About Economy

This page contains an archive of the last 100 entries posted to ProgressNow.org Daily News Digest in the Economy category. They are listed from newest to oldest. You can find older entries using the search box below.

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February 29, 2008

Bipartisan Spirit Falters in Fights on Debt Relief - New York Times

http://www.nytimes.com/2008/02/29/business/29econ.html?ref=washington...
Just a month after President Bush and Democratic leaders hailed their bipartisan agreement on an economic stimulus plan, the two sides went to war on Thursday over how to prevent widening damage from the housing crisis. Senate Republicans, lining up with President Bush, blocked a Democratic bill that would provide more money for homeowner counseling programs and let bankruptcy judges reduce the terms of a mortgage for people about to lose their houses through foreclosure. Meanwhile, the Bush administration flatly rejected Democratic proposals to rescue hundreds of thousands of borrowers, as well as their mortgage lenders, by having the government buy up and restructure billions of dollars in delinquent home loans. Instead, the president called on Congress to extend indefinitely his 2001 and 2003 tax cuts, which expire at the end of 2010.
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More Americans using credit cards to stay afloat - USATODAY.com

http://www.usatoday.com/money/perfi/credit/2008-02-28-credit-cards_N.htm...
Seven years in the credit-counseling business didn't prepare Ann Estes for the alarming trend she began noticing last fall: As her clients' mortgage bills became unaffordable, a growing number of them began paying their credit card bills before — and sometimes instead of — their mortgages. "We've never seen anything like this," says Estes, who counsels clients by phone from her office in Richmond, Va. "Their homes are at risk, and they know it. But people say, 'I don't want to let my credit cards go because that's my cash flow.' " Across the nation, credit counselors are reporting the same trend. Credit bureau analyses of consumer payment data show that financially squeezed borrowers have begun paying their credit card and car bills before their mortgages. That's a striking reversal from the norm, one that reflects rising desperation. It suggests that some people essentially have given up trying to stay current with their mortgages and instead are focused on using credit cards to squeak by. If the trend persists, many economists say, it could accelerate mortgage losses and further drag down the economy.
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Euro zone sentiment falls, inflation confirmed - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/29/AR2008022900641....
Euro zone economic sentiment deteriorated much more than expected in February but inflation expectations were stable, even though data confirmed that food and energy costs fuelled a record surge in inflation in January. The European Commission's monthly economic sentiment survey showed sentiment declined to 100.1 in February from 101.7 in January -- a much steeper fall than the decline to 101.2 expected by economists. It was driven by declining optimism in the euro zone's services sector, which generates more than two thirds of the 15-member area's gross domestic product. Industry and construction sentiment also deteriorated, while consumer optimism remained stable. The only sector to record an improvement in sentiment was retail.
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2008 on track as record year for dividend cuts - USATODAY.com

http://www.usatoday.com/money/perfi/stocks/2008-02-28-dividends_N.htm...
As if Sprint Nextel's $29.5 billion quarterly loss and dour forecast weren't enough of a blow to investors: The cellphone company also killed its dividend. Cutting a dividend — or eliminating it — is extremely rare and is frowned upon by investors who see these cash payments as money in the bank. And Sprint's (S) move Thursday follows similar actions by several struggling financial companies, which raises a new fear about whether dividends are in jeopardy. "The numbers speak for themselves," says Howard Silverblatt of Standard & Poor's. (SPF) "It's not all positive."
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Bernanke Doesn't See Stagflation - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/28/AR2008022801770....
The economy is not close to a 1970s-style mix of stagnant growth and high inflation, Federal Reserve Chairman Ben S. Bernanke said yesterday, but he painted a generally dour outlook and cautioned that the downturn is likely to cause some small banks to go under. "I don't anticipate stagflation," Bernanke told the Senate Banking Committee during his semiannual report to Congress on monetary policy. Some analysts have become increasingly worried about that possibility after recent high readings on inflation and weak readings on growth. "I don't think we're anywhere near the situation that prevailed in the 1970s," he said. As Bernanke spoke, new data and activity on financial markets underscored the risks that the economy is facing. The Commerce Department said that the gross domestic product, the broadest measure of economic output, rose only 0.6 percent in the fourth quarter, disappointing analysts. The Labor Department said that the number of new unemployment claims rose to their second-highest weekly level since Hurricane Katrina struck in 2005. Almost every piece of economic data that has come out this week has been worse than economists had projected.
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EBay settles 7-year dispute over patents - USATODAY.com

http://www.usatoday.com/money/industries/technology/2008-02-28-ebay-patent_N.htm...
Online auctioneer eBay settled a seven-year patent dispute Thursday with tech firm MercExchange, ending a legal entanglement that prompted a Supreme Court ruling on intellectual property. EBay (EBAY) says it agreed to buy three MercExchange patents it has been accused of violating. EBay did not disclose financial terms of the settlement. MercExchange sued eBay in 2001, claiming eBay infringed on its patents. A jury ruled in MercExchange's favor in 2003. A judge in December upheld the $30 million judgment, which eBay appealed. The appeal was dropped as part of the settlement, eBay says.
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Struggling Sprint Reports Huge Loss - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/28/AR2008022803926....
Sprint Nextel yesterday reported a $29.45 billion fourth-quarter loss and said legions of subscribers continue to abandon its service, many because they can't pay their bills. The nation's third-largest wireless carrier last year courted people with poor credit to boost its number of subscribers. Now the company is feeling the pain disproportionately as the economy weakens and consumers default on their debts. Sprint said it expects 1.2 million wireless subscribers to drop their service in the current quarter, roughly the same number that left in all of 2007. The company offset losses by signing up new customers, but it has steadily lost ground to its two main rivals, Verizon Wireless and AT&T.
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Sears Chairman Rallies Investors - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/28/AR2008022801039....
Sears Holdings Chairman Edward S. Lampert is invoking Eli Manning, the once-maligned New York Giants quarterback turned Super Bowl hero, to inspire investors unhappy with a 45 percent drop in profit in the past 12 months. Manning "did not give up or lose heart," Lampert wrote to shareholders in a letter accompanying the retailer's fourth-quarter profit report yesterday. "Like Eli Manning, we know what it's like to be underestimated and questioned." Profit dropped 47 percent, to $426 million, in the three months ended Feb. 2, the company said. Revenue fell 6.8 percent, to $15.07 billion. Lampert attributed the plunge to a crumbling housing market and company missteps.
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February 28, 2008

Bernanke Says Sagging Growth Is Chief Concern - New York Times

http://www.nytimes.com/2008/02/28/business/28fed.html?ref=business...
Ben S. Bernanke, chairman of the Federal Reserve, signaled his readiness on Wednesday to bolster the economy with cheaper money even though inflation is picking up speed. The Fed chairman acknowledged that the central bank faced increasingly contradictory pressures of slowing growth and rising consumer prices. But his bottom line was that, for now, the top priority would be fighting a recession rather than fighting inflation. Mr. Bernanke’s view of the state of the economy, part of his semiannual appearance before Congress, came as the dollar sank to a historic low against other major currencies, introducing a possible third dimension to the economic problems the Fed chairman must tackle all at once.
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Dollar dives to new lows amid weak reports, rate cut talk - USATODAY.com

http://www.usatoday.com/money/markets/2008-02-27-dollar-wed_N.htm...
The dollar sank Wednesday to its lowest level ever against the euro after markets took comments from the Federal Reserve chairman as a sign that more U.S. interest rate cuts are on the way. The 15-nation euro topped $1.50 for the first time since its 1999 introduction in Asian trading, then surged after Fed Chairman Ben Bernanke told the House Financial Services Committee that "the economic situation has become distinctly less favorable" since last summer. That added to sentiment that the Fed is likely to add to recent rate cuts that already have left U.S. interest rates below those in the euro zone.
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Stocks finish mixed in choppy session - USATODAY.com

http://www.usatoday.com/money/markets/2008-02-27-stocks-wed_N.htm...
Stocks ended little changed Wednesday after a rally fizzled when doubts emerged that the lifting of investment caps on the two largest home financing companies was enough to prevent deeper damage to the housing market. Stocks finished mixed in another seesaw session Wednesday after regulators allowed Fannie Mae and Freddie Mac to buy more mortgages and Federal Reserve Chairman Ben Bernanke said the central bank will remain vigilant about the weakened economy. Investors pared the market's gains after both developments had initially boosted confidence amid increasing signs of a slowing economy. Wall Street has in recent months grappled with concerns about rising prices, a weaker dollar and continued turmoil in the credit markets.
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Businesses, Worried About Economy, Invest Less - New York Times

http://www.nytimes.com/2008/02/28/business/28econ.html?ref=business...
Hesitant about the shaky economy, American businesses are cutting back on investments and equipment. And the housing industry, in its worst crisis since the early 1990s, is poised for several months of anemic sales. Government reports released Wednesday reinforced concerns that the economy was facing severe headwinds. “Businesses are reluctant to invest because they still have no clue about how the economy is going to shake out over the next six to 12 months,” said Bernard Baumohl, managing director of the Economic Outlook Group, a forecasting firm in Princeton, N.J.
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An Upside for the Middle Class - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/27/AR2008022703334....
Median family income in the United States has decreased about $1,000 since peaking in 2000. The income decline came after more than a quarter-century of slow growth. Between 1973 and 2000, incomes increased at just a third the rate of worker productivity, a sharp break from the previous generation when family incomes and productivity both doubled, fueling an unprecedented expansion of the middle class. The wage stagnation experienced by many Americans has been accompanied by a sharp growth in income inequality. After-tax family income for the nation's middle tier of wage earners increased 21 percent between 1979 and 2005, to $50,200. Incomes of the top 1 percent of wage earners, meanwhile, tripled, to just over $1 million, even as the after-tax income of the bottom fifth of income earners grew just 6.3 percent, to $15,300. Rose says that if total compensation -- which includes the increasing cost of health and other benefits -- is included, American workers have done better than census numbers would indicate. Also, he said, upward mobility allowed 13 percent more Americans to earn inflation-adjusted salaries of $100,000 in 2004 than in 1979.
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Top F.T.C. Official Expected to Resign - New York Times

http://www.nytimes.com/2008/02/28/business/28ftc.html?ref=washington...
The chairwoman of the Federal Trade Commission is expected to resign her post next month to take a senior position at Procter & Gamble, according to people briefed on her plans. Deborah Platt Majoras, the chairwoman, is the latest in a series of Bush administration officials to leave in the last year of the president’s second term. Before joining the commission, Ms. Majoras was a senior official in the antitrust division of the Justice Department, where she played an important role in the antitrust case against Microsoft. William E. Kovacic, a member of the commission since January 2006, is the leading candidate to succeed Ms. Majoras, according to the people, who were briefed on her resignation plan but were not authorized to discuss it publicly. Mr. Kovacic was previously a law professor at Georgetown University and the general counsel for the commission.
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Bernanke Signals Rate Cuts On Concern About Economy - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/27/AR2008022700967....
Federal Reserve Chairman Ben S. Bernanke came to Capitol Hill yesterday during a swirl of new evidence that the economy is getting weaker and inflation is on the rise. But his message was the same as it has been since the beginning of the year: His foremost concern is the slumping economy, and more interest rate cuts could well be on the way.
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Survival strategies for Macy's, Penney's, Target, Neiman's - USATODAY.com

http://www.usatoday.com/money/industries/retail/2008-02-27-retail-strategy-slowd...
An economic slowdown tends to spook the retail industry. When the economy sputters, people close their wallets and delay purchases, and stores suffer. Store chains, after all, can't survive very long without robust consumer spending. But retailers don't just stand there and take a beating. They slim down, shut stores, trim inventory, slice payroll and take other strategic steps they hope will help them endure the pain. Some stores even thrive in recession even as others struggle. With fears that the coming months could be the toughest for them since the 1991 recession, retailers are fighting to gain any edge they can over their rivals and to cushion themselves from the slide in customer spending. Many of them are redeploying staff and revising promotions; some are putting a new stress on low prices. In the end, they know, some of them will be winners, others losers. "I see clients being more aggressive about promotion and reviewing the strategy by which they promote and how often they do it," says Madison Riley, a retail strategist with consulting firm Kurt Salmon Associates, whose clients include most major retailers.
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Taxpayers not planning rebate spending spree - Los Angeles Times

http://www.latimes.com/news/nationworld/nation/la-na-econpoll28feb28,1,1271953.s...
Most say they'll either pay down debt or put money in savings, minimizing the economic stimulus the government was aiming for.
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February 27, 2008

Euro Soars to Record High $1.5057 - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/27/AR2008022700286....
The euro climbed to a record high of $1.5057 in early European trading on Wednesday as sentiment increased that the U.S. Federal Reserve would continue its rate cut campaign. The 15-nation currency hit the high around 8:30 a.m. local time before falling back slightly to $1.5048, still above the $1.4967 it bought in late trading in New York on Tuesday _ equal to the last record high it had reached, back in November. Along with the rise in the British pound, which is nearing $2 again, the surging euro will not be kind to Americans visiting Europe _ they'll have to pay more for hotel rooms in Rome, entrance fees at the Louvre and chocolates in Belgium. On the other hand, the stronger euro makes shopping trips to the U.S. more appealing to Europeans.
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New Worries on Inflation and Homes - New York Times

http://www.nytimes.com/2008/02/27/business/27econ.html?ref=business...
Houses are getting cheaper by the month. Everything else is becoming more expensive. Several economic reports released on Tuesday provided fresh evidence that the economic pain of a prolonged slump in housing is being compounded by the rising cost of oil, food, clothes and other goods. Not surprisingly, a measure of consumer confidence fell to its lowest level in nearly five years. In addition to squeezing American homeowners, the confluence of falling home prices and accelerating inflation is putting policy makers in an increasingly tough position. If they move aggressively to cut interest rates and stimulate the economy, they risk fueling inflation further at a time consumers are already strained. But if they fail to act boldly, the economy could weaken faster. “The Fed is now having to walk a very fine line,” said Jane Caron, chief economic strategist at Dwight Asset Management, an investment firm that specializes in bonds. “We have clearly seen an acceleration in inflation pressure in the last couple of months and the risk is that the markets are going to react negatively to aggressive easing going forward.”
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Stocks up on IBM buyback plan, shrug off economic news - USATODAY.com

http://www.usatoday.com/money/markets/2008-02-26-stocks-tue_N.htm...
Stocks reversed earlier losses and moved higher Tuesday after IBM approved a $15 billion stock buyback, suggesting to investors that there are still some companies out there with financial muscle. The Dow Jones industrial average rose more than 110 points. IBM, one of the 30 companies that make up the Dow, said the buyback will boost its earnings for 2008 past Wall Street's prior forecasts. Shares of Big Blue vaulted $4.30, or 3.9%, to $114.38. The buyback news followed two dismal economic reports showing core wholesale prices shot up more than expected last month and that consumer confidence is waning. The data reinforced worries that the United States is suffering from stagflation, a state when the economy weakens amid rising costs. "The market is kind of overcoming negative news, which is potentially a next step toward higher prices," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research. "At least in the short-term, it's a nice change here."
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Weak dollar draws more European visitors in 2007 - USATODAY.com

http://www.usatoday.com/money/industries/travel/2008-02-26-foreign-tourists_N.ht...
The USA received 1.5 million more visits from overseas last year than in 2006 as the weak U.S. dollar lured more Europeans interested in exercising their increased buying power. Last year, the USA received an estimated 23.2 million visits from outside North America, up almost 7% from 2006, according to a U.S. Department of Commerce estimate. Visits by Western Europeans, the largest source of visitors, were up 8% for the year, and the news Tuesday suggested they continue to have a strong motive for visiting the USA: record strength of the euro. The euro surged Tuesday to an all-time peak of $1.4982 before closing the trading day in New York at $1.4967. Nowhere in 2007 was the growth in overseas visits more evident than in New York City, which experienced a 22% rise in visitors from outside North America, according to its tourism agency, NYC & Co. Europeans flocked to the Big Apple especially during the fall when they realized they could shop at Barneys, Tiffany, Manolo Blahnik and other iconic stores at a discount because of the weakness of the dollar against the euro and British pound.
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Even as consumers lose heart, prices rise - USATODAY.com

http://www.usatoday.com/money/economy/2008-02-26-ppi_N.htm...
Consumer confidence plunged to the lowest since the onset of the Iraq war in 2003, while wholesale inflation surged to the highest yearly rate in a quarter-century, according to Tuesday reports offering fresh evidence the economy is teetering near recession. Also Tuesday, a closely watched index indicated U.S. home prices dropped 9% in the final quarter of 2007 from a year earlier. That's the steepest decline in the 20-year history of the S&P/Case-Shiller home price index.
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Consumers cut back on small pleasures - USATODAY.com

http://www.usatoday.com/money/economy/2008-02-26-consumers-cut-small-luxuries_N....
Jason Jepson works for a chi-chi yacht dealer in Newport Beach, Calif., but he's so worried about the economy he stopped buying $1.79 PowerBars at his gym. Richmond, Va., legal secretary Angela Harris is passing up her beloved $3.46 Iced Mocha Latte at Starbucks (SBUX). William Muckelroy II, a research director from Eagle, Idaho, now carries a bottle of tap water instead of buying $1.29 bottles of Evian at Walgreens (WAG). Such small luxuries seemed almost necessities in happier economic times. But no more for lots of folks, including those and other USA TODAY readers who described how they've changed their habits.
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Slow Economy, High Prices Raise Specter of Stagflation - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/26/AR2008022600934....
Prices for a wide variety of the materials that businesses buy soared in January, according to a government report, creating new pressure for businesses to raise the prices they charge consumers. The producer price index, which measures wholesale inflation, rose 1 percent in January -- more than double what economists had forecast. Wholesale prices are up 7.4 percent over the past year, the Labor Department reported, their steepest rise since 1981. Fuel prices were a major driver of the January increase, but prices also rose rapidly for a broad range of other items that businesses buy: agricultural machinery (up 2 percent from December); transformers and power regulators (3.6 percent); flour (3.3 percent); industrial chemicals (2.4 percent); and nonferrous wire and cable (3.8 percent). Businesses tend to pass on the increased costs of their wholesale purchases to consumers. Last week, the Labor Department said that consumer prices rose 4.3 percent in the year ended in January.
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EU Fines Microsoft Record $1.3 Billion - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/27/AR2008022700646....
The European Union fined Microsoft Corp. a record $1.3 billion Wednesday for the amount it charges rivals for software information. EU regulators said the company charged "unreasonable prices" until last October to software developers who wanted to make products compatible with the Windows desktop operating system. The fine is the largest ever for a single company and brings to just under $2.5 billion the amount the EU has demanded Microsoft pay in a long-running antitrust dispute. Microsoft immediately said the issues for which it was fined have been resolved and the company was making its products more open.
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Small and Midsize U.S. Banks Beginning to Struggle in Credit Crisis - New York Times

http://www.nytimes.com/2008/02/27/business/27bank.html?ref=business...
The credit crisis is tightening the screws on thousands of small to midsize banks across the United States, squeezing local builders and businesses that depend on those lenders for financing. Losses are mounting so rapidly at some of these banks that a small number of them, perhaps 50 out of the 7,500 nationwide, could fail over the next 12 to 18 months, analysts said. Some of the others are likely to shut branches or seek out mergers as the weakening economy strains their finances. Small lenders are in far less danger than they were during the 1980s and early 1990s, when roughly 1,600 federally insured institutions failed during a savings and loan crisis. And unlike many bigger banks, they shied away from complex mortgage-linked investments and subprime home loans. But the breadth and depth of the current troubles have caught bank executives by surprise.
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U.S. Among Countries Investigating Tax Evasion - New York Times

http://www.nytimes.com/2008/02/27/business/worldbusiness/27tax.html?ref=world...
Following the lead of Germany and Britain, at least eight other countries, including the United States, said Tuesday that they were investigating whether some of their citizens were using banks in Liechtenstein to evade taxes.
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February 26, 2008

New Outlook on Bond Firms Ignites Rally - New York Times

http://www.nytimes.com/2008/02/26/business/26stox.html?ref=business...
Signs that two embattled bond insurance companies are getting close to restoring their reputations and credit ratings bolstered stocks on Monday. The credit-rating firm Standard & Poor’s helped incite a broad stock rally in the afternoon when it affirmed the triple-A ratings of MBIA and Ambac Financial, the two bond guarantors, saying the companies have made progress in raising capital and restructuring their businesses. Since late last year, investors have worried that a downgrading of MBIA or Ambac could generate losses across Wall Street, because many investment banks and other large investors are counting on the firms to back bonds they own. On Monday, Fitch Ratings, another rating firm, said a downgrading would be generally “manageable” but would severely pressure three banks that have struggled with big write-downs on mortgage-related securities: Citigroup, Merrill Lynch and UBS.
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Treasury meets Abu Dhabi, Singapore funds: report - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/26/AR2008022600378....
Treasury officials have met executives from two of the world's largest sovereign wealth funds to discuss embracing a set of promises not to use their wealth for political advantage, the Wall Street Journal reported on Tuesday. The U.S. delegation met executives from the Abu Dhabi Investment Authority and from the Government Investment Corp. of Singapore last week, the newspaper reported, quoting officials involved in the sessions. The talks are part of global negotiations to draft rules to oversee the behavior of such funds without discouraging them from investing in the United States at a time of global financial turmoil.
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Visa's IPO Could Ease Some Banks' Subprime Pain - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/25/AR2008022500778....
Visa said Monday that it is looking to raise as much as $18.8 billion in what would be the largest initial public offering ever for a U.S. company. In a filing with the Securities and Exchange Commission, Visa said it plans to offer 406 million shares at $37 to $42 each, with an option for the deal's underwriters to buy an additional 40.6 million shares. If it goes well, the Visa IPO would give a boost to its member banks, which include Bank of America, J.P. Morgan Chase, HSBC, Capital One and Citigroup. Some banks have been hit with billions of losses on subprime mortgage-related securities and have actively been looking to raise capital. The details of the long-anticipated IPO comes as public appetite for risky investments, including stocks, has waned significantly with shares of financial companies hit particularly hard as the credit crunch worsens. The date of the IPO has not been determined.
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FCC Head Says Action Possible on Web Limits - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/25/AR2008022502817....
The chairman of the Federal Communications Commission yesterday sharply questioned Internet service providers who control consumers' Web access over their networks, and suggested the agency could intervene against the practice. Kevin J. Martin made his remarks at an unusual off-site hearing to address complaints that cable provider Comcast restricts the flow of content -- such as video and music clips -- through file-sharing service BitTorrent. Rep. Edward J. Markey (D-Mass.), chairman of the House Energy and Commerce subcommittee on telecommunications and the Internet and a proponent of so-called net neutrality rules barring online traffic controls, offered opening remarks. "While carriers will assert the need to manage networks in their current state of evolution, we need to remember that Internet freedoms are most properly thought of as consumer-centric," he said. The hearing, held at Harvard University, pit Comcast and DSL provider Verizon against legal scholars and public interest advocates who have pushed for open-Internet rules.
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NZ, China Free Trade Deal in April -- chicagotribune.com

http://www.chicagotribune.com/news/nationworld/sns-ap-new-zealand-china-free-tra...
New Zealand will sign a free trade agreement with China in early April, the government announced Tuesday -- the first such deal between the Asian economic powerhouse and a developed economy. Trade Minister Phil Goff said outstanding technical requirements and processes to finalize the deal "are on track for completion" in coming weeks. The signing ceremony and related events are "planned to take place in Beijing from 6 to 9 April," he said.
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GAO Finds Data Protection Lagging - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/25/AR2008022503120....
Despite a steady stream of embarrassing computer security breaches, many major federal agencies still are doing too little to safeguard the sensitive personal information in their possession, according to congressional investigators. Only two of 24 agencies studied by the Government Accountability Office in a report released last week had implemented all five security measures recommended by the Office of Management and Budget to protect personal information. The top performers included the Treasury Department and the Department of Transportation. The worst were the Small Business Administration and the National Science Foundation, neither of which had adopted any of the measures, according to Sen. Norm Coleman (R-Minn.), one of two senators who requested the study. But officials at both agencies said yesterday that they had completed most or all of the recommended measures since GAO investigators last visited them in October. "Since that report, we've followed OMB directives, and we are now up to speed," said Christine Mangi, an SBA spokeswoman.
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February 25, 2008

Stocks in a Slump, and Look Who's Buying - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/23/AR2008022300015....
While many shareholders have fled the stock market recently, some big-name investors have been buying big-time. These savvy investors are sifting through the wreckage of financial and consumer stocks, housing shares and battered tech companies to find what they believe are future market darlings, quietly amassing stakes in names as diverse as Kraft Foods, Wells Fargo and J.C. Penney. The billionaire investor Warren E. Buffett, for example, this month disclosed ownership of 132 million shares of Kraft. That amounts to an 8.6 percent stake in the maker of Ritz crackers, Philadelphia cream cheese and Maxwell House coffee. Nicknamed the Oracle of Omaha for his investing savoir faire, Buffett also took a stake in drugmaker GlaxoSmithKline and raised his bets on Johnson & Johnson, the health-care products manufacturer; U.S. Bancorp; and Wells Fargo.
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Rising Inflation Creates Unease in Middle East - New York Times

http://www.nytimes.com/2008/02/25/world/middleeast/25economy.html?ref=world...
Even as it enriches Arab rulers, the recent oil-price boom is helping to fuel an extraordinary rise in the cost of food and other basic goods that is squeezing this region’s middle class and setting off strikes, demonstrations and occasional riots from Morocco to the Persian Gulf.
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February 22, 2008

Reports paint a glum economic picture - USATODAY.com

http://www.usatoday.com/money/economy/2008-02-21-jobless_N.htm...
The latest batch of economic reports provided little good news Thursday, with a gauge of future economic activity dropping for a fourth month, contraction in Mid-Atlantic factory production and the four-week average for new jobless claims hitting the highest level since October 2005.
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Indexes sink as data fan new fears - Los Angeles Times

http://www.latimes.com/business/la-fi-markets22feb22,1,6474268.story...
Wall Street sank Thursday as bulging oil inventories deflated energy shares and after the weakest reading on mid-Atlantic manufacturing activity since 2001 added evidence the economy was in or near recession. Investors again ran for the perceived safety of U.S. Treasury securities, driving yields down sharply. Some investors also jumped into gold, pushing the metal's price to a new high. The Dow Jones industrial average tumbled 142.96 points, or 1.2%, to end at 12,284.30. The Standard & Poor's 500 slid 17.50 points, or 1.3%, to 1,342.53. The Nasdaq composite dropped 27.32 points, or 1.2%, to 2,299.78. Smaller stocks were hit harder. The Russell 2,000 index lost 1.9%. Losers outnumbered winners by nearly 3 to 1 on the New York Stock Exchange.
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Expect food prices to keep rising, industry says - USATODAY.com

http://www.usatoday.com/money/industries/food/2008-02-21-food-inflation_N.htm...
Americans who dug deeper into their pockets for groceries last year will face sticker shock again this year when shopping for food, experts said Thursday. Consumer food prices are expected to rise 3.0% to 4.0% this year after a 4.0% gain in 2007, said USDA Chief Economist Joseph Glauber at the U.S. Agriculture Department's annual outlook conference.
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Best Buy to ramp up China expansion, shuns partners - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/22/AR2008022200621....
Top U.S. electronics retailer Best Buy Co (BBY.N), facing stagnant sales at home, said on Friday it would ramp up its expansion in China but would not grow through partnerships with local rivals. Best Buy will invest substantially and open a large number of stores in China in the next five years, and will launch online sales in the country in the next 24 months, Bob Willett, chief executive officer of Best Buy International, said in an interview. He declined to give specific figures. Willett denied Chinese media reports that Best Buy was in talks on a possible share swap with GOME Electrical Appliances Holdings Ltd (0493.HK), China's top electronics retailer.
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E.U. Skeptical of Vow by Microsoft To Share More Product Information - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/21/AR2008022101301....
Microsoft said Thursday that it will share more information about its products and technology in an effort to make it work better with rivals' software and meet the demands of antitrust regulators in Europe. European Union regulators, however, expressed skepticism, saying the software maker did not touch on possible monopoly abuse in the past, or address allegations that it is trying to undercut rivals by illegally giving away its Internet Explorer browser with the Windows operating system. Microsoft said it was expanding access to information about how its programs work. Microsoft said it will give away documentation and computer code needed to make outside applications work with its Office suite, Windows operating system and other programs. In the past, Microsoft charged for the information.
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Societe Generale Posts 2007 Profit Despite Loss From Illicit Trades - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/21/AR2008022100792....
Societe Generale, the French bank that racked up $7.2 billion in losses last month because of unauthorized and allegedly fraudulent trades, nonetheless posted a profit of about $1.39 billion in 2007, the bank reported Thursday. The earnings report followed a preliminary audit released late Wednesday that generally endorsed the bank's conclusion that a lone junior trader was responsible for the "exceptional fraud" that was discovered in January and led to the largest bank-trading loss in history. "At this stage of the investigations, there is no evidence of embezzlement or internal or external complicity (i.e., the existence of a third party who knowingly assisted the fraudster to conceal his positions)," the audit said.
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German Bank Offering Aid for Its Troubled Investments - New York Times

http://www.nytimes.com/2008/02/22/business/worldbusiness/22dresdner.html?ref=bus...
Dresdner Bank said on Thursday that it would bail out its investment vehicle for complex financial products, the latest bank to take the step to avoid a forced sale of assets into turbulent markets. Dresdner, part of the German insurer Allianz, said that its structured investment vehicle, known as K2, would receive a credit line from the bank to compensate for investors’ dwindling interest in shoring up such vehicles through purchases of short-term commercial paper. Though a different approach from that of banks including HSBC, which took its structured investment vehicles, or SIVs, onto its own books, Dresdner’s strategy eliminates the need to persuade investors to buy such debt paper, something difficult in current market conditions.
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February 21, 2008

Soaring prices threaten economy - The Boston Globe

http://www.boston.com/business/personalfinance/articles/2008/02/21/soaring_price...
Consumer prices rose sharply last month and oil prices hit a record above $100 a barrel yesterday, fueling inflationary pressures that could complicate efforts to steer the US economy away from recession. Despite a weakening economy that many analysts, including Federal Reserve chairman Ben S. Benanke, say should put a damper on inflation, prices have kept rising at a worrisome pace. Over the past three months, inflation has surged at an annual rate of nearly 7 percent, more than double the pace in the previous three months, the Labor Department said yesterday. Fueling the surge are energy costs, which have soared at a 44 percent annual rate since November, according to the Labor Department. "We've got a rock-and-a-hard-place problem if inflation is setting in," said Larry Chorn, chief economist at Platts, a publisher of energy market information.
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Fed minutes show worried central bankers - USATODAY.com

http://www.usatoday.com/money/economy/2008-02-20-fed_N.htm...
Federal Reserve policymakers grew increasingly worried about the economy last month, with "several" officials noting there was a very real possibility of an actual downturn, according to minutes of meetings. The minutes released Wednesday also showed continued concern about inflation, with some Fed officials arguing interest rate cuts may have to be reversed at a quick pace when the economy improves. "Several participants noted that the risks of a downturn in the economy were significant," the account of the Jan. 29-30 meeting said. While not using the "R" word, the minutes revealed a gloomy mood at the Fed. Housing, manufacturing, business investment and the job market all weakened, while financial market turmoil persisted and credit tightened. There was concern that drops in home and stock prices and general economic uncertainty would lead consumers to substantially pull back. And slower growth abroad would reduce the lift the economy had received from U.S. exports.
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Inflation, Consumer Prices Rise in January - washingtonpost.com

http://www.washingtonpost.com/wp-dyn/content/article/2008/02/20/AR2008022000915....
Inflation accelerated in January as the rising cost of energy, food and transportation led price increases across a broad array of goods and services, complicating the efforts of federal policymakers trying to battle a slowing economy. Housing starts, meanwhile, increased slightly in January, but permits for future building declined, signaling a continued downturn. On the day after oil closed at a record high of more than $100 a barrel, new federal data show that overall prices rose 0.4 percent in January compared to the month before, on a seasonally adjusted basis. The consumer price index was 4.3 percent higher last month compared with January a year ago. While the largest monthly price increases were for energy and food, the cost of all other goods -- so-called core inflation -- rose 0.3 percent in January. That was faster than analysts expected, and a potentially troubling sign for Federal Reserve and other officials who recently approved lower interest rates, tax rebates and other measures to try to stimulate economic growth.
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