Roubini forecasts recession will last 2 years
Thu, 08 Jan 2009 20:55:42 GMT
WASHINGTON (MarketWatch) -- The U.S. recession will last two full years, with gross domestic product falling a cumulative 5%, said Nouriel Roubini, chairman of RGE Monitor. Roubini was one of the first economists to predict the recession and the credit crunch stemming from the housing bubble. For 2009, Roubini predicts GDP will fall 3.4%, with declines in every quarter of the year. The unemployment rate should peak at about 9% in early 2010, he said. Consumer prices will fall about 2% in 2009. Housing prices will probably overshoot, dropping 44% from the peak through mid-2010. "The U.S. economy cannot avoid a severe contraction that has already started and the policy response will have only a limited and delayed effect that will be felt more in 2010 than 2009," he said.
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Lawmakers reach deal with Citigroup on mortgage adjustments
Thu, 08 Jan 2009 20:38:42 GMT
WASHINGTON (MarketWatch)-- Senate democrats have reached an agreement with Citigroup Inc. on a key bill to give bankruptcy judges the authority to eliminate some mortgage debt and help reduce foreclosures, lawmakers announced Thursday afternoon. According to Sen. Richard Durbin, Citigroup has agreed not to oppose legislation that would allow bankruptcy judges the authority to modify mortgages that were set up prior to the enactment of the bill. It's unclear at this point whether the bill will be enacted, but Durbin said he has reached out to other financial institutions to get their support for the agreement. Borrowers would be required to contact lenders 10 days prior to filing with a bankruptcy judge to see if they can reach an agreement. Durbin added that he believed this bill, which he has worked on since 2007, will lead lenders to take a greater effort to work with borrowers to modify mortgages to avoid foreclosure. "I hope other institutions will follow suit," Durbin said. "If others join, I think we can enact this as part of Obama's stimulus package."
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UAW barred from striking at GM for federal loan: WSJ
Thu, 08 Jan 2009 20:23:04 GMT
SAN FRANCISCO (MarketWatch) -- The United Auto Workers union can not strike or threaten to strike at General Motors Corp. before Feb. 17 as part of a federal loan package, The Wall Street Journal reported on its Web site Thursday. The stipulation is part of the U.S. Treasury Department's $13.4 billion loan to GM. Both the UAW and GM reportedly must agree to key labor concessions by Feb. 17 as part of the loan agreement. The Journal said it is unclear whether the same terms apply to Chrysler LLC's $4 billion federal loan.
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Deal between lawmakers and Citigroup on mortgage adjustments
Thu, 08 Jan 2009 20:11:49 GMT
WASHINGTON (MarketWatch) - Senate Banking Committee chairman Christopher Dodd and key democrats are scheduling a press conference for Thursday afternoon about an agreement with Citigroup Inc. that should help move a key bill giving bankruptcy judges the authority to eliminate some mortgage debt and help reduce foreclosures. According to two congressional aides familiar with the matter, Citigroup has agreed not to oppose legislation that would allow bankruptcy judges the authority to modify its mortgages that were set up prior to the enactment of the bill. A spokesman for Richard Durbin, D-Ill., who introduced a bankruptcy judge bill on Tuesday, said he expects this agreement with Citigroup to lead to an agreement with the rest of the banking industry.
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U.S. stocks tilt upward on plan to forestall foreclosures
Thu, 08 Jan 2009 20:07:43 GMT
NEW YORK (MarketWatch) -- U.S. stocks turned mostly higher on Thursday after reports a plan is in the works to let bankruptcy judges change home loans to stem foreclosures. The Dow Jones Industrial Average was off 38.63 points at 8,731.07. The S&P; 500 gained 1.2 points to 907.85, and the Nasdaq Composite gained 10.82 points to 1,609.88.
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Princeton plans budget cuts on drop in endowment: WSJ
Thu, 08 Jan 2009 20:04:10 GMT
SAN FRANCISCO (MarketWatch) -- Princeton University plans budget cuts to offset an expected drop in its endowment and said it will raise tuition and fees next fall by 2.9%, the smallest hike in 43 years, the Wall Street Journal reported Thursday on its Web site. Princeton's endowment, worth $16.3 billion on June 30, ranks fourth among major universities, behind Harvard, Yale and Stanford, the newspaper said.
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Consumer credit drops record $7.9 billion in November
Thu, 08 Jan 2009 20:00:15 GMT
WASHINGTON (MarketWatch) - U.S. households paid down a record $7.9 billion in consumer debt in November, the third month in the past four in which they paid off more debt than they took on, the Federal Reserve reported Thursday. Consumer debt fell $7.9 billion to a seasonally adjusted $2.57 trillion in November, a 3.7% annualized decline. It's the largest percentage decline in nearly 11 years and is the largest decline ever in dollar terms. U.S. residents paid down $2.8 billion, or 3.4% annualized, on their revolving credit accounts, the largest decline in credit-card balances in nearly five years.
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Oil falls for third session on economic concerns
Thu, 08 Jan 2009 19:50:18 GMT
NEW YORK (MarketWatch) -- Oil futures fell Thursday for a third straight session as newly released U.S. jobs data highlighted concerns that deepening economic troubles in the world's biggest oil-consuming country will further cut into energy demand. Meanwhile, natural-gas futures extended losses after government data showed U.S. inventories fell less than expected. Crude for February delivery ended down 93 cents, or 2.2%, at $41.70 a barrel on the New York Mercantile Exchange. It fell to as low as $40.54 earlier.
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Palm shares get lift as new Nova software is introduced
Thu, 08 Jan 2009 19:42:31 GMT
SAN FRANCISCO (MarketWatch) -- Palm Inc. shares climbed almost 7% Thursday after the company unveiled its new software for use with touch screen smartphones at the Consumer Electronics Show in Las Vegas. Palm said the new software, called Nova, will be used with smartphones that use both a touchscreen and a traditional keyboard. Palm also introduced a new phone, called the Palm Pre, that will use the Nova operating system. Palm shares pulled back from their high point, but were still up by 10 cents at $3.38 following the announcement.
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Exxon favors carbon tax over cap and trade for CO2 curbs
Thu, 08 Jan 2009 19:36:17 GMT
NEW YORK (MarketWatch) -- Exxon Mobil CEO Rex Tillerson said Thursday the current economic slowdown, efficiency improvements and alternative energy won't greatly dampen global energy demand, still expected to grow by 35% between 2005 and 2030. Tillerson said Exxon Mobil supports a carbon tax to curb greenhouse gases rather than a cap and trade system. "A carbon tax strikes us as a more direct, transparent and effective approach," said Tillerson. "It is easier to apply globally, avoids the establishment of new markets for trading emissions and new regulators to monitor them, can be implemented through the existing tax infrastructure and made revenue neutral to mitigate the impact on the economy."
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Lawmakers close to deal letting judges alter mortgages
Thu, 08 Jan 2009 19:34:30 GMT
WASHINGTON (MarketWatch) - Key Democratic lawmakers are close to reaching a deal with the banking industry over permitting bankruptcy judges the authority to eliminate some mortgage debt and help reduce foreclosures. According to a congressional aide familiar with the matter, key lawmakers have worked out a deal with the banking industry that would only allow bankruptcy judges the authority to modify mortgages that were set up prior to the enactment of the bill. Key House leaders, including House Judiciary Committee chairman John Conyers, D-Mich. and Sen. Richard Durbin, are working on the bankruptcy judge bill. Some lawmakers are seeking to have the bill attached to Obama's stimulus package, which is likely to be approved by February. Other provisions under consideration would give borrowers more time for repayments, which would make their mortgages more affordable. Judges could also be permitted to replace variable interest rates with a more affordable rate. Both Conyers and Rep. Brad Miller, D-N.C., have introduced bankruptcy judge bills in the House. Sen. Durban has introduced a bill in the Senate.
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Gold futures rise on weaker dollar, jobs data
Thu, 08 Jan 2009 18:54:55 GMT
NEW YORK (MarketWatch) -- Gold futures rose Thursday to above $850 an ounce, as a weakening dollar raised the metal's investment appeal and as dismal U.S. jobs data increased safe-haven buying. Gold for February delivery ended up $12.80, or 1.5%, at $854.50 an ounce on the Comex division of the New York Mercantile Exchange. The dollar extended its losses Thursday against a basket of other major currencies after the Labor Department reported the number of people collecting benefits in the week ended Dec. 27 rose to the highest level in more than 26 years.
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