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US Bankruptcy Lawyers Strip Cash from Coal Miners’ Health Insurance
Workers often bear the brunt of the coal industry’s decline. One case stands out: 208 Indiana miners, wives and widows whose health care may fall to financial engineering.
 
This story was co-published with The Daily Beast.
 
There was plenty in the complex deal to benefit bankers, lawyers, executives and hedge fund managers. Patriot Coal Corp. was bankrupt, but its mines would be auctioned to pay off mounting debts while financial engineering would generate enough cash to cover the cost of the proceedings.
 
When the plan was filed in U.S. bankruptcy court in Richmond last week, however, one group didn’t come out so well: 208 retired miners, wives and widows in southern Indiana who have no direct connection to Patriot Coal. Millions of dollars earmarked for their health care as they age would effectively be diverted instead to legal fees and other bills from the bankruptcy. 
 
As coal companies go bankrupt or shut down throughout Appalachia and parts of the Midwest, the immediate fallout includes lost jobs and devastated communities. But the Indiana case stands out as an example of how financial deals hatched far from coal country can also endanger the future safety net. 
 
At issue is health insurance promised to people who worked for the Squaw Creek Coal Company in Warrick County, Indiana, near Evansville, who, like other retired union miners, counted on coverage after they turned 55.
 
“We were assured as miners we would have lifetime health-care benefits — no one ever envisioned that we would have to worry about these other things that were going on,” said Bil Musgrave, 59, one of the retired miners in Indiana. “A lot of them depend entirely on this.”
 
Secure health insurance has been one casualty of the wave of bankruptcies. Companies in decline are seeking to offload those obligations onto taxpayers, putting more stress on an already-strained federal safety net. An effort is underway in Congress to protect at least some families facing a loss in benefits because of the industry’s turmoil, but its prospects are unclear.
 
Squaw Creek, where Musgrave started working almost 40 years ago, opened as a joint venture between Alcoa, and Peabody Energy, the world’s largest private-sector coal company. The unionized surface mine in Warrick County, Indiana, near Evansville, powered Alcoa’s huge aluminum plant nearby. The venture mostly petered out by the late 1990s, though mining has since resumed in the same area, using non-union miners.
 
Under their union contract, miners who worked at least 20 years at Squaw Creek were entitled to a pension and to health care coverage once they reached 55. For many of those who are still under 65, this coverage is what they rely on; for those who are on Medicare, it offers a supplement to cover the extensive health care costs many of them now face. Some suffer from black lung disease, while others, including Musgrave, have fought cancers they believe are linked to industrial waste dumps at Squaw Creek.
 
The Squaw Creek miners thought little of it when, in 2007, Peabody passed what remained of its Alcoa venture — some environmental reclamation work at the mine — to an offshoot called Heritage Coal, a subsidiary of a new entity Peabody created called Patriot Coal. The health care obligation for the retirees was assumed by… Continue Reading…
 

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Nifty, Sensex showing no strength – Thursday closing report
Nifty has to stay above 7,900 for the market to continue to head higher. Bank Nifty is already weak
 
We had mentioned in Wednesday’s closing report that Nifty, Sensex may put in more gains for which Nifty has to stay above 7,880. The market indices in the Indian stock markets were range-bound during the day and closed with marginal gains. Bank Nifty however, closed with a marginal loss. The market indices were subdued after key economic data showed a slowdown in manufacturing activity for the last month.
 
 
The markets made healthy gains within minutes of opening and continued their upward trajectory on the back of Tuesday's monetary easing by the Reserve Bank of India (RBI), overnight rally in the US markets, supportive Asian markets and strengthening rupee value. However, the upward momentum lost its steam as the latest Nikkei India Manufacturing PMI (Purchasing Manufacturers Index) for the last month showed a contraction. The PMI was at a seven-month low of 51.2 in September 2015.
 
Markets analysts said the less-than-expected PMI data impacted sentiments and erased the gains made during the day's trade, as profit booking was also witnessed.
 
The rupee continued to gain strength on Thursday. It gained 7 paise and closed at 65.51 against a US dollar around 5.00 p.m. from its previous close of 65.58 against a greenback. It touched a day's low of 65.48 against the US dollar.
 
The Indian rupee had gained 38 paise on Wednesday to close at a five-week high of 65.58 against the US dollar.
 
The positive Asian markets have supported sentiments here. Japan's Nikkei index was higher by 1.92%. The Chinese markets -- Hong Kong's Hang Seng index and Shanghai Composite Index -- will remain closed till 7 October 2015 (Wednesday), on account of the Chinese national day.
 
Sector-wise, healthcare, capital goods and consumer durables witnessed healthy buying support. On the other hand, automobile, banking and information technology (IT) index came under heavy selling pressure.
 
The S&P BSE healthcare index zoomed by 260.11 points, capital goods index increased by 110.89 points and consumer durables index was higher by 96.29 points.
 
However, the S&P BSE automobile index receded by 78.81 points, banking index declined by 73.37 points and IT index was lower by 27.25 points.
 
HCL Technologies announced on Wednesday after market close that its first quarter earnings may be hit on account of client-specific issue, cross currency impact and longer transition deadlines for some of its complex projects in infrastructure management services. In a sharp market reaction the company’s share price fell by more than 12.5% in Thursday’s trading.
 
Major Sensex gainers during Thursday's trade were: Lupin, up 3.62% at Rs.2,107.05; Sun Pharma, up 2.57% at Rs.890.75; Tata Consultancy Services (TCS), up 2.01% at Rs.2,639.70; Dr.Reddy's Lab, up 1.80% at Rs.4,230.05; and Larsen and Toubro (L&T), up 1.54% at Rs.1,489.30.
 
The major Sensex losers were: BHEL, down 2.85% at Rs.199.70; Gail, down 2.60% at Rs.294.25; Maruti Suzuki, down 2.33% at Rs.4,579.85; Vedanta, down 1.82% at Rs.83.55; and HDFC, down 1.15% at Rs.1,199.25.
 
The Indian markets will remain closed on Friday on account of Gandhi Jayanti.
 
The top gainers and top losers of the major indices in the stock market are given in the table below:
 
 
The closing values of the major Asian indices are given in the table below:
 
 
Among European indices, DAX was at 9,672.13, up 0.12% and the FTSE 100 was at 6,143.23, up 1.35%.

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IDBI Bank: Employees, officers oppose proposed move of privatisation
IDBI has been exploited by the Centre which has resulted in burgeoning bad loans for the Bank, allege employees’ and officers’ unions 
 
Bank employees and officers are making full preparations to defeat the government’s move to privatise IDBI Bank. "Arun Jaitley, Finance Minister made a statement that IDBI Bank will be modelled on Axis Bank Ltd an outright privatisation of IDBI Bank. We will write to all Members of Parliament (MPs) and all political parties to save this important institution to be hijacked by corporate in India," says S Nagrajan, General Secretary, All India Bank Officers Association (AIBOA). 
 
"Our organisation has come across the oft repeated message of the Finance Minister of reduction of capital in IDBI Bank and attempting to experiment the model of the erstwhile UTI Bank and now Axis Bank. IDBI has been utilised to experiment all sorts of expressions at different points of time by the owners at the centre it is not on excessive expressions. The result is burgeoning bad loans in the books of the Bank at this point of time," Nagrajan said in a statement.
 
In 1964, Industrial Development Bank of India (IDBI) was set up as developmental financial institution [DFI] and the capital was fully subscribed by the Government of India. Subsequently, it became a subsidiary of Reserve Bank of India (RBI). Later in April 2005, RBI sanctioned a scheme of amalgamation of IDBI Bank Ltd with IDBI Ltd as a legal entity. The Central government had a stake of 51% in the entity at that time.
 
Next year, an order of amalgamation of United Western Bank Ltd [UWB] was issued, which became effective from 3 October 2006. In the present structure, there are three entities, IDBI, a subsidiary of RBI, IDBI Bank Ltd and UWB, the old generation private sector bank.
 
"In these circumstances, the statement from Mr Jaitley is bolt from blue, says Nagrajan, adding, "Instead of expeditious steps to recover the bad loans, the Finance Minister, unmindful of the assurances given in the floor of Parliament in 2003 by his seniors to have the Government stake of not less than 51% in the capital, repeatedly reiterates to push IDBI to AXIS Bank model."
 
"In the event of non-responsiveness of the Government, AIBOA will roll out plan of actions to halt the moves along with the operating trade unions in IDBI," he added.

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COMMENTS

R.Asokkumar

1 year ago

If IDBI Bank has been exploited by Centre, as alleged by the Employees' and Officers' Unions, should they not welcome the move to liberate the Bank from the control of Centre?

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