Senate Dems move to curb Fed's powers
WASHINGTON (AP) _ Senate Democrats on Tuesday proposed stripping the Federal Reserve of its supervisory powers and creating instead three new federal agencies to police banks, protect consumers and dismantle failing institutions.
The 1,136-page bill, released by Senate Banking Committee Chairman Chris Dodd, would represent a significant shift in power in federal oversight of the U.S. market. The Fed has been a dominant figure in managing the economy, although many lawmakers blame the central bank for not doing enough to prevent last year's crisis.
Housing plan reaches 1 in 5 borrowers
WASHINGTON (AP) _ The Obama administration's mortgage relief program has reached one in five eligible homeowners, a government report says, but most of those borrowers are on temporary trial plans that have yet to be made final.
As of the end of October, more than 650,000 borrowers, or 20 percent of those eligible, had signed up for trials lasting up to five months, the Treasury Department said Tuesday. The modifications reduce monthly payments to more affordable levels.
To make the change permanent, though, borrowers must complete a big stack of paperwork and show they can make their payments on time. At the beginning of September, only about 1,700 permanent modifications had been made. The Treasury Department expects to release updated data later this month.
Median home prices fell nationwide in 3Q
A real estate group says home prices fell in eight out of every 10 U.S. cities in the third quarter of this year as heavily discounted distressed sales made up 30 percent of all deals.
But home sales continued their climb, with quarterly sales outpacing the second quarter and the previous year's figures, the National Association of Realtors said Tuesday.
The median sales prices of existing homes declined in 123 out of 153 metropolitan areas compared with the same period a year ago. Prices rose in the other 30 cities.
The national median price clocked in at $177,900, or 11 percent below the third quarter last year.
Stocks zigzag after rally as the dollar rises
NEW YORK (AP) _ Investors cooled their buying of stocks and commodities, pausing from a surge that carried major stock indexes to their highest levels in more than a year.
Stocks ended mixed Tuesday. The Dow Jones industrials tacked on 20 points a day after shooting up 200 points for the second time in three days.
The market again took its direction from the dollar, as it has for months. Stocks drove higher Monday as the dollar weakened and slipped Tuesday as the currency rose.
The Dow swung in a range of about 60 points in light trading as investors increased their buying of safe-haven assets like the dollar and Treasurys. The ICE Futures US dollar index, which measures the dollar against other currencies, edged higher.
Job openings remain close to record-lows
WASHINGTON (AP) _ Job openings are at rock-bottom levels, according to government and private surveys released Tuesday, a trend that could keep the unemployment rate high even as layoffs slow.
Small businesses in particular are reluctant to add workers as they struggle to obtain credit. Many are pushing their current employees to produce more. Economists say small businesses account for about 60 percent of new jobs.
Still, there are some pockets of hiring as demand for information technology and sales professionals grows, according to government reports and job search Web sites. And there are signs that companies are adding more human resources personnel, which could signal more hiring down the road.
Madoff associate wills bulk of fortune to charity
NEW YORK (AP) _ A man who made billions of dollars off Bernard Madoff's Ponzi scheme signed a will leaving the bulk of his fortune to charity, but the gift's ultimate size may depend on legal wrangling over how much of the money rightfully belongs to cheated victims.
Jeffry Picower, 67, a prominent philanthropist, drowned after suffering a heart attack in the swimming pool of his Palm Beach, Fla., mansion on Oct. 25.
Unlike some other Madoff investors, he died a rich man. The trustee unraveling Madoff's financial web said Picower withdrew some $7 billion from his Madoff accounts over the decades _ well more than he invested.
2 ex-Bear Stearns hedge-fund managers acquitted
NEW YORK (AP) _ Two Bear Stearns executives who ran hedge funds that collapsed after betting heavily on the shaky subprime mortgage market were acquitted Tuesday of lying to investors _ a defeat in the government's bid to punish fraud exposed by the financial crisis.
A jury in federal court in Brooklyn deliberated about eight hours over two days before finding Ralph Cioffi and Matthew Tannin not guilty of conspiracy and other charges in an alleged scheme that cost 300 investors about $1.6 billion and nearly caused the demise of Bear Stearns itself. The firm avoided bankruptcy in a rescue buyout by JPMorgan Chase & Co.
Beazer Homes posts profit in fiscal 4th quarter
Beazer Homes USA Inc. reported its first quarterly profit since 2006 on Tuesday and credited more stable home prices and cost cuts for a marked improvement in the homebuilder's gross margins.
The Atlanta-based company also posted an annual increase in new home orders, as low mortgage interest rates and a first-time homebuyer tax credit helped lure buyers. Beazer said it expects orders for the current fiscal year to modestly outpace those of fiscal 2009.
The company said foot traffic slowed somewhat in October as would-be buyers waited for word on whether the government would extend the tax credit. That news came last week as Congress extended the tax incentive through next June, as long as the buyer signs a binding contract by the end of April.
Fed officials warn weak recovery won't spur jobs
WASHINGTON (AP) _ Unemployment likely will remain high for the next several years because the economic recovery won't be strong enough to spur robust hiring, Federal Reserve officials warned Tuesday.
The cautionary note struck by the presidents of regional Fed banks in San Francisco and Atlanta were the first public remarks of Fed officials since the government reported last week that the nation's jobless rate bolted to 10.2 percent in October. It marked only the second time in the post-World War II period that the rate surpassed 10 percent.
In separate speeches, Janet Yellen, president of the Federal Reserve Bank of San Francisco, and Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, warned that rising unemployment could crimp consumers, restraining the recovery.
Adobe to cut about 680 full-time jobs
NEW YORK (AP) _ Adobe Systems says it is cutting 680 full-time jobs, or about 9 percent of its work force as it aligns costs with its fiscal 2010 budget.
Adobe Systems Inc., the maker of Photoshop, Flash and Acrobat software products, said Tuesday it will record pretax charges of $65 million to $71 million as a result.
The job cuts relate only to Adobe employees before the company, based in San Jose, Calif., bought Omniture Inc. in October. Adobe also cut 9 percent of Omniture's work force when that deal closed.
By The Associated Press
The Dow rose 20.03, or 0.2 percent, to 10,246.97, its fourth straight advance and its highest close since Oct. 3, 2008.
The broader Standard & Poor's 500 index fell 0.07, or less than 0.1 percent, to 1,093.01, after six straight days of gains. The Nasdaq composite index fell 2.98, or 0.1 percent, to 2,151.08.
Benchmark crude for December delivery fell 38 cents to settle at $79.05 a barrel on the New York Mercantile Exchange.
Natural gas for December delivery plunged 4 percent, or 20.3 cents, to settle at $4.467 per 1,000 cubic feet on Nymex.
In other Nymex trading, heating oil fell a penny to settle at $2.0523 a gallon. Gasoline for December delivery fell less than a penny to settle at $1.9774 a gallon.
In London, Brent crude for December delivery fell 27 cents to settle at $76.50 on the ICE Futures exchange.