The top business news from The Associated Press for the morning of Monday, October 20, 2008:
Bruised economy likely to limp into next year
WASHINGTON (AP) _ Beaten down by housing, credit and financial crises, the bruised economy is likely to drag into next year, leaving more people out of work and more businesses wary of making big investments. Federal Reserve Chairman Ben Bernanke, scheduled to appear Monday before the House Budget Committee, is likely to once again put the country on notice that there won’t be a quick fix.
Global markets advance; S. Korea up on bank plan
HONG KONG (AP) _ World markets advanced Monday, with South Korean shares gaining for the first time in four days after the government announced a $130 billion plan to buttress the country’s vulnerable banks amid the credit crisis. Japan’s Nikkei 225 stock average rose almost 3.6 percent to 9,005.59, and the Hang Seng Index in Hong Kong jumped 5.28 percent to 15,323.01.
Germany approves bailout terms, sets salary cap
FRANKFURT, Germany (AP) _ The German Cabinet on Monday approved terms that banks will have to accept in order to benefit from its 480 billion ($645 billion) bailout plan _ including a salary cap of 500,000 ($670,200) for top bank managers. Those managers would also be obliged to forgo bonuses and dividend payments as long as their banks were indebted to the government.
Oil rises to $73 on expectation of OPEC cut
SINGAPORE (AP) _ Oil prices rose to $73 a barrel in Asia on Monday on expectations that OPEC will cut production quotas at an extraordinary meeting later this week. Light, sweet crude for November delivery rose $1.16 to $73.01 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract Friday gained $1.53 to settle at $71.38.
AP IMPACT: Mortgage firm arranged stealth campaign
WASHINGTON (AP) _ Freddie Mac secretly paid a Republican consulting firm $2 million to kill legislation that would have regulated and trimmed the mortgage finance giant and its sister company, Fannie Mae, three years before the government took control to prevent their collapse. In the cross hairs of the campaign carried out by DCI of Washington were Republican senators and a regulatory overhaul bill sponsored by Sen. Chuck Hagel, R-Neb. DCI’s chief executive is Doug Goodyear, whom John McCain’s campaign later hired to manage the GOP convention in September.
Wall Street eyes earnings, looking for bottom
NEW YORK (AP) _ With little question the U.S. is in the grips of a recession, investors this week will lean on a stream of earnings and economic reports to help determine exactly how prolonged and painful the downturn might be. There’s certainly been fresh evidence the credit market has begun to thaw. But, that alone might not be enough to restore confidence in the stock market at a time when investors are clamoring for stronger signs of a bottom.
Grocery bill still high? Blame ‘sticky’ prices
Worries over a global recession have pushed the price of oil to its lowest in over a year. Don’t expect the same for a bottle of beer, a tube of toothpaste, or a box of cereal. You can blame “sticky” prices.
SAG board votes to allow members to vote on strike
LOS ANGELES (AP) _ A vote by the leaders of the Screen Actors Guild on Sunday has simultaneously ratcheted up negotiation efforts and the possibility of strike. The guild’s national board of directors voted to formally request a federal mediator for stalled contract talks with studios and, at the same time, agreed to ask members if they want to authorize a strike.
Analysts: 1 million barrel OPEC cut not enough
CAIRO, Egypt (AP) _ A crude oil production cut of even 1 million barrels per day at OPEC’s upcoming emergency meeting is unlikely to reverse slumping prices in the short term, analysts said Sunday, amid mounting calls by several cartel members to take action to keep prices at the $80 per barrel level. A decision by the Organization of Petroleum Exporting Countries to hold an emergency meeting next Friday clearly signaled the group’s concern that the recent pummeling of crude prices would erode revenues needed to sustain government spending and weather broader fallout from the global financial crisis.
Sparse plug-ins for electric cars spark creativity
SEATTLE (AP) _ Owning an electric vehicle requires more than global-cooling ambitions. It takes guile, planning, sharp vision, a silver tongue _ and a 50-foot extension cord. Steve Bernheim knows accessible outlets like a firefighter knows hydrants. He has to _ his Corbin Sparrow runs only 25 miles on a charge.
TOKYO (AP) _ The benchmark Nikkei 225 index rose 311.77 points on Monday, or 3.59 percent, to 9,005.59, managing to climb above the 9,000-level for the first time since Wednesday.
TOKYO (AP) _ The U.S. dollar was trading at 102.14 yen Monday afternoon in Asia, up from 101.63 yen late Friday.
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