodley, senior vice president of distribution and revenue management.

Cruises are another popular option with families. The industry will add another 12,000 new beds in 2013, bringing total capacity up to more than 350,000, according to the Cruise Lines International Association, a trade group.

For groups larger than 16 on off-peak vacations, cruise lines start to kick in some discounts, such as offering one free bed as well as points that can be traded for services, said Lauren Goldenberg, a Philadelphia-based travel agent who runs The Family Traveler agency with her sister, Mindy.

HEAD OFF CONFLICTS

But with so many people of varying ages in close quarters for days at a time, family harmony can be in jeopardy without advance planning, Goldenberg added.

The first step is to look at meeting the needs of the children - how long a plane trip can they tolerate, what activities can they do, will they eat anything beyond chicken nuggets?

Next she suggests finding a place where family members can amuse themselves during the day, usually on their own dime, and come back together for a pre-arranged evening meal, often paid for by the family elder.

She recently booked a trip for a group of 15 to Scottsdale, Arizona, for a grandparent's 75th birthday. The location worked since family members from California, Boston and Washington, D.C. could all get there on non-stop flights, which they paid for individually. The resort had villas where each family could sleep on its own, for less than $500 a night per family. There was a spa, a pool, tennis, mountain biking and hot-air ballooning.

"Plenty of grandparents come back these trips and say, it was best ever. We got away from electronics and enjoyed each other's company," Goldenberg said.

(Editing by Lauren Young, G Crosse)

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WASHINGTON | Wed May 8, 2013 6:14pm EDT

WASHINGTON (Reuters) - The U.S. Consumer Financial Protection Bureau warned on Wednesday that the economy will soon feel the effects of surging student loan debt unless steps are taken to ease the burden on existing borrowers.

The agency, charged with protecting consumers from the financial markets, reported its findings at a public hearing in Miami, Florida after analyzing about 28,000 responses from individuals, consumer groups and other organizations to a February query on the effects of student loan debt.

U.S. student loan debt, which now exceeds $1 trillion, has come under focus as lawmakers and economists debate its affect on the economy.

According to a CFPB analysis, student debt affects borrowers' credit and may limit their ability to start small businesses, save for retirement or invest in new homes or cars.

Rural communities are struggling to attract healthcare professionals and teachers who take higher-paying urban jobs that allow them to pay off debt, the CFPB said.

"We hear from many who say they just need to live with their parents until they weather the storm or tackle this debt, which could lead to delayed economic activity," Rohit Chopra, the CFPB's student loan ombudsman, told reporters.

Americans aged 18-to-34, who decide to live with their parents to cut expenses, account for about $100 billion in withheld or delayed spending that would be pumped into the economy if they set up new households, Chopra said.

Student loans are the only kind of debt that continued to rise through the financial crisis, according to data from the New York Federal Reserve Bank. The average borrower owes about $27,000.

Delinquency rates also have spiked, as the lingering effects of the recession make it difficult for recent graduates to find jobs. About 6.7 million borrowers - out of 37 million - are at least 90 days delinquent on loan payments, the New York Fed said.

Recent discussions among lawmakers in Washington have focused on making student loans more affordable for future borrowers. Fewer solutions have been offered for easing the burden of already existing debts.

The agency called for refinancing as a way to offer some relief to existing borrowers and allow them to take advantage of historically low interest rates.

"With improved credit, many borrowers could get ahead and climb the economic ladder," Chopra said. "Most borrowers aren't looking to get off the hook-they are just looking for a repayment system that works."

(Reporting By Elvina Nawaguna; Editing by Marilyn Thompson and Leslie Gevirtz)

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A screen grab shows the access to Netflix online, as displayed on a television screen, in Encinitas, California July 25, 2011.

Credit: Reuters/Mike Blake

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Baseball player Fritz Ostermueller is pictured with his wife Faye and daughter in this 1948 family photo released to Reuters by his daughter Sherrill Duesterhaus (C). Ostermueller, threw the pitch, but it did not hit Jackie Robinson, the first black man to play major league baseball, in the head and there is no evidence he uttered, ''You don't belong here and you never will,'' as shown in ''42,'' the Warner Bros. Pictures film that opened in April.

Credit: Reuters/Sherrill Duesterhaus/Handout via Reuters

By Kevin Murphy

KANSAS CITY, Missouri | Sat May 11, 2013 12:33pm EDT

KANSAS CITY, Missouri (Reuters) - When a racist pitcher beans Jackie Robinson in the head in the new movie about the first black man to play major league baseball, Sherrill Duesterhaus wants everybody in the theater to know it's a lie.

Duesterhaus' father, Fritz Ostermueller, threw the pitch, but it did not hit Robinson in the head and there is no evidence he uttered, "You don't belong here and you never will," as shown in "42," the Warner Bros. Pictures film that opened in April.

"I respect Jackie Robinson, his story is so inspiring and it's good that it is out there, but not at the expense of someone's good name," said Duesterhaus, 66, of Joplin, Missouri.

Duesterhaus said she had been warned by a friend that the film was unflattering to her father, who died of cancer at age 50 when she was 11 years old.

But the scene in which he taunts Robinson and throws at his head was still a shock, she said.

"It just took my breath away," Duesterhaus said. "I thought, 'All these people are sitting here believing this and it didn't happen.' It broke my heart."

She said her father was a "kind and loving man" and neither she nor her mother can recall him talking badly about Robinson or any black player.

Duesterhaus produced an article from a Pittsburgh newspaper in 1947 in which her father said Robinson crowded the plate, making pitching to him difficult. Ostermueller played for the Pittsburgh Pirates at the time.

"I told my wife the night before I pitched that I might have trouble with Robinson - that one of my pitches would hit him, if he didn't move back," Ostermueller said in the article.

"I knew, too, some people would say it was intentional. It wasn't at all, but in his first trip to the plate I hit him. After that, he moved back a couple of inches and showed me some respect."

TRUTH 'WENT SOUTH'

The pitch early in the 1947 season - Robinson's rookie year - sailed toward his head but he deflected it with his arm before falling to the ground, according to several accounts.

Robinson's teammates on the Brooklyn Dodgers yelled at Ostermueller, but no fight broke out on the field as shown in the movie.

A Warner Bros. spokesman, Paul McGuire, had no comment in response to questions about the film and Duesterhaus' concerns.

She said the movie contained other errors, such as showing Ostermueller as a right-handed pitcher, when he threw left-handed.

"I enjoyed the movie," Duesterhaus said, "up until the truth went south."

Jonathan Eig, author of the 2007 book "Opening Day: The Story of Jackie Robinson's First Season," said Robinson took verbal abuse from some players but there is no indication Ostermueller wanted to drive him out of baseball or threw at him because he was breaking the game's color barrier.

"I was surprised they chose that moment to dramatize the issue and picked Ostermueller of all people to be the villain," Eig said. "Even as I was watching the movie, I wondered if any of Ostermueller's kids will see this and what they would think."

Eig said Robinson was known to lean into pitches and swing wildly, making him vulnerable to getting hit.

Robinson was hit by more pitches than all but one other National League batter in 1947, and led the league in that category in 1948, according to baseball-reference.com.

Robert Butler, a former film critic for the Kansas City Star who now has an online movie review site, said the movie unnecessarily tainted Ostermueller's reputation.

"In my opinion, it's the result of bad research, laziness or outright malice," Butler said. "It would have been the easiest thing in the world to give (Ostermueller) a different name in the film. That said, anyone who goes to movies looking for true history is fighting a losing battle."

(Editing by David Bailey and Xavier Briand)

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People wait in line to meet a job recruiter at the UJA-Federation Connect to Care job fair in New York March 6, 2013.

Credit: Reuters/Shannon Stapleton

By Lucia Mutikani

WASHINGTON | Thu May 9, 2013 2:19pm EDT

WASHINGTON (Reuters) - The number of Americans filing new claims for jobless aid fell last week to its lowest level in nearly 5-1/2 years, signaling labor market resilience in the face of fiscal austerity.

The job market buoyancy, flagged last week by a relatively strong April employment report, eased fears of an abrupt economic slowdown.

"We are not getting a slowing in the second quarter. The claims data provide another set of confirmation that the labor market is healing," said Michael Strauss, chief economist at Commonfund in Wilton, Connecticut.

Initial claims for state unemployment benefits fell 4,000 to a seasonally adjusted 323,000, the lowest level since January 2008, the Labor Department said on Thursday.

The third weekly decline confounded economists' expectations for a rise to 335,000. Layoffs remained contained even as other parts of the economy such as manufacturing showed strain from belt-tightening in Washington.

"No sign of a summer swoon in the labor market this year yet. We think the economy is strong enough to stand on its own two feet," said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ in New York.

The government said last week that employers added 165,000 workers to their payrolls in April and that hiring in the prior two months was much stronger than previously believed. The jobless rate dropped to a four-year low of 7.5 percent.

Job gains so far this year have averaged 196,000 per month, up from an average of 181,000 for all of 2012.

Stocks on Wall Street edged lower, pausing for breath after a sustained rally that took the Standard & Poor's 500 index to record closing highs for five straight sessions.

But the claims data pushed up the dollar against a basket of currencies. U.S. Treasury debt price were little changed.

GROWTH SLOWDOWN SEEN TEMPORARY

The four-week moving average for new claims, a better gauge of job market trends, dropped 6,250 to 336,750. That was the lowest level since November 2007, just before the economy slipped into recession.

The number of people still receiving benefits under regular state programs after an initial week of aid dropped to its lowest level since May 2008. Continuing claims, which lag by a week, are a closely watched measure of long-term unemployment.

The improvement in employment contrasts with a range of other data that have suggested a cooling in the economy.

Dean Maki, chief U.S. economist at Barclays in New York, said the claims figures suggested companies saw softer growth as temporary and were responding by reducing hours worked and slowing hiring, rather than increasing layoffs.

Separately, a number of top U.S. retailers reported disappointing April sales on Thursday as consumers gravitated to discount chains because they were pinched by the end of a payroll-tax cut in January. The government will release its retail sales report on Monday.

Costco Wholesale Corp and Victoria's Secret parent L Brands Inc reported smaller-than-expected sales gains. In contrast, so-called off price chains TJX Cos Inc, which operates T.J. Maxx and Marshalls, and Ross Stores Inc both easily beat Wall Street forecasts.

The slowdown in activity after the economy expanded at a 2.5 percent annual pace in the first three months of the year has been blamed on the higher payroll taxes and $85 billion in government budget cuts known as the "sequester."

(Editing by Andrea Ricci, Tim Ahmann and David Gregorio)

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Britain's Education Secretary, Michael Gove, leaves Downing Street in London December 19, 2012.

Credit: Reuters/Neil Hall

LONDON | Fri May 10, 2013 8:16am EDT

LONDON (Reuters) - British Education Minister Michael Gove criticized the use of the popular "Mr Men" cartoon figures to teach 16-year olds about Adolf Hitler, saying such play-based learning infantilized students and led to a culture of low aspirations.

In a speech delivered on Thursday, Gove lashed out against an online resource for history teachers that promotes using the "Mr Men" figures for revision on Nazi Germany.

British media reports on Gove's speech were accompanied by a picture of Mr Fussy, a figure with a Hitler-style moustache and hair-do, one of a panoply of characters such as Mr Happy and Mr Cool created by author Roger Hargreaves.

"I may be unfamiliar with all of Roger Hargreaves's work but I am not sure he ever got round to producing Mr Anti-Semitic Dictator, Mr Junker General or Mr Dutch Communist Scapegoat," Gove told an education conference in Brighton.

"What makes the setting of higher expectations more difficult is the culture of excuses and low aspirations which some in the education establishment still defend," Gove added.

The website ActiveHistory, which offers the Mr Men lesson plan, stresses that the Mr Men exercise is a revision tool, and students should have finished studying the rise of Hitler before embarking on the cartoon exercise.

Gove came under pressure about his own plans to revise the history curriculum earlier this year when historians criticized him in an open letter, saying the scope of his proposed teaching program was too narrowly focused on Britain.

(Reporting By Shadia Nasralla, editing by Mohammed Abbas and Paul Casciato)

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NEW YORK | Fri May 10, 2013 7:01pm EDT

NEW YORK (Reuters) - Workers cheered and whistled as they completed the spire on New York's One World Trade Center on Friday, raising the building to its full height of 1,776 feet and helping fill a void in the skyline left by the September 11, 2001 attacks.

The spire makes the building the tallest building in the Western Hemisphere, 47 feet taller than Chicago's Willis Tower, though it is substantially shorter than towers in the Middle East and Asia.

"I am very happy, but also sad, because why did we have to rebuild this tower? It's a proud day for the city," said Philip English, one of a couple dozen construction workers on hand as the spire was completed at 7:46 a.m. local time (1146 GMT).

The skies were crystal clear, reminiscent of the weather on the day that hijacked airliners crashed into the former Twin Towers, in a coordinated attack on New York and Washington that killed about 3,000 people and left the United States on high alert for future incidents.

Formerly called the Freedom Tower, One World Trade Center is one of four skyscrapers being built around the site of the fallen Twin Towers in a partnership between developer Larry Silverstein and the Port Authority of New York and New Jersey, which owns the site.

The tower's height is a reference to the year 1776, which marked the beginning of the American revolution against British rule and is considered the start of what became the modern United States.

(Reporting by Elly Park; Writing by Scott Malone)

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