G-20 sets ambitious goals, but short on details
PITTSBURGH (AP) -- World
leaders lined up Friday behind sweeping promises to fix a malfunctioning global
economic system in hopes of heading off future financial meltdowns. For now,
they said, they would keep stimulus programs going "until recovery is
assured."
In the first international
summit hosted by President Barack Obama, the G-20 moved to give China and other
fast-growing economies a bigger say in decision-making and to crack down on
greedy bankers.
They moved to require
members to subject their economic policies to the scrutiny of a peer review
process that would determine whether they were "collectively
consistent" with sustainable global growth. They promised tighter and more
coordinated financial regulation.
And, repeating pledges from
G-20 summits in November and April, when financial panic was rampant, they
vowed anew to "reject protectionism in all its forms."
Device approval exposes
political pressure on FDA
WASHINGTON (AP) -- The Food
and Drug Administration has taken the unprecedented step of acknowledging that
it buckled to "extreme" pressure from Capitol Hill in its approval of
a knee repair device last year. While FDA officials call the situation an
anomaly, experts said Friday there is nothing to stop similar political
lobbying from influencing future decisions.
In a sweeping critique
Thursday, FDA leadership said the agency failed to protect its scientists from
outside pressure after they twice rejected ReGen Biologics' Menaflex device.
The Hackensack, N.J.-based
company ultimately won approval last December after enlisting the support of
four New Jersey lawmakers, who urged then-FDA Commissioner Andrew von
Eschenbach to intervene on the company's behalf.
Approval came despite
protests by FDA scientists that Menaflex -- which reinforces damaged knee
tissue -- provided little, if any, benefit to patients.
Reports on manufacturing,
housing weigh on stocks
Stocks fell for a third day
Friday after disappointing reports on manufacturing and home sales further
dampened enthusiasm about the state of the economy.
Durable goods orders, a key
indicator for the manufacturing industry, fell unexpectedly in August. It was
the second drop in three months and the latest sign that any rebound inside the
nation's factories is likely to be slow.
The Commerce Department said
orders for goods expected to last at least three years fell 2.4 percent, after
rising 4.8 percent in July. Economists polled by Thomson Reuters had forecast
an increase of 0.5 percent.
Durable goods orders, new
home sales disappoint
WASHINGTON (AP) -- Orders
for durable goods like aircraft and electronics fell unexpectedly in August,
while sales of new homes rose less than expected. The weak reports renewed
concerns about whether the economy can sustain a recovery with consumer
spending held back by job losses, tight credit and falling home values.
Still, economists said the
figures -- which follow weaker-than-expected data on existing home sales
Thursday -- also reflect a volatile economy emerging from the worst recession
since the 1930s.
Orders for durable goods
dropped 2.4 percent in August, after rising a revised 4.8 percent in July, the
Commerce Department said Friday. Economists had expected a 0.5 percent
increase, according to a survey by Thomson Reuters. It was the second drop in
three months in orders for goods expected to last at least three years.
Regulators close Ga. bank;
95th US failure in '09
WASHINGTON (AP) --
Regulators on Friday shut down Atlanta-based Georgian Bank, the 95th U.S. bank
to fail this year as loan defaults rise in the worst financial climate in
decades.
In coming months, more banks
are expected to buckle under the weight of commercial real estate and other
loans that go sour. Those failures could imperil the insurance fund for
deposits, already at the lowest point in nearly 20 years.
The Federal Deposit
Insurance Corp. took over Georgian Bank, with about $2 billion in assets and $2
billion in deposits as of July 24. First Citizens Bank and Trust Co., based in
Columbia, S.C., agreed to assume the assets and deposits of the failed bank.
Georgian Bank's five branches will reopen Monday as offices of First Citizens
Bank.
Fresh bailouts for smaller
banks being weighed
WASHINGTON (AP) -- Treasury
officials and regulators are weighing a fresh round of bailouts for banks that
were deemed too risky to qualify for earlier aid.
Representatives from the
Treasury Department, Federal Deposit Insurance Corp. and House Financial
Services Committee discussed the plan by phone Thursday, said California
Bankers Association Chairman Dan Doyle, who was on the call.
Small community banks are
struggling as commercial real estate and other loans go sour. Officials and
industry representatives are considering how to get money to those banks, Doyle
said Friday.
The new program could force
Treasury to postpone closing its $700 billion bailout fund, which is scheduled
to expire this year. That decision has become a political hot potato amid
public backlash against bailouts and a rising deficit.
Unilever buys some Sara Lee
businesses for $1.9B
AMSTERDAM (AP) -- Consumer
products giant Unilever NV said Friday it has agreed to buy soaps and personal
care businesses including the Sanex and Duschdas brands from Sara Lee Corp. for
euro1.28 billion ($1.88 billion).
The businesses to be
acquired, subject to regulatory approval, include Sara Lee's worldwide body
care products business and its European detergents arms. In addition to Sanex
-- a cheaper parallel of Unilever's Dove brand -- and Duschdas, a German shower
gel maker, Unilever is buying several strong regional brands such as Radox
bubble bath and Switzal, a maker of baby shampoo.
Unilever said the businesses
it will acquire had sales of euro750 million and operating earnings of euro128
million in the 12 months ending in June.
KB Home posts smaller 3Q
loss as sales increase
LOS ANGELES (AP) -- KB Home
posted a smaller third-quarter loss on Friday as new home orders increased and
the builder cut costs.
The company lost $66
million, or 87 cents a share, in the three months ended in August. That
compares with a loss of $144.7 million, or $1.87 a share, the same period last
year.
Still, the results missed
analysts' expectations. Analysts polled by Thomson Reuters forecasted a loss of
58 cents a share on revenue of about $457.9 million.
Something to tweet about:
Twitter valued at $1B
SAN FRANCISCO (AP) --
Twitter Inc.'s founders now have a billion-dollar baby, and they seem
determined to raise it without a corporate parent.
That was the message
underlying Friday's news that Twitter has lined up $100 million to finance its
operations while founders Evan Williams and Biz Stone plot ways to make money
off one of the Internet's most popular communications tools.
The investment values the
3-year-old company at $1 billion, even though it has yet to generate any
meaningful revenue, let alone profits.
By The Associated Press
The Dow Jones industrial
average fell 42.25, or 0.4 percent, to 9,665.19. The broader Standard &
Poor's 500 index fell 6.40, or 0.6 percent, to 1,044.38, and the Nasdaq fell
16.69, or 0.8 percent, to 2,090.92.
Benchmark crude for November
delivery added 13 cents to settle at $66.02 a barrel on the New York Mercantile
Exchange. In London, Brent crude rose 29 cents to settle at $65.11 on the ICE
Futures exchange.
In other Nymex trading,
gasoline for October delivery lost nearly 2 cents to settle at $1.6205 a
gallon, and heating oil for October delivery lost less than a penny to settle
at $1.6771 gallon. Natural gas added 3 cents to settle at $3.985 per 1,000
cubic feet.