Obama puts GM, Chrysler on short leash
WASHINGTON (AP) -- President Barack Obama asserted unprecedented
government control over the auto industry Monday, bluntly rejecting turnaround
plans by General Motors Corp. and Chrysler LLC, demanding fresh concessions for
long-term federal aid and raising the possibility of quick bankruptcy for
either ailing auto giant.
Obama took the extraordinary step of announcing the government
will back new car warranties issued by both GM and Chrysler, an attempt to
reassure consumers their U.S.-made purchases will be protected even if the
companies don't survive.
GM CEO Wagoner forced out as part of gov't
plan
DETROIT (AP) -- Time and time again, General Motors Corp.'s board
of directors reaffirmed its support for Chairman and CEO Rick Wagoner, even as
the company piled up billions of dollars in losses and begged for government
loans to stay alive.
But Wagoner is now a high-profile casualty of government
intervention, forced out as part of the Obama administration's sweeping
last-ditch effort to save the century-old auto giant. He stepped down effective
immediately, the company said in a statement early Monday. He was replaced as
CEO by Fritz Henderson, the company's vice chairman and chief operating
officer.
Stocks tumble as automaker plans are rejected
Major indexes fell about 3 percent Monday, including the Dow
Jones industrial average, which lost about 254 points but finished well off its
lows at 7,522.02. Financial stocks weighed heavily on the market amid worries
that banks will need fresh injections of capital.
Fears of an automaker bankruptcy have been looming over investors
for months, and the latest developments made the market even more uneasy.
However analysts said the pullback wasn't surprising after the average surged
21 percent over just 13 days.
Oil tumbles below $49 on gloomy economic outlook
HOUSTON (AP) -- Oil prices tumbled below $49 Monday as unease
about the economy -- from
Benchmark crude for May delivery fell more than 7.6 percent, or
$3.97, to settle at $48.41 on the
In
Gasoline futures plunged more than a dime a gallon.
New GM CEO says bankruptcy still an option
DETROIT (AP) -- General Motors Corp.'s new chief executive said
Monday there's a greater risk that the company will have to reorganize through
bankruptcy, because of greater demands from the Obama administration to get
debt off its balance sheet.
Fritz Henderson told reporters on a conference call that the
company would still prefer to restructure outside of court, but the various
support mechanisms Obama outlined Monday would provide a better cushion for the
company to reorganize under a court-order bankruptcy if necessary.
EPA head announces new port emissions proposal
NEWARK, N.J. (AP) -- The head of the Environmental Protection
Agency wants to limit emissions along the nation's coastline and within its
seaports, just as the agency does along highways, with tougher pollution
standards on large commercial ships.
EPA Administrator Lisa Jackson said Monday that the
The move is intended to ensure the shipping industry does its
part to improve the air quality of major seaport communities.
Google, music labels launch
BEIJING (AP) -- Google Inc. and major music companies launched a
free Internet music download service for
The advertising-supported service will offer 1.1 million tracks,
including the full catalogs of Chinese and Western music for Warner Music Group
Corp., EMI Group Ltd., Sony Music Entertainment and Universal Music and 14
independent labels, the companies said. It will be limited to use by computers
whose Internet protocol, or IP, addresses show they are in mainland
Sales of second homes fall 22 percent
WASHINGTON (AP) -- Sales of vacation and investment homes slid 22
percent last year, a sign that tough economic conditions and tight lending
requirements shut out buyers, the National Association of Realtors reported
Monday.
Second home sales comprised 30 percent of the entire housing
market, down from a peak of 40 percent in 2005 when financing was easier.
Just 9 percent of sales last year were for vacation homes, down
from 12 percent in 2007. Proportionally, investment properties held steady at 21
percent.
Fifth Third sells stake in processing business
Cincinnati-based Fifth Third said it will retain a 49 percent
stake in the new company, Fifth Third Processing Solutions LLC, which is valued
at $2.35 billion, before any adjustments. The unit processes electronic
payments such as debit, credit and merchant transactions.
FDA: Bristol-Myers diabetes drug appears safe
WASHINGTON (AP) -- A potential blockbuster diabetes medication
from Bristol-Myers Squibb appears free from heart-related side effects that
have plagued similar treatments, federal health officials said Monday.
Despite low rates of heart attacks and related problems in
testing, the Food and Drug Administration will still ask an outside panel to
scrutinize the company's safety data at a meeting Wednesday.
By The Associated Press
The Dow Jones industrial average fell 254.16, or 3.3 percent, to
7,522.02.
The Standard & Poor's 500 index fell 28.41, or 3.5 percent,
to 787.53, while the Nasdaq
composite index fell 43.40, or 2.8 percent, to 1,510.80.
Benchmark crude for May delivery fell more than 7.6 percent, or
$3.97, to settle at $48.41 on the
In
In other Nymex trading, gasoline for
April delivery tumbled 10.8 cents to settle at $1.3799 a gallon while heating
oil slipped 9.02 cents to settle at $1.3426 a gallon. Natural gas for May
delivery rose less than a penny to settle at $3.739
per 1,000 cubic feet.