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Thursday, December 18, 2008

Free Internet Press Newsletter - Thursday December 18 2008 - (813)

Thursday December 18 2008 edition
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Poll: 63 Percent Of Americans Already Hurt By Economic Downturn
2008-12-17 16:59:35

The deepening recession has eroded the financial standing and optimism of a broad swath of Americans, nearly two-thirds of whom say that they have been hurt by the downturn and that the country has slipped into long-term economic decline.

A new Washington Post-ABC News poll also found that a rapidly increasing share of Americans - 66 percent, up from just over half a year ago - are worried about maintaining their standard of living. Nearly two in 10 said they or someone living in their household had lost a job in the past few months, and more than a quarter said they had their pay or hours reduced; and 15 percent said that at some point in the past year they fell behind on their rent or mortgage.

The poll captures the widening fallout from the faltering economy that policymakers are struggling to contain. The Federal Reserve Tuesdaycut its target for the federal funds rate to a range of zero to 0.25 percent, the lowest on record.

"They're getting to be about as low as they can go," President-elect Barack Obama said at a news conference yesterday before meeting with members of his economic team. "And although the Fed is still going to have more tools available to it, it is critical that the other branches of government step up. And that's why the economic recovery plan is so absolutely critical."

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U.S. HUD Chief Calls Mortgage Aid A Failure, Blames Congress
2008-12-17 16:59:12

U.S. Secretary of Housing and Urban Development (HUD) Steve Preston said the centerpiece of the federal government's effort to help struggling homeowners has been a failure and he's blaming Congress.

The three-year program was supposed to help 400,000 borrowers avoid foreclosure. But it has attracted only 312 applications since its October launch because it is too expensive and onerous for lenders and borrowers alike, Preston said in an interview.

"What most people don't understand is that this program was designed to the detail by Congress," Preston said. "Congress dotted the i's and crossed the t's for us, and unfortunately it has made this program tough to use."

The criticism comes as Congress prepares to weigh in with further plans to help distressed borrowers facing foreclosures, which are at the root of the financial meltdown. This week, House Speaker Nancy Pelosi (D-California) demanded that Treasury Department use some of the money from the $700 billion emergency rescue package to help at-risk homeowners.

One of several federal and state foreclosure prevention initiatives facing difficulties, HUD's Hope for Homeowners program has been especially hamstrung. For instance, a program launched by the Federal Deposit Insurance Corp. on behalf of IndyMac Bank customers has modified more than 3,500 mortgages in two months of operation.

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Race On To Expand Web Access
2008-12-17 16:58:36

President-elect Barack Obama's call to bring high-speed Internet to all Americans has set off a scramble among service providers for a piece of the action.

Building out networks to rural and under-served urban areas - with possible help from the economic stimulus plan being crafted by Congress - could create hundreds of thousands of jobs and enrich telecom, wireless and cable companies whose businesses have suffered as households tighten spending.

Within the well-funded world of telecom lobbying, even fierce opponents are in rare agreement that Obama's plans to expand networks would boost the economy with jobs digging trenches for fiber lines and designing complex networks. But the interest groups differ on how that ambition should be executed, and that has sparked a race that one lobbyist calls a "telecom takefest."

For the Telecommunications Industry Association, tax breaks are a priority. In a letter to House Leader Nancy Pelosi  (D-California) last week, the trade group asked for tax breaks to build broadband infrastructure and $25 billion in grants to companies that build networks in hard-to-reach areas.

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OPEC Agrees To Cut Daily Oil Production
2008-12-17 16:58:05

The Organization of the Petroleum Exporting Countries Wednesday agreed to cut production by 2.2 million barrels a day, slightly more than expected, and called on oil producers outside the group to join in output cuts in a bid to halt the five-month slide in world oil prices.

Prices continued to slide immediately after the announcement, as traders appeared to bet that the production cuts would not be big enough to offset the decline in demand resulting from the slumping world economy. Shortly after noon, the price for January delivery fell $2.50 a barrel, to $41.10 on the New York Mercantile Exchange.

Nonetheless, many oil analysts said that the OPEC cut would ultimately prop up prices. The cuts are scheduled to go into effect Jan. 1.

"It's a big cut. These guys are taking the situation very seriously," said Roger Diwan, a partner at PFC Energy, a Washington consulting firm. "Right now the price is falling. But let them cut, and I think it will stabilize prices."

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Editorial: Fixing Interior
2008-12-17 16:57:25
Intellpuke: This editorial appeared in the New York Times edition for Tuesday, December 16, 2008.

Senator Ken Salazar, the Colorado Democrat who is President-elect Barack Obama’s choice for secretary of the interior, will inherit a department riddled with incompetence and corruption, captive to industries it is supposed to regulate and far more interested in exploiting public resources than conserving them.

No cabinet post is as critical to the integrity of the nation’s parks, its open spaces and its animal species. Mr. Obama, and his environmental adviser in chief, Carol Browner, must be prepared to offer Mr. Salazar full support, especially in fending off the ranchers and the oil, gas, mining and other special interests who have always found the Interior Department to be a soft target, never more so than in the Bush administration.

Mr. Salazar’s most urgent task will be to remove the influence of politics and ideology from decisions that are best left to science.

Just as Mr. Salazar’s name was surfacing for the job, Earl Devaney, currently the department’s inspector general, reported to Congress that on 15 separate occasions the department’s political appointees had weakened protections for endangered species against the advice of the agency’s scientists, whose work they either ignored or distorted.

This sort of meddling has become standard operating procedure. Julie MacDonald, a former deputy assistant secretary for fish and wildlife and parks, resigned last year after an earlier report found that she had run roughshod over agency scientists and violated federal rules by giving internal documents to industry lobbyists.

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Iraqi Parliament In Tumult Over Shoe Hurling
2008-12-17 16:56:37
A session of the Iraqi Parliament erupted in uproar on Wednesday as lawmakers clashed over how to respond to the continuing detention of an Iraqi television reporter who threw his shoes at President Bush during a Baghdad news conference earlier this week, said people attending the parliamentary meeting.

As Parliament began to discuss legislation on the withdrawal from Iraq of armed forces from nations other than the United States, a group of lawmakers demanded that the legislature instead take up the issue of the detained journalist, Muntader al-Zaidi, 29. After his shoes narrowly missed Bush’s head at the news conference on Sunday, Zaidi was subdued by a fellow journalist and then beaten by members of the prime minister’s security detail, who hauled him out of the room. Zaidi’s cries could be heard from a nearby room.

The legislative session became so tumultuous that it prompted the speaker of Parliament, Mahmoud al-Mashhadani, to announce his resignation, according to the Associated Press. A spokesman for Mashhadani, Jabar al-Mashhadani, refused to confirm whether the speaker had tendered his resignation, although he would not deny it.

Some in Parliament say the government should release Zaidi immediately, while others say the judiciary should decide his fate.

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Study: Heat, Cold, And Thunderstorms More Dangerous Than Earthquakes And Hurricanes
2008-12-17 16:37:20
Heat is more likely to kill an American than an earthquake, and thunderstorms kill more people than hurricanes do, according to a U.S. "death map" published on Tuesday. Researchers who compiled the county-by-county look at what natural disasters kill Americans said they hope their study will help emergency preparedness officials plan better. Heat and drought caused 19.6 percent of total deaths from natural hazards, with summer thunderstorms causing 18.8 percent and winter weather causing 18.1 percent, the team at the University of South Carolina found. Earthquakes, wildfires and hurricanes combined were responsible for fewer than 5 percent of all hazard deaths. Writing in BioMed Central's International Journal of Health Geographics, they said they hoped to dispel some myths about what the biggest threats to life and limb are.
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Wall Street Ends Lower A Day After Rate Cut
2008-12-17 16:59:25

Stock markets treaded water for most of Wednesday, before closing lower.

Investors with an appetite for safety rushed onto the far end of the yield curve, pushing Treasury prices even higher as they faced the prospect of zero-percent interest rates for the foreseeable future. Investors flocked to 10- and 30-year Treasuries, whose prices have boomed this year as the broader stock market tumbled by more than a third.

The yield on the benchmark 10-year Treasury, which falls as prices rise, fell below 2.10 percent to its lowest point in four decades, before rebounding slightly Wednesday afternoon.

“You’ve seen just a remarkable run-up in longer dated Treasuries,” said Chris Lafakis, an economist at Moody's .

Meanwhile, stock prices hovered in negative territory Wednesday afternoon after soaring a day earlier, in response to the Federal Reserve's decision to cut interest rates to historic lows of zero to 0.25 percent.

The Dow Jones industrial average eventually closed down 99.80 points, to 8,824.24, and the broader Standard & Poor’s index of 500 stocks fell 8.76 points, less than 1 percent, to 904.42. 

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Impeachment Inquiry Of Illinois Governor Hits Bumps
2008-12-17 16:58:57
An inquiry here into the impeachment of Gov. Rod R. Blagojevich met resistance on Tuesday, with federal prosecutors indicating that it might interfere with the criminal case against him and a lawyer for Blagojevich requesting that the proceedings not move forward without the lawyer in attendance.

Members of the newly appointed House impeachment committee met for less than two hours before adjourning until Wednesday so the lawyer, Ed Genson, could arrive from Chicago and an agreement with prosecutors could be considered about how to proceed.

“We’re prepared, we’re here,” said Representative Barbara Flynn Currie, a Chicago Democrat who is the chairwoman of the committee. “We’ll be ready to have at it all the way through, but whether as a matter of practical logistics -  whether we can - depends very much on when we hear from the United States attorney.”

Patrick J. Fitzgerald, the United States attorney who a week ago charged Blagojevich with conspiracy to commit wire and mail fraud and bribery, has expressed reservations about the prospect that lawmakers may hear testimony from witnesses in the criminal case before a jury does, said Currie.

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Morgan Stanley Post $2.36 Billion Quarterly Loss
2008-12-17 16:58:23
Morgan Stanley reported a fourth-quarter loss of $2.36 billion - or $2.34 a share - on Wednesday, as the bank remained battered by old investments.

The quarter was Morgan’s first loss this year, though it did not outweigh the profit earned earlier this year. Morgan reported a full-year profit of $1.59 billion, or $1.54 a share. Revenue in every corner of the bank fell, even when compared with last quarter, showing a deteriorating environment that cut across businesses.

Analysts polled by Thomson Reuters had forecast a loss of 34 cents a share. The loss from continuing operations for the quarter, which does not include Discover, the credit card unit that was spun off, was $2.20 billion, or $2.24 a share.

“I was very disappointed with what Morgan Stanley had to report,” said Ada Lee, an analyst with Sterne Agee. “I just don’t know how this organization got to this point.”

Lee said she was wrong to have issued a positive report on Morgan’s prospects last month. She said she did not appreciate the bank’s continued exposure to toxic assets at the time. The bank’s expenses are bloated, she said, and a turnaround could be years away.

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Madoff Placed Under Home Detention
2008-12-17 16:57:42

Bernard Madoff, the financier accused of one of the biggest frauds in Wall Street history, will remain out on bail but will be placed under home detention and electronic monitoring, a federal judge ordered on Wednesday.

Federal District Judge Gabriel Gorenstein also ordered that Madoff’s wife, Ruth, surrender her passport by noon on Thursday.

In the order, the judge also modified the bail so that Madoff would not need two additional signatures to guarantee the bond, as initially required. Only his wife and his brother Peter, who worked at Madoff’s firm, had signed the guarantee as of Wednesday morning. His two sons, Mark and Andrew, had refused to sign, according to court papers.

Under the new bail package, Madoff and his wife agree to surrender their houses in Montauk, New York, and Palm Beach, Florida, if he flees in exchange for reducing the number of co-signers on his bail from four to two. He also agreed to a curfew of 7 p.m. through 9 a.m.

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Obama Names Colorado Gov. Salazar To Head Interior Dept.
2008-12-17 16:57:13

President-elect Barack Obama Wednesday nominated Sen. Ken Salazar (D-Colo.) as interior secretary and former Iowa governor Tom Vilsack to be secretary of agriculture, adding two centrists with considerable government experience to his nearly complete Cabinet roster.

Salazar, a fifth-generation Coloradan whose family settled in the West before the United States' founding and has ranched and farmed on the same land in the San Luis Valley for more than a century, is better known for brokering deals between warring interests than for outlining an ambitious agenda of conservation. In four years in the Senate, he has pushed to temper energy exploration in the West even as he has backed offshore oil drilling and subsidies for ranchers on public land.

Vilsack, a strong proponent of ethanol who made a brief bid for the presidency in 2007, will lead a sprawling federal bureaucracy charged with overseeing farm subsidies, land conservation, food safety and hunger programs. He has taken a moderate position on the often controversial issue of farm subsidies, siding at times with those favoring a shift of funding in the agriculture budget from traditional subsidies to new kinds of supports for farmers that improve soil and water management.

"Together, they will serve as guardians of the American landscape on which the health of our economy and the well-being of our families so heavily depend," Obama said in introducing Salazar and Vilsack as his latest Cabinet picks. "How we harness our natural resources, from the farmlands of Iowa to the springs of Colorado, will speak not only to our quality of life, but to our economic growth and our energy future."

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Britain's Prime Minister Confirms Troops Will Leave Iraq By June
2008-12-17 16:56:24
British Prime Minister Gordon Brown confirmed Wednesday that British troops would withdraw from Iraq before June, virtually ending the role of the United States' most important coalition ally in Iraq.

"The role of U.K. in Iraq is about to end, and British forces will finish their missions within the first part of 2009; then they will leave the country," Brown said in a joint statement with Iraqi Prime Minister Nouri al-Maliki.

Brown told reporters that the 4,100 British troops still in the country, down from the 46,000 who participated during the U.S.-led invasion in 2003, would end their mission "no later" than May 31. British military officials said a few hundred troops would remain in Iraq beyond that date to train and advise Iraqi forces.

Maliki thanked British troops "for the efforts they have made in getting rid of dictatorship and terrorism. They have made a lot of sacrifices."

The announcement came as two bombs exploded near a Baghdad traffic police station, killing 18 people and injuring 52, police said. The U.S. military said nine people died and 43 were wounded in the attack.

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