Wednesday February 4, 2009, 6:10 pm EST
Obama caps executive pay tied to bailout money
WASHINGTON (AP) -- President Barack Obama on Wednesday imposed a
$500,000 cap on senior executive pay for the most distressed financial
institutions receiving taxpayer bailout money and promised new steps to end a
system of "executives being rewarded for failure."
Obama announced the unusual government intervention into
corporate America at the White House, with Treasury Secretary Timothy Geithner at his side. The president said the executive-pay
limits are a first step, to be followed by the unveiling next week of a
sweeping new framework for spending what remains of the $700 billion financial
industry bailout that Congress created last year.
The pay limit comes amid a national outcry over huge bonuses to
executives who head companies that seek taxpayer dollars to remain afloat. The
demand for limits was reinforced by revelations that Wall Street firms paid
more than $18 billion in bonuses in 2008 amid the economic downturn and the
massive infusion of taxpayer dollars.
Lawmaker says SEC hindering House's Madoff
probe
WASHINGTON (AP) -- House lawmakers on Wednesday accused the
Securities and Exchange Commission of impeding their probe into the agency's
failure to uncover the alleged $50 billion Bernard Madoff
fraud.
The clash between lawmakers and high-ranking SEC officials at a
House Financial Services subcommittee hearing came after the man who waged a
decade-long campaign to alert the regulators to problems in Madoff's
operations denounced the agency for its inaction. Whistleblower Harry Markopolos also said he had feared for his physical safety
and would turn over new evidence that Madoff had not
acted alone.
In loud, angry exchanges, lawmakers threatened to issue subpoenas
to SEC officials to compel their testimony in the case.
Congress postpones digital TV transition to June
WASHINGTON (AP) -- Congress is giving consumers four more months
to prepare for the upcoming transition from analog to digital television
broadcasting.
The House on Wednesday voted 264-158 to postpone the shutdown of
analog TV signals to June 12, to address growing concerns that too many
Americans won't be ready in time for the Feb. 17 deadline that Congress had set
three years ago. The Senate passed the measure unanimously last week and the
bill now heads to President Barack Obama for his signature.
The change is being required because digital signals are more
efficient than analog, and ending analog will free up valuable space in the
nation's airwaves.
The delay is a victory for the Obama administration and Democrats
in Congress.
Stocks fall on worries about consumer companies
After an early rally Wednesday, investors succumbed to concerns
about disappointing earnings and the market ended the day with a loss. Falling
consumer stocks weighed most heavily on the Dow Jones industrial average, which
slid 122 points. Meanwhile, the tech-focused Nasdaq composite index showed only a moderate
retreat.
Fourth-quarter numbers from Kraft Foods Inc., Walt Disney Co. and
Time Warner Inc. provided the latest reminder of the economy's struggles. The
weaker-than-expected reports and a profit warning from Costco Wholesale Corp.
left investors fearing that consumers are cutting back even more than most
analysts thought.
Rising unemployment hits 98 percent of metro areas
WASHINGTON (AP) -- Metropolitan areas across the Southeast and
Midwest are seeing some of the steepest increases in joblessness, stung by
their dependence on factories serving the struggling housing and auto sectors.
That is one of the key trends that emerges
from a Labor Department report released Wednesday showing December unemployment
rates rose in 98 percent of the country's largest metropolitan areas, compared
with a year earlier.
More than 100,000 job cuts have been announced since then by a
wide range of industries, sparing few communities. The government's next
monthly snapshot of nationwide unemployment is expected to show the January
rate climbed to a 17-year high.
Time Warner swings to 4Q loss on hefty writedown
LOS ANGELES (AP) -- Media and entertainment giant Time Warner
Inc. reported a fourth-quarter loss, hurt by a previously expected $24.2
billion writedown for its cable, publishing and AOL
assets.
The company predicted flat earnings in the year ahead as it takes
on major restructuring charges amid a declining advertising market.
Its cable unit, meanwhile, also reported a loss and said it plans
to cut 1,250 jobs, or about 2.6 percent of the unit's work force, as its
business slows. Time Warner owns 85 percent of Time Warner Cable and plans a
spinoff of that interest.
Time Warner shares fell 36 cents, or 3.7 percent, to close at
$9.42.
Kraft, Sara Lee see
volume drops in latest quarter
Both companies lowered their forecasts for the current and
upcoming quarters due to weakness overseas and a rising U.S. dollar.
Kraft said it saw unit volume slip in its U.S. beverage, cheese
and snack nuts businesses, as it raised prices to offset higher input costs,
and Sara Lee said it sold fewer deli and frozen bakery products.
Service sector declines less than expected in Jan.
WASHINGTON (AP) -- The nation's service sector shrank for the
fourth straight month in January, a trade group said Wednesday, but at a slower
pace than the previous month.
The Institute for Supply Management, a trade association of
purchasing executives, said its service sector index rose to 42.9 last month,
from December's downwardly revised reading of 40.1.
That January reading was above analysts' expectations of 39,
according to a survey by Thomson Reuters. Any reading above
50 signals growth, while a reading below 50 indicates contraction.
Visa profit rises 35 pct despite recession
BOSTON (AP) -- Visa Inc. said Wednesday its fiscal first-quarter
profit rose by 35 percent as the shift away from cash toward electronic
payments maintained its staying power amid the recession.
The results beat Wall Street expectations, and shares of Visa
rose nearly 8 percent after the regular trading session. Visa also reiterated
its earnings outlook for the current fiscal year, despite expectations of
tougher economic conditions in coming months.
The world's largest electronic payment network reported net
income of $574 million, or 74 cents per share, for the three months ended Dec.
31. That's up from $424 million, or 55 cents per share, in the same quarter a
year earlier, when Visa was privately held before its initial public offering
last March.
Lawmakers push for food safety reforms
WASHINGTON (AP) -- Lawmakers vowed Wednesday to press for
stronger food safety laws and more money for inspections as the list of
recalled peanut products surpassed 1,000 in an ongoing national salmonella
outbreak.
Rep. Rosa DeLauro, D-Conn. introduced a bill to reorganize
federal food safety enforcement and make it more accountable.
Meanwhile, the number of recalled peanut products approached
1,100 in what independent experts said appears to be a record for foods
consumed by humans.
The salmonella outbreak has sickened at least 550 people, eight
of whom have died. A
By The Associated Press
The Dow Jones industrial average fell 121.70, or 1.51 percent, to
7,956.66.
Broader indicators also fell. The Standard & Poor's 500 index
fell 6.28, or 0.75 percent, to 832.23, and the Nasdaq composite index fell 1.25, or 0.08 percent, to
1,515.05.
Light, sweet crude for March delivery dropped 46 cents to settle
at $40.32 a barrel on the
In other Nymex trading, gasoline futures
stayed rose 5.14 cents to settle at $1.2184 a gallon, while heating oil added
0.16 cent to settle at $1.327 a gallon. Natural gas for March delivery gained
8.4 cents to settle at $4.597 per 1,000 cubic feet.
In