Battling a dangerous wave of home foreclosures, Federal Reserve Chairman Ben Bernanke called Tuesday for additional relief and urged lenders to help distressed owners by lowering the amount of their loans.
Even with some relief efforts under way by industry and government, foreclosures and late payments on home mortgages are likely to rise “for a while longer,” Bernanke told a banking group in Orlando, Fla.
One of the suggestions Bernanke made was for mortgage and other financial companies to reduce the amount of the loan to provide relief to a struggling owner, while acknowledging the idea might be a tough sell to lenders.
Still, Bernanke suggested such longer-term permanent solutions may work better than shorter-term and temporary ones. To date, permanent home mortgage modifications that have occurred have typically involved a reduction in the interest rate, while reductions of the principal balance of the loan have been quite rare, he said.
Drug prices go up, AARP study finds
Drug makers increased their prices last year by an average of 7.4 percent for brand-name medicines most commonly prescribed to the elderly, according to the advocacy group AARP.
The increase was about 2.5 times overall inflation, continuing a long-standing trend.
The advocacy group has tracked drug prices going back to 2002. Specifically, it looks at the prices charged to wholesalers. It noted that the price increases have been slightly greater since the Medicare drug benefit kicked in Jan. 1, 2006.
In the four years before the benefit’s startup, wholesale prices rose between 5.3 percent and 6.6 percent a year, according to AARP’s tracking.
AARP officials said the outcry over drug prices was quite strong when Congress approved legislation establishing the drug benefit.
Since the drug benefit began, that outcry has diminished, thanks to the federal government picking up much of the tab for beneficiaries’ medicine.
“Unfortunately, many manufacturers have taken the absence of an outcry as a green light to go ahead and raise prices even more,” said John Rother, AARP’s policy director.
All but four of the 220 brand-name prescriptions in the study had price increases during 2007. Nearly all exceeded the rate of general inflation.
Among the top 25 drug products, the sleep aid Ambien had the largest price increase, 27.7 percent.
Ambien is manufactured by Sanofi-Aventis. On the other end of the spectrum, Merck’s cholesterol drug Zocor had no price change in 2007.
Also, Bristol-Myers Squibb’s blood thinner Plavix had a price increase of 0.5 percent.
Nike, Apple joining forces with gyms
Nike and Apple are making the iPod compatible with gym equipment.
The companies announced Tuesday that they are working with several gym equipment manufacturers and health clubs 24-Hour Fitness and Virgin Athletic Health Clubs to allow members to plug their iPod Nano into cardio equipment to track workouts, set goals and upload the information to a Nike Web site.
The new technology is expected to hit more than 500 gyms worldwide this summer.
It’s another major partnership for Nike Inc. and Apple Inc., which created Nike+ technology more than a year ago.
The wireless system allows some Nike running shoes embedded with a sensor to communicate with Apple’s iPod Nano.