Fed Chairman Ben Bernanke and his colleagues will open a two-day meeting starting today -- the last before the November elections -- to make a fresh assessment of economic and financial conditions and decide their next move on interest rates. Their decision will be announced Wednesday at 2:15 pm (Eastern Time).
Former Federal Reserve Chairman Paul Volcker said there "can't be any doubt we're in a recession" and that, while he did not know how deep the economic downturn would be, he…
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Added by Jack Lott on October 28, 2008 at 10:20am —
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As a result of the current volatile economic situation, the Federal Reserve is reportedly prepared to cut interest rates -- perhaps to their lowest point in more than four years -- with the hope of relieving some of the pain felt by many Americans. The FOMC will announce their decision after their two day meeting, Wednesday afternoon at 2:15 pm (Eastern Time).
The government will begin doling out $125 billion to nine major banks this week as part of its effort to contain a growing…
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Added by Jack Lott on October 27, 2008 at 10:30am —
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The National Association of Realtors said that sales of existing homes rose by 5.5 percent in September compared to August, the best showing since a 5.6 percent increase in July 2003, during the five-year housing boom.
The chief economist of the American Federation of Labor and Congress of Industrial Organizations said Congress moved quickly on the $700 billion financial rescue package and now working families throughout the country deserve the same attention. Ron Blackwell said as…
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Added by Jack Lott on October 24, 2008 at 1:00pm —
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Former Federal Reserve Chairman Alan Greenspan said financial companies and markets should be more heavily regulated to prevent a repeat of a "once-in-a-century credit tsunami." Greenspan, testifying at the House Oversight Committee, said he reluctantly supports requiring securities firms that structure new investments to maintain some ownership of those securities to put their own capital at risk. He also said he was "in a state of shocked disbelief" over the failure of banks and other…
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Added by Jack Lott on October 23, 2008 at 10:25am —
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The White House has announced that World leaders will meet Nov. 15th in Washington to address the global financial crisis -- the first in a series of summits to ease what economists predict could be a long and deep downturn.
U.S. Treasury Undersecretary David McCormick said the U.S. economy is in for a challenging few quarters but could start to recover late next year. McCormick told a lunch in Hong Kong, "The coming quarters will be very challenging." He also said that it is his…
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Added by Jack Lott on October 22, 2008 at 10:30am —
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The Federal Reserve has created a new facility to ease the stress in the short-term debt market. Under the new program, called the Money Market Investor Funding Facility, the Fed will provide funds to a private-sector controlled effort to purchase assets from U.S. money market mutual funds.
The Bank of Canada lowered its target interest rate by a quarter of a percentage point to 2.25%. Policy makers noted "severe strains in financial markets" and lower commodity prices, likely to…
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Added by Jack Lott on October 21, 2008 at 10:23am —
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Fed Chairman Ben Bernanke told the House Budget Committee the country's economic weakness could last for a while and it was the right time for Congress to consider a new package. Earlier this year, most individuals and couples received tax rebate checks of $600-$1,200 through the $168 billion stimulus package enacted in February.
Treasury Secretary Henry Paulson said government purchases of stock in banks represent an investment that should eventually make money for the taxpayer.…
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Added by Jack Lott on October 20, 2008 at 1:48pm —
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President Bush said U.S. steps to ease the financial crisis will take "more time," to work but said he was confident they would be effective. It's going to "take awhile" for the credit crunch to ease. In a speech to the U.S. Chamber of Commerce, the President outlined actions the government has taken including supporting commercial paper and expanding insurance for bank accounts.
Housing starts fell 6.3% in September to a seasonally adjusted annual rate of 817,000, the lowest since…
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Added by Jack Lott on October 17, 2008 at 3:36pm —
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There's good news on the inflation front, as the Labor Department reported that consumer prices were unchanged in September, with energy prices declining and food prices rising. Energy prices dropped 1.9% after seasonal adjustments, the September data showed. For the second consecutive month, food prices rose by 0.6%.
The Labor Department reported that initial claims for unemployment insurance last week fell 16,000 to a seasonally adjusted level of 461,000. That was below analysts'…
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Added by Jack Lott on October 16, 2008 at 12:01pm —
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Federal Reserve Board Chairman Ben Bernanke believes more difficulties lie ahead for the U.S. economy, but the U.S. is in better position to get through them now that the government has new powers to strengthen the banking sector. He said the Fed is committed to using "all the tools at our disposal" to improve market functioning, reduce stress in credit markets and complement the work of the Bush administration and foreign governments to strengthen the financial system.
The Commerce…
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Added by Jack Lott on October 15, 2008 at 11:30am —
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President Bush announced a $250 billion plan by the government to directly buy shares in the nation's leading banks, saying the drastic steps were "not intended to take over the free market but to preserve it." Nine major banks will initially participate including all of the country's largest institutions.
Treasury Secretary Henry Paulson urged banks receiving $250 billion in capital injections from the government to use the funds to spur economic growth. The U.S. initiative followed…
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Added by Jack Lott on October 14, 2008 at 10:00am —
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The U.S. Treasury plans to buy equity in "healthy" financial institutions as part of a multibillion-dollar program designed to kick-start the flow of credit for consumers. Speaking to a group of international bankers, Interim Assistant Secretary for Financial Stability Neel Kashkari said the U.S. is working "around the clock" on the program and detailed the steps Treasury is taking to put it in place.
The Bush administration said it is moving quickly to implement a $700 billion…
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Added by Jack Lott on October 13, 2008 at 11:19am —
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President Bush said the government's financial rescue plan was aggressive enough and big enough to work, but would take time to fully kick in. Bush spoke as leaders of the world's leading economies gathered in Washington amid frozen credit markets, panic selling in stock markets and a looming global recession. The president noted that major Western economies were working together in an attempt to stabilize markets and end the spreading panic.
U.S. authorities are now considering…
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Added by Jack Lott on October 10, 2008 at 11:00am —
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Initial claims for jobless benefits dropped 20,000 to a seasonally adjusted 478,000, in line with Wall Street economists. The department said Hurricanes Ike and Gustav were responsible for adding about 20,000 claims on a seasonally adjusted basis. That's down from approximately 45,000 the previous week.
Inventories at U.S. wholesalers rose 0.8 percent in August, higher than what analysts had expected, while sales suffered their largest drop in more than a year and a half. Wall Street…
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Added by Jack Lott on October 9, 2008 at 11:39am —
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Treasury Secretary Henry Paulson said patience is needed because the ongoing financial market turmoil will not end quickly despite Congress approving a $700 billion bank rescue package. At the start of a press conference, Paulson said that the bailout plan and coordinated central bank interest rates could not end the crisis overnight. More banks are likely to fail in coming months and he stressed that Treasury now has the power to inject capital into banks, a step advocated by many…
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Added by Jack Lott on October 8, 2008 at 10:00am —
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In The News
The Federal Reserve says it will begin paying interest on commercial banks' reserves and will expand its loan program to squeezed banks, fresh steps to help ease a painful credit crisis. Congress in the $700 billion bailout bill President Bush signed on Friday gave the Fed the power to pay interest on those reserves for the first time. The law accelerated the effective date to Oct. 1st of this year versus 2011.
Bank of America Corp. (BAC) and a number of U.S.…
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Added by Jack Lott on October 6, 2008 at 10:55am —
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The House of Representatives voted to approve a revised $700 billion bailout plan for the financial markets. The House's vote follows the Senate's approval and clears the way for President Bush's signature. Passage came over the objections of some members who balked at tax provisions in the bill and giving the Treasury secretary extraordinary power to buy bad assets. The bill now goes to the President for signature.
Employers made deeper cuts in their payrolls in September as the…
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Added by Jack Lott on October 3, 2008 at 10:00am —
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House members are getting another chance to vote on a financial rescue bill that has infuriated millions of voters after the Senate added tax cuts and other sweeteners and passed it handily. Senators passed the much-criticized measure in a 74-25 vote, sending it to the other side of the Capitol for a showdown vote expected tomorrow.
The SEC has extended an unprecedented ban against all short-selling in the shares of more than 800 financial companies, keeping it in place at least…
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Added by Jack Lott on October 2, 2008 at 10:39am —
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House leaders believe progress is being made toward getting the $700 billion financial industry rescue bill through Congress, thanks partly to a provision increasing insurance for people's deposits. The plan was set for a Senate vote tonight after leaders agreed to add tax breaks for businesses and the middle class and increase deposit insurance in an attempt to revive the legislation rejected by the House. The vote is slated to take place at 7:30 p.m. (Eastern Time). Senators John McCain,…
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Added by Jack Lott on October 1, 2008 at 10:30am —
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The U.S. Senate will try to salvage a $700 billion financial-rescue package after the measure was defeated in the House of Representatives. The lawmakers won't have a lot of room to negotiate. The Senate won't hold any roll-call votes today because several lawmakers will be celebrating Rosh Hashanah, the Jewish New Year. Senators say they have no choice but to revive the measure, which is designed to restore confidence in the nation's banking system.
President Bush said the economic…
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Added by Jack Lott on September 30, 2008 at 10:30am —
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