The Internal Revenue Service said today it will begin sending the first of 130 million stimulus payments on May 2.

The checks will be sent on a schedule determined by the last two digits of Social Security numbers. The checks will be sent by direct deposit to those taxpayers who have received refunds via direct deposit - all other checks will be sent my mail.

The IRS also announced today that it is operating an online calculator where people can determine the amount of their stimulus payments. Visit www.IRS.gov for more information.

Here's a look at the schedule for payments:

Is your budget being squeezed with the rising cost of milk, bread and gas? Are you making choices about what to buy and passing on extra items?

We want to hear from you. C.R. posted a story this morning about inflation here in Pierce County and surrounding areas.

It said that overall inflation was up but grocery prices are down.

This weekend I paid more than $50 to fill up my wagon, the first time I had topped that mark. And while grocery shopping, I found that many of the items I buy weekly were up 20 to 40 cents. The energy bars I buy for my kids were 69 cents each instead of the 49 cents I paid a few weeks ago.

How are rising prices affecting you?

The Bureau of Labor Statistics is reporting that prices in the Tacoma-Bremerton-Seattle area increased 1.3 percent for the two months ending February 2008.

Regional Commissioner Richard J. Holden says the increase in the all-items index was mainly due to higher prices for housing, as the housing index rose 1.9 percent for the two months, and 4.4 percent for the previous 12 months.

• Prices for household furnishings and operations rose 0.8 percent during the latest two month period, but were 5.4 percent lower over the year.

• The food and beverages index advanced 1.0 percent from December to February and was 4.2 percent higher over the year. Food away from home prices increased 2.2 percent.

• Grocery prices, as measured by the food at home index, decreased 0.3 percent for the past two months, but were 3.3 percent above last year’s level.

• Medical care prices advanced 1.6 percent for the two months and were 6.5 percent higher compared to a year ago.

• The transportation index declined 0.6 percent for the two months. New motor vehicles, an unpublished transportation subcategory, contributed strongly to the transportation index decrease. Gasoline prices advanced 1.0 percent since December and are up 26.9 percent since last year.

• Apparel prices moved up 3.2 percent for the latest two-month period and were 5.1 percent higher over the past 12 months.

Another low-cost air carrier may be in the gestation stages.

A Charleston, W.Va. newspaper reports that serial start-up airline executive John Weikle is trying to put together a new airline that may be named Jet America.

Weikle was among the founding managers of ultra-low-cost carrier Skybus.

As for Jet America, those of you with a long enough memory may recall that SeaTac's Alaska Airlines bought another Jet America Airlines in the early '90s. That startup carrier was based in Long Beach, Calif.

Although virtually all traces of Jet America are gone, I'm wondering if Alaska still owns the Jet America name?

The news from Wells Fargo on small business: Pessimistic.

The bank has issued its latest installment of the Wells Fargo/Gallup Small Business Index, which catalogs the optimism of small-business owners.

In January, Wells says, the Index score fell to 83, the second-lowest level since the survey’s inception in August 2003, when the score was 69.

The recent numbers mark a 16-point drop from the previous survey in October 2007, and a 31-point total drop from the Index’s highest score of 114 in December 2006. The 16-point drop is the Index’s largest quarterly decrease to date.

The Index score is the sum of both current and future expectations for six key measures: financial situation, cash flow, revenues, capital allocation, job hiring, and credit availability.

“Small business optimism is eroding along with the economic and financial outlook,” said Dr. Scott Anderson, Wells Fargo senior economist.

Still, owners of small businesses remain steadfast. Ninety percent of respondents said they are satisfied being owners. Eighty-five percent reported that if “they could do it all over again,” they would still become small business owners. In October, 83 percent reported the same.

All major U.S. airlines have now given their endorsement to the largest airfare increase in years by matching United Airline's Friday fare increase of up to $50 a trip.

Northwest Airlines submitted like fares to United's Sunday becoming the last of the major carriers to up the ante once again.

Those increases vary by distance ranging from $10 a roundtrip for flights of up to 500 miles to $50 for flights over 1,500 miles.

This increase is the seventh since Dec. 18 of last year. Airlines are raising fares to offset steeply rising fuel bills.

The hikes aren't universal, but apply in situations where competition is little or none.

For example, consider non-stop flights between Seattle and Atlanta in mid-April, a route that only Delta flies non-stop year round. With the latest increases, the least expensive airfare on that route is $600 roundtrip.

But contrary to the usual rule-of-thumb which says air fares rise when summertime crowds hit the airways, the least expensive non-stop fare on that route actually drops in mid-July to $374. Credit that to seasonal competition from Air-Tran which flies to Sea-Tac from Atlanta only during the vacation season.

More typical is the Sea-Tac-Orlando route, which only Alaska Airlines flies non-stop. Their cheapest price in mid-April for a non-stop is $303. In mid-July, those same flights cost $595 roundtrip.

On routes with ample competition, Sea-Tac to New York City, for instance, the fares have remained within reason, $319 roundtrip non-stop in mid-April and $431 roundtrip non-stop in July.

The Seattle-Boston route, on which only Alaska and JetBlue compete, the fares are higher: a low of $429 in April and $539 in July for a red-eye overnight flight and $669 for a daytime non-stop.

Of course, flights with connections are less expensive than the non-stop ones.

On the Orlando April roundtrip where the least expensive non-stop in $303, flights with connections can be bought for as little as $238. In July a flight to Orlando with connections is available for $348 versus $595 for non-stop.

Delta Airlines is talking with Boeing about increasing the reach of the world's longest-range jetliner, the 777-200LR.

Delta wants an aircraft capable of flying non-stop from its Atlanta hub to Sydney, a Delta executive recently told Flight International.

If Boeing tweaks the LR's range to accomplish that feat, the plane might be capable of flying what airlines call the "Kangaroo Route," London to Sydney non-stop.

If the LR developed that capability, it would give airlines like Qantas and British Airways a potent weapon against the Airbus A380s rivals Emirates and Singapore Airlines are deploying on that route.

Though the A380 is a long range aircraft, it has to make a refueling stop somewhere on the way, in Singapore or Dubai, for instance.

Delta recently took delivery of its first 777-200LR. It's likely to deploy that plane on some its new long-range routes, say New York to Mumbai in India or Atlanta to Africa.

The 777-200LR in present form has a range of nearly 10,900 statute miles. The Atlanta-Sydney distance is 9,281 miles and the London-Sydney flight would cover 10,562 miles. While the present 777-200LR could theoretically cover the Atlanta-Sydney flight in still air or with tail winds, it would need additional range to consistently cover the distance against headwinds without a fuel stop or without a reduced load. The same goes for London-Sydney.

An extended range LR could open up new markets for Boeing from airlines wanting to fly literally to the other side of the world non-stop.

Amtrak's got a new special promotion through May 23 that makes it less expensive to take the train to Portland than driving.

That promotion has some holiday blackout dates and some popular trains may already be sold out.

The deal allows an adult paying regular fare to take another adult along free. Kids are half the adult fare.

The economics under this deal still favor the train on a total cost basis even if two adults are going.

Here's the math:
Cost of two roundtrip tickets on Amtrak from Tacoma to Portland under the promotion: $44.

Cost of just the gas for the 286-mile roundtrip to Portland assuming your vehicle averages 20 miles per gallon and gas costs $3.50: $50.05.

Of course that doesn't count the cost of wear and tear on your vehicle or the two and a half hours or so each way spent behind the wheel.

Amtrak has four trains daily between Tacoma and Portland. When you reserve on Amtrak's Web site, enter the promotion code H750 in the space provided after you select your departure times.

GMG, Bangladesh's largest private airline, says it is ordering six new Boeing airliners to mount a major route expansion.

The airline is buying three Boeing 777-300ERs and three 787-9s. It will use the planes to expand its network to include Saudi Arabia, Bahrain, Singapore, Hong Kong and London.

GMG is the second airline from Bangladesh to buy new Boeing aircraft this month. Biman Airways last week ordered four 777s and four 787s from Boeing.

Don't expect the GMG order to show up on Boeing's official order book for six weeks or so. The airline says it has worked out all the details with Boeing, but is still negotiating the fine points with its banks.

A reader has called to ask if there’s a tape of Arthur Laffer’s lecture last Thursday night at PLU.

Well, no. But I attended – and I took a few notes, got a few quotes and found a few interesting tidbits (as I did at the reception buffet, which contained a nice cheddar and some good grapes).

Stimulus package: “The resources still do not come from the tooth fairy.” “this silly notion has been around forever.”
Bill Clinton: “A disgusting person but a great president.”
Taxation: The highest marginal income tax rate under JFK was 91 percent, and he cut it to 70 percent. (It’s now 35 percent, and likely to rise again with a Democrat majority in Congress.)
Ronald Reagan: “He’s still in my little heart, be still.”

=> Read more!

El Al Israel Airlines has completed its rumored buy of four 777-200ER aircraft from Boeing, the airline confirmed over the weekend.

Boeing will deliver three of those planes in 2012 and one in 2013. They will be equipped with Rolls Royce engines.

El Al will use them on long-haul routes.

I just posted a story on the Business home page about Weyerhaeuser selling its containerboard packaging and recycling business to International Paper.

Here are some more details.

The deal means that Weyerhaeuser shed more Washington properties including:

Packaging operations in Bellevue, Moses Lake, Olympia, Yakima

Recycling operation in Kent.

I put a call into the company for a list of what it still operates in Washington. Weyerhaeuser has been shedding operations that don't meet its criteria for cost and profitability. The process started in 2002 following the purchase of Willamette Industries, an Oregon forest products company.

Washington Mutual Inc. fell nearly 14 percent this morning to its lowest level since 1995.

Shares were trading at $9.16 at 7:21 a.m.

Analyst David Hendler of CreditSights Inc. and others have cited Washington Mutual as a possible takeover target because its finances have weakened because of rising losses on home loans, according to Bloomberg News.

JP Morgan Chase & Co. was viewed as a potential buyer, a move considered less likely after its $240 million purchase of Bear Stearns Cos.

“Washington Mutual has outsized exposure to the mortgage crisis,” CreditSights Inc. Hendler said in a report today. “There could be a lack of many buyers in light of the deteriorating credit quality at WaMu and since potential buyers have also have their own internal issues to contend with.”

For those of you keeping score on the economy: This news from the Federal Deposit Insurance Corp. came out Friday. In case you missed it, this is from a press release. In essence, the FDIC foresees failures on the horizon, and is taking steps to be prepared...

"(The FDIC) today voted to keep the assessment rates charged to insured banks and savings associations for the Deposit Insurance Fund (DIF) unchanged for 2008. The existing assessment rate schedule is 5 to 43 basis points per year; most institutions will be charged a rate between 5 and 7 basis points.

"The decision to leave rates unchanged this year is consistent with the Board's objective to increase the reserve ratio to the Designated Reserve Ratio (DRR) of 1.25 percent before the end of 2009. The fund stood at 1.22 percent of estimated insured deposits at year-end 2007, up from 1.21 percent at the end of 2006. According to FDIC staff, with expected insured deposit growth of between 3 and 4 percent in 2008 and 2009, the fund could reach the Board's DRR objective of 1.25 percent at the end of 2008 or early in 2009 under the existing rate schedule.

"'There are significant uncertainties regarding our projections, and given the challenges facing the banking industry and the likelihood of more bank failures, I believe preparedness should be our overriding concern,' said Sheila C. Bair, FDIC Chairman. 'Because we are anticipating more difficult times, it would be prudent to continue to build the deposit insurance fund at the pace allowed by the current rates and the remaining credits. As we build up the insurance fund, banks and thrifts should be taking steps to bolster their capital and reserves.'