Congress’s agreement over the government bailout caused stocks to soar on Thursday. According to Investor’s Business Daily, “At 2:44 p.m. EDT, the S&P 500 and NYSE composite climbed 2% each. That’s down from 2.9% and 2.7% respectively, at session highs. The Dow gained 1.9% and Nasdaq 1.6%.”
Washington Mutual Inc. is struggling to find buyers as one of the companies hit hardest by the banking crisis. Banks such as JPMorgan Chase & Co. have not yet extended an offer to WaMu, and sources say that WaMu has approached Carlyle Group and Blackstone Group LP. However, “A WaMu deal is likely frozen until the bailout gets worked out,'' said Steven Kaplan, a finance professor at the University of Chicago Graduate School of Business.
President George W. Bush addressed the country last night to explain the state of the economy and lay out his $700 billion Wall Street bailout plan. He warned of “a long and painful recession” if the country didn’t act, and he also invited presidential candidates Barack Obama and John McCain to a meeting to discuss the crisis.
Warren Buffett’s decision to invest $5 billion in investment-bank-turned-holding-company Goldman Sachs reveals some of his opinions on the outlook of the financial crisis. According to The Wall Street Journal, “At a minimum, he regards Goldman as a survivor, although the firm’s profits could be pinched as it adjusts to life as a banking holding company, taking fewer risks and facing heightened regulation.” He has also expressed his optimism in the U.S. government’s bailout plan.
London is “turning against” the estimated 980 hedge funds that exist in Britain, in the belief that they may have had a hand in the current financial troubles. Some have called for more oversight of the hedge fun industry in Britain, which boasts about $450 billion.
CNN Money reports, “General Electric (GE) is the latest levered-up financial company to hit the wall. The Fairfield, Conn., conglomerate guided to weaker-than-expected earnings for the third quarter and year, citing the ‘unprecedented weakness and volatility in the financial services markets’ in which it earns much of its profit.”
The Pentagon says that Pakistan fired upon two U.S. military aircraft today in Afghanistan. The helicopters were reportedly not hit and they did not return fire. “A Pakistani military spokesman said the helicopters had crossed the border into Pakistani territory, while Pakistan’s president, Asif Ali Zardari, denied troops had shot at the helicopters, insisting that only warning flares had been fired,” according to Reuters.
South Africa’s Parliament elected anti-apartheid activist Kgalema Motlanthe as president on Thursday. “Motlanthe is expected to step aside after elections next year, when [Jacob] Zuma was expected to become president.”
More countries are removing contaminated Chinese products from their stores. Australia, New Zealand and India are some of the recent nations to take action. The decision to pull Chinese products comes in light of the tainted milk revelations, and now some countries are pulling “everything from candy to biscuits.”
Finnish investigators are looking into a possible connection between Tuesday’s school shooting, in which 10 people and the shooter died, and the incident last year in which an 18-year-old shot himself after firing on 8 others people. “Investigators say the two killers had bought their guns in Jokela, possibly even at the same shop. They also could have been in contact with each other,” the BBC reports.
Zimbabwe President Robert Mugabe will speak at the UN General Assembly today. In a pre-speech interview, the president claimed that, contrary to news reports, his power-sharing deal with rival Morgan Tsvangirai is not about to collapse, and that he is looking for the West to diminish its sanctions against his country.
North Korea barred UN weapons inspectors yesterday from Yongbyon, a former weapons-grade plutonium-producing plant, and the country indicated that it will once again commence production of plutonium, possibly even next week. The move by North Korea puts President Bush’s denuclearization deal in serious jeopardy.
The House and the Senate have both come to an agreement on the outline of the $700 government bailout plan. In a meeting that lasted almost three hours, they made some revisions to the original rescue plan; the revised plan will be presented to the Treasury.
Ariz. Sen. John McCain announced yesterday that he would halt his campaign to work on the financial crisis and the government bailout plan in Washington. Ill. Sen. Barack Obama rejected McCain’s proposal to postpone Friday’s scheduled debate, however, saying that it is now “more important than ever” for voters to understand the candidates’ views.
The federal government and the presidential campaigns are considering a plan to keep several top executives at some of the critical executive agencies on board through the first months of a new administration to ensure continuity.
“Eleven children ranging in age from 1 to 17 were left at hospitals Wednesday under Nebraska’s unique safe haven law, which allows caregivers to abandon youngsters up to age 19 without fear of prosecution,” according to the Associated Press.
The Chicago Tribune writes: “Less than 24 hours after passing major ethics legislation aimed at Gov. Rod Blagojevich, the Illinois Senate on Tuesday overwhelmingly approved a package backed by the governor that would put some of the same restrictions on lawmakers. Blagojevich and his chief legislative ally, Senate President Emil Jones (D-Chicago), said the legislation would close loopholes in the just-passed law that bans campaign donations to statewide officeholders from those who have or are seeking state contracts totaling more than $50,000.”
“Attorneys general from 13 states on Wednesday protested a proposed Bush administration rule that would give stronger job protections to doctors and other health care workers who refuse to participate in abortions because of religious or moral objections," according to the Associated Press.
“Calling it a necessary step to help bridge an expected $1-billion budget gap next year, the Metropolitan Transportation Authority narrowly voted Wednesday to revoke thousands of free E-ZPass privileges from nearly 100 public agencies … despite criticism that the measure was a petty tactic to squeeze money out of New York City and the state,” according to Newsday.
Time magazine writes: “David Chameides is not your average American. For one thing, the TV cameraman owns two Emmy awards—how many do you have? But more importantly, while the average American throws out around 1,700 lbs. of trash annually, for the past year Chameides has thrown out absolutely nothing. A deep green by nature—he also runs a website called Sustainable Dave—beginning in December Chameides decides he would keep all the garbage he created, at home and on the road, in his house. ‘We have the concept of throwing something away, but in reality, we’re just tossing it over our shoulder and forgetting about it,’ says Chameides. ‘It wouldn’t be so funny if it was really just in your backyard.’”
The Detroit Lions fired Matt Millen as team president and CEO yesterday, after years of “Fire Millen” chants from fans; the “Lions were an NFL-worst 31-84 since 2001 with Millen in charge.” Lions vice chairman Bill Ford, the son of the team’s owner, had said earlier this week that he would make major changes if he were in charge. His father, William Clay Ford, agreed on Wednesday.
The New York Mets fell into a tie with the Milwaukee Brewers for the National League Wild Card spot last night after a stunning, 10th-inning loss to the Chicago Cubs in which the Mets blew several chances to score late in the game.
“Nicole Kidman has credited a waterfall with bringing about a flurry of pregnancies—including her own—on the set of one of her films, Australia,” according to the BBC. The actress said seven babies had been conceived during production of the film in a small town in Australia’s outback.”
David Blaine completed his “dive of death” last night in New York’s Central Park, after he had allegedly hung upside down for 60 hours. The stunt got mixed reviews, however, as the magician “stopped for regular breaks on his feet—as often as once an hour—to drink liquids, urinate and undergo medical checks.”