Free Internet Press Newsletter - Thursday October 16 2008 - (813)

Thursday October 16 2008 edition
Free Internet Press is operated on your donations. Donate Today
Debate Analysis: Aggressive Underdog vs. Cool Counterpuncher 2008-10-16 03:55:03 John McCain threw everything he could at Barrack Obama here in Hempstead, New York, Wednesday night. Down in the polls and with time running out, McCain took every opportunity to put Obama on the defensive, looking to turn a race that has been slipping away from him back in his direction in the final 20 days. It was what many of his supporters, including running mate Sarah Palin, had urged him to do, and McCain responded with vigor and seeming enthusiasm. Obama was repeatedly forced Wednesday night to explain himself. But he did not lose his cool under his opponent's persistent criticism, parrying time and again with measured explanations designed to take the sting out of McCain's charges with voters who may still be making up their minds. This debate may have been McCain's strongest performance of the three, but it was also an example of how Obama has used the encounters to try to show that he has not only the knowledge of the issues but also the temperament and the judgment that voters are looking for in a successor to President Bush. In the end, given the overwhelming desire for change in the country, that may be enough to keep him in the driver's seat. McCain will have to continue to press his case relentlessly in the final days to change the shape of the campaign. Read The Full Story World Markets Fall As Investors Weigh Relentless Trouble 2008-10-16 03:54:40 Stock markets plunged anew on Wednesday, nearly wiping out the record gains of Monday and sending another wave of wealth destruction washing over American households. The government’s rescue of the banks has been widely embraced, but the frenzied selling, which pushed the Dow Jones industrial average down 733 points, underscored how the economy’s troubles are too broad to be fixed by the bailout of the financial system. In early trading in Asia on Thursday, the markets followed Wall Street’s lead. The Nikkei was down 10.03 percent, or 957.90 points, the Hang Seng dropped 1,204.27 points, more than 7.5 percent, the South Korean Kospi fell 6 percent, the Standard and Poor’s/Australian Stock Exchange 200 index shed 5.5 percent and Taiwan opened down 3.8 percent. Investors are recognizing that the financial crisis is not the fundamental problem. It has merely amplified economic ailments that are now intensifying: vanishing paychecks, falling home prices and diminished spending. And there is no relief in sight. Wednesday’s rout began in the morning with the latest evidence of the nation’s economic deterioration - reports showing that retail spending slipped in September and broader signs of a pullback among suddenly thrifty American consumers. Read The Full Story Dow Down More Than 400 As Fears Of Slowdown Grow 2008-10-15 15:43:58 Wall Street looked beyond the government’s bailout plan on Wednesday and saw more signs that the economy was in for a dramatic slowdown. Shares in New York fell sharply on Wednesday amid the likelihood that serious dislocations will plague the economy even if the coordinated bailouts announced this week succeed in restoring confidence to credit markets. Two reports on Wednesday put the slowdown into perspective. One report said that retail sales decreased 1.2 percent last month, nearly double the 0.7 percent drop that had been expected, while an index of New York manufacturing hit a record low in September. “The market’s focus in a day has shifted from resilience in the financial sector to the recession,” said Brian Gendreau, investment strategist at ING investment management. And the chairman of the Federal Reserve, Ben S. Bernanke, in a speech Wednesday in New York, warned that the economy faced a difficult time ahead. “Our export sales, which have been a source of strength, very probably will slow,” said Bernanke, adding consumer spending and business investment remained weak. Read The Full Story Editorial: Downward Spiral 2008-10-15 15:43:38 Intellpuke: This editorial appeared in the New York Times edition for Tuesday, October 14, 2008. After years of denial and negligence, President Bush and his aides are finally waking up to the desperate mess they’ve made in Afghanistan. They have little choice, since the alarms are coming from all corners. In a rare moment of agreement, America’s 16 intelligence agencies are warning that Afghanistan is on a dangerous “downward spiral.” Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, is publicly predicting that next year will be an even “tougher year.” As the New York Times reported last week, a draft intelligence report blames three problems for the breakdown in central authority and the Taliban’s rising power: rampant corruption, a booming heroin trade and increasingly sophisticated attacks from militants based across the border in Pakistan. Unless all three are addressed quickly, the war in Afghanistan could be lost. Under pressure from the United States and other NATO governments, Afghanistan’s president, Hamid Karzai, appointed a new interior minister over the weekend who will be charged with cleaning up and strengthening the country’s police force. Mr. Karzai now must cut all ties with corrupt officials. He must take a hard and credible look at allegations that his brother may be involved in the heroin trade that is pouring $100 million annually into the Taliban’s coffers. Read The Full Story Stocks Fall As Retail Sales Show Steep Drop 2008-10-15 14:39:38 The Dow slides almost 375 points after the government reports retail sales slumped 1.2 percent. The new data may herald the problems facing the market in coming months. Monday's history-making stock market rally faded further into the background Wednesday as share prices tumbled after grim retail-sales data stoked concern that a punishing recession may be looming. The Dow Jones industrial average fell almost 375 points after the government reported that retail sales slumped 1.2% in September, far worse than the 0.7% that economists had expected. Even as fears about the financial system quieted following the government's plan to inject capital directly into banks, the retail data demonstrated the difficulty that stocks may face in coming months as they confront what is likely to be a torrent of depressing economic news. Read The Full Story The Sloan Digital Sky Surveys 3-D Guide To The Universe 2008-10-15 14:39:08 A remarkable model brings a sense of order to the universe, allowing observers to navigate it as if by rocket ship. It's fair to say that Dan Long has seen more of the universe than anyone but God. Month after month, year after year, Long has sat in a windowless room atop a windy mountain peak, watching the heavens scroll by on 12 monitors connected to the Apache Point Observatory's 98-inch telescope. He saw stars, galaxies and clusters of galaxies banded together like giant herds of animals on an unending savanna roll by. Less frequently, exotic denizens of deep space would pop up - blinding quasars and supernovae, flaring up as brightly on the bank of TV screens as entire galaxies. "You get a sense of how big it is out there," said Long, a genial 46-year-old astronomer. "If you didn't already feel small, this would do it." Read The Full Story Cheney Experiences Abnormal Heart Rhythm 2008-10-15 14:38:25 Vice President Dick Cheney experienced an abnormal heart beat this morning, went to the White House physician and scheduled a hospital visit to "restore his normal rhythm." For the 67-year-old Cheney, who canceled a campaign event he was to attend later Wednesday in Illinois, it will be the second time in less than a year that he will have the cardiological procedure. The vice president's office said that after experiencing a problem, Cheney saw the White House physician. It was discovered there that he was experiencing a recurrence of atrial fibrillation, an abnormal rhythm involving the upper chambers of the heart, said Megan Mitchell, a Cheney spokeswoman. As a result, Cheney was scheduled to go to George Washington University Hospital in the afternoon for an outpatient procedure - an electrical shock - to restore his normal rhythm, said Mitchell. Cheney was remaining at the White House until time for the procedure, and participated in regular morning briefings with President Bush among other duties. Read The Full Story Harper Returned To Power As Canadian Prime Minister 2008-10-15 14:38:01 Canadian Prime Minister Stephen Harper was returned to power in national elections Tuesday, strengthening his Conservative Party's position in Parliament but still falling just short of an absolute majority. The result seemed to guarantee another period of political instability for Canada, and it made a new election likely before the incoming government's four-year term is up. Harper has led a minority government since 2006, relying on votes from opposition parties to pass legislation. Declaring Parliament deadlocked and dysfunctional, he called this snap election a year ahead of schedule, hoping for a majority. Harper was also concerned that waiting until after the U.S. elections might prompt Canadians to put a more compatible Liberal Party government into power if Americans produced a Democratic Party landslide. With 95 percent of precincts reporting, Harper was on track to win 17 extra seats in Parliament, according to the country's election agency. Most of those seats came from an unexpectedly strong showing in Ontario, including Toronto. Elections Canada reported Wednesday morning that the Conservatives appeared headed to Parliament with at least 144 seats, up from 127 when the last Parliament was dissolved in September. A party needs 155 seats for a majority. Read The Full Story CIA Tactics Endorsed In Secret White House Memos 2008-10-15 03:52:21 The Bush administration issued a pair of secret memos to the CIA in 2003 and 2004 that explicitly endorsed the agency's use of interrogation techniques such as waterboarding against al-Qaeda suspects - documents prompted by worries among intelligence officials about a possible backlash if details of the program became public. The classified memos, which have not been previously disclosed, were requested by then-CIA Director George J. Tenet more than a year after the start of the secret interrogations, according to four administration and intelligence officials familiar with the documents. Although Justice Department lawyers, beginning in 2002, had signed off on the agency's interrogation methods, senior CIA officials were troubled that White House policymakers had never endorsed the program in writing. The memos were the first - and, for years, the only - tangible expressions of the administration's consent for the CIA's use of harsh measures to extract information from captured al-Qaeda leaders, said the sources. As early as the spring of 2002, several White House officials, including then-national security adviser Condoleezza Rice and Vice President Cheny, were given individual briefings by Tenet and his deputies, the officials said. Rice, in a statement to congressional investigators last month, confirmed the briefings and acknowledged that the CIA director had pressed the White House for "policy approval." The repeated requests for a paper trail reflected growing worries within the CIA that the administration might later distance itself from key decisions about the handling of captured al-Qaeda leaders, former intelligence officials said. The concerns grew more pronounced after the revelations of mistreatment of detainees at the Abu Ghraib prison in Iraq, and further still as tensions grew between the administration and its intelligence advisers over the conduct of the Iraq war. Read The Full Story Buckley Endorses Obama, Resigns From National Review 2008-10-15 03:51:51 Christopher Buckley, the son of conservative icon William F. Buckley, said Tuesday he's resigned from the conservative National Review days after endorsing Barack Obama's White House bid, among the most powerful symbols yet of the conservative discontent expressed this election cycle. In an online column, Buckley said he had decided to offer his resignation from the magazine his father founded after hundreds of readers and some National Review colleagues expressed outrage he was backing the Illinois senator. "While I regret this development, I am not in mourning, for I no longer have any clear idea what, exactly, the modern conservative movement stands for," Buckley wrote. "Eight years of 'conservative' government has brought us a doubled national debt, ruinous expansion of entitlement programs, bridges to nowhere, poster boy Jack Abramoff and an ill-premised, ill-waged war conducted by politicians of breathtaking arrogance. As a sideshow, it brought us a truly obscene attempt at federal intervention in the Terry Schiavo case," he also wrote. The resignation comes four days after Buckley formally endorsed Obama on the Website The Daily Beast, writing the presidential campaign had made John McCain "inauthentic," and Obama appeared to have a "first-class temperament and first-class intellect." Read The Full Story	Home Prices Likely To Continue Falling Through Late 2009 2008-10-16 03:54:54 The American housing market, where the global economic crisis began, is far from hitting bottom. Home prices across much of the country are likely to fall through late 2009, economists say, and in some markets the trend could last even longer depending on the severity of the anticipated recession. In hard-hit areas like California, Florida and Arizona, the grim calculus is the same: More and more homes are going up for sale, but fewer and fewer people are willing or able to buy them. Adding to the worries nationwide are rising unemployment, falling wages and escalating mortgage rates - all of which will reduce the already diminished pool of would-be buyers. “The No. 1 thing that drives housing values is incomes,” said Todd Sinai, an associate professor of real estate at the Wharton School at the University of Pennsylvania. “When incomes fall, demand for housing falls.” Despite the government’s move to bolster the banking industry, home loan rates rose again on Tuesday, reflecting concern that the Treasury will borrow heavily to finance the rescue. Read The Full Story Switzerland Pumps Billions Into Banks Rescue Plan 2008-10-16 03:54:14 The Swiss government says it will help banking giant UBS raise billions of dollars in new capital. The government says the measure is part of a wider package to support the country's banking system. It includes lending UBS up to 54 billion Swiss francs (US$47.23 billion) so that it can part with bad securities. UBS has suffered losses and writedowns totaling about 45 billion francs (US$40 billion) over the past year. Read The Full Story U.S. Retail Sales Fall 1.2 Percent In September 2008-10-15 15:43:48 Even as the federal government and its counterparts around the world began to introduce their financial bailout plans, more signs emerged on Wednesday that the economic downturn had taken a darker turn. Retail sales fell sharply in September as consumers shunned department stores, auto showrooms and shopping malls, ratcheting back spending for a third consecutive month. Last month’s 1.2 percent decline in retail sales was the sharpest drop in years, and it came in the heart of the back-to-school shopping season, traditionally the busiest time of the year for retailers outside of the December holidays. “There is almost nothing positive to say about these figures,” Rob Carnell, an economist at ING Bank, wrote in a note. Stocks on Wall Street were sharply lower Wednesday. The Dow Jones industrial average was down almost 500 points, as investors shifted their focus to the economic problems that could spell the start of a deeper phase of the slowdown. Many people fear that corporations - and by extension their workers and shareholders - will face harder times in the months ahead. Read The Full Story U.S. Infant Death Rate Higher Than 28 Other Nations 2008-10-15 15:43:29 Infant deaths in the United States declined 2 percent in 2006, government researchers reported Wednesday, but the rate still remains well above that of most industrialized countries and is one of many indicators suggesting that Americans pay more but get less from their health care system. Infant mortality has long been considered one of the most important indicators of the health of a nation and the quality of its medical system. In 1960, the United States ranked 12th lowest in the world, but by 2004, the latest year for which comparisons were issued by the Centers for Disease Control and Prevention, that ranking had dropped to 29th lowest. This international gap has widened even though the United States devotes a far greater share of its national wealth to health care than other countries. In 2006, Americans spent $6,714 per capita on health - more than twice the average of other industrialized countries. Some blame cultural issues like obesity and drug use. Others say that the nation’s decentralized health care system is failing, and some researchers point to troubling trends in preterm births and Caesarean deliveries. Many agree, however, that the data are a major national concern. More than 28,000 infants under the age of 1 die each year in the United States. Read The Full Story The Crash: Risk And Regulation, What Went Wrong 2008-10-15 14:39:24 A decade ago, long before the financial calamity now sweeping the world, the federal government's economic brain trust heard a clarion warning and declared in unison: You're wrong. The meeting of the President's Working Group on Financial Markets on an April day in 1998 brought together Federal Reserve Chairman Alan Greespan, Treasury Secretary Robert E. Rubin and Securities and Exchange Commission Chairman Arthur Levitt, Jr. - all Wall Street legends, all opponents to varying degrees of tighter regulation of the financial system that had earned them wealth and power. Their adversary, although also a member of the Working Group, did not belong to their club. Brooksley E. Born, the 57-year-old head of the Commodity Futures Trading Commission, had earned a reputation as a steely, formidable litigator at a high-powered Washington law firm. She had grown used to being the only woman in a room full of men. She didn't like to be pushed around. Now, in the Treasury Department's stately, wood-paneled conference room, she was being pushed hard. Greenspan, Rubin and Levitt had reacted with alarm at Born's persistent interest in a fast-growing corner of the financial markets known as derivatives, so called because they derive their value from something else, such as bonds or currency rates. Setting the jargon aside, derivatives are both a cushion and a gamble - deals that investment companies and banks arrange to manage the risk of their holdings, while trying to turn a profit at the same time. Read The Full Story Even The Swiss Are Uneasy Over Banking Crisis 2008-10-15 14:38:53 Of all the places in the world, this was supposed to be the safest to stash your wealth during times of calamity, war and financial panic. Yet here, in the heart of Zurich's financial district, anxious Swiss investors have been lining up to watch the stock tickers in front of the headquarters of UBS, a financial behemoth that has written off a stunning $43 billion in loser investments since 2007, more than any other bank in Europe. "The idea that this could happen in Switzerland is unbelievable," said Klaus Stoeckli, 55, a food-products salesman who has withdrawn about $90,000 in investments from UBS, worried that its storied vaults might not be able to protect his money from the global credit crisis. UBS executives say the bank is not in danger of failure. It has cut 7,000 jobs worldwide and is still trying to unload billions of dollars' worth of risky securities. But the bank has moved aggressively since December to reinforce its balance sheet with $25 billion in fresh private capital. It announced this month that it expects to report a small profit for the third quarter. But the scare has forced Switzerland for the first time to contemplate the disaster that would result if one of its champion banks failed. It's been a shocking exercise for a country that has long cultivated a reputation for unsurpassed security - and secrecy - in its banking industry. Read The Full Story Nancy Reagan Hospitalized With Broken Pelvis 2008-10-15 14:38:15 Former first lady Nancy Reagan broke her pelvis and has been admitted to the hospital, her spokeswoman said in a statement this morning. Reagan, 87, fell last week at her home in Los Angeles and went to the Ronald Reagan UCLA Medical Center on Monday for tests after "experiencing persistent pain," the statement said. Her recovery time is expected to last six to eight weeks, and will include physical therapy and a modified schedule. Reagan is expected to remain at the hospital for "a few days" until doctors are satisfied with her progress, spokeswoman Joanne Drake said in the statement. Read The Full Story Smaller U.S. Banks Resist Federal Cash Infusion, But May Be Forced To Take It 2008-10-15 03:52:33 Community banking executives around the country responded with anger Tuesday to the Bush administration's strategy of investing $250 billion in financial firms, saying they don't need the money, resent the intrusion and feel it's unfair to rescue companies from their own mistakes. Yet regulators said some banks will be pressed to take the taxpayer dollars anyway. Others banks judged too sick to save will be allowed to fail. The government also said Tuesday that it will guarantee up to $1.4 trillion of private investment in banks. The combination of public and private investment is intended to refill coffers emptied by losses on real estate lending. With the additional money, the government expects, banks would be able to start making additional loans, boosting the economy. President Bush, in introducing the plan, described the interventions as "limited and temporary." "These measures are not intended to take over the free market but to preserve it," said Bush. On Capitol Hill, lawmakers from both parties praised the plan and scrambled to take credit for writing provisions into the law passed almost two weeks ago that allowed the government to switch from buying bad loans to buying ownership stakes in banks. Read The Full Story Commentary: Buckle Up, We Haven't Reached Bottom Yet 2008-10-15 03:52:08 Intellpuke: This commentary was written by Washington Post Business Columnist Steven Pearlstein and appeared in the Post edition for Wednesday, October 15, 2008. In the wake of an unprecedented, coordinated effort by governments around the world, the global financial meltdown has been contained, at least for the moment. Amazing what you can accomplish with a mere $2 trillion! If we're lucky, the panic phase of this crisis may be over - the hoarding of cash, the tidal waves of forced selling and indiscriminate liquidation. As the various initiatives are put in place over the coming weeks, credit should begin to flow more freely again through the financial system and out to the wider economy. There is no guarantee that the panic won't return, but certainly there is nothing that makes it inevitable. What is significant is that governments have now established that they are willing and able to do whatever is necessary to prevent the financial system from spinning out of control, which is crucial to putting a floor under investor and consumer confidence. Do not confuse this moment of calm with a stock market bottom or a sign that a serious recession has been avoided. We are in a bear market and will be for some time. That doesn't mean that you can't have good days or even long strings of good days - what traders refer to as bear market rallies. But for a bear market to become a bull market, there needs to be some evidence that corporate profits have bottomed out and are about to take off again in response to a pickup in the economy - and at this point we're a long way from that. Read The Full Story
Original materials on this site © Free Internet Press. Any mirrored or quoted materials © their respective authors, publications, or outlets, as shown on their publication, indicated by the link in the news story. Original Free Internet Press materials may be copied and/or republished without modification, provided a link to http://FreeInternetPress.com is given in the story, or proper credit is given. Newsletter options may be changed in your preferences on http://freeinternetpress.com Please email editor@freeinternetpress.com there are any questions. XML/RSS/RDF Newsfeed Syndication: http://freeinternetpress.com/rss.php