Oil and gas prices --- Lane (slow)
>> welcome back. chevron texaco chief executive david o’reilly says oil and gas prices may continue to rise. o’reilly told the u.s. chamber of commerce that rising demand for oil in china and natural gas in the u.s. is pushing prices higher.
>> don’t worry about the world running out of oil. and gas in the near term. but i do worry about people recognizing that we’re in a much more mature phase of the energy supply business.
>> o’reilly says high gasoline prices in the u.s. are the result of high crude oil prices varying lending standards mandated by state and local governments and a lack of new refining capacity. yesterday u.s. energy secretary spencer abraham asked the national petroleum council to study the nation’s oil refineries and recommend ways to boost gasoline production. shares of chevron texaco have risen 29% in the past year. a divided securities and exchange commission today ordered mutual fund boards to appoint independent chairmen. the controversial rule will affect hundreds of mutual fund companies who currently have insiders chairing their fund boards. the governance changes approved today mark the latest mutual fund reforms in the wake of recent abuses uncovered in the $7.5 trillion industry. republican chairman william donaldson provided the swing vote when he sided with the commission’s two democrats. donaldson said an independent chairman would ensure that shareholders’ interests and not fund companies’ come first.
>> conflicts of interest sit at the very core of the mutual fund investment adviser relationship and are huge. so much so that if we were to devise a mutual fund governance structure from scratch it seems to me self-evident that we would conclude that these conflicts could only be effectively resolved if the leadership of the mutual fund and investment adviser were different, separate and independent of one another.
>> large fund families like fidelity and van guard opposed the change arguing it would do more harm to investors than good. their top executives will have to give up chairing hundreds of individual funds. donaldson’s two republican colleagues on the commission voted against the rule. paul atkins and cynthia glassman said the commission lacked any evidence showing it would actually help fund shareholders. they also worried it would raise costs.
>> it is a fact that many of the top-rated funds today, based on high performance and low fees, have inside shares. why should we tell shareholders that they can no longer have the form of governance that produced that high level of performance? and, further, why should we require them to pay for it?
>> mutual fund industry analysts estimate about 80% of the approximately 500 mutual fund companies have boards led by insiders. today’s rule change will take effect 18 months after it is published in the federal register. bill clinton’s memoir is breaking records. the 957-page “my life” sold more than 400,000 copies in the u.s. during its first day at book stores. the publisher says it’s printing an additional 725,000 copies due to demand boosting the number published to 2.25 million. the book chronicles the former president’s childhood in arkansas, his rise in politics, and two terms of office. his wife, hillary’s autobiography sold about 200,000 copies on its first day. in world and national news saudi arabia has an offer for suspected terrorists.
