AP
Business
Highlights
Wednesday
January 28, 6:25 pm ET
House passes economic stimulus, prodded
by Obama
WASHINGTON (AP) -- In a swift victory
for President Barack Obama, the Democratic-controlled House approved a $819
billion stimulus bill Wednesday night, filled with new spending and tax cuts at
the core of the young administration's revival plan for the desperately ailing
economy.
"We don't have a moment to spare," Obama declared at
the White House as congressional allies hastened to do his bidding in the face
of the worst economic crisis since the Great Depression.
The vote sent the bill to the Senate, where debate is expected to
begin as early as this week on a companion measure already taking shape.
Democratic leaders have pledged to have legislation ready for Obama's signature
by mid-February.
Fed ready to provide fresh aid to revive economy
WASHINGTON (AP) -- The Federal Reserve
signaled Wednesday that it stands ready to use new unconventional tools, or
expand existing ones, to spur lending and consumer spending that could help
lift the economy out of a painful recession.
The Fed also agreed to keep the targeted range for the federal
funds rate between zero and 0.25 percent for "some time" to help
brace the economy.
With its key lending rate to banks already near zero, the Fed
pledged anew to use "all available tools" to revive the economy.
Specifically, the Fed said it is "prepared" to buy
longer-term Treasury securities if the circumstances warrant such action. At
its previous meeting in December, the Fed said it was merely evaluating that
option.
Billions more needed for financial rescue
WASHINGTON (AP) -- The Obama administration is developing
proposals to help rescue the banking system that could cost taxpayers hundreds
of billions of dollars beyond the $700 billion bailout Congress already has
approved.
Details are still being worked out. But the administration will
likely propose spending hundreds of billions more to address the foreclosure
crisis, buy some distressed bank assets and guarantee losses on others,
according to people with knowledge of the discussions who spoke on condition of
anonymity.
Looming above the proposals is a plan to set up a federal bank --
dubbed a "bad bank" -- that would buy troubled assets clogging banks'
balance sheets. This would free the institutions to lend money and would entice
wary investors back into the market, proponents say.
But the government will have to commit to far more money than
policymakers had expected even a few weeks ago.
Stocks jump on reports of plan for bad bank assets
The Standard & Poor's 500 index, a
benchmark for the overall stock market, completed its first
four-day rally since late November. And the Dow Jones industrial average jumped
201 points.
Financial companies surged on the notion
that the government could take soured debt like defaulting mortgages off the
hands of banks and place them in a so-called bad bank to hold toxic assets.
Investors have been worrying that banks won't be able to resume more normal
levels of lending without somehow dumping or walling off the bad debt that is
corroding their balance sheets.
Boeing posts loss, announces 10,000 job cuts
PITTSBURGH (AP) -- Facing falling air traffic and pressure on
military budgets, Boeing Co. announced plans to cut 10,000 jobs after reporting
a surprise fourth-quarter loss Wednesday.
The Chicago-based company, which makes passenger and military
jets, became the latest blue chip company to mirror a slowdown in the world
economy. Boeing, whose orders plunged in 2008 following three years of very
strong bookings, also announced lower-than-expected earnings for this year.
Boeing reported a fourth-quarter loss of $56 million, or 8 cents
per share, compared with profit of $1.03 billion, or $1.36 per share, a year
earlier. Results were dragged down by charges totaling $1.79 per share,
including the effects of an autumn labor strike and delayed deliveries of new
747 jets.
Starbucks 1Q profit down 69 pct, shuts
more stores
NEW YORK (AP) -- Starbucks Corp. said nearly 7,000 employees may
lose their jobs due to a new round of store closures and cost cuts as it
reported Wednesday that its profit dropped 69 percent in its fiscal first
quarter.
The company plans to close 300 underperforming stores around the
world by the end of the fiscal year in addition to the 600 it already planned
to close in the
The additional closures could result in the loss of 6,000
in-store jobs. Starbucks also plans to lay off about 700 non-store employees.
It also has reduced the number of new stores it plans to open.
House defeats bill to delay digital TV transition
WASHINGTON (AP) -- Bucking the Obama administration, House
Republicans on Wednesday defeated a bill to delay the upcoming transition from
analog to digital television broadcasting to June 12 -- leaving an estimated
6.5 million
The 258-168 vote failed to clear the two-thirds threshold needed
for passage in a victory for GOP members, who warn that postponing the
transition from the current Feb. 17 deadline would confuse consumers.
House Republicans say a delay also would burden wireless
companies and public safety agencies waiting for the spectrum that will be
freed up by the switch, and create added costs for television stations.
GM to end controversial 'jobs bank'; follows Chrysler
NEW YORK (AP) -- General Motors Corp.'s "jobs bank"
program will end Monday, following a similar move at Chrysler LLC that helps
satisfy the conditions the government imposed when it lent the automakers $17.4
billion late last year.
The program gives union workers at the
GM spokesman Tony Sapienza said
Wednesday that the 1,600 GM workers in the jobs bank will be placed on layoff
and will need to file for unemployment. They'll receive about 72 percent of
their salaries, paid by state unemployment benefits and GM subsidies. The
workers also will get medical and other benefits from the company.
Postmaster General: Mail days may need to be cut
WASHINGTON (AP) -- Massive deficits could force the post office
to cut out one day of mail delivery, the postmaster general told Congress on
Wednesday, in asking lawmakers to lift the requirement that the agency deliver
mail six days a week.
If the change happens, that doesn't necessarily mean an end to
Saturday mail delivery. Previous post office studies have looked at the
possibility of skipping some other day when mail flow is light, such as
Tuesday.
Faced with dwindling mail volume and rising costs, the post
office was $2.8 billion in the red last year.
Total mail volume was 202 billion items last year, over 9 billion
less than the year before, the largest single volume drop in history.
And, despite annual rate increases, the postmaster general said
2009 could be the first year since 1946 that the actual amount of money
collected by the post office declines.
Mass layoffs surge in 2008, continue at rapid pace
WASHINGTON (AP) -- Mass layoffs involving 50 or more workers
increased sharply last year, and large job cuts appear to be accelerating in
2009 at a furious pace.
Boeing, Pfizer, Home Depot and other
The Labor Department reported Wednesday that 21,137 mass layoffs
took place last year, up from 15,493 in 2007. That's the highest annual total
since 2001, the last time the economy was in recession, and the second-highest
since the department began tracking mass layoffs in 1995.
More than 2.1 million workers were fired as a result of last
year's mass layoffs, the department said.
By The Associated Press
The Dow Jones industrials rose 200.72, or 2.46 percent, to
8,375.45.
Broader stock indicators also rose. The S&P 500 index jumped
28.38, or 3.36 percent, to 874.09. The index last recorded as many straight
advances in a five-day run that ended Nov. 28.
The Nasdaq
composite index rose 53.44, or 3.55 percent, to 1,558.34.
Light, sweet crude for March delivery rose 58 cents to settle at
$42.16 a barrel in trading on Nymex.
In other Nymex trading, gasoline
futures rose 8 cents to settle at $1.18 a gallon and heating oil rose 5 cents
to settle at $1.42 a gallon. Natural gas for February delivery dropped 3 cents
to settle at $4.48 per 1,000 cubic feet.
In