Economy Watch - Coverage of the financial crisis from The Washington Post and around the Web - February 1, 2009

Bank Of America's Lewis Opposes $500,000 Executive Pay Cap

UPDATED WITH BAILOUT REPAYMENT ESTIMATE: Ken Lewis, chief executive of embattled Bank of America, said he opposes the $500,000 pay cap for top executives of banks receiving government funds because he's afraid of losing top talent, according to an interview...

By Frank Ahrens | February 6, 2009; 3:20 PM ET | Permalink | Comments (32)
Categories: The Ticker | Tags: Bank of America, Ken Lewis, Paulson
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SEC's Schapiro: 'Mark To Market' Changes May Be Coming

New SEC chairwoman Mary Schapiro said this morning that companies whose balance sheets are burdened with toxic assets they cannot sell may get some relief, as relaxations in the "mark to market" accounting rules are being considered. Schapiro said that...

By Frank Ahrens | February 6, 2009; 10:30 AM ET | Permalink | Comments (1)
Categories: The Ticker | Tags: FASB, Mary Schapiro, mark to market
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Markets Shrug Off Jobs News, Stage Opening Rally

Possibly because we are living in the Era of Diminished Expectations, Wall Street jumped out of the gates following the release this morning of absolutely dismal unemployment news. The government said that employers slashed nearly 600,000 jobs in January, pushing...

By Frank Ahrens | February 6, 2009; 9:51 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: China, Dow Jones, nasdaq, s&p 500
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Bailout Overseer: Treasury Overpaid By Nearly $80 Billion

UPDATED WITH FURTHER COMMENTS FROM BAILOUT OVERSEER: Harvard econ Prof. Elizabeth Warren, testifying before a Senate Banking committee hearing underway now to judge the performance of the $700 billion bailout, said that the Treasury overpaid by $78 billion in its...

By Frank Ahrens | February 5, 2009; 11:41 AM ET | Permalink | Comments (44)
Categories: The Ticker | Tags: Ben Bernanke, Evan Bayh, Paulson, bailout
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Markets Down Slightly At Opening

Wall Street is down but only slightly at the opening, as the markets absorb worse-than-expected jobless claims numbers and declining retails sales, save for one exception -- Wal-Mart. In the first 15 minutes of trading, the Dow is down about...

By Frank Ahrens | February 5, 2009; 9:49 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Dow Jones, nasdaq, s&p 500, unemployment
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Today's Focus: Jobless Claims, Retail, Stimulus

Before the opening bell today, markets will have a lot of information to digest. The weekly jobless claims will be out at 8:30 a.m., giving us a picture into the last week of January and also provide a window into...

By Sara Goo | February 5, 2009; 6:50 AM ET | Permalink | Comments (0)
Categories: The Ticker
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Volcker: $900 Billion Won't Do the Trick

4:51 P.M.: UDPATED WITH VOLCKER PRICING THE RECOVERY: Paul Volcker -- the former Fed chairman and current economic adviser to President Obama -- told lawmakers moments ago that even Obama's $900 billion stimulus plan won't turn around the economy, The...

By Frank Ahrens | February 4, 2009; 4:53 PM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Paul Volcker, hedge funds
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SEC Evasion On Madoff Infuriates Lawmakers

4:24 P.M.: UPDATED WITH MADOFF INVESTOR RECOVERY: Investors are starting to get back a little bit of what Bernie Madoff allegedly stole in his confessed $50 billion Ponzi scheme. Irving Picard, the trustee liquidating Madoff's investment firm, told a federal...

By Frank Ahrens | February 4, 2009; 2:31 PM ET | Permalink | Comments (35)
Categories: The Ticker | Tags: Harry Markopolos, Madoff, SEC
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Obama Announces Symbolic Cap On Executive Pay

President Obama and Treasury Secretary Tim Geithner moments ago announced a largely symbolic cap on executive compensation for a handful of the companies receiving federal bailout money. It does not apply to the 300-plus companies that already received federal help....

By Frank Ahrens | February 4, 2009; 11:58 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: AIG, Bank of America, Citigroup, Geither, Obama
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Panasonic Cutting 15,000 Jobs

Panasonic said this morning that it will cut 15,000 jobs and close 27 plants worldwide, following the company's first quarterly loss in six years, as the Japanese consumer electronics maker struggles with the global recession and a rising yen. Panasonic...

By Frank Ahrens | February 4, 2009; 10:29 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Japan, Panasonic, Sony, recession
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Wall Street Flat at Opening

Wall Street had an indifferent opening this morning, as it digested poor corporate earnings and watched as Republican senators lined up to block President Obama's $900 billion stimulus plan. In the first 15 minutes of trading, the Dow is up...

By Frank Ahrens | February 4, 2009; 9:53 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Dow Jones, Obama, nasdaq, s&p 500
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Today's Focus: Madoff, Stimulus, Executive Compensation

Today, we'll watch for Wall Street's reaction to the startling news in The Washington Post that the Senate does not have the votes to pass the stimulus bill and will have to make significant cuts in order to get more...

By Sara Goo | February 4, 2009; 7:25 AM ET | Permalink | Comments (0)
Categories: The Ticker
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Rep. Frank To Banks: 'Don't Do Stupid Stuff'

In a wide-ranging press conference concluded moments ago, Rep. Barney Frank (D-Mass.), head of the Financial Services committee, said that banks receiving federal bailout money must do two things: 1) "Don't do stupid stuff," such as buying $50 million jets,...

By Frank Ahrens | February 3, 2009; 12:47 PM ET | Permalink | Comments (1)
Categories: The Ticker | Tags: Barney Frank, executive compensation, mortgage workouts
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Big Three Bloodbath: Chrysler Down 55 Pct., GM Down 51 Pct., Ford Down 39 Pct. In January

4:13 P.M.: UPDATED WITH CHRYSLER, SMALLER AUTOMAKERS: It was a terrible month for all automakers but especially for Detroit's Big Three, which saw sales drop by an average of nearly 50 percent compared to January 2008. Chrysler was the grim...

By Frank Ahrens | February 3, 2009; 12:26 PM ET | Permalink | Comments (25)
Categories: The Ticker | Tags: Chrysler, Detroit bailout, Ford, GM, Toyota, automakers
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Schumer Favors Guarantees Over 'Bad Banks' Plan

Sen. Chuck Schumer (D-N.Y.), appearing on CBNC moments ago, said he opposes the "bad bank" plan being tossed around by President Obama and Treasury Secretary Tim Geithner, which would create a federal government bank that would take all the toxic...

By Frank Ahrens | February 3, 2009; 11:10 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Schumer, toxic assets
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Today's Early Flood Of Good News/Bad News

There's a lot of earnings and economic news out already this morning, so The Ticker will tick down the two lists to give readers a handy-dandy handle on the day. The Good News (such as it is): - Drug king...

By Frank Ahrens | February 3, 2009; 10:44 AM ET | Permalink | Comments (1)
Categories: The Ticker | Tags: Dow, Liz Claiborne, Merck, Motorola, PNC, UPS, home sales
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Wall Street Down Slightly At Opening

If "Not So Bad" is the new "Good," then a raft of "Not So Bad" fourth-quarter earnings briefly pushed the markets' nose above water at the opening, though now it has sunk back down. Uncertainty still rules Wall Street, as...

By Frank Ahrens | February 3, 2009; 9:51 AM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Dow, Merck, nasdaq, s&p 500
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Auto Sales, Real Estate Data in Focus

Aside from the continuing debate in the Senate on the $800 billion-plus stimulus bill, today we await several economic reports. None are expected to be too cheerful, but analysts will be waiting to see whether the numbers will beat expectations....

By Sara Goo | February 3, 2009; 6:55 AM ET | Permalink | Comments (0)
Categories: The Ticker
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Report: Chrysler, GM Offer Employee Buyouts, Vouchers

UPDATED WITH GM BUYOUT OFFER: Troubled automaker Chrysler -- probably in the worst shape of the Big Three, though it's impossible to know because it's a privately held company -- is offering a new round of buyouts to employees with...

By Frank Ahrens | February 2, 2009; 2:47 PM ET | Permalink | Comments (1)
Categories: The Ticker | Tags: Chrysler, Ford, GM
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Macy's Lets Go 7,000 Employees

Macy's will cut about 7,000 jobs, or about 4 percent of its workforce, as it restructures following a dismal holiday season and slumping sales, The Post's Ylan Q. Mui reports. The department store chain is also reducing its quarterly dividend...

By Frank Ahrens | February 2, 2009; 2:09 PM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Macy's, layoffs
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Dallas Fed President: Protectionism Is 'Crack Cocaine' Of Economics

If it ever crossed your mind: "I wonder what Dallas Federal Reserve President Richard Fisher thinks about protectionism," then wonder no longer. "Protectionism is the crack cocaine of economics," Fisher said on C-Span this morning. "It provides an immediate high...

By Frank Ahrens | February 2, 2009; 12:36 PM ET | Permalink | Comments (0)
Categories: The Ticker | Tags: Obama, Smoot-Hawley, protectionism, tariffs, trade
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Economy Watch: February 1, 2009 - February 7, 2009