Monday Morning Business Update

Old News

Saturday

1 U.S. offers strong backing for IMF governance overhaul

By Glenn Somerville, Reuters

2 hrs 46 mins ago

WASHINGTON (Reuters) – The United States on Saturday pledged robust support for an overhaul of governing power within the International Monetary Fund so key emerging-market nations get more say in how the lender operates.

In a speech to the IMF’s steering committee, U.S. Treasury Secretary Timothy Geithner also called on the Fund to be prepared to offer loans to recapitalize banks or to aid developing countries in rolling over corporate debt.

Geithner’s proposals, delivered in a strongly worded address at the IMF’s semiannual meeting, are likely to provoke some controversy among the other industrialized countries who, with the United States, have long dominated the global lender.

2 Analysis: IMF relevant again, will big plans work?

By MARTIN CRUTSINGER, Associated Press

2 hrs 8 mins ago

WASHINGTON – Not long ago the International Monetary Fund seemed headed for relic status. Now it’s once more flying high, rolling out ambitious plans to blanket an economically distressed world in dollars. Even grander designs are on the drawing board.

Yet the money might not cover the job and those lofty plans might never get approved.

Failure would carry a heavy political price because the Group of 20 countries have made the lending agency the linchpin in their efforts to combat the worst economic downturn since the Great Depression.

3 Geithner pushes for more money for IMF lending

By CHRISTOPHER S. RUGABER, AP Economics Writer

28 mins ago

WASHINGTON – As protesters clashed with police on Washington’s streets, Treasury Secretary Timothy Geithner urged world finance officials meeting near the White House on Saturday to ante up more to help countries wrung by the recession.

Geithner said major progress toward bolstering the International Monetary Fund “must be an important outcome of these meetings. The international community should act quickly.”

More than 100 demonstrators angered by how world leaders have handled the economic crisis took on police outside the headquarters of the IMF and World Bank, which are holding their spring meetings this weekend.

4 Poor countries pushed into "danger zone": World Bank

By Lesley Wroughton, Reuters

Fri Apr 24, 1:09 pm ET

WASHINGTON (Reuters) – A triple jeopardy of food, fuel and financial crises is pushing many countries into a danger zone, a joint World Bank and International Monetary Fund report warned on Friday.

The report called for strong and urgent actions to address a deepening human and development crisis in the world’s poor countries, including more aid to help countries shore up their economies and protect the poor.

“The development emergency that now confronts many poor countries calls for commitment to a set of actions that signal a clear resolve to avert the potentially large human costs of the crisis and assist these countries,” the report said.

5 Women bear brunt of hunger crisis in Africa, world

By DONNA BRYSON, Associated Press Writer

Sat Apr 25, 10:07 am ET

BULAWAYO, Swaziland – Phetsile Ndwandwe, short, skinny and 23 years old, accepts an apple from a development worker and nibbles at it, stripping the peel with her teeth before handing the fruit to Siphokazi, her baby daughter.

Siphokazi manages a bite of the apple, the first fruit she has had in months, then thanks her mother with a kiss.

Ndwandwe allows herself only the peel.

6 Protesters, police clash near IMF meetings in DC

By NAFEESA SYEED, Associated Press Writer

1 hr 14 mins ago

WASHINGTON – More than 100 protesters upset with the way world leaders have handled the economic crisis clashed with police Saturday outside the International Monetary Fund and World Bank meetings.

Authorities used batons and pepper spray when activists tried to march onto a prohibited street, and several people were pushed to the ground by police. The protesters swarmed officers unexpectedly, and police had to respond, said D.C. police Capt. Jeffrey Herold.

A 22-year-old man accused of using pepper spray on an officer during the scuffle was arrested, D.C. police said. Before the demonstrations began, police arrested six people and accused them of vandalizing two banks, an incident that authorities think was linked to the protests.

7 Stress tests aim for capital ‘buffer’ for banks

by Rob Lever, AFP

Fri Apr 24, 3:52 pm ET

WASHINGTON (AFP) – The “stress tests” of major US banks will call for a capital buffer to help them withstand a worse-than-expected 3.3 percent economic contraction in 2009, the Federal Reserve said Friday.

Preliminary results of the tests were given to the 19 largest banking firms Friday and complete results will be made available starting May 4, according to the Federal Reserve, which released its methodology for the tests.

Fed officials said the tests would help reveal the need for additional capital from the government or private sources in case of a bleaker economic scenario than expected.

8 Spending the U.S. stimulus: states can’t afford it

By Lisa Lambert, Reuters

Fri Apr 24, 4:41 pm ET

WASHINGTON (Reuters) – One of the greatest challenges U.S. states face in spending federal stimulus money is funding the burst in bureaucracy that accompanies the funds, a government watchdog said on Thursday, as the Obama administration pledged to give states more help.

Revenue has been dropping in most U.S. states for a year, and many governments have cut staff. But the $787 billion American Recovery and Reinvestment Act flooded states with money for programs and required them to keep the public and federal government apprised of their spending, all of which requires more workers, said the Government Accountability Office.

“Due to fiscal constraints, many states reported significant declines in the number of oversight staff — limiting their ability to ensure proper implementation and management of Recovery Act funds,” the GAO’s nearly 300-page report on the stimulus plan said.

9 Battered U.S. cities buy foreclosed homes to rebuild

By Dan Whitcomb, Reuters

Fri Apr 24, 1:13 am ET

RIVERSIDE, California (Reuters) – California’s Riverside County has been one of the most punished areas in the U.S. housing crash and now local leaders are among the first in the nation with a program to buy foreclosed homes and sell them back to young families.

The city of Riverside is using money recently made available by the Obama administration to help communities lure buyers back to areas hit by a wave of foreclosures.

In recent weeks, Riverside began leveraging more than $6.5 million in federal Neighborhood Stabilization Program funds, added to its own redevelopment money, to purchase houses in the worst shape, fix them up and sell them to mostly first-time homebuyers. Other cities, like Chicago, are considering similar plans.

10 Chrysler, CAW in tentative deal, GM draws $2 billion

By David Bailey and John Crawley, Reuters

Fri Apr 24, 10:50 pm ET

DETROIT/WASHINGTON (Reuters) – Chrysler won a round of concessions from its Canadian union on Friday while General Motors Corp soaked up $2 billion more in U.S. government aid and Ford Motor Co posted a narrower-than-expected loss that sent its shares soaring.

The developments underscored the diverging fortunes of Ford and Chrysler and GM, both of which are operating under U.S. government oversight and increasing pressure to win cost-saving agreements to avoid bankruptcy.

Chrysler and the Canadian Auto Workers’ (CAW) tentative agreement on a new labor contract is intended to cut costs and keep the automaker from bankruptcy.

11 Ford sees light at end of tunnel

AFP

Fri Apr 24, 7:15 pm ET

NEW YORK (AFP) – Ford Motor Co. said Friday it remains on a slow road to recovery by 2011 without help from the government as it posted a quarterly loss of 1.4 billion dollars that was not as bad as feared.

The automaker, the only member of the Detroit Big Three that has not received emergency government aid, said it has enough cash to keep its plans on track.

“Our results in the first quarter reflected the extremely difficult business environment and weak demand for autos around the world,” said Ford president and chief executive Alan Mulally.

12 Italy’s Mafia thrives in global financial meltdown

By FRANCES D’EMILIO, Associated Press Writer

Sat Apr 25, 11:19 am ET

NAPLES, Italy – While businesses around the world are hunkering down for survival, the Italian mob is living a golden moment.

Italy’s various organized crime syndicates – often lumped together colloquially as Mafia Inc. – are gobbling up gas stations, muscling in on supermarket franchises, making loans to cash-starved businesses, taking over trattorias and acquiring buildings in swank neighborhoods in Rome and Milan, investigators say.

These mobsters have lots of what is in short supply for many businesses these days – liquidity – as well as centuries-honed expertise in preying on the vulnerable, whose ranks are swelling in the current financial crisis.

13 Delta posts $794 million 1Q loss

By HARRY R. WEBER, AP Airlines Writer

Tue Apr 21, 12:08 pm ET

ATLANTA – Delta Air Lines Inc., the world’s biggest airline operator, said Tuesday it will institute a $50 fee for most passengers to check a second bag on an international flight – a first among major U.S. carriers – as it reported a $794 million first-quarter loss due to the weak economy and bad bets on fuel hedges.

Company shares soared more than 16 percent as the results beat Wall Street expectations. Also, Delta executives said they’ve seen some signs of revenue stabilization and the airline still expects to be profitable for the year.

“In short, things aren’t good, but they are not getting worse,” Delta President Ed Bastian said on a conference call with analysts and reporters.

14 Mood grim as Icelanders vote for new Parliament

By HERDIS SIGURGRIMSDOTTIR, Associated Press Writer

Sat Apr 25, 12:17 pm ET

REYKJAVIK, Iceland – Idle building cranes and empty shop windows reminded Icelandic voters of their country’s economic calamity Saturday as they voted for a new Parliament.

Opinion surveys and interviews with voters suggest they plan to turn to the left and punish the pro-business leaders who brought the country to ruin.

The economic crisis gripping this volcanic island in the middle of the Atlantic just south of the Arctic Circle has emerged as the key issue.

15 Judge throws out Dole "bananeros" cases

By Gina Keating, Reuters

Fri Apr 24, 1:29 am ET

LOS ANGELES (Reuters) – A California judge on Thursday threw out two pesticide lawsuits against Dole Food Co and other companies by plaintiffs claiming to be banana farm workers, citing a “pervasive conspiracy” by plaintiffs’ attorneys and Nicaraguan judges.

The ruling by Los Angeles Superior Court Judge Victoria Chaney puts in doubt $2 billion in pending judgments in dozens of similar lawsuits. Chaney also said she would refer the matter to states’ bar associations and to prosecutorial agencies.

The plaintiffs, known as bananeros, have won judgments against Dole in Nicaraguan courts after claiming they were made sterile by the chemical DBCP, which was banned in the United States but was used by Dole to control fungus. The other defendants were Dow Chemical and AMVAC.

Sunday

16 Crisis turning into ‘human calamity’: IMF, World Bank

AFP

28 mins ago

WASHINGTON (AFP) – The global economic crisis is turning into “a human and development calamity,” with poorer countries being hit increasingly hard, the IMF and World Bank said Sunday.

“The global economy has deteriorated dramatically … Developing countries face especially serious consequences as the financial and economic crisis turns into a human and development calamity,” they said in a statement.

The crisis “has already driven more than 50 million people into extreme poverty … We must alleviate its impact on developing countries and facilitate their contribution to global recovery.”

17 IMF agrees on stimulus measures, bank clean-up

by Veronica Smith, AFP

Sat Apr 25, 6:46 pm ET

WASHINGTON (AFP) – The International Monetary Fund Saturday said it had forged agreement on the stimulus measures taken to combat the global financial crisis and the need to clean up bad assets weighing on banks.

“Everybody is happy with what has been done on fiscal stimulus … all agree on the absolute necessity of cleansing the financial system,” IMF head Dominique Strauss-Kahn said after a meeting of the fund’s steering committee.

The IMF chief said that during discussions of the IMF board’s International Monetary and Financial Committee, it had become clear there was no longer any major disagreement over how to tackle the crisis.

18 Global aid ministers warn of risk of rising poverty

By Lesley Wroughton, Reuters

2 hrs 50 mins ago

WASHINGTON (Reuters) – Global finance and aid ministers on Sunday warned that world poverty will rise sharply as more nations fall victim to the financial crisis unless donor countries step up funding for the developing world.

The ministers from the 185 member countries of the World Bank and International Monetary Fund said the crisis should not be allowed to set back progress made in recent years under targets set by the U.N. to halve poverty by 2015.

“A clear message must go out from this meeting, that despite the crisis, we will not allow achievement of the Millennium Development Goals to be jeopardized,” German Development Minister Heidemarie Wieczorek-Zeul told the joint IMF-World Bank Development Committee.

19 World Bank: Nations should speed aid to poor

By DEB RIECHMANN, Associated Press Writer

1 hr 5 mins ago

WASHINGTON – The World Bank on Sunday urged donor nations to speed up delivery of the money they’ve already pledged – and open their wallets wider – to help poor countries reeling from recessions rooted in rich nations.

The economic nosedive is turning into a human and development “calamity,” which already has driven more than 50 million people into extreme poverty this year, the World Bank’s policy steering committee said in a communique issued at the close of its spring meeting.

“There is widespread recognition that the world faces an unprecedented economic crisis, poor people could suffer the most and that we must continue to act in real time to prevent a human catastrophe,” World Bank chief Robert Zoellick said.

20 WTO’s Lamy says Doha round relaunch awaits U.S.

By Doug Palmer, Reuters

Fri Apr 24, 11:08 pm ET

WASHINGTON (Reuters) – A renewed push to finish long-running world trade talks cannot begin until the United States is ready to engage, the head of the World Trade Organization said on Friday.

Completing the Doha round of talks would help pull the global economy out of recession by unleashing new trade flows and “help restore confidence at this moment of crisis,” Pascal Lamy, the WTO’s director general, said at the Peterson Institute for International Economics in Washington.

“I cannot restart a political process without the U.S. being ready,” Lamy said.

21 Chrysler creditors urged to make concessions

By Nick Carey, Reuters

Sat Apr 25, 10:17 pm ET

DETROIT (Reuters) – With just days to go for Chrysler LLC to reach agreements to cut labor and debt costs or face bankruptcy, members of Michigan’s Democratic congressional delegation said on Saturday the onus was now on the U.S. automaker’s creditors to make concessions.

“The unions have come to the table over and over and over again and have taken huge cuts,” said Senator Debbie Stabenow on the sidelines of a Michigan Democratic Party fundraising event in Detroit, the heart of the beleaguered U.S. auto industry.

“It is now incumbent on the creditors, in particular those that have taken public funds, to make some concessions and be a part of the solution,” Stabenow said.

22 U.S. official cites progress in Chrysler talks

By John Crawley, Reuters

2 hrs 47 mins ago

WASHINGTON (Reuters) – There has been some progress in U.S. government-driven negotiations to save Chrysler LLC, according to a senior White House official, who on Sunday also did not rule out an attempt to complete the company’s restructuring in bankruptcy.

“We’re hopeful this is all going to work out in a successful way,” Larry Summers, President Barack Obama’s senior economic adviser and co-leader of the government’s task force working to restructure the auto industry, told the “Fox News Sunday” program with the automaker facing a Thursday deadline to arrange viable business plan. “It’s something we want to see.”

Summers cited some gains in talks on multiple fronts but was not specific.

23 GM retirees watch, worry as day of reckoning nears

By Soyoung Kim, Reuters

1 hr 14 mins ago

DETROIT (Reuters) – John Martinez, a former autoworker, feels as though he is watching his future sink as General Motors Corp slips closer to failure.

Pressured to take an early retirement in April, Martinez had been pinning his hopes on GM’s once-generous pensions and health-care benefits to help look after his four children and his disabled father, also a GM hourly retiree.

But with the 100-year-old industrial icon teetering on the brink of bankruptcy, Martinez and the nearly 1 million other Americans who rely on the automaker for healthcare and pensions face new risks and heightened uncertainty.

24 Wall Street on edge over earnings, banking sector

By IEVA M. AUGSTUMS, AP Business Writer

1 hr 37 mins ago

CHARLOTTE, N.C. – The wait for news about the government’s stress tests of big banks and a crush of earnings reports are likely to keep Wall Street on edge this week.

Investors whose burst of optimism sent stocks higher Friday will see if their bets – which came in part on some stronger-than-expected earnings reports – were well-founded. Hundreds of companies will be reporting their first-quarter results and their outlooks for the coming months.

“Companies that are being challenged will continue to be challenged, but the market is looking past what happened last quarter and looking more ahead to what’s going to happen later this year,” said Jason Ronovech, portfolio manager for Paradigm Capital Management in Albany, N.Y.

25 Fed to stay aggressive, but prepare for recovery

by Rob Lever, AFP

Sun Apr 26, 1:32 am ET

WASHINGTON, (AFP) – The Federal Reserve is likely to maintain its aggressive efforts to lift the US economy out of deep recession but also seek to lay the groundwork for a potential recovery, analysts say.

The Federal Open Market Committee, which opens a two-day meeting on Tuesday, is likely to signal no change in policy since its March gathering, when it added over one trillion dollars to its arsenal to fight the economic crisis.

The FOMC statement due Wednesday is expected to depict a weak economy that still needs extraordinary support, justifying its policy of near-zero interest rates and vast lending facilities to pump up credit availability.

26 $1 tln at risk in German banks: report

AFP

Sat Apr 25, 4:26 pm ET

BERLIN (AFP) – Germany’s banking system is exposed to over one trillion dollars’ worth of “toxic” or risky assets, news media in Europe’s largest economy said Saturday citing a confidential financial watchdog report.

Within the 816-billion-euro headline sum (1,080 billion dollars), 355 billion euros are held in the network of Germany’s regional state banks, according to the document revealed by the Suddeutsche Zeitung newspaper and the online edition of Der Spiegel magazine.

Another 268 billion euros is attributed to the troubled Hypo Real Estate bank, which on Friday moved a step closer to becoming Germany’s first full nationalisation since 1949.

27 Taiwan, China in landmark financial services deal

By Lin Miao-jung, Reuters

Sun Apr 26, 5:10 am ET

NANJING, China (Reuters) – Taiwan and China signed a series of landmark agreements on Sunday laying the groundwork for a flood of financial services investment to flow across the Taiwan Strait for the first time in six decades.

The agreements are the latest sign of warming ties between the former Cold War adversaries under the year-old administration of Taiwan President Ma Ying-jeou, who ran for office promising to improve the economy through closer ties with the mainland.

The centerpiece of the latest cross-strait talks, the third since Ma took office, is an agreement setting up a regulatory framework for financial services firms on both sides of the Taiwan Strait to invest and do business in each others’ markets.

28 Russia’s Kudrin says U.S. treats his country as pupil

By Gleb Bryanski, Reuters

Fri Apr 24, 9:16 pm ET

WASHINGTON (Reuters) – The United States’ treatment of Russia as a junior partner in negotiations is the biggest hurdle in bilateral relations, Russia’s Finance Minister Alexei Kudrin said on Friday.

The Obama administration has pledged to “reset” relations with Russia after they reached post-Cold War lows under former President George W. Bush, most recently over Russia’s war with Georgia and the planned U.S. anti-missile system.

“Russia does not accept being treated as a junior partner. Russia has enough grounds to count on equal partnership, not just be given marks as a pupil,” Kudrin said in a speech in Washington where he is meeting G20 finance ministers.

From Yahoo News Business

29 GM to announce brand changes, restructuring moves

By TOM KRISHER, AP Auto Writer

28 mins ago

DETROIT – General Motors Corp. will announce details of its massive restructuring plan on Monday, including the demise of its storied Pontiac brand, more factory closures and bigger job cuts as it fights to avoid bankruptcy protection.

The struggling automaker must make the announcement in advance of a planned offer to its bondholders to swap debt for company stock. GM owes $28 billion to large and small bondholders, and under Securities and Exchange Commission rules, it must disclose its operational plans before making an exchange offer.

Two people briefed on GM’s plan said the company has decided to close more factories than the five it announced in February. But the locations of the doomed factories will not be identified Monday, said the people, who asked not to be identified because the plan has not yet been made public.

30 UAW, Chrysler and Fiat reach concession deal

By TOM KRISHER, AP Auto Writer

51 mins ago

DETROIT – Chrysler LLC cleared another major obstacle to its survival Sunday when it reached a tentative deal for concessions with the United Auto Workers union.

The troubled automaker is just days from a Thursday U.S. government deadline to gain concessions from its unions and debtholders and form an alliance with Italy’s Fiat Group SpA or face almost certain liquidation.

The UAW announced the deal in a news release Sunday night, calling the concessions painful but saying the deal takes advantage of the Obama administration giving Chrysler and its workers a second chance.

31 At meeting, Fed to weigh options to revive economy

By JEANNINE AVERSA, AP Economics Writer

Sun Apr 26, 4:23 pm ET

WASHINGTON – As the recession grinds on, Federal Reserve policymakers will open a two-day meeting Tuesday to make a fresh assessment of economic conditions, review the effectiveness of programs in place and weigh whether they need to expand or change them.

Any policy decisions would come Wednesday.

Fed Chairman Ben Bernanke and his colleagues have already ratcheted down a key lending rate for banks to a record low near zero. To ease the impact of the recession, economists predict the Fed will keep its targeted range for its bank lending rate between zero and 0.25 percent at this week’s meeting and probably well into next year.

32 At annual meetings, perks are out and anger is in

By MADLEN READ, AP Business Writer

Sun Apr 26, 1:17 pm ET

NEW YORK – Just a few years ago, companies staging annual meetings brought in acts like Paul McCartney and Tony Bennett. At the very least, they offered snacks as CEOs boasted about big profits.

This year, when stockholder Ram Bijapur decided to show up at the Hilton hotel for the Citigroup meeting because he was angry about the bank’s steep losses, what he found was decidedly more sparse.

“They’re so broke,” he observed, “they can’t even give us a bottle of water.”

33 OPEC, Asia, call for curbs on oil speculation

By TAREK EL-TABLAWY, AP Business Writer

Sun Apr 26, 3:40 pm ET

CAIRO – OPEC and Asian energy officials called Sunday for new oil investments and tougher measures to combat speculation in crude markets that some have argued helped fuel last year’s oil price spike.

The call came during a one-day energy meeting in Tokyo to discuss volatility in the world oil market. Officials are concerned about another price spike once the world emerges from the global recession. The slowdown has sharply eroded oil demand and driven crude prices down about 65 percent from mid-July levels of $147 per barrel.

The drop in prices, while helping offset some of the pain from the financial meltdown, has undercut investments in the sector. That has led to the delay or cancellation of dozens of projects worldwide and sparked concerns of another oil price spike once demand rebounds.

34 Personal fortunes riding on the fate of GM’s debt

By KIMBERLY S. JOHNSON, AP Auto Writer

Sat Apr 25, 1:08 pm ET

GROSSE ILE, Mich. – Retired Chrysler LLC project manager Clifford St. Pierre and his wife Patricia bought $200,000 in General Motors Corp. notes three years ago, thinking it was a sound way to finance their retirement.

The 10-year securities carry a 7.2 percent interest rate and what they viewed as an almost bulletproof yearly payout of more than $14,000. “We made a decision to buy bonds in the largest manufacturer in the world,” he said from his home on Grosse Ile, an island in the Detroit River about 25 miles south of GM’s headquarters.

Their next semiannual payment is due in July, but St. Pierre, 70, now spends his free time scouring news reports, trying to figure out whether that check will ever be in the mail.

35 Profit reports turn spotlight on consumer spending

By MAE ANDERSON, AP Business Writer

Sat Apr 25, 1:08 pm ET

NEW YORK – When the economy screeched to a halt late last year, so did consumer spending, which accounts for 70 percent of all U.S. economic activity. That’s why the latest string of quarterly reports will be closely watched for any indication that consumers feel more confident about parting with their money.

Consumers curbed their spending to an unprecedented degree as they worried about declining home values, tight credit and unemployment. But recent data indicates the worst may be over. The government reported last month that consumer spending rose in February. It was the second month in a row spending rose, following half a year of declines.

Among the major companies reporting earnings, Visa Inc. and MasterCard Inc. will likely offer some insight into spending habits. VF Corp. is scheduled to report, too, providing some visibility into overall apparel sales.

36 Homebuyers hope to time the bottom

By J.W. ELPHINSTONE, AP Real Estate Writer

Sat Apr 25, 12:35 pm ET

With white tin ceilings, original woodwork, bay windows, and a $699,000 price tag, the two-bedroom apartment at 719 Carroll St. in Brooklyn would have been snatched up in a New York minute a couple of years ago.

Instead, it’s been on the market for more than two months. On a recent spring weekend 14 buyers came through, and still no bids.

“We’re in the early stages of the search,” said Joanna Brett, 33, as she checked out the apartment with Sarah Madigan. “We’ve been looking on and off for six months.”

37 Banks, Fed, earnings, flu in view

By Ellis Mnyandu, Reuters

Sun Apr 26, 4:27 pm ET

NEW YORK (Reuters) – U.S. stocks may run into some turbulence this week as the impending release of bank “stress test” results, a Federal Reserve meeting and a flood of earnings give investors reasons for caution.

Fears of a global swine flu pandemic developed into another factor to watch over the weekend with new infections in the United States and Canada discovered on Sunday, and as millions of Mexicans hid indoors to avoid a virus that has already killed up to 81 people.

But investors said that as this point, news on the state of the financial system and earnings would drive sentiment and that information about the illness was too sparse to influence the New York open on Monday. News of the flu spreading, however, could weigh on the market as the week progresses.

38 Swiss ask U.S. to drop UBS tax evasion case

By Brian Love, Reuters

Sat Apr 25, 3:09 pm ET

WASHINGTON (Reuters) – Switzerland, under pressure to join a global crackdown on tax fraud, asked the United States Saturday to drop a legal case involving UBS bank in return for a new tax accord the two countries are about to negotiate.

UBS agreed recently to pay a $780 million fine and disclose the identity of about 300 of its U.S. clients to avert criminal charges but U.S. authorities are still pursuing it, seeking to access the data of another 52,000 Americans they say are hiding about $14.8 billion in assets in Swiss bank accounts.

Swiss President Hans-Rudolf Merz, whose country is famous for strict bank secrecy, told a news conference U.S. Treasury Secretary Timothy Geithner seemed sympathetic to his call, put to Geithner at a meeting in Washington.

39 Top U.S. banks must hold sizable capital buffer: Fed

By Mark Felsenthal and Karey Wutkowski, Reuters

Fri Apr 24, 4:36 pm ET

WASHINGTON (Reuters) – The top 19 U.S. banks need to hold a “substantial” amount of capital above regulatory requirements to weather a potential worsening of the economic recession, the U.S. Federal Reserve said on Friday.

The Fed said so-called “stress tests” that regulators conducted at major banks are aimed at ensuring the institutions have enough capital in reserve to continue to lend in potentially bleaker conditions, and are not a measure of banks’ current solvency.

“It is important to recognize that the assessment is a ‘what if’ exercise intended to help supervisors gauge the extent of capital needs across a range of potential economic outcomes,” the Fed said in a white paper outlining the methodologies regulators employed.

40 Chrysler creditors urged to make concessions

By Nick Carey, Reuters

Sat Apr 25, 10:17 pm ET

DETROIT (Reuters) – With just days to go for Chrysler LLC to reach agreements to cut labor and debt costs or face bankruptcy, members of Michigan’s Democratic congressional delegation said on Saturday the onus was now on the U.S. automaker’s creditors to make concessions.

“The unions have come to the table over and over and over again and have taken huge cuts,” said Senator Debbie Stabenow on the sidelines of a Michigan Democratic Party fundraising event in Detroit, the heart of the beleaguered U.S. auto industry.

“It is now incumbent on the creditors, in particular those that have taken public funds, to make some concessions and be a part of the solution,” Stabenow said.

41 Crisis turning into ‘human calamity’: IMF, World Bank

AFP

2 hrs 57 mins ago

WASHINGTON (AFP) – The global economic crisis is turning into “a human and development calamity,” with poorer countries being hit increasingly hard, the IMF and World Bank said Sunday.

“The global economy has deteriorated dramatically … Developing countries face especially serious consequences as the financial and economic crisis turns into a human and development calamity,” they said in a statement.

The crisis “has already driven more than 50 million people into extreme poverty … We must alleviate its impact on developing countries and facilitate their contribution to global recovery.”

42 IMF agrees on stimulus measures, bank clean-up

by Veronica Smith, AFP

Sat Apr 25, 6:46 pm ET

WASHINGTON (AFP) – The International Monetary Fund Saturday said it had forged agreement on the stimulus measures taken to combat the global financial crisis and the need to clean up bad assets weighing on banks.

“Everybody is happy with what has been done on fiscal stimulus … all agree on the absolute necessity of cleansing the financial system,” IMF head Dominique Strauss-Kahn said after a meeting of the fund’s steering committee.

The IMF chief said that during discussions of the IMF board’s International Monetary and Financial Committee, it had become clear there was no longer any major disagreement over how to tackle the crisis.

43 Summit urges diversification to secure Europe’s gas

by Antoine Agasse and Diana Simeonova, AFP

Sat Apr 25, 1:48 pm ET

SOFIA (AFP) – Seeking to secure Europe’s energy supplies, gas producer, consumer and transit countries Saturday urged greater cooperation and diversification of gas sources, at the end of a two-day summit in Sofia.

The leaders from 28 European, Caspian and Central Asian countries failed however to iron out difficulties over the supply of two major new pipeline projects — the EU’s Nabucco and the Russia-backed South Stream.

In a common declaration, they called for the “rapid development of international gas infrastructure, pipelines, liquefied natural gas terminals and strategic storages to guarantee diversification of gas supplies to Europe in a sustainable and viable way.”

44 IMF, World Bank focus on crisis aid for poor countries

by Bryan McManus, AFP

Sun Apr 26, 3:28 pm ET

WASHINGTON (AFP) – The International Monetary Fund and World Bank met Sunday, aiming to get more help to developing countries battered by the global financial crisis that is pushing millions more into poverty.

Topping the agenda of a meeting of the joint IMF-World Bank development committee was the fallout from the crisis that began in the advanced economies but which is now hitting the most vulnerable countries.

A World Bank/IMF report warned on Friday that the crisis means up to 90 million more people will remain trapped in extreme poverty this year while the chronically hungry could top one billion.

45 IMF says time to talk crisis exit plans

by Veronica Smith, AFP

Sun Apr 26, 3:26 am ET

WASHINGTON, (AFP) – The IMF says it is time to talk exit strategies since all members now endorsed stimulus measures taken to combat the global financial crisis and the need to clean up banks’ bad assets.

“Everybody is happy with what has been done on fiscal stimulus … all agree on the absolute necessity of cleansing the financial system,” the head of the International Monetary Fund, Dominique Strauss-Kahn said.

He said there were substantial differences, however, over what steps should be taken to prepare for the economic upturn on the other side of the crisis, adding that countries needed to have a view three to four years ahead.

46 Crisis warms Turks to opening Armenia border

by Nicolas Cheviron, AFP

Sun Apr 26, 1:37 am ET

KARS, Turkey (AFP) – Hit by a bruising economic crisis, residents of Kars, in eastern Turkey, are increasingly warming to the idea of opening the border with Armenia, hoping that revived trade links would provide a lifeline to the impoverished region.

The border’s closure in 1993 — ordered by Turkey to back Azerbaijan in a territorial conflict with Armenia — has had heavy economic consequences not only for Armenia but also this Turkish city of 80,000.

The border crossing, some 70 kilometres (43 miles) away, was once massively used to export cattle — Kars’ main wealth — to the Caucasus and Russia through the only railway linking Turkey to its northern neighbours.

47 Spanish clothes price war fuels deflation fears

by Virginie Grognou, AFP

Sun Apr 26, 1:27 am ET

MADRID, (AFP) – Faced with declining sales due to Spain’s worst recession in a generation, Spanish clothing retailers like Zara have launched a fierce price war that has contributed to the risk of deflation.

The official summer sales period only gets underway at the end of June, but for the past few weeks signs announcing massive discounts have popped up in clothing store windows across the country.

At the flagship store belonging to Sfera, the clothing chain set up by Spanish department store El Corte Ingles to compete with Zara, colourful stickers advertise reductions of up to 30 percent.

48 Pork industry assures customers pork is safe

By MARK JEWELL, AP Business Writer

2 hrs 25 mins ago

BOSTON – U.S. pork producers on Sunday, responding to a swine flu outbreak that has escalated into a public health emergency, said their product is safe and that consumers cannot catch the virus by eating properly cooked food.

The industry-funded National Pork Board said it “wishes to reassure the public that pork is safe and will continue to be safe to consume.” The statement comes as multiple nations increase their screening of pigs and pork imports from the Americas or are banning them outright as the virus is said to have killed up to 86 people and likely sickened up to 1,400 since April 13 in Mexico. U.S. officials say the virus has been found in New York, California, Texas, Kansas and Ohio, but so far no fatalities have been reported.

The stakes are high for U.S. pork producers, which export nearly $5 billion worth of products each year. The organization pointed to a statement by the U.S. Centers for Disease Control and Prevention that swine influenza viruses “are not spread by food” and that eating properly handled pork and cooked pork products is safe since the virus dies when cooked at temperatures of 160 degrees or higher.

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  1. Relentlessly Business.

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