The Fed chief's speech to the Economic Club of Washington made
clear he thinks the economy will struggle even as it recovers from the
recession. He said the economy confronts "formidable headwinds" --
including a weak job market, cautious consumers and tight credit. The central bank has leeway to keep rates low because inflation
is under control and is expected to stay tame because of the economy's
weakness. Some private forecasters even fear that the recovery could fizzle
late next year as the government stimulus fades. Early stock gains from Bernanke comments evaporate NEW YORK (AP) -- Even the prospect of interest rates staying low
couldn't keep buyers in the stock market. Stocks ended little changed Monday, having given back a brief
afternoon gain that followed comments from Federal Reserve Chairman Ben
Bernanke. Bernanke's remarks sent the dollar down because low rates make a
currency less attractive, and that gave stocks a boost since a lower dollar can
add to profits for U.S. companies that do business overseas. The market's gains
evaporated later, however, as the dollar pared its losses. Many traders have closed their books on the year and are
wondering whether incremental improvements in the economy will be able to
support more stock market gains next year. Consumer borrowing falls for 9th straight month WASHINGTON (AP) -- Americans borrowed less for a record ninth
straight month in October, another sign that consumer spending will remain
weak, making it harder for the economy to mount a sustained rebound. Consumer credit fell at an annual rate of $3.51 billion in
October, the Federal Reserve said Monday. Economists expected a $9.3 billion
decline. Demand for revolving credit, the category that includes credit
cards, fell 9.3 percent, while borrowing in the category that includes auto
loans rose at an annual rate of 2.6 percent. Americans are borrowing less as they try to replenish depleted
investments. Many are finding it hard to get credit as banks, hit by the worst
financial crisis since the 1930s, have tightened lending standards. Historic EPA finding: Greenhouse gases harm humans WASHINGTON (AP) -- The Obama administration took a major step
Monday toward imposing the first federal limits on climate-changing pollution
from cars, power plants and factories, declaring there was compelling
scientific evidence that global warming from manmade greenhouse gases endangers
Americans' health. The announcement by the Environmental Protection Agency was
clearly timed to build momentum toward an agreement at the international
conference on climate change that opened Monday in Copenhagen, Denmark. It
signaled the administration was prepared to push ahead for significant controls
in the U.S. if Congress doesn't act first on its own. The EPA finding clears the way for rules that eventually could
force the sale of more fuel-efficient vehicles and require plants to install
costly new equipment or shift to other forms of energy. SEC accuses 3 ex-New Century execs of fraud WASHINGTON (AP) -- Federal regulators on Monday accused three
former top executives of collapsed mortgage lender New Century Financial Corp.
of fraud, saying they misled investors as the company's subprime loan business
was failing in 2006. In a case stemming from the mortgage market meltdown, the
Securities and Exchange Commission filed a lawsuit seeking injunctions, and
unspecified civil fines and restitution against New Century's former CEO and
co-founder Brad Morrice, former chief financial officer Patti Dodge and former
controller David Kenneally. The SEC also wants the three barred from serving as officers or directors
of any public company and reimbursement of their bonuses or stock option
awards. Obama eyes 'selective' use of bailout dollars WASHINGTON (AP) -- President Barack Obama said Monday the
massive federal bailout program for financial institutions has turned out to be
much less costly than expected and there may be ways to redirect some of the
money toward creating new jobs. Speaking in the Oval Office, Obama declined to say directly
whether he would seek to redirect some of the repaid money from the $700
billion Troubled Asset Relief Program to jobs programs. He did say he would
address the topic in an economic speech on Tuesday. The president said the key question is determining whether the
bailout money could be put toward selective job creation that meets the
original intent of the law. He cited as an example directing bailout money to
help small businesses get lending. GM plans to invest $700M in Michigan for Volt DETROIT (AP) -- General Motors Co. said Monday it will spend
$700 million at eight Michigan facilities to get its new rechargeable electric
car road-ready -- a technological and economic boost for its home state. GM officials detailed their investment plans for the Chevrolet
Volt on the floor of its assembly plant that straddles the border between
Detroit and tiny Hamtramck. The plant, which will begin mass producing the Volt
in late 2010, is getting a $336 million upgrade that includes new machinery and
other equipment. The state of Michigan last year approved $135.2 million in tax
incentives for the sites. Supreme Court weighs validity of anti-fraud law WASHINGTON (AP) -- The Supreme Court cast doubt Monday on the
validity of part of the anti-fraud law enacted in response to Enron and other
corporate scandals early this decade. The court heard arguments in a case over the composition of the
board that was created to tighten oversight of internal controls and outside
auditors following accounting scandals at Enron Corp., WorldCom Inc., Tyco
International Ltd. and other corporations. A small Nevada accounting firm and an anti-tax group brought the
challenge to the 2002 Sarbanes-Oxley law, arguing that the board created by the
law violates the Constitution's separation of powers mandate because the
president cannot appoint or remove its members. CF Industries sweetens takeover bid for Terra DEERFIELD, Ill. (AP) -- CF Industries Holdings Inc. has
sweetened its hostile takeover offer for rival fertilizer maker Terra
Industries Inc. by 12 percent to $4.6 billion, boosting the cash portion of its
bid. Terra, which has been fighting off CF's buyout attempts since
the start of the year, said Monday it expects to consider the revised proposal
at a board meeting later in the week. CF said it is offering to pay $36.75 in cash -- including the
$7.50 per share special dividend declared by Terra -- plus 0.1034 of a CF
common share for each Terra share. Its previous bid included $32 a share in
cash. Dubai World looks to sell assets in quest for cash DUBAI, United Arab Emirates (AP) -- Dubai World, the
cash-strapped conglomerate at the center of Dubai's debt crisis, appears set
for an unaccustomed period of retrenchment after the emirate's top finance
official said Monday the company may need to change course and unload assets as
it struggles to pay back lenders. What eventually gets sold remains uncertain. Clearer is the
city-state's position that the government itself won't be responsible for Dubai
World's debts, renewing questions about its backing of other state-run
companies. The comments appeared to cement concerns that Dubai was washing
its hands of debts racked up by companies it created and backed during the
city-state's frenetic boom years earlier this decade. By The Associated Press The Dow Jones industrial average rose 1.21, or less than 0.1
percent, to 10,390.11 after being up 54 points and down 29 points. The broader Standard & Poor's 500 index fell 2.73, or 0.3
percent, to 1,103.25. It's up 22.1 percent for the year. The Nasdaq composite
index fell 4.74, or 0.2 percent, to 2,189.61. Benchmark crude for January delivery fell 2 percent, or $1.54,
to settle at $73.93 on the New York Mercantile Exchange, the lowest level in
about two months. In other Nymex trading in January contracts, heating oil fell
1.71 cents to settle at $2.0097 and gasoline slipped 3.44 cents to settle at
$1.9406. Natural gas jumped 38.5 cents to settle at $4.971 per 1,000 cubic
feet. In London, Brent crude for January delivery lost $1.09 to settle
at $77.53 on the ICE Futures exchange.