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AP Business NewsBrief at 11:53 a.m. EDT
(AP Online Via Acquire Media NewsEdge) Rescue plan seeks $700B to buy bad mortgagesWASHINGTON (AP) _ The Bush administration is asking Congress to let the government buy $700 billion in toxic mortgages in the largest financial bailout since the Great Depression, according to a draft of the plan obtained Saturday by The Associated Press. The plan would give the government broad power to buy the bad debt of any U.S. financial institution for the next two years. It would raise the statutory limit on the national debt from $10.6 trillion to $11.3 trillion to make room for the massive rescue. The proposal does not specify what the government would get in return from financial companies for the federal assistance.
Judge says Lehman can sell units to BarclaysNEW YORK (AP) _ A bankruptcy judge approved a plan just after midnight Saturday under which Lehman Brothers will sell its investment banking and trading businesses to Barclays. The deal was said to be worth $1.75 billion earlier in the week but the value was in flux after lawyers announced changes to the terms on Friday. It may now be worth closer to $1.35 billion, which includes the $960 million price tag on Lehman's Midtown Manhattan office tower.
As fares and fees rise, passengers want serviceFORT WORTH, Texas (AP) _ On a recent rainy day at Dallas-Fort Worth International Airport, a suitcase bound for Colorado Springs, Colo., lay on the ground outside a terminal under a maze of American Airlines conveyor belts that ferry bags to and from nearby planes. A field representative for the airline who was showing a reporter the long, circuitous route checked bags take put the suitcase on a belt where it was supposed to be. He said it likely fell off a belt or a baggage handler's vehicle. He didn't know how long it had been off its path.
A tumultuous week ends with Wall Street remadeNEW YORK (AP) _ One of the most tumultuous weeks in the 216-year history of Wall Street closed with a dramatic two-day rally as investors celebrated an unprecedented government plan to cleanse banks of the bad mortgages that touched off a crisis in world finance. The details of the rescue _ not to mention how many hundreds of billions of dollars it will cost _ remained a mystery, but investors snapped up stocks anyway in hopes the end of the credit crisis was near.
Govt trading ban could have unintended resultsWASHINGTON (AP) _ The government's unprecedented move Friday to ban people from betting against financial stocks might be a salve for the market's turmoil but could also carry serious unintended consequences. In a bid to shore up investor confidence in the face of the spiraling market crisis, the Securities and Exchange Commission temporarily banned all short-selling in the shares of 799 financial companies. Short selling is a time-honored method for profiting when a stock drops.
Paulson oversees historic government interventionWASHINGTON (AP) _ The man behind the Bush administration's sweeping intervention in the U.S. financial system is a former Goldman Sachs executive who came to Washington two years ago hoping to streamline regulation of the financial services sector. It was Treasury Secretary Henry Paulson who pushed through the government bailout of struggling mortgage finance giants Fannie Mae and Freddie Mac two weeks ago. It was Paulson _ working hand-in-hand with Federal Reserve Chairman Ben Bernanke _ who decided to inject $85 billion of taxpayer money to prop up teetering insurance titan American International Group Inc. earlier this week. And now it is Paulson who is leading the push to craft a government rescue plan to relieve financial firms of billions of dollars in bad debt.
Can Washington stop home price declines?WASHINGTON (AP) _ Home prices. That's what the Bush administration's historic Wall Street bailout is really about. Falling home prices nationwide have acted like dominoes, knocking homeowners into foreclosure and taking down lender after lender, until the entire global financial system was in jeopardy.
4 Fannie execs depart; organization restructuredWASHINGTON (AP) _ Mortgage finance giant Fannie Mae, taken over by the government earlier this month, announced Friday the resignations of four senior executives and said it was restructuring its organization. The company, the biggest buyer and guarantor of home loans in the country, and its sibling Freddie Mac were taken over on Sept. 7 in a rescue plan that eventually could require the Treasury Department to put up as much as $100 billion for each of them over time if needed to keep them afloat as mortgage losses mount.
No rise in monthly Medicare premiums for 2009WASHINGTON (AP) _ The monthly premium for the vast majority of the elderly and disabled participating in Medicare will hold steady at $96.40 next year. It's the first time since 2000 that the charge for health coverage is not increasing. Premiums usually go up to reflect higher costs and demand for care projected for the coming year. Such increases will most certainly occur in 2009, but they will be offset when calculating the premiums by an adequate reserve in the Medicare Part B trust fund. That reserve gained $9.3 billion earlier this year after officials discovered money was inadvertently being drawn from Medicare Part B to cover hospice benefits.
Buffett biography reveals flaws, recounts triumphsOMAHA, Neb. (AP) _ Warren Buffett's youthful confidence about his business acumen hid a self-doubt about nearly everything else, yet the son of a Nebraska congressman grew into one of the world's greatest investors. The tale of how the brilliant but needy Buffett built a fortune by investing in undervalued companies is recounted in the first authorized biography of the chairman and CEO of Berkshire Hathaway Inc. The Associated Press obtained an audio version of the book Friday, ahead of its Sept. 29 release.
Copyright ? 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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