Blue Spot

UPDATE 2-NY gov seeks $2 bln spending cuts, led by schools | Markets | Markets News | Reuters

NEW YORK, Nov 12 (Reuters) - New York Gov. David Paterson on Wednesday proposed $2 billion of spending cuts, led by aid to schools and health care for the poor, to clip a widening budget deficit as fallout from the financial crisis crimps revenues.

Paterson said the legislature agreed not to increase personal income taxes at a special session set for next week to reduce the state's $121 billion budget.

Paterson, a Democrat who says the state must reform its long history of over-spending, said he hoped to avoid an income tax hike next year -- though he did not rule one out.

"If we're not getting cooperation, and can't get any other way to do it, then it would become a possibility," he told a news conference, warning against relying on more aid from Washington to fix a two-year $14 billion deficit.

Assembly Democrats had pushed to increase the personal income tax on millionaires, a move that the Senate, led by lame duck Republicans, blocked.

Under Paterson's proposal, school aid would be cut by $800 million and funding for Medicaid, the joint state-federal health-care program for the poor, would be cut by $572 million. Those cuts will come even as more people are expected to seek health benefits as the economy falters.

New York has one of country's most generous Medicaid plans and spends more per pupil -- $14,884 -- than any other state.

In addition, Paterson proposed higher fees, including a $600 increase in annual tuition at state universities and a new 5-cent deposit for bottles of water and noncarbonated drinks.

Paterson's proposals drew a mixed response from legislators.

Republic Senate Majority Leader Dean Skelos said lawmakers cannot act until they see next year's budget. "We must avoid any job-killing taxes and fee increases, which the governor is proposing," he said.

Republicans will control the Senate only until the new Democratic majority is inaugurated in January.

Meanwhile, Democratic Speaker Sheldon Silver said he disagreed with Senate Republicans who say the fiscal crisis has been exaggerated.

"The Assembly will not shrink from tough choices and plans to confront New York's fiscal crisis head-on, based on the principle of shared sacrifice." Silver said.

Labels: Economy, Financial, Gov. Paterson, Local, Spending cuts, State budgets

Emanuel Urges Aid for Auto Industry - NYTimes.com

In his first televised interviews since being named the chief of staff for President-elect Barack Obama, Rahm Emanuel on Sunday called for swifter action to lift the struggling auto industry and suggested Mr. Obama and President Bush might clash over a stimulus package.

On the first weekend since Mr. Obama was elected president, several of his aides said his administration would attempt to roll back a number of Bush administration policies, including tight restrictions on stem cell research and a push for oil and gas drilling in Utah. The statements indicated that the first few months of an Obama administration could bring about stark reversals on controversial policies.

But Mr. Obama’s aides emphasized that his first priority would be finding ways to repair the battered economy, whose latest woes include a steep drop-off in retail sales and the loss of millions of jobs. The auto industry has been particularly hard hit, with Ford and General Motors pleading for government help after car sales plummeted 18 percent this quarter. General Motors, the country’s largest carmaker, reported a $4.2 billion third-quarter operating loss, and said it may be on the brink of collapse.

Over the weekend, the Speaker of the House, Nancy Pelosi, and the Senate Majority leader, Harry Reid, sent a letter to the Bush administration requesting that funds from the $700 billion bailout package — intended for Wall Street — be used to help carmakers as well. But the White House has signaled that it would oppose such a measure.

When asked on ABC’s “This Week” where Mr. Obama stood on the issue, Mr. Emanuel seemed to suggest that Mr. Obama, as a last resort, might be open to tapping the rescue fund to help carmakers, calling the auto industry an “essential part of our industrial base.”

Labels: Auto industry, Economy, Financial, Government Bailout, Rahm Emanuel

Columnist Krugman Wins Nobel For Economics : NPR

Princeton economist and New York Times columnist Paul Krugman won the Nobel economics prize on Monday for his analysis of how economies of scale can affect trade patterns and the location of economic activity.

Krugman was the lone of winner of the $1.4 million award and the latest in a string of American researchers to be honored.

The Royal Swedish Academy of Sciences praised Krugman for formulating a new theory to answer questions about free trade.

"What are the effects of free trade and globalization? What are the driving forces behind worldwide urbanization? Paul Krugman has formulated a new theory to answer these questions," the academy said in its citation.

"He has thereby integrated the previously disparate research fields of international trade and economic geography," it said.

The award, known as the Nobel Memorial Prize in Economic Sciences, is the last of the six Nobel prizes announced this year and is not one of the original Nobels. It was created in 1968 by the Swedish central bank in Nobel's memory.

In addition to his work as an economist at Princeton University in New Jersey, where he has been since 2000, Krugman also writes about politics and inequality in the United States and other topics for The New York Times.

Labels: Economy, Financial, Nobel Prize

In what could lead to another crippling blow to the Wall Street's image, Katie Couric examines Congressional hearings involving the alleged corrupt practices of former AIG CEOs.


House Committee on Oversight and Government Reform holds a hearing investigating what led to the taxpayer-funded bailout of insurance giant AIG. Rep. Elijah Cummings (D-MD) questioned witnesses regarding expenses incurred by AIG at a hotel that hosted a company conference after the government bailout that totaled up to $85 billion. Cummings cited charges totaling nearly half a million dollars, including thousands spent at the hotel salon and spa.

Labels: Corporatocracy, Economy, Financial, Government Bailout

Congress passes bailout, Bush signs into law | Reuters NEW YORK/WASHINGTON (Reuters) - The Congress approved a $700 billion bailout package for U.S. banks as efforts to head off a spreading global financial crisis hung in the balance.

The U.S. House of Representatives approved the financial rescue plan by a vote of 263-171. That vote sent the measure to U.S. President George W. Bush, who quickly signed it into law, concluding two weeks of haggling in Washington that had roiled and captivated global markets.

Markets pivoted on passage of the bailout, with stocks drifting from highs and the dollar slipping as the focus began to shift from the immediate response to the financial crisis to signs of a gathering recession.

"This probably comes a bit too late. If this had been done earlier, it probably would have had a much bigger impact in restoring confidence," said Anna Piretti, economist at BNP Paribas in New York. "Over the past two weeks what we have seen is an accumulation of weak reports."

Earlier, the hobbled financial sector was bolstered as Wells Fargo & Co stepped in to buy Wachovia Corp.

But in signs of the spreading crisis, California said it was running out of money, France said the world stood on the "edge of the abyss" and European leaders divided over their response to the banking sector's difficulties.

U.S. Treasury Secretary Henry Paulson, who had been the administration's chief lobbyist for the plan, said regulators would get going quickly to implement the emergency power to start buying up distressed assets from banks.

Labels: Congress, Economy, Financial, Government Bailout

As the vice presidential debate got underway Democratic nominee Joe Biden charged that Republican presidential candidate John McCain is "out of touch" on the U.S economy. Here the two spar on government regulation and tax relief.

Labels: Debates, Economy, Financial, Gov. Sarah Palin, joe biden, the middle-class

Senate passes financial bailout bill full of sweeteners - Oct. 1, 2008
Plan to buy $700B in troubled assets wins OK. Backers hope add-ons will yield more yes-votes in House.

NEW YORK (CNNMoney.com) -- The Senate on Wednesday night passed a sweeping and controversial financial bailout similar in key ways to one rejected by the House just two days earlier.

The measure was passed by a vote of 74 to 25 after more than three hours of floor debate in the Senate. Presidential candidates Sens. Barack Obama, D-Illinois, and John McCain, R-Arizona, voted in favor.

Like the bill the House rejected, the core of the Senate bill is the Bush administration's plan to buy up to $700 billion of troubled assets from financial institutions.

Those assets, mostly mortgage-related, have caused a crisis of confidence in the credit markets. A major aim of the plan is to free up banks to start lending again once their balance sheets are cleared of toxic holdings.

But the Senate legislation also includes a number of new provisions aimed at Main Street.

The changes are intended to attract more votes in the House, in particular from House Republicans, two-thirds of whom voted against the bailout plan.

The House is expected to take up the Senate measure for a vote on Friday, according to aides to Democratic leaders.

The package adds provisions to the House version - including temporarily raising the FDIC insurance cap to $250,000 from $100,000. It says the FDIC may not charge member banks more to cover the increase in coverage. But that doesn't prevent the agency from raising premiums to cover existing concerns with the insurance fund, according to Jaret Seiberg, a financial services analyst at the Stanford Group, a policy research firm.

Instead, the bill allows the FDIC to borrow from the Treasury to cover any losses that might occur as a result of the higher insurance limit.

The bill also adds in three key elements designed to attract House Republican votes - particularly popular tax measures that have garnered bipartisan support.

It would extend a number of renewable energy tax breaks for individuals and businesses, including a deduction for the purchase of solar panels.

The Senate bill would also continue a host of other expiring tax breaks. Among them: the research and development credit for businesses and the credit that allows individuals to deduct state and local sales taxes on their federal returns.

In addition, the bill includes relief for another year from the Alternative Minimum Tax, without which millions of Americans would have to pay the so-called "income tax for the wealthy."

Labels: Economy, Financial, Government Bailout, Senate

Wall St.
Video sent by marc1a

With the Senate set to vote on a bailout proposal tomorrow, here's a look at the circus in NY, right outside the big tent.

Labels: Economy, Financial, Government Bailout

House Rejects Bailout Package, 228-205; Stocks Plunge - NYTimes.com

WASHINGTON — In a moment of historic drama in the Capitol and on Wall Street, the House of Representatives voted on Monday to reject a $700 billion rescue of the financial industry.

Stock markets plunged sharply at midday as it appeared that the measure would go down to defeat.

House leaders pushing for the package kept the voting period open for some 40 minutes past the allotted time, trying to convert “no” votes to “yes” votes by pointing to damage being done to the markets, but to no avail.

Supporters of the bill had argued that it was necessary to avoid a collapse of the economic system, a calamity that would drag down not just Wall Street investment houses but possibly the savings and portfolios of millions of Americans. Opponents said the bill was cobbled together in too much haste and might amount to throwing good money from taxpayers after bad investments from Wall Street gamblers.

Should the measure somehow clear the House on a second try, the Senate is expected to vote later in the week. The Jewish holidays and potential procedural obstacles made a vote before Wednesday virtually impossible, but Senate vote-counters predicted that there was enough support in the chamber for the measure to pass. President Bush has urged passage and spent much of the morning telephoning wavering Republicans to plead for their support.

Many House members who voted for the bill held their noses, figuratively speaking, as they did so. Representative John A. Boehner of Ohio, the Republican minority leader, said there was too much at stake not to support it. He urged members to reflect on the damage that a defeat of the measure could mean “to your friends, your neighbors, your constituents” as they might watch their retirement savings “shrivel up to zero.”

The House debate was heated and, occasionally, emotional up to the last minute, as illustrated by the remarks of two California lawmakers.

Representative Darrell Issa, a Republican, said he was “resolute” in his opposition to the measure because it would betray party principles and amount to “a coffin on top of Ronald Reagan’s coffin.”

But Representative Maxine Waters, a Democrat, said the measure was vital to help financial institutions survive and keep people in their homes. “There’s plenty of blame to go around,” she said, and attaching blame should come later.

The House vote came after a weekend of tense negotiations produced a rescue plan that Congressional leaders said was greatly strengthened by new taxpayer safeguards. “If we defeat this bill today, it will be a very bad day for the financial sector of the economy,” Representative Barney Frank, Democrat of Massachusetts and the chairman of the Financial Services Committee, said as the debate began and the stock market opened sharply lower. The Standard & Poor’s 500 index was down almost 3.4 percent at midmorning.

Labels: Economy, Financial, Government Bailout

Lawmakers and the Bush administration must settle the details on a rescue intended to keep credit flowing and avert a recession.

Labels: Congress, Economy, Financial, Government Bailout

Talks Implode During a Day of Chaos; Fate of Bailout Plan Remains Unresolved - NYTimes.com

WASHINGTON — President Bush tried to assure Americans on Friday morning that lawmakers and the administration would be able come together and reach an agreement on a proposal to rescue the country’s financial system.

“We are going to get a package passed,” Mr. Bush said, a day after an earlier agreement dissolved amid a flurry of political rancor. “We will rise to the occasion. Democrats and Republicans are going to come together to get a rescue plan passed.”

Mr. Bush spoke as lawmakers and administration officials were gearing up for a second day of discussions about the shape of the $700 billion rescue package. Thursday’s agreement, which seemed like a sure thing by early afternoon, fell apart during a meeting later in the day at the White House.

Wall Street seemed to find some solace in Bush’s comments, Shares, which trading down more than 100 points, cut their loses in half.

Speaking from the White House just after the New York Stock Exchange opening bell, President Bush noted the disagreements among lawmakers about how the rescue should be shaped. “The legislative process is sometimes not very pretty,” he said.

But he said everyone in Washington agreed that action was needed immediately. “There are disagreements over aspects of the plan, but there is no disagreement that something substantial must be done,” he said.

For their part Friday morning, lawmakers from both parties staked out their positions on a round of morning talk shows. Ahead of the anticipated resumption of negotiations later in the morning, the House speaker, Nancy Pelosi, said the urgency of the moment meant that agreement would come within the next 24 hours.

“It will happen because it has to happen,” she said in an interview on ABC’s “Good Morning America, according to Reuters.

Separately, Representative Barney Frank, Democrat of Massachusetts, and the chairman of the House Financial Services Committee, said on Friday that an agreement depended on House Republicans ending their opposition and “dropping this revolt” against the plan proposed by the Bush administration, The Associated Press reported. He described the rival plan being proposed by Republicans as “an ambush.”

Labels: Congress, Economy, Financial, Government Bailout

JPMorgan to buy WaMu - Sep. 25, 2008

NEW YORK (CNNMoney.com) -- JPMorgan Chase acquired the banking assets of Washington Mutual late Thursday after the troubled thrift was seized by federal regulators, marking the biggest bank failure in the nation's history and the latest stunning twist in the ongoing credit crisis.

Under the deal, JPMorgan Chase will acquire all the banking operations of WaMu, including $307 billion in assets and $188 billion in deposits.

To put the size of WaMu in context, its assets are equal to about two-thirds of the combined book value assets of all 747 failed thrifts that were sold off by the Resolution Trust Corp. - the former government body that handled the S&L crisis from 1989 through 1995.

In exchange for scooping up WaMu, JPMorgan Chase (JPM, Fortune 500) will pay approximately $1.9 billion to the Federal Deposit Insurance Corporation.

Analysts were largely encouraged by the news even as JPMorgan Chase absorbs WaMu's toxic subprime and option-ARM mortgages as part of the deal.

"My initial impression is that this deal is 'generally OK'," wrote Nancy Bush, managing member at investment advisory firm NAB Research LLC, adding that there would be questions about the loan losses that JPMorgan took as part of the deal would be sufficient.

All told, JPMorgan Chase said it would recognize projected losses on the loan portfolio upfront by marking down the value of the loans by a whopping $31 billion.

Quite possibly the biggest losers in Thursday's deal, however, are WaMu's stock and debt holders, who were effectively wiped out.

Among that group was the private equity giant TPG, which was part of a consortium of investors that acquired a stake in WaMu for $7 billion in April.

JPMorgan Chase reportedly had made a previous bid for WaMu around that time for about $8 a share which was snubbed by WaMu, according to news reports at the time.

Tough times for banks
The fall of WaMu is the latest turn in a dizzying two weeks that have seen the bankruptcy of Lehman Brothers, the acquisition of Merrill Lynch by Bank of America (BAC, Fortune 500) and the near collapse of insurance giant AIG (AIG, Fortune 500).

The widening credit crisis has prompted President Bush to seek from Congress extraordinary authority to spend as much a $700 billion to bail out the nation's financial system by purchasing toxic assets from banks.

President Bush, in a televised address Friday morning, said the nation's economy is at risk, adding he believed that Congress will move quickly on a bailout proposal.

"We've got a big problem," he said.

Regulators acknowledged they were encouraged to get a deal done but JPMorgan Chase's Dimon stressed to investors that a potential bailout by the government was not a factor.

Labels: Economy, Financial, Government Bailout

Republican presidential candidate John McCain said he will break off from campaigning to help on a Wall Street rescue plan and asked that a Friday night debate with Democrat Barack Obama be postponed. In a statement to reporters, McCain said he would suspend his campaign on Thursday to return to Washington and called on Obama to join him, saying he had spoken to the Democrat. McCain said he did not believe a current $700 billion rescue plan would pass the U.S. Congress in its current form. He urged President George W. Bush to call for a bipartisan meeting of lawmakers to try to find an agreement. "It's time for both parties to come together to solve this problem," he said.

Labels: Economy, Financial, General Election 2008, McCain

Bloomberg.com: Worldwide

Sept. 24 (Bloomberg) -- Billionaire investor Warren Buffett, calling the market turmoil ``an economic Pearl Harbor,'' said Treasury Secretary Henry Paulson's $700 billion proposal to prop up the U.S. financial system is ``absolutely necessary.''

``The market could not have taken another week'' like last week, Buffett told CNBC today, a day after saying his Berkshire Hathaway Inc. will buy a $5 billion stake in Goldman Sachs Group Inc. ``I think it was the last thing Hank Paulson wanted to do, but there's no Plan B for this.''

Paulson and Federal Reserve Chairman Ben S. Bernanke are pushing Congress to quickly approve the plan to remove illiquid assets from the banking system. Lawmakers have balked at rubber- stamping the proposal, with Democrats demanding it include support for homeowners and limits on executive pay and Republicans questioning the plan's reach and size.

``I am betting on the Congress doing the right thing for the American public and passing this bill,'' Buffett said. The economy is ``everybody's problem,'' he said, likening it to ``a bathtub -- you can't have cold water in the front and hot water in the back.''

Berkshire is buying the stake in Goldman, Paulson's former firm, after three of the investment bank's biggest competitors went bankrupt or were forced into emergency sales. He has already agreed to spend at least $25 billion this year to acquire companies, finance buyouts and purchase securities for Omaha, Nebraska-based Berkshire.

``I certainly have a vote of confidence in Goldman and vote of confidence in Congress,'' said Buffett, who is investing in the firm after it lost 40 percent of its market value in the past year.

Buffett, who last year complained that he couldn't find companies big enough to buy, said he's not a fan of cash.

``It's nice to have a lot of money, but you know, you don't want to keep it around forever,'' Buffett said. ``I prefer buying things. Otherwise, it's a little like saving sex for your old age.''

Labels: Congress, Economy, Financial, Government Bailout

House GOP rises up against Cheney - Daniel W. Reilly and Patrick O'Connor - Politico.com

There was a time when Dick Cheney could turn back a Republican revolt on Capitol Hill. That time is gone.

House Republicans rose up en masse against their vice president on Tuesday morning to blast an administration proposal that would grant Treasury historic authority to start buying hundreds of billions of dollars in devalued mortgage-related assets, according to members present.

The lines to speak were long, the questions many and sentiment in the Cannon Caucus Room Tuesday swayed heavily against the Treasury proposal.

Afterward, Texas Rep. Joe Barton took the unusual step of telling reporters that he had politely given Cheney a piece of his mind – the sort of dissent Republicans considered unthinkable during much of the Bush administration's reign.

A full-throated Republican revolt could create huge problems for the administration and congressional Democrats scrambling to assemble a package to reassure jittery markets. It could also preserve the Republicans’ options after the fact – if the bailout doesn’t work or proves deeply unpopular with voters, they can say they opposed it.

Labels: Cheney, Congress, Economy, Financial

Hillary Clinton: Bailout necessary: The Swamp

Sen. Hillary Clinton has offered a guarded endorsement of the Treasury Department's plan to purchase as much as $700 billion in bad mortgage-related debt from banks and other financial institutions.

In a talk with FOX Business Network's Liz Claman, the New York Democrat also offered a candidate for overseer of the bailout: independent New York Mayor Michael Bloomberg.

"I am generally supportive of the Treasury proposal,'' Clinton told the FOX Business Network today, "however I believe there needs to be accountability and oversight and some authority for mortgage modification or we're not going to get to the root of what is going on because this is a collapsed housing bubble that has rippled through the financial world but it is at root an economic challenge, which we will meet."

Clinton said she has spoken with the campaigning Sen. Barack Obama about the bailout, with Obama taking a more guarded approach to it and also suggesting that an overseer will be needed -- perhaps handing President Bush's Treasury Secretary, Henry Paulson. a role in the transition to a new administration.

"Yes, I have spoken with Senator Obama,'' Clinton said. "He understands the gravity of the situation we're facing... He is working with a number of very knowledgeable experts to be sure that he's kept fully apprised of all of these changes that are going on in the negotiations. So I'm confident he's on top of this."

On the question of the government assuming the toxic assets of the mortgage world: "In a perfect world, that might not be the case, but we don't live in a perfect world,'' Clinton said. "We live right now in a world that is fraught with psychological feelings that may or may not be reality-based...We need to stabilize it and that is exactly what Secretary Paulson is proposing...

"The net result will be that for a short period of time, which is what I prefer, the Treasury will be in charge, but we've got a transition coming. People are coming in and out of the government. That is why I'm so much in favor of creating an entity where we can house this. So it's not the Treasury day to day, but its people who are immersed in it. Some people have suggested that Mike Bloomberg take that over. I think that'd be a great choice. There are other great choices....

"Everybody needs to take a deep breath,'' Clinton said, calling on people to "calm down here. Let's work our way through this. Look, the American economy, our society, we're going to get through it, we will be fine but we got to start, we got to make some tough decisions, and I'm urging that we do that."

Labels: Economy, Financial, Hillary

CNN Political Ticker: All politics, all the time Blog Archive - Wall Street Journal editorial board skewers McCain « - Blogs from CNN.com

(CNN) — John McCain's recent comments on the economy aren't just coming under fire from Barack Obama's campaign: arguably the country's most conservative editorial board said Friday the Arizona senator's recent "populist rifting" was downright "un-presidential."

A Friday Wall Street Journal editorial sharply criticized McCain for his recent condemnation of Christopher Cox, the chairman of the Securities and Exchange Committee. The Republican presidential nominee told an Iowa crowd Thursday Cox had "betrayed the public trust" and should be fired.

"Mismanagement and greed became the operating standard while regulators were asleep at the switch. The primary regulator of Wall Street, the Securities and Exchange Commission kept in place trading rules that let speculators and hedge funds turn our markets into a casino," McCain said.

Fact check: Does McCain oppose financial regulation

In the bruising editorial, the Journal said those comments an "assault on Mr. Cox is both false and deeply unfair."

"It's also un-Presidential," the Journal said.

Specifically the editorial says many of McCain's allegations against the SEC were misleading — particularly his claim the SEC allowed "naked short selling" and eliminated the "uptick rule that has protected investors for 70 years.

According to the editorial, the SEC never condoned the practice of "naked" shorting, and has sought to eliminate the practice during Cox's tenure. The Journal also supports the SEC's decision to eliminate the uptick rule, calling it a "Depression-era chestnut" that "protected no one."

"In a crisis, voters want steady, calm leadership, not easy, misleading answers that will do nothing to help. Mr. McCain is sounding like a candidate searching for a political foil rather than a genuine solution," the editorial also said. "He'll never beat Mr. Obama by running as an angry populist like Al Gore, circa 2000."

Labels: Economy, Financial

Stocks Leap as Feds Fashion Aid Plan - WSJ.com

U.S. stocks jumped at the open and the Dow Jones Industrial Average was up over 300 points as the U.S. government worked on plans to wade into markets in the most decisive fashion since the 1930s.

The Dow recently rose 291.88 points, or 2.7%, to 11311.67.

While hurting hedge funds and other momentum traders, the government's intervention through relieving banks of toxic mortgage bonds, backstopping money-market accounts and temporarily banning short sales of financial stocks may finally stem the panic on Wall Street and turn the stock market and the banking system around. One veteran trader compared the action to John Pierpont Morgan spearheading the move by bankers to bail out of Wall Street in 1907. The government appeared determined to prevent the ripple effects of financial markets from dragging the "real economy" into a depression, the trader said.

"I would be amazed if we haven't seen the bottom here," the trader said. "It's very good for the markets (but) it's very bad for the people who've taken the point of view that things in the U.S. and globally are fundamentally so bad that they have to be unsound at much lower price levels. The authorities are saying, 'not so fast.'"

Initial reports of the government action stirred the rally in the Dow Thursday. The Nasdaq Composite Index recently rose 51.27 points, or 2.3%, to 2250.37. The Standard & Poor's 500 Index rose 34.63 points, or 2.9%, to 1241.14.

Labels: Economy, Financial

Washington Wire - WSJ.com : Wall Street Helped Fill McCain, Obama Campaign Chests

The tumbles on Wall Street have also put a spotlight on the bundlers from the finance industry working the presidential fund-raising circuit.

An analysis of bundlers–people who gather checks for campaigns–by the nonpartisan Center for Responsive Politics shows that people who work on Wall Street have raised more money for Barack Obama and John McCain than any other profession.

Overall, the two presidential candidates have a total of 125 bundlers who work in the securities and investment industry who have raised at least $20 million combined for their respective campaigns.

McCain is slightly more reliant on Wall Street bundlers than his opponent. The Arizona senator has raised at least $11.4 million from 69 bundlers who work on Wall Street. That makes Wall Street the number one source of bundlers for McCain.

Obama has raised $8.9 million from 56 Wall Street bundlers, according to the data. That was second on the Obama campaign’s bundling list behind the 80 lawyers who have raised at least $11.7 million for his campaign.

Together, Wall Street bundlers edged out lawyer bundlers, according to the study. Between Obama and McCain, lawyers account for 124 bundlers bringing in at least $16.6 million.

Labels: Campaign financing/contributions, Financial

White House spokeswoman Dana Perino defends takeover of AIG, says taxpayers faced even greater risk if company failed. (Sept. 17)

Labels: Economy, Financial

Bloomberg.com: Worldwide

Sept. 16 (Bloomberg) -- American International Group Inc., the biggest U.S. insurer by assets, has been offered an $85 billion U.S. loan in return for an 80 percent stake in the company, according to a person familiar with the situation.

The Federal Reserve was persuaded to offer the loan because of the risk that an AIG failure would threaten the stability of world financial markets, according to the person, who declined to be identified because negotiations were confidential. Efforts to find a private-sector solution failed because the company is too big and a long-term fix was needed, the person said.

The agreement keeps New York-based AIG in business, averting a collapse that could have threatened more financial companies and cost them $180 billion in losses, according to RBC Capital Markets. AIG needed the rescue to stave off a collapse after its credit ratings were cut and shares plunged 79 percent since Sept. 11.

``There's a systemic risk if AIG isn't saved,'' Benoit de Broissia, an equity analyst at Richelieu Finance in Paris, said in a Bloomberg Television interview. Richelieu has about $6.2 billion under management.

Fed spokeswoman Michelle Smith declined to comment. Peter Tulupman, a spokesman for AIG, also declined to comment. Terms of the plan were reported earlier by the New York Times.

Labels: Economy, Financial

AP Source: Gov't bailout of AIG seen more likely - Yahoo! News

NEW YORK - The government is increasingly likely to step in to help rescue the huge insurer AIG, a person with knowledge of the situation said Tuesday. AIG's failure could open the ugliest chapter yet of the financial meltdown.

"The glimmer of hope has turned into a ray of hope," said the person, who asked not to be named because of the sensitive nature of the talks to help American International Group Inc.

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke met with members of Congress to brief them on options the government is considering. The meeting ended without Bernanke and Paulson commenting.

Hoping to stave off what would be the ugliest chapter of the financial meltdown, AIG executives huddled with Fed officials and representatives from top banks at the New York Fed in downtown Manhattan to find the cash the huge insurer needs to stay in business.

One solution: A plan to have the government provide financial backing to ensure that AIG could secure a short-term loan from banks worth up to $100 billion to stay out of bankruptcy court, the person, who had direct knowledge of the talks, said.

He said the discussions had stalled because AIG did not have enough collateral to obtain a loan of that size. Both sides were trying to figure out how to close the gap between the amount AIG needs and the amount of collateral it has.

The person said it was increasingly likely the Fed would step in with taxpayer money.

Labels: Economy, Financial

Labels: Economy, Financial, Gov. Paterson

Labels: Economy, Financial

Everyone's a 'vice president'

Labels: Corporatocracy, Financial

Greenspan bashes Bush policies - U.S. Business - MSNBC.com

WASHINGTON - Former Federal Reserve Chairman Alan Greenspan, in his upcoming book, bashes President Bush for not responsibly handling the nation’s spending and racking up big budget deficits.

A self-described “libertarian Republican,” Greenspan takes his own party to task for forsaking conservative principles that favor small government.

“My biggest frustration remained the president’s unwillingness to wield his veto against out-of-control spending,” Greenspan wrote.

Labels: Economy, Financial, Record deficits

Rupert Murdoch's Big Bet - MSN Money

Rupert Murdoch got his trophy.

After weeks of back and forth, it looks like Murdoch's News Corp. (NWS, news, msgs) has succeeded in a years-long quest to buy the parent of The Wall Street Journal.

"The Bancroft family has accepted," John Prestbo, editor and executive director of Dow Jones Indexes, told reporters earlier today in Chicago. Dow Jones (DJ, news, msgs) "will be part of News Corp.," Prestbo said.

Murdoch now has enough support from reluctant Bancroft family members to make the deal happen, The Journal reported today.

Labels: Financial, Fox propaganda, Murdoch

Several DJ & Wall St. Journal employees lined up outside the Dow Jones headquarters at the World Financial Center today to sign a painting of Rupert Murdoch in protest of his bid to buy the Dow Jones. The painting was done by a local artist named Geoff Raymond and is entitled "The Annotated Murdoch." It is currently for sale now on E-bay. The count at the time of this post was approximately 28 annotations, one of them reading "News is Sacred."

Labels: Financial, Fox propaganda, Murdoch

Dow Jones Director Resigns Over Deal: Financial News - Yahoo! Finance

NEW YORK (AP) -- German publishing executive Dieter von Holtzbrinck has resigned as a director of Dow Jones & Co. to protest the board's endorsement of a deal to sell the company, which publishes The Wall Street Journal, to Rupert Murdoch's News Corp.

In a letter to Dow Jones' other board members, von Holtzbrinck said he was "very worried" that the company's "unique journalistic values will long-term strongly suffer after the proposed sale." Dow Jones disclosed von Holtzbrinck's departure and included a copy of his letter in a regulatory filing Thursday.

Dow Jones' board endorsed the $5 billion buyout offer from News Corp. late Tuesday, and the proposal has now gone to the company's controlling shareholders, the Bancroft family, for a decision. They are expected to meet Monday and take several days to consider the offer.

Labels: Financial, Murdoch

Rupert Murdochs New York Post Slammed for Anti-Gay Cartoons

Although the Post's anti-gay cartoons appear shocking and offensive to many, this is not a surprise. The paper is owned by media mogul Rupert Murdoch, head of the News Corp. behemoth, which owns conservative outlets such as FOX and hundreds of others across seven distribution categories.

The board of Dow Jones now supports Murdoch's $5-billion takeover of Dow Jones, which owns The Wall Street Journal. The deal now is in the hands of the Bancroft family, which controls 64 percent of the shareholder vote.

Murdoch-owned FOX streamlines bias on a regular basis and uses Murdoch's bully pulpit to advance his political agenda, which includes donating money to dismantle affirmative action. (See also: Do They All Look Alike? FOX News Shows Wrong Black Congressman Indicted and Who Is Paying to End Affirmative Action?)

Prior to Murdoch's purchase of the Post, it had been viewed as a politically liberal publication. That changed during the "Murdoch years." Murdoch purchased the Post in 1976 but was forced to sell it in 1988 in accordance with federal regulations limiting media ownership. Political friends orchestrated a buy-back in 1993 that granted Murdoch a waiver from the cross-ownership rules.

Labels: Financial, Fox propaganda, Media

Dow Jones, News Corp. deal close - MSN Money

After an 11-week courtship, it appears that News Corp. (NWS, news, msgs) chief Rupert Murdoch has finally persuaded Wall Street Journal parent Dow Jones (DJ, news, msgs) to accept his $5 billion buyout proposal.

Dow Jones' board will vote on the deal tonight, according to The Journal, and the Bancroft family, which controls 64% of the voting shares in Dow Jones, will meet Thursday to hear details of the agreement.

Although it is too close to call whether the family will ratify the deal, Wall Street, which has been buzzing for weeks over whether Murdoch's aggressive offer was ingenious or insane, has warmed to the deal in recent days.

Labels: Financial, Murdoch