Economy Watch - Coverage of the financial crisis from The Washington Post and around the Web - November 2, 2008

Obama: Extend Unemployment Benefits

Here's a more detailed look at what President-elect Obama had to say in his first economic address earlier this afternoon, after meeting with his economic brain rust. First, here's the text and video of his speech. Second, here are some...

By Frank Ahrens | November 7, 2008; 4:01 PM ET | Permalink | Comments (0)
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Obama: I Want a Stimulus Package Now

In his first address as president-elect, Sen. Barack Obama (D-Ill.) talked about the stumbling economy and made the following key points: - He wants Congress to convene a lame-duck session and pass a second stimulus package right away. "I want...

By Frank Ahrens | November 7, 2008; 2:01 PM ET | Permalink | Comments (0)
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Atlanta Fed Head: Bad Times Through First Half of 2009

Don't expect an economic turnaround until at least the second half of 2009, the head of the Federal Reserve Bank of Atlanta said today. “Recent data indicate that the national economy is in recession,” Dennis Lockhart, president of the Atlanta...

By Frank Ahrens | November 7, 2008; 1:54 PM ET | Permalink | Comments (0)
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GM's Wagoner: A Solid 'No' To Bankruptcy

Rick Wagoner, chief executive of teetering General Motors, just wrapped up an interview on CNBC following his company's troubling earnings this morning, in which he said the company has "no plans whatsoever" to declare bankruptcy. "We don't think anything positive...

By Frank Ahrens | November 7, 2008; 1:09 PM ET | Permalink | Comments (2)
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GM Teeters on Brink as Earnings Worse Than Expected

Troubled General Motors just released its third-quarter earnings moments ago, and they're much worse than analysts expected. Over the three-month quarter, GM burned through $6.9 billion in cash, a rate of $2.3 billion per month. By comparison, GM burned through...

By Frank Ahrens | November 7, 2008; 11:45 AM ET | Permalink | Comments (0)
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AIG: Give Us a New Deal

For the past week, advisers close to insurance giant AIG have been pushing the government to renegotiate the rescue of the insurance giant, and one proposal has the government guaranteeing the company’s debt, The Post's Carol D. Leonnig reports. The...

By Frank Ahrens | November 7, 2008; 10:42 AM ET | Permalink | Comments (0)
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Dow Shrugs Off Bad News, Jumps Out of Gates

It's hard to imagine Wall Street dealing with more bad news in one morning. And yet, the markets burst out of the gate, all happy-like. Earlier this morning, the Labor Department reported that U.S. unemployment jumped higher than expected and...

By Frank Ahrens | November 7, 2008; 9:17 AM ET | Permalink | Comments (0)
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Obama Address to Wrap Up Big News Day

Here's what to look for today, as the markets close out a pretty bleak week: - At 8:30 a.m., the Labor Department is set to release its October jobs numbers. Economists expect a loss of 200,000 jobs for the month,...

By Frank Ahrens | November 7, 2008; 8:20 AM ET | Permalink | Comments (3)
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Ford Reports Loss; Most Foreign Markets Up

Ford said this morning that it lost $129 million in the third quarter (6 cents a share), compared with a profit of $251 million (13 cents) in the same quarter a year earlier. Revenue was $32.1 billion. The company said...

By Terri Rupar | November 7, 2008; 7:34 AM ET | Permalink | Comments (0)
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Nov. 6, 2008

Regulators must be strong cops on the beat rather than turn a blind eye to reckless lending practices...Markets cannot police themselves." — Sen. Chris Dodd (D-Conn.), Chairman of the Senate Banking committee, Nov. 6...

By washingtonpost.com Editor | November 6, 2008; 7:02 PM ET | Permalink | Comments (2)
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Union Man Bonoir Leads Names Floated For Labor

One of the key elements of any economic recovery in 2009 is job creation. Another is job retention -- figuring out which jobs stay in the U.S. and which go overseas. Which means the Labor Secretary under an Obama administration...

By Frank Ahrens | November 6, 2008; 6:22 PM ET | Permalink | Comments (0)
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Immigrants

Immigrants On October 8, 1936, the 50th birthday of the Statue of Liberty, Roosevelt praises immigrants old and new, saying that their search for peace and freedom transcends class, place of birth and all other considerations. Note: Please upgrade your...

By washingtonpost.com Editor | November 6, 2008; 5:29 PM ET | Permalink | Comments (0)
Categories: FDR's Fireside Chats
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Unemployment Line Barbie: Mattel Cuts 1,000 Jobs

The contraction continues, Episode 235: Toy giant Mattel said today it will cut 1,000 jobs, or about 3 percent of its payroll, through a combination of layoffs, attrition and retirements. The cuts will not mean empty shelves at Christmas, though,...

By Frank Ahrens | November 6, 2008; 4:57 PM ET | Permalink | Comments (0)
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Wall Street Closes Ugly Two Days

So much for the Barack Bounce. Wall Street took its second straight dive today, with losses across the boards, two days after the election of Barack Obama. Early indications show that yesterday and today may be prove to be the...

By Frank Ahrens | November 6, 2008; 4:14 PM ET | Permalink | Comments (0)
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SEC's White Exits, Returns To Law Firm

John W. White, director of the SEC's Division of Corporation Finance, will leave the agency at the end of this year and return to Cravath, Swaine & Moore LLP as a partner, both entities announced today. White joined the SEC...

By Frank Ahrens | November 6, 2008; 3:27 PM ET | Permalink | Comments (0)
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Fidelity to Cut 1,300 Jobs, More Layoffs To Come

The contraction continues: Fidelity Investments said today that it will eliminate about 1,300 jobs this month with more layoffs to come next year. The firm has been hurt by Wall Street declines that have drained mutual fund assets, which in...

By Frank Ahrens | November 6, 2008; 3:25 PM ET | Permalink | Comments (0)
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Dodd to Wall Street: Here Comes the Regulation

Sen. Chris Dodd (D-Conn.) just wrapped up an address to the media, saying that he will maintain his chairmanship of the Senate Banking committee in the new Congress. In his remarks, he laid out a six-point plan to Wall Street,...

By Frank Ahrens | November 6, 2008; 3:16 PM ET | Permalink | Comments (0)
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Big Vehicle Shakeup Coming At GM?

Even as the heads of the (former) Big Three automakers and UAW president Ron Gettelfinger get ready to meet with House Speaker Nancy Pelosi (D-Calif.) and other lawmakers today at around 4 p.m., the former giant of all automakers --...

By Frank Ahrens | November 6, 2008; 3:11 PM ET | Permalink | Comments (0)
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Oberstar to Transportation?

For Transportation secretary in the Obama administration, a name that keeps floating to the top of the list is Rep. James Oberstar (D-Minn.), chairman of the House Transportation Committee and an early Obama supporter. Oberstar has not indicated any interest...

By Frank Ahrens | November 6, 2008; 1:59 PM ET | Permalink | Comments (0)
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CBO's Orszag to White House?

The Post's Lori Montgomery is hearing that one name being talked about to head president-elect Obama's White House Budget Office is Peter Orszag, currently the head of the Congressional Budget Office. Here's a long bio of Orszag. You may recall...

By Frank Ahrens | November 6, 2008; 1:37 PM ET | Permalink | Comments (0)
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Big Three Asking Congress For More Money

The heads of Detroit's (former) Big Three automakers -- GM, Ford and Chrysler -- are set to meet with House Speaker Nancy Pelosi (D-Calif.) and other congressional leaders today at around 4 p.m. What they want: More money. How much...

By Frank Ahrens | November 6, 2008; 12:10 PM ET | Permalink | Comments (0)
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Nov. 6, 2008

The Next Paulson? The New Republic | A thoughtful look at New York Fed President Tim Geithner, a leading candidate for Obama's Treasury secretary, and his relationship with fellow candidate for the job Larry Summers. A China Slump Council...

By washingtonpost.com Editor | November 6, 2008; 11:39 AM ET | Permalink | Comments (0)
Categories: Neil Irwin's Must Reads
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Long-Term Unemployment Hits 25-Year High

The Labor Department reported this morning that the number of Americans drawing long-term unemployment benefits spiked by 122,000 to 3.84 million in late October. It was the highest level since early 1983, when the nation was trying to pull itself...

By Frank Ahrens | November 6, 2008; 11:26 AM ET | Permalink | Comments (0)
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IMF: Global Slowdown Worse Than We Thought

The International Monetary Fund cut its estimate for global growth by .75 of a percentage point today, saying GDP around the world will grow by only 2.2 percent in 2009. The cut is a downward revision since the IMF's most...

By Frank Ahrens | November 6, 2008; 11:11 AM ET | Permalink | Comments (0)
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Dow Opens Weakly

Wall Street sort of wandered aimlessly out of the gates this morning before heading downhill. After the first 30 minutes of trading, the Dow is trading down about 140 points, or about 1.5 percent. The S&P 500 and Nasdaq are...

By Frank Ahrens | November 6, 2008; 10:04 AM ET | Permalink | Comments (0)
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Another Rough Morning Ahead

Following a dismal day on Wall Street yesterday, with the Dow closing down about 5 percent, it has been a rough night and morning for overseas trading. Japan's Nikkei was down 6.5 percent. The FTSE 100 index in London is...

By Michael S. Rosenwald | November 6, 2008; 7:29 AM ET | Permalink | Comments (0)
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Paulson: Way To Go, Obama

Treasury Secretary Hank Paulson just released this statement regarding the president-elect and his transition: "I congratulate Senator Obama on the election and look forward to working with his team to ensure that there is a smooth and effective transition. A...

By Frank Ahrens | November 6, 2008; 1:16 AM ET | Permalink | Comments (0)
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Report: Goldman Begins Cutting 3,200 Jobs

The Associated Press is reporting that Goldman Sachs, alma mater of Treasury Secretary Hank Paulson and bailout manager Neel Kashkari, has begun notifying some 3,200 employees they will be let go. The cuts represent a little less than 10 percent...

By Frank Ahrens | November 5, 2008; 6:22 PM ET | Permalink | Comments (1)
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Candidates For Obama Administration Positions

Post Business reporters have been working their beats, coming up with possible candidates for jobs in the Obama transition and administration. Here's what reporter Sholnn Freeman has found out: Transportation: -- Mortimer L. Downey, who served as No. 2 at...

By Frank Ahrens | November 5, 2008; 5:53 PM ET | Permalink | Comments (36)
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Service Sector Shrinks In October

In yet another sign of the ongoing economic contraction, a key measure of the health of the U.S. service sector took a nosedive last month. The Institute for Supply Management, a trade group of purchasing executives, said today that its...

By Frank Ahrens | November 5, 2008; 2:08 PM ET | Permalink | Comments (1)
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Pelosi Calls (Again) For Lame-Duck Session

House Speaker Nancy Pelosi (D-Calif.) today called again for a lame-duck session of Congress to approve a second economic-stimulus plan aimed at consumers. But a second package likely would not involve sending checks to taxpayers, like the one earlier this...

By Frank Ahrens | November 5, 2008; 1:12 PM ET | Permalink | Comments (0)
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Report: 3 Million Jobs Lost if Detroit's Big Three Fail

The Center for Automotive Research said this morning that if Detroit's (former) Big Three -- GM, Ford and Chrysler -- fail, it will mean the loss of 3 million jobs across the entire auto sector in the first year of...

By Frank Ahrens | November 5, 2008; 11:39 AM ET | Permalink | Comments (4)
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The Economy Obama Gets

Congratulations, President-elect Obama. Here's the economy you inherit: --Your government is beginning perhaps its biggest run of borrowing since the war bond blitz during World War II. The government will sell $55 billion in bonds next week to raise money...

By Frank Ahrens | November 5, 2008; 10:55 AM ET | Permalink | Comments (0)
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Dow Dives At Opening

Are the markets taking a Democratic dip? Or did they get their Obama rally in yesterday and are back to trading on the economy's fundamentals? In the first 20 minutes of trading, Wall Street is down across the board, as...

By Frank Ahrens | November 5, 2008; 9:52 AM ET | Permalink | Comments (0)
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No Post-Election Market Rally for Obama?

Traditionally, the stock market rallies the day after an election, for the simple reason that the market is happy to have a big decision settled. Usually, such rallies aren't huge. But perhaps the market jumped the gun and rallied early...

By Sara Goo | November 5, 2008; 7:31 AM ET | Permalink | Comments (0)
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N.Y. Fed Hires Bears Stearns Risk Manager

The New York Fed recently hired Michael Alix as its senior vice president in bank supervision. He holds an M.B.A. in finance from the prestigious Wharton School of the University of Pennsylvania and a bachelor's in economics from Duke. He...

By Frank Ahrens | November 4, 2008; 5:27 PM ET | Permalink | Comments (0)
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Are Dems Better for Wall Street?

Some on Wall Street fear higher taxes under an Obama presidency. Others think an Obama presidency, if it comes to pass, will be more centrist -- more Clintonian -- because Obama leans on Clinton economic advisers. But what do the...

By Frank Ahrens | November 4, 2008; 3:56 PM ET | Permalink | Comments (0)
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Boeing: Dreamliner 787 Delayed

As predicted in recent weeks by Boeing, the long machinist's at the aerospace company strike will further delay the first test flight of its new Dreamliner 787 jet, the company said moments ago. The Dreamliner, on which Boeing has pegged...

By Frank Ahrens | November 4, 2008; 3:17 PM ET | Permalink | Comments (0)
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Today's Rare Wall Street Rally

Today is a very unusual thing on Wall Street: an Election Day rally. As of about 2 p.m., the Dow was trading up about 280 points, or 3 percent. The S&P 500 was up about 3.5 percent and the Nasdaq...

By Frank Ahrens | November 4, 2008; 2:05 PM ET | Permalink | Comments (0)
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Sept. Factory Orders Plunge

The Commerce Department just reported that U.S. factory orders were down 2.5 percent in September compared with September 2007, a deeper-than-expected drop. That means "smokestack America," as CNBC's Rick Santelli referred to it, is contracting like most other U.S. businesses....

By Frank Ahrens | November 4, 2008; 10:11 AM ET | Permalink | Comments (0)
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Markets Rally at Opening

Wall Street, happy to have the uncertainty of the election soon behind it, zipped right out of the gates this morning with a rally across the board. In the first 15 minutes of trading today, with Sen. Barack Obama (D-Ill.)...

By Frank Ahrens | November 4, 2008; 9:38 AM ET | Permalink | Comments (0)
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Plenty to Watch on Election Day

What will Wall Street be watching today? The House and Senate races. Wall Street seems already to have built in an Obama presidency to prices. What it's unsure about is the Congress -- will the Democrats gain a super-majority in...

By Frank Ahrens | November 4, 2008; 9:00 AM ET | Permalink | Comments (0)
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Global Markets Up on Election Day

Global markets moved slightly higher today just ahead of Election Day in the United States. In Europe, UBS announced a profit in the most recent quarter after a string of consecutive losses, but the company warned that investors continue to...

By Sara Goo | November 4, 2008; 8:31 AM ET | Permalink | Comments (0)
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Taxes: No Laffing Matter

As voters head to the polls today, the economy is probably top of mind. At the heart of the economy is taxation, on individuals and businesses. What kind of tax policies will the next president put in place? Noted conservative...

By Frank Ahrens | November 4, 2008; 6:32 AM ET | Permalink | Comments (0)
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October Auto Sales Worst Since At Least '92

Detroit automakers released their October auto sales figures today, and they are bad. Worse than Toyota, worse than Honda -- probably worse than a company trying to sell dirigibles and canal boats. October GM sales were down 47 percent compared...

By Frank Ahrens | November 3, 2008; 5:09 PM ET | Permalink | Comments (4)
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Nov. 3, 2008

Perhaps the recent mortgage cycle will be remembered as just another failed episode of financial innovation." — Federal Reserve Chairman Ben Bernanke, Oct. 31....

By washingtonpost.com Editor | November 3, 2008; 4:06 PM ET | Permalink | Comments (1)
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Love of Liberty for All

Love of Liberty for All "Liberty is the air that we Americans breathe." At the Harvard tercentenary in September of 1936, Roosevelt reminds the other alums that their love of liberty and truth is a virtue shared with all their...

By washingtonpost.com Editor | November 3, 2008; 3:55 PM ET | Permalink | Comments (0)
Categories: FDR's Fireside Chats
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Wall Street Ponders President Obama

Wall Street has been trying to wrap its head around an Obama presidency and possible Democratic control of Congress. There are two main concerns: Tighter regulation of runaway financial institutions in the wake of the credit crisis and economic policies...

By Frank Ahrens | November 3, 2008; 3:40 PM ET | Permalink | Comments (1)
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October Ford Sales Crash

Ford reported today that its October sales were down 30 percent in October compared to October of last year, as the auto industry is on pace to report its worst month in 25 years. October sales of Ford SUVs dropped...

By Frank Ahrens | November 3, 2008; 1:00 PM ET | Permalink | Comments (0)
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Construction Spending Not As Bad As Expected

It passes for good news these days: The Commerce Department said that construction spending fell by .3 percent September, less than the .8 percent expected. Housing provided no relief -- construction dropped 1.3 percent; it has fallen every month but...

By Frank Ahrens | November 3, 2008; 12:44 PM ET | Permalink | Comments (0)
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Network News

Economy Watch: November 2, 2008 - November 8, 2008