Fed Cuts Funds Rate to 1 Percent

The Federal Reserve statement, on its cut in the federal funds rate to 1 percent, follows.The Federal Open Market Committee decided today to lower its target for the federal funds rate 50 basis points to 1 percent.The pace of economic activity appears to have slowed markedly, owing importantly to...

By CFO Editorial Staff • Oct. 29, 2008

Pension Sponsors Seek to Delay New Rules

With the global stock market collapse sending assets of traditional pensions into a tailspin, a coalition of large companies that still offer defined-benefit plans is seeking a suspension or delay of new rules that would further drain them of much-needed cash.Pensions currently are about 85 perce...

By Stephen Taub and Roy Harris • Oct. 29, 2008

Congressional Leaders Fear Misuse of Bailout Money

Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.) on Wednesday called on Treasury Secretary Henry Paulson to use his broad new authority to further restrict chief executive officer pay at the financial institutions being aided by the $700 billion bailout package.In a ...

By Roll Call Staff • Oct. 29, 2008

Teva Gets $100 Million ARS Settlement

Teva Pharmaceutical Industries announced it has received $100 million as part of a settlement from an institution that acted as a broker in placing Teva’s auction rate securities investments.The Jerusalem-based drug-making giant did not disclose the name of the institution. “Due to confidentially...

By Stephen Taub • Oct. 27, 2008

AIG Pockets $90B in Government Funds

Rapidly tapping into taxpayers’ money, American International Group has accessed about $90 billion from the government since the Federal Reserve came to its rescue last month.AIG said Friday that as of October 22, it had outstanding borrowings of $72 billion under the two-year $85 billion revolvi...

By Stephen Taub • Oct. 24, 2008

UBS to Pay HealthSouth $100M for Abetting Fraud

HealthSouth Corp. says it will get $100 million from UBS in partial settlement of a derivative lawsuit over the investment bank’s role in the health-care provider’s $2.7 billion accounting fraud. The settlement agreement relates only to UBS and does not affect HealthSouth’s claims against its for...

By Stephen Taub • Oct. 24, 2008

Did Lehman Renege on Stock-Loan Deal?

Evergreen Solar Inc., a small maker of solar power panels that had loaned stock to Lehman Brothers before the investment bank filed for bankruptcy, has sued Lehman, charging that it refused to return the shares. The suit also names Barclays PLC, which subsequently bought Lehman.The suit, which a...

By Stephen Taub • Oct. 23, 2008

The Hot Seat: Cox Deflects Blame for Crisis

During a sometimes intense exchange with congressmen on Thursday, Securities and Exchange Commission Chairman Christopher Cox defended his agency’s actions — and his own legacy — in the years and months leading up to the implosion of U.S. financial markets.“I would want the agency’s economists an...

By Sarah Johnson • Oct. 23, 2008

The SEC in 2008: A Very Good Year?

It was a great year for Securities and Exchange Commission enforcement, according to the SEC. In a fiscal-year-end summary, it notes, for example, that it brought the highest number ever of insider trading cases.And altogether, it took the second-highest number of enforcement actions in agency hi...

By Stephen Taub and Roy Harris • Oct. 22, 2008

U-turn for Kerkorian: He’s Selling Ford Stake

Kirk Kerkorian is seeking the exit ramp for his investment in Ford Motor, suggesting he will move his holdings back to hotel-casinos and oil and gas.Tracinda Corp., the 91-year-old billionaire’s investment vehicle, said in a press release and a regulatory filing that on Monday he sold 7.3 million...

By Stephen Taub and Roy Harris • Oct. 21, 2008

Citi Triumphant: Parmalat Loses

A New Jersey state court jury ruled that Citigroup did not help executives at Italian dairy Parmalat commit a massive fraud earlier this decade.The global banking giant was sued for $1.92 billion in damages. However, lawyers for Parmalat CEO Enrico Bondi failed to prove Citi aided in the fraud, B...

By Stephen Taub • Oct. 20, 2008

Capitalism at Bay

ONE hundred and sixty five years ago, a Scottish businessman set out his plans for a newspaper. James Wilson’s starting point was “a melancholy reflection”: “while wealth and capital have been rapidly increasing” and science and art “working the most surprising miracles”, all classes of people we...

By Economist Staff • Oct. 17, 2008

The Last Word

THE third and final debate, which took place at Hofstra University, New York, was a firecracker of a show, as riveting as the two previous meetings were soporific. The candidates discussed substantive issues. They exchanged sharp blows. And, most of the time, they avoided reciting their talking p...

By Economist Staff • Oct. 16, 2008

It’s Years More Jail for the “Tyco Two”

It looks like former Tyco International Ltd. chief executive Dennis Kozlowski and former chief financial officer Mark Swartz will be in the slammer for many years more, after all.The New York State Court of Appeals upheld their criminal convictions today, according to Reuters. In a written decisi...

By Stephen Taub • Oct. 16, 2008

America Catches Up

WITH luck, the American government’s bank recapitalization plan will save the financial system, but it is probably too late to save the economy from succumbing to the combined impact of shrinking wealth and the credit crunch.American officials unveiled a three-part rescue programme on Tuesday Oct...

By Economist Staff • Oct. 15, 2008

Barroso Spies “Light at the End of the Tunnel”

The president of the European Commission, José Manuel Barroso, has said he sees “light at the end of the tunnel” following the massive, co-ordinated rescue packages offered by EU and other governments in a bid to restore confidence in the world’s financial system. “We have created nothing less th...

By European Voice Staff • Oct. 15, 2008

Verdict Against KPMG Could Lead to $41M Payment

Clarification:In an earlier version of this story, the amount of the jury award against KPMG was given as “more than $41 million,” although the actual dollar amount cited by the jury was $31.8 million. The $41-million-plus figure reflects interest on that amount. The original headline also incorr...

By Roy Harris and Stephen Taub • Oct. 14, 2008

Two Take Pills; Don’t Call Them in the Morning

At least two more companies — Cleveland-Cliffs Inc. and Mariner Energy Inc. — this week said their boards approved shareholder-rights plans, in a sign that the global selloff in stocks has companies feeling undervalued and vulnerable to a hostile bidders.Cleveland-Cliffs, which said it would off...

By Stephen Taub • Oct. 14, 2008

TARP Priority

THE signing into law of America’s $700 billion bailout was never likely to save the financial system. In the event, it did not even come close. The Troubled Asset Relief Programme (TARP) could still do some good but to maximise its effectiveness, the Treasury will almost certainly have to stray f...

By Economist Staff • Oct. 13, 2008

Katy Bar the Filing Costs

Katy Industries is orchestrating an intriguing two-step process with the ultimate goal of de-registering its shares.The company, which makes industrial and home-consumer cleaning products, including Brillo, said its plan will reduce costs by eliminating SEC reporting requirements and Sarbanes-Oxl...

By Stephen Taub • Oct. 13, 2008

Ex-Duane Reade Execs Charged with Fraud

The Securities and Exchange Commission charged a former CEO and a one-time CFO of drug store chain Duane Reade with fraud, saying they orchestrated elaborate multimillion-dollar accounting schemes that led the company to inflate earnings.Filed in federal court in Manhattan, the center of the metr...

By Roy Harris • Oct. 9, 2008

Revenue Scheme to Win Financing Is Charged

The former CFO and former CEO of small, privately-held software company Entellium Corp, were charged with wire fraud for overstating revenue to help them secure financing.Parrish L. Jones, Seattle-based Entellium’s former chief financial officer, and former chief executive officer Paul Thomas Joh...

By Stephen Taub • Oct. 8, 2008

Reporting in Real Time, All the Time?

A slippery slope appeared during the Wednesday meeting discussing the Securities and Exchange Commission’s 21st Century Disclosure Initiative. What if companies had to be filing financial information all the time? The initiative, announced last June, is intended to modernize the disclosure system...

By Alan Rappeport • Oct. 8, 2008

On Defensive, SEC Touts Reporting Plan

The Securities and Exchange Commission suggested during a meeting today that had its plans for a new financial reporting system been implemented earlier, they could have provided more transparency during the financial market meltdown. Launched in June, the project involves changing the way compan...

By Sarah Johnson • Oct. 8, 2008

Mission Impossible?

With bad news continuing to pour out of the banking sector, it takes a brave person like Tom Hill to want to take charge of a bank’s financial communications. Hill recently stepped down after three years as UBS’s chief communication officer. But there’s a twist. As before, Hill’s replacement as C...

By Tim Burke • Oct. 8, 2008