Business in brief: Bear Sterns exec to step down

Tue., Jan. 8, 2008

The Spokesman-Review

Bear Stearns Chief Executive James Cayne is resigning under pressure from shareholders upset over the firm’s losses amid a slew of problems sparked by the collapse of mortgage markets, the Wall Street Journal reported Monday.

Cayne was expected to be replaced by Bear Stearns President Alan Schwartz, a 57-year-old investment banker respected for his dealmaking savvy.

Cayne started notifying Bear Stearns’ board on Sunday that he plans to give up his post but remain as chairman, the Journal reported on its Web site, citing unnamed people familiar with the matter.

Cayne, 73, had been under scrutiny since the summer as the liquidity crisis pushed scores of mortgage lenders out of business, bled more than $100 billion from Wall Street’s books, and coaxed the Federal Reserve to cut interest rates by a full percentage point.

NEW YORK

Oil falls amid economic worries

Oil futures fell sharply Monday, extending their retreat from $100 as investors sold on concerns that a cooling economy will curb demand for oil and gasoline.

Comments Monday by Treasury Secretary Henry Paulson suggesting there is no simple fix for the nation’s housing crisis added to worries about the economy raised by last Friday’s Labor Department jobs report.

A stronger dollar Monday also weighed on oil prices. Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the greenback is falling. Many analysts believe the weakening dollar helped draw speculative investors into oil markets this fall and winter, driving oil prices above $100 a barrel last week.

On Monday, light, sweet crude for February delivery dropped $2.82 to settle at $95.09 a barrel on the New York Mercantile Exchange. It was the third day in a row oil prices have declined.

WASHINGTON

Lipitor ads under federal scrutiny

House Democrats are investigating whether consumers are being misled by advertisements for Lipitor featuring the world-renowned inventor of an artificial heart.

In the ads, Dr. Robert Jarvik talks about the benefits of Pfizer’s cholesterol-lowering drug, the world’s best-selling medication.

Michigan Reps. John Dingell and Bart Stupak sent a letter to Pfizer Monday questioning Jarvik’s credibility as a medical expert.

“In the ads, Dr. Jarvik appears to be giving medical advice, but apparently, he has never obtained a license to practice or prescribe medicine,” the lawmakers state. A spokesman for Dingell on Monday could not confirm whether Jarvick is certified to practice medicine, but cited media reports that he never took an internship or practiced medicine.

According to the Web site of his company, Jarvik holds a degree in engineering from New York University and a medical degree from the University of Utah.

After earning a medical degree, physicians must complete a series of tests to earn certification to practice medicine.

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