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Archive for October, 2008

The Federal Reserve Takes Unprecedented Steps to Bailout Businesses.

WASHINGTON (AP) – Frantically trying to stop the bleeding on Wall Street, the Federal Reserve took a first-time step Tuesday to get cash directly to businesses and hinted that interest rates could come down soon.

Stocks continued their free fall anyway and hit new five-year lows.The central bank invoked emergency powers to lend money to companies outside the financial sector and buy up mounds of commercial paper, the short-term debt that firms use to pay for everyday expenses like salaries and supplies.

The Fed, which has only loaned money to banks before, made the move as the gravest financial crisis in decades wore on and concern spread around the world.

“The outlook for economic growth has worsened,” Bernanke said. “The heightened financial turmoil that we have experienced of late may well lengthen the period of weak economic performance.”

The gloomy assessment appeared to open the door wider to an interest rate cut on or before the Fed convenes again Oct. 28. The Fed’s key interest rate now stands at 2 percent.

Wall Street turned its back. The Dow Jones industrials lost 508 points, more than 5 percent, to close at 9,447, the lowest since Sept. 30, 2003. The Standard & Poor’s 500, a broader stock index, closed below 1,000 for the first time since that same day.

Dems and Republicans Screwed the Middle Class Good

Last week, the Bush administration proposed a three-page bill to bail out Wall Street to the tune of $700 billion. It died in the U.S. House of Representatives earlier this week.

On Friday, though, the House approved a far bigger, broader, and beefier version of the bill–which has ballooned to a remarkable 442 pages. The vote was 263 to 171, with the bulk of the opposition coming from Republicans. Because the Senate already approved the measure, it immediately went to President Bush, who signed it into law.

The bailout bill also gives the Internal Revenue Service new authority to conduct undercover operations. It would immunize the IRS from a passel of federal laws, including permitting IRS agents to run businesses for an extended sting operation, to open their own personal bank accounts with U.S. tax dollars, and so on. (Think IRS agents posing as accountants or tax preparers and saying, “I’m not sure if that deduction is entirely legal, but it’ll save you $1,000. Want to take it?”) That section had expired as of January 1, 2008, and would now be renewed.

90 Year Old Ohio Woman Attempts Suicide as Sheriffs Attempt to Evict Her

CINCINNATI (Reuters) – A 90-year-old Ohio woman, facing eviction from the home she has lived in for 38 years, shot and wounded herself this week, becoming a grim symbol of the U.S. home mortgage crisis.

Addie Polk was found lying on the floor of her home with what appeared to be a self-inflicted gunshot wound to her shoulder when police came to the home on Wednesday to serve an eviction notice, Akron police spokesman Lt. Rick Edwards said on Friday.

Home foreclosure rates are at record highs in the United States, in many cases because buyers with adjustable interest rates could not keep up with sharp increases in monthly payments. The foreclosure crisis has sparked a wider housing market downturn and is at the heart of the U.S. financial crisis.