AIG bonuses won't stand, Dem senators declare
WASHINGTON (AP) -- Talking tougher by the hour, livid Democrats
confronted beleaguered insurance giant AIG with an ultimatum Tuesday: Give back
$165 million in post-bailout bonuses or watch Congress tax it away with
emergency legislation.
Fresh details, meanwhile, pushed AIG outrage ever higher: New
York Attorney General Andrew Cuomo reported that 73 separate company employees
received bonus checks of $1 million or more last Friday. This at a company that
was failing so spectacularly the government felt the need to prop it up with a
$170 billion bailout.
Housing starts surge; wholesale prices edge up
WASHINGTON (AP) -- Housing construction posted a surprisingly
large increase in February, bolstered by strength in all parts of the country
except the West.
While the surge in construction was far better than the continued
decline economists had expected, experts viewed the rebound as a temporary gain
given all the problems the housing industry still faces.
The Commerce Department reported Tuesday that construction of new
homes and apartments jumped 22.2 percent in February compared with January,
pushing total activity to a seasonally adjusted annual rate of 583,000 units.
Wall Street resumes rally following housing report
Major market indicators jumped more than 2 percent, including the
Dow Jones industrial average, which added 179 points to 7,395.70. The
technology-heavy Nasdaq
surged more than 4 percent after sliding Monday. Stocks have risen
five out of the past six sessions.
IRS giving relief to some Madoff
investors
WASHINGTON (AP) -- The Internal Revenue Service issued guidelines
Tuesday that will allow tax relief and refunds for some Bernard Madoff victims who were levied for investment earnings that
turned out to be nonexistent.
IRS Commissioner Douglas Shulman told
Congress the new guidelines are for taxpayers who have suffered losses from Ponzi investment schemes such as the massive Madoff swindle.
He said the guidelines will apply to victims of all Ponzi schemes -- financial scams in which early investors
are paid returns from money put in by later investors. But given the scope of
the Madoff scandal, the IRS wanted to establish an
easy system for investors to recover taxes they paid on "fictitious
income," Shulman said.
Fed considers how to lift country out of recession
WASHINGTON (AP) -- Federal Reserve policymakers gather to examine
ways to lift the country out of financial and economic turmoil as Americans
fume over the government's handling of AIG's bailout.
Fed Chairman Ben Bernanke and his colleagues opened a two-day
meeting Tuesday, where they also will take fresh stock of financial and
economic conditions. They are all but certain to leave a key bank lending rate
at a record low to try to brace the economy, which has been stuck in a
recession since December 2007.
Fed officials meet as public outrage over government bailouts of
financial institutions has swelled.
Caterpillar to lay off 2,454 workers in 3 states
PITTSBURGH (AP) -- Caterpillar Inc. on Tuesday announced plans to
lay off more than 2,400 employees at five plants in
Caterpillar, the world's largest maker of mining and construction
equipment, has seen its sales wither as the sluggish world economy and the
credit crisis weaken demand for its products, used to build everything from
houses to highways. The company had expanded dramatically in recent years,
helped by a building boom in developing countries.
GM CEO says bankruptcy would cause liquidation
DETROIT (AP) -- If General Motors Corp. were forced into Chapter
11 bankruptcy protection, the company would end up being liquidated because a
long bankruptcy would scare customers away, CEO Rick Wagoner said Tuesday.
Speaking at a breakfast in
Wagoner's statements came as members of President Barack Obama's
auto task force told Michigan lawmakers they would signal next week what
direction they plan to take to restructure GM and Chrysler LLC.
Adobe 1Q profit, sales drop, squeezed by downtown
Adjusted earnings slightly exceeded Wall Street's expectations,
however.
The San Jose, Calif.-based company had already warned this month
of revenue falling below its previous targets. The recession has slowed sales
of Creative
Nokia to lay off 1,700 worldwide
HELSINKI (AP) -- Nokia Corp. said Tuesday
it would lay off 1,700 people worldwide to cut costs, as the global economic
downturn strikes deeper into the mobile phone sector.
The world's top mobile phone maker said the job cuts will affect
several sectors, including its devices and markets units, the corporate
development office and global support functions.
GE to offer investors peek inside GE Capital
WASHINGTON (AP) -- General Electric Co. plans to take investors
on a "deep dive" into the books of its wobbling finance unit on
Thursday, part of an offensive to calm worries that bigger troubles loom at GE
Capital.
Investors attending a five-hour GE conference in
By The Associated Press
The Dow rose 178.73, or 2.5 percent, to 7,395.70.
The Standard & Poor's 500 index rose 24.23, or 3.2 percent,
to 778.12, while the Nasdaq
composite index rose 58.09, or 4.1 percent, to 1,462.11.
The Russell 2000 index of smaller companies rose 17.23, or 4.5
percent, to 403.59.
Benchmark crude for April delivery rose
$1.81 a barrel to settle at $49.16 on the
Brent crude jumped $4.26 to settle at $48.24 a barrel on the ICE
Exchange in
In other Nymex trading, gasoline for
April delivery rose 5.65 cents to settle at $1.4238 a gallon, while heating oil
rose by 6.17 cents to settle at $1.2747 a gallon. Natural gas for April
delivery fell about 4 cents to settle at $3.850 per 1,000 cubic feet.