Obama to address Congress, nation on economy

WASHINGTON – Barreling ahead on a mammoth agenda, Barack Obama is ready to offer a detailed sketch of the first year of his presidency, casting the nation’s bleeding economy as a tangle of tough, neglected problems.

In a prime-time speech to Congress and millions watching at home, Obama will make his case Tuesday that much more has to be done to turn around the economy — a message he knows he must explain.

White House spokesman Robert Gibbs said Tuesday that Obama will provide more details about his financial stability plan and measures to help the economy while delivering “a sober assessment about where we are and the challenges we face.”

“He’ll say we’re on the right path to meeting these challenges, and there are better days ahead,” Gibbs said.

Obama approaches this moment riding a strong, upbeat sentiment among the public. Overall, 68 percent of people approve of his job performance, a new Washington Post-ABC News poll finds. A New York Times/CBS News polls finds that more than three-quarters of those surveyed were optimistic about the next four years with Obama in charge, and similar majorities said they were confident in his ability to make the right decisions about the economy.

Still, the president faces steep challenges. The nation is nearly dizzy keeping up with what’s emerged from Washington during Obama’s first weeks as president, from a staggering $787 billion stimulus plan to a revamped bailout for the financial sector to a rescue plan for struggling homeowners.

And investors are dour. Wall Street took another pounding Monday, with the Dow Jones industrial average tumbling to its lowest close since 1997.

Although Obama is too new in office to be delivering a State of the Union address, his speech will have all the same trappings. It comes two days before he delivers a budget blueprint to Congress. Unlike that detail-driven document, his address will be broad, spelling out what he wants and how he will do it.

The economy, in its worst tailspin in decades, will dominate. Obama will touch on foreign policy, but that will largely be left for other upcoming speeches. This will not be a rollout of one policy initiative after another.

Obama will make clear that the trillion-dollar-plus deficit is one he “inherited.” In other words, he wants to remind people that President George W. Bush and the previous Congress left him a big hole, forcing him to pursue the costly stimulus package.

The president will push for movement on ensuring health coverage for all Americans. He will seek to expand educational opportunities, and diversify the country’s energy sources, and contain sacred entitlements like Social Security, and halve the soaring budget deficit in four years.

His rhetorical mission is to show not only how all those pieces connect to the health of the economy, but why they must be pursued simultaneously.

Gunning for so much at once is complicated, both in terms of the issues themselves and the politics. Senior presidential adviser David Axelrod acknowledged Monday there is a risk in taking on too much.

“I think the bigger concern,” he said, “is to not be aggressive at a time when a tepid approach could really consign us to a long-term economic catastrophe. We believe the times demand vigor and aggressive action, and so we’re having to do a lot of things at once.”

Rep. Darrell Issa of California, the top Republican on the House Committee on Oversight and Government Reform, said Obama’s speech amounts to a coming-out party.

“You never know what a salesman’s going to sell you until he shows up at your door,” Issa said of his expectations. “If he gives us a narrow set of priorities that can be executed, and they don’t just involve more spending, then I think it will be refreshing. If he gives us a long laundry list, which most presidents do, then although it will set the agenda … it won’t be as meaningful.”

In many ways, though, Obama will be speaking directly to the American people. Daily followers of Obama’s rhetoric are not likely to be surprised by Obama’s words, some of which will be repeats. He is trying to reach millions of people who don’t get to hear him every day.

So Obama will say that the crises facing the nation are so large they can only be solved in bipartisan ways. He will be blunt about the country’s woes but try to balance that talk with optimism. He will talk about his travels as president so he can focus on the stories of communities outside Washington.

Asked in an MSNBC interview how the president plans to make good on his pledge to cut the deficit in half by the end of his first term, Gibbs said, “The biggest thing we’re going to do is cut the amount of money we spend each year in Iraq.”

He said Obama also planned to talk about necessary investments and about taxes.

“I think the president believes very clearly that we have to be honest about where we are,” Gibbs said. “Tonight, he will tell the country that we’ve faced greater challenges than we face now and we’ve always met those challenges.”

There is sure to be ceremony as Obama arrives in the well of the House. His speech is tentatively at 45 minutes, accounting for applause time.

source : news.yahoo.com

Forecasters: Economy worse in ‘09, better in ‘10

WASHINGTON – Brace yourself: The recession is projected to worsen this year. The country stands to lose a sizable chunk of economic activity in 2009 as consumers at home and abroad retrench in the face of persistent economic troubles. And the U.S. unemployment rate — now at 7.6 percent, the highest in more than 16 years — is expected hit a peak of 9 percent this year.

That gloomy outlook came from leading forecasters in the latest survey by the National Association for Business Economics to be released Monday. The new estimates are roughly in line with other recent projections, including those released last week by the Federal Reserve.

“The steady drumbeat of weak economic and financial market data have made business economists decidedly more pessimistic on the economic outlook for the next several quarters,” said NABE president Chris Varvares, head of Macroeconomic Advisers.

All told, Varvares and his fellow forecasters now expect the economy to shrink by 1.9 percent this year, a much deeper contraction than the 0.2 percent dip projected in the fall.

If the new forecast is correct, it would mark the first time since 1991 the economy actually contracted over a full year and would be the worst showing since 1982, when the country had suffered through a severe recession.

Vanishing jobs, shrinking nest eggs, rising foreclosures and tanking home values have forced American consumers to cut back, which in turn has caused businesses to lay off workers and slash costs in other ways, feeding a vicious downward cycle for the economy.

The current recession, which started in December 2007, is posing a major challenge to Washington policymakers, including President Barack Obama and Fed Chairman Ben Bernanke. That’s because its root causes — a housing collapse, credit crunch and financial turmoil — are the worst since the 1930s and don’t lend themselves to easy or quick fixes.

“As the news on the economy has darkened, so too, have the forecasts,” said Ken Mayland, president of ClearView Economics. “We are suffering a period of maximum stress on the economy.”

The economy is expected to remain feeble this year — even with new efforts by the administration and Congress to provide relief.

Just over the past few weeks, a $787 billion recovery package of increased government spending and tax cuts was signed into law, the president unveiled a $75 billion plan to stem home foreclosures and Treasury Secretary Timothy Geithner said as much as $2 trillion could be plowed into the financial system to jump-start lending.

In terms of lost economic activity in 2009, the biggest hit will come in the first six months, forecasters said.

NABE forecasters now expect the economy to slide backward at a staggering pace of 5 percent in the current January-March quarter. That’s a sharp downgrade from the 1.3 percent annualized drop projected in the old survey.

“Further pronounced weakness in housing and deteriorating labor markets underscore the risks for 2009,” Varvares said.

Many economists believe that the current quarter will be the worst of the recession in terms of the bite to gross domestic product, which is the value of all goods and services produced within the U.S. and is the broadest barometer of the country’s economic health.

The second quarter of this year also will be a lot weaker, with the forecasters now calling for the economy to contract at a 1.7 percent pace, compared with the prior projection of 0.5 percent growth.

In the second half of this year, the economy should expand, but still less than what economists thought just a few months ago. NABE forecasters believe home sales and housing construction should hit bottom by the middle of the year, which would help stabilize the economy. Home prices, however, are expected to keep falling, according to other experts.

NABE forecasters predicted that when all is said and done the recession will have caused GDP to decline 2.8 percent. That would be “slightly less than the 3.1 percent during the early ’70s,” according to the survey of 47 forecasters taken between Jan. 29 and Feb. 12.

Even in the best-case scenario, with the recession ending sometime in the second half of this year, employment conditions will be tough.

Some of the forecasters said the nation’s unemployment rate could rise as high as 9 percent for all of 2009 and hit 10 percent next year. In 2008, the jobless rate averaged 5.8 percent, the highest since 2003. The survey’s median forecast — or middle point — called for the unemployment rate to rise to 8.4 percent this year and 8.8 percent next year.

Companies touching every part of the economy have announced thousands of layoffs already this year and more cuts came last week. Goodyear Tire & Rubber Co., said it will cut nearly 5,000 jobs, or almost 7 percent of its work force, this year, following the elimination of about 4,000 jobs in the second half of last year. General Motors Corp. and Chrysler, which are asking the government for billions more in aid to remain viable, announced plans to cut 50,000 more jobs, 47,000 of which would be at GM.

The Fed said the unemployment rate could stay elevated into 2011. Some analysts think the jobless rate won’t drift down to a more normal range of around 5 percent until 2013 — at the earliest.

Companies won’t ramp up hiring until they feel confident that any recovery has staying power. That’s why employment is usually the last piece of the economy to reap the benefits of a recovery.

“A meaningful recovery is not expected to take hold until next year,” said Varvares.

NABE predicts GDP will rebound in 2010, averaging 2.4 percent over the course of the year. The Fed, too, is forecasting that the economy will grow again in 2010_ and will pick up momentum in 2011.

Even so, the Fed is still guarded about any turnaround.

Given all the negative forces weighing on consumers and businesses, the economic recovery “would be unusually gradual and prolonged,” the Fed said.

source : news.yahoo.com

Asian markets fall as Japan’s recession deepens

HONG KONG: Most Asian stock markets fell Monday, as new figures showed Japan’s economy contracted at its quickest pace in 35 years and Group of Seven finance ministers warned the global slump will drag on through most of the year.

The fourth quarter GDP numbers out of Japan, worse than many forecasts, were a sobering reminder of the toll on Asia’s export-driven economies as world demand collapses amid the worst slump in decades.

Japan’s Nikkei 225 stock average edged down 29.23 points, or 0.4percent, to 7,750.17, and Hong Kong’s Hang Seng Index dropped 118.07points, or 0.9 percent, to 13,436.60. South Korea’s Kospi lost 1.4 percent to 1,176.23. India’s benchmark dropped more than 3 percent, Australia’s stock measure eased 1.2 percent and Singapore’s index was off 0.6 percent.

Meanwhile, Shanghai’s main index jumped 3 percent as mainland stocks extended their rally in the new year. In Japan, several exporters were hurt by the data showing the economy sank deeper into recession. Shares in Toyota Motor Corp. lost 0.7 percent, while electronics heavyweight Canon Inc. slid 1.2 percent. Sony Corp. lost 1.3 percent. Also weighing on markets were declines on Wall Street last week.

source : jang.com.pk

India’s NTPC, NPC plan 2,000 MW nuclear power unit

MUMBAI: Indian state-run firms NTPC Ltd and Nuclear Power Corp of India Ltd have agreed to form a joint venture to build 2,000 megawatts nuclear power plant in India.

NTPC, India’s largest power utility, will hold 49 percent stake in the venture, it said in a statement over the weekend. Nuclear Power Corp will hold the majority 51 percent stake. It did not disclose financial details, but Indian newspapers estimated investment in the join venture would total 150 billion rupees ($3 billion) over eight years, with the two firms bringing in 50 billion rupees as equity.

India signed a nuclear pact with the United States last year, giving New Delhi access to civilian nuclear fuel and technology for the first time in three decades, and opening up a potential multi-billion dollar market to global trade.

The country hopes to generate 20,000 MW through nuclear power by 2020, boosting supply for its power-starved economy, which currently faces shortages of up to 16 percent at peak hours. Existing nuclear power capacity stands at about 4,000MW.

source : jang.com.pk

Gregg withdraws as commerce secretary nominee

WASHINGTON – Saying “I made a mistake,” Republican Sen. Judd Gregg of New Hampshire abruptly withdrew as commerce secretary nominee on Thursday and left the fledgling White House suddenly coping with Barack Obama’s third Cabinet withdrawal. Gregg cited “irresolvable conflicts” with Obama’s policies, specifically mentioning the $790 billion economic stimulus bill and 2010 census in a statement released without warning by his Senate office.

Later, at a news conference in the Capitol, he sounded more contrite.

“The president asked me to do it,” he said of the job offer. “I said, yes. That was my mistake.”

Obama offered a somewhat different account from Gregg.

“It comes as something of a surprise, because the truth, you know, Mr. Gregg approached us with interest and seemed enthusiastic,” Obama said in an interview with the Springfield (Ill.) Journal-Register.

Later, he told reporters traveling with him on Air Force One that he was glad Gregg “searched his heart” and changed course now before the Senate confirmed him to the Cabinet post. He also said Gregg’s withdrawal won’t deter him from working with Republicans and trying to change the partisan ways of Washington.

“Clearly he was just having second thoughts about leaving the Senate, a place where he’s thrived,” Obama added.

The unexpected withdrawal came just three weeks into Obama’s presidency and on the heels of several other Cabinet troubles. The new president is in the midst of expending political capital in Washington — and around the country — for his economic package and is seeking to move forward with an ambitious agenda in the midst of an economic recession while the country continues to face threats abroad.

Now Obama also finds himself needing to fill two vacancies — at Commerce and at the Health and Human Services Department. Former Senate Democratic leader Tom Daschle withdrew his nomination for that post amid a tax controversy. Treasury Secretary Tim Geithner was confirmed despite revelations that he had not paid some of his taxes on time.

New Mexico Gov. Bill Richardson was Obama’s first choice as commerce secretary. He withdrew in early January following disclosure that a grand jury is investigating allegations of wrongdoing in the awarding of contracts in his state. Richardson has not been implicated personally.

Gregg was one of three Republicans Obama had put in his Cabinet to emphasize his campaign pledge that he would be an agent of bipartisan change.

White House Chief of Staff Rahm Emanuel said Gregg told the White House early this week that he was having second thoughts and met with Obama about them during an Oval Office meeting on Wednesday. Emanuel said there were no hard feelings and “it’s better we figured this out now than later.”

“He went into this eyes open and he realized over time it wasn’t going to be a good fit,” Emanuel added.

Gregg said he’d always been a strong fiscal conservative and added: “It really wasn’t a good pick.”

In an interview with The Associated Press, Gregg said, “For 30 years, I’ve been my own person in charge of my own views, and I guess I hadn’t really focused on the job of working for somebody else and carrying their views, and so this is basically where it came out.”

Gregg, 61, said he changed his mind after realizing he wasn’t ready to “trim my sails” to be a part of Obama’s team.

“I just sensed that I was not going to be good at being anything other than myself,” he said.

The New Hampshire senator also said he would probably not run for a new term in 2010.

Senate Majority Leader Harry Reid, D-Nev., called Gregg a friend and said, “I respect his decision.” But Sen. Jay Rockefeller, D-W.Va., chairman of the Senate Commerce Committee, said he wished Gregg “had thought through the implications of his nomination more thoroughly before accepting this post.”

In his statement, Gregg said his withdrawal had nothing to do with the vetting into his past that Cabinet officials routinely undergo. He told the AP he foresaw conflicts over health care, global warming and taxes.

He also cited both the stimulus and the census as areas of disagreement with the administration.

When the Senate voted on the president’s massive stimulus plan earlier this week, Gregg did not vote. The bill passed with all Democratic votes and just three Republican votes. Asked by reporters whether the White House could have used his vote on the plan, Gregg said “I’m sure that’s true” and he said the administration had asked him to vote for it.

Conservatives in both houses have been relentless critics of the centerpiece of Obama’s economic recovery plan, arguing it is filled with wasteful spending and won’t create enough jobs.

The Commerce Department has jurisdiction over the Census Bureau, and the administration recently took steps to assert greater control. The outcome of the census has deep political implications, since congressional districts are drawn based on population.

Gregg’s announcement also undid a carefully constructed chain of events.

The New Hampshire senator had agreed to join the Cabinet only if his departure from the Senate did not allow Democrats to take his seat.

New Hampshire’s Democratic governor, John Lynch, in turn, pledged to appointed Bonnie Newman, a Republican and a former interim president of the University of New Hampshire.

She, in turn, had agreed not to run for a full term in 2010, creating an open seat for Democrats to try to claim.

In a statement, Senate Republican leader Mitch McConnell of Kentucky said Gregg “made a principled decision to return and we’re glad to have him.”

Lynch, who spoke to Gregg several hours before the announcement, said he respected Gregg’s decision to withdraw and remain in the Senate. He thanked Newman for her willingness to serve.

A day after Gregg’s nomination had been announced, the AP reported that a former staffer, Kevin Koonce, was under criminal investigation for allegedly taking baseball and hockey tickets from a lobbyist in exchange for legislative favors while working for Gregg.

The senator said at the time that he had been told he was neither a subject nor target of the investigation, and would cooperate fully.

___

Associated Press writers Jennifer Loven and Andrew Taylor in Washington, Ben Feller in Springfield, Ill., and Holly Ramer in Concord, N.H., contributed to this report.

source : news.yahoo.com

Asian markets crude prices steady

SINGAPORE: Oil prices remained steady near $40 a barrel in early Asian trade Tuesday ahead of an US economic stimulus package expected to be approved this week.

Light sweet crude for March delivery slid 1 cent to $39.55 a barrel at 10.00 a.m Singapore time. On Monday the contract settled down 61 cents at $39.56 a barrel in New York. London Brent crude rose 2 cents to $46, maintaining a rare premium against US prices.

Investors and governments worldwide are keeping an anxious eye on US plans to stimulate its economy and rescue its banks on Monday, hoping the world’s largest economy can lead the way out of a global crisis.

source : jang.com.pk

Kuwait announces economic stimulus package

KUWAIT CITY: Kuwait on Sunday unveiled a multi-billion dollar stimulus plan that includes wide-ranging state guarantees for bank loans and assisting troubled investment firms to repay their debts.

Draft legislation approved by the cabinet on Thursday stipulates that the state would guarantee 50 percent of an estimated four billion dinars (13.8 billion dollars) of new credit facilities to be granted by banks to local companies.

“This is a way to encourage local banks to provide fresh credit to productive local companies to overcome shortage of cash,” governor of Kuwait central bank Sheikh Salem Abdulaziz al-Sabah told a media conference.

Under the legislation, the state would guarantee half the credit facilities that would be provided by banks to local investment companies to help them repay part of their debt.

Sheikh Salem said that debt on the 99 Kuwaiti investment firms is five billion dinars (17.3 billion dollars), 7.6 billion dollars of which are owed to foreign banks and financial institutions.

The governor said that the package is estimated to cost public funds a maximum of 1.5 billion dinars (5.2 billion dollars).

The draft legislation, which is expected to go before parliament soon, also guarantees for 15 years any drop in the value of local banks’ investment and real estate portfolios.

The package aims to “safeguard the financial system and stabilise the domestic economy against the fallout of the global economic crisis,” the governor said.

Last year, Kuwait guaranteed deposits of all banks operating in the country.

A number of Kuwaiti investment companies have defaulted on loans as credit facilities have become difficult to obtain and the value of their assets has dropped sharply.

Some of them have laid off a number of employees and cut the salaries of others as the price of their shares on the stock market has dropped sharply.

Last week, lawmakers urged swift government intervention to rescue the local economy from what they called an imminent collapse.

A number of lawmakers are however demanding the money be used to help ordinary Kuwaitis rather than bailing out wealthy businessmen.

source : jang.com.pk

US seven major firms layoff over 72,000 employees

NEW YORK: US seven major business firms Monday on the first day of the week further relieved of over 72,000 of their employees in the wake of the global recession.

Among the companies, which resorted to massive downsizing, machinery manufacturing giant firm Caterpiller topped the list by relieving of their 20,000 employees, while the world’s largest pharmaceutical firm Pfizer and telecommunication organization Sprint Nextel have announced 8,000 job cuts. Besides, Home Depot, Dutch Financial Group sacked 7000 of their employees and Texas Instrument 3,400. American economy continued its downward spiral with business economists predicting many more U.S. job losses in 2009.

source : jang.com.pk

Arab leaders focus on economy, aid after Gaza divide

KUWAIT: Arab leaders looking to bridge sharp divisions over Israel’s Gaza offensive will agree at a summit on Tuesday to launch a $2 billion reconstruction fund and call for greater economic cooperation.

Differences over how to deal with the three-week Israeli offensive that killed more than 1,300 people highlighted the divide between Egypt, Saudi Arabia and their allies on one side, and Syria, Qatar and their allies on the other. In a bid to restore unity, Saudi King Abdullah on Monday hosted a lunch attended by the leaders of Qatar, Jordan, Egypt, Syria and Kuwait at which they agreed to patch up their differences over Gaza. Leaders were expected to back a $2 billion fund to rebuild Gaza. Saudi Arabia has committed $1 billion to the fund. The final declaration would concentrate on increased economic cooperation, with the emphasis on energy.

source : jang.com.pk

Obama: Geithner will be confirmed despite mistake

WASHINGTON – President-elect Barack Obama called disclosures about Treasury choice Timothy Geithner’s tax problems an embarrassment Wednesday but said Geithner’s “innocent mistake” shouldn’t keep him from confirmation as the new administration’s top official in urgent efforts to revive the economy.

The revelations that Geithner had failed to pay $34,000 in taxes several years ago derailed Senate Democrats’ plans to speed him to confirmation by Inauguration Day, but senators in both parties said the information was unlikely to torpedo his chances in the end.

Obama had hoped for approval by Tuesday, but senators now have scheduled Geithner’s confirmation hearing for next Wednesday, with Senate debate and a vote sometime after that.

Two Republicans objected to scheduling a confirmation hearing this Friday at the Senate Finance Committee after the panel disclosed Geithner had failed to pay taxes he owed for several years. Democrats were working to clear away the obstacles, holding out hope that he could still be confirmed the day Obama is sworn in.

The president-elect, asked about the situation on Wednesday, said, “Look is this an embarrassment for him? Yes. He said so himself. But it was an innocent mistake. It is a mistake that is commonly made for people who are working internationally or for international institutions. It has been corrected. He paid the penalties.”

“My expectation is that Tim Geithner will be confirmed,” Obama said.

He spoke at his transition office after a meeting with Vice President-elect Joe Biden and Sen. Lindsey Graham, R-S.C., about their recent trip to Afghanistan, Pakistan, Iraq and Kuwait.

Democrats and Republicans on the Finance Committee voiced strong support for Geithner, who was phoning senators individually in an effort to persuade them his tax problems were the result of innocent errors, not deliberate attempts to avoid paying the Internal Revenue Service.

Senators’ comments suggested that Geithner’s tax troubles are being viewed on Capitol Hill more as embarrassing mistakes than as disqualifying misdeeds. That’s despite the fact that tax problems have sunk other government nominees, including Zoe Baird, Bill Clinton’s choice for attorney general, who stepped aside when word leaked that she had hired illegal immigrants as household workers and failed to pay their Social Security taxes.

“It’s an honest mistake,” said Sen. Max Baucus, the Montana Democrat who chairs the committee, adding that Geithner’s confirmation was “a given.”

Geithner is “very, very competent, and add to that the country needs to have an economic team in place immediately to address the dire economic problems,” he said.

Sen. Jon S. Kyl of Arizona, the No. 2 Republican, is blocking the hearing by insisting on rules that require a full week’s notice for scheduling such a session, according to an aide close to the confirmation process. Kyl’s objection was disclosed on condition of anonymity because the aide was not authorized to announce it.

A second Finance Committee Republican, Sen. Jim Bunning of Kentucky, was also balking at expediting the hearing.

“Senator Bunning did not feel it was appropriate to rush forward with the hearing this week in light of the late-breaking information,” said his spokesman, Mike Reynard. “He wanted more time to carefully consider” the disclosures.

Sen. Charles E. Grassley, the senior Finance Republican, said he was not inclined to oppose a quick hearing. He planned to meet individually with other GOP members of the panel to see whether they could agree on the Friday session.

“I’m not saying at this point it’s disqualifying,” Grassley told reporters in a conference call. “But it’s a little more important about income tax for somebody that’s overseeing the IRS than there is, maybe, for the secretary of agriculture, as an example.”

Whenever he goes before the Finance panel, Geithner — whose responsibilities in his new post would include authority over the IRS — is likely to face a grilling about his tax errors.

He failed to pay self-employment taxes for money he earned from 2001 to 2004 while working for the International Monetary Fund, according to materials released by the committee Tuesday.

He paid some of the taxes in 2006, after an IRS audit discovered the discrepancy for taxes paid in 2003 and 2004. But it wasn’t until much later — days before Obama tapped him to head Treasury late last year — that Geithner paid back most of the taxes, incurred in 2001 and 2002. He did so after Obama’s transition team found that Geithner had made the same tax mistake his first two years at the IMF as the one the IRS found he made during his last two years there.

Despite the disclosures, several committee Republicans appeared to be leaning toward backing Geithner. Sen. Orrin G. Hatch of Utah called the tax problems “a mistake that a human being can make.”

“I’m confident in the man’s ability. I think he’s a very fine man. I’m not one that holds mistakes against people,” Hatch said.

Sen. John Ensign, R-Nev., who said he spoke with Geithner for about a half-hour Wednesday morning, said he didn’t foresee trouble for the nominee.

“I don’t think I see enough in there to cause a problem,” Ensign said. “It’s very, very easy to make honest mistakes.”

Sen. Pat Roberts, R-Kan., said he’d probably vote to confirm Geithner.

Obama’s team informed Baucus and Grassley of the problems in early December, and a subsequent investigation by their staffs unearthed another embarrassing detail about Geithner: that a housekeeper he employed in 2005 allowed her legal immigrant work status to lapse for three and a half months.

It was the unpaid taxes, though, that were proving more damaging. Obama’s team says his mistake was a common one for people hired by international organizations and foreign embassies that don’t pay the employer share of Social Security taxes. The IRS estimated in 2006 that as many as half those employees had made tax-filing mistakes, and offered a group settlement to let them correct the errors.

But the Finance Committee, in 30 pages of documents released on Tuesday, noted that the IMF issues several clear guidelines each year for its employees detailing their responsibility to pay all their self-employment taxes, and that Geithner had signed annual statements saying that he would do so. He also had experience dealing with such taxes, the panel noted.

___

Associated Press Writers Ann Sanner, Charles Babington, Jim Kuhnhenn and Andrew Taylor contributed to this report.

source : news.yahoo.com

Stocks slide after rise in unemployment rate

NEW YORK – The first full week of 2009 didn’t bring Wall Street any huge shocks, but it didn’t bring much for investors be happy about, either.

A jump in unemployment sent stocks sharply lower Friday as investors feared that Americans won’t soon deviate from their tightened budgets. The Dow Jones industrial average fell 143 points to end the week down nearly 5 percent, its worst week since November.

The Labor Department’s much-anticipated report showed employers cut 524,000 jobs in December, a smaller decline than the loss of 550,000 jobs economists forecast. But the unemployment rate jumped to a 16-year high of 7.2 percent — more than the 7 percent economists predicted — from 6.8 percent in November.

Lost jobs were not a shock to Wall Street, but the news still stung.

“People say that they know how bad the economy is. But they don’t know how it feels to have the reality hit home,” said Stu Schweitzer, global markets strategist at J.P. Morgan’s Private Bank. “It’s not the facts — it’s how the facts feel. And it feels terrible to have so many Americans losing jobs, and so many more likely to follow in the coming months.”

Rising unemployment tends to erode consumer spending, which accounts for more than two-thirds of U.S. economic activity. For all of 2008, the economy lost 2.6 million jobs — the most since 1945. Retailers have been reporting dismal holiday sales figures, and Wall Street is concerned about how long the economy will be suffering a pullback in consumer spending.

President-elect Barack Obama on Friday called December’s jobs loss “a stark reminder of how urgently action is needed” to revive the nation’s staggering economy. Obama is planning on a stimulus package costing about $800 billion, consisting of tax cuts and other ways to try to help individuals and businesses.

But investors were nonetheless worried about the prospects for the economy. Warnings from industry leaders during the week about business conditions underscored the economy’s troubles. Wal-Mart Stores Inc., chip maker Intel Corp., aluminum producer Alcoa Inc. and media company Time Warner Inc. all told Wall Street their results suffered in the fourth quarter.

The Dow Jones industrial average fell 143.28, or 1.64 percent, to 8,599.18. The blue chips‘ 4.8 percent decline for the week was the biggest point and percentage loss since the week ended Nov. 21.

Broader stock indicators also lost ground. The Standard & Poor’s 500 index fell 19.38, or 2.13 percent, to 890.35, and the Nasdaq composite index fell 45.42, or 2.81 percent, to 1,571.59.

For the week, the S&P 500 slid 4.5 percent and the Nasdaq lost 3.7 percent.

The Russell 2000 index of smaller companies dropped 20.71, or 4.13 percent, to 481.30.

Declining issues outnumbered advancers by more than 2 to 1 on the New York Stock Exchange, where consolidated volume came to a light 4.13 billion shares compared with 4.34 billion shares traded Thursday.

Bond prices mostly rose Friday as investors sought safety from the grim economic data. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.40 percent from 2.44 percent late Thursday. The yield on the three-month T-bill, considered one of the safest short-term investments, slipped to 0.07 percent from 0.08 percent compared with late Thursday.

The dollar mostly rose against other major currencies, while gold prices fell.

Light, sweet crude fell 87 cents to settle at $40.83 on the New York Mercantile Exchange after dipping as low as $39.38.

Investors also digested a Commerce Department report that businesses cut wholesale inventories for a third straight month in November as sales continued to plunge. Wholesale inventories dropped 0.6 percent, and sales were down a record 7.1 percent.

Energy companies were among the hardest hit stocks Friday after months of declining oil prices and a loss for the week of about $10 a barrel. Occidental Petroleum Corp. fell $2.70, or 4.6 percent, to $56.30. Schlumberger Ltd. fell $2.83, or 6.2 percent, to $43 after announcing plans to cut about 5 percent of its work force due to the drop in crude. Oil is down from more than $147 a barrel in July, hurting demand for exploration and production services.

Citigroup Inc. fell 41 cents, or 5.7 percent, to $6.75 after board member Robert Rubin, the former U.S. Treasury secretary, resigned as a senior adviser to the big financial services company. The company said he will remain a director until his term expires at the next annual meeting in the spring. Rubin has drawn criticism for his role in the bank’s recent problems that drove it to seek federal assistance.

The rise in unemployment also hurt consumer discretionary stocks like retailers. Target Corp. fell $2.12, or 5.7 percent, to $35.40, while Macy’s Inc. fell 63 cents, or 5.8 percent, to $10.30.

Wall Street is also girding for dismal fourth-quarter earnings reports from companies starting next week.

“Everyone is expecting bad results,” said Jim Swanson, chief investment strategist at MFS Investment Management. But he said Wall Street has also set expectations so low that results would have to be far worse than expected to startle the market.

“Anything that’s not catastrophic will probably be greeted mildly or even a little bit positively,” he said.

Nick Kalivas, vice president of financial research at the brokerage MF Global, said he believes investors will start buying back into the market again, but slowly and cautiously. “There’s nothing in the short term that’s going to give people real satisfaction,” he said.

Overseas, Japan’s Nikkei stock average fell 0.45 percent. Britain’s FTSE 100 fell 1.26 percent, Germany’s DAX index fell 1.97 percent, and France’s CAC-40 fell 0.75 percent.

___

The Dow Jones industrial average ended the week down 435.51, or 4.82 percent, at 8,599.18. The Standard & Poor’s 500 index fell 41.45, or 4.45 percent, to 890.35. The Nasdaq composite index ended the week down 60.62, or 3.71 percent, at 1,571.59.

The Russell 2000 index finished the week down 24.54, or 4.85 percent, at 481.30.

The Dow Jones Wilshire 5000 Composite Index — a free-float weighted index that measures 5,000 U.S. based companies — ended at 8,935.80, down 378.77 points, or 4.04 percent, for the week. A year ago, the index was at 14,120.81.

source : news.yahoo.com

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Obama says his plan with tax cuts to get quick OK

WASHINGTON – President-elect Barack Obama plunged into rare pre-inaugural crisis talks with congressional leaders Monday, declaring the national economy was “bad and getting worse” and embracing tax cuts now expected to reach $300 billion. He predicted lawmakers would approve a mammoth revitalization package within two weeks of his taking office.

If the two-year plan is enacted, workers would see larger paychecks almost immediately because taxes withheld by the government would drop. The break would be retroactive to Jan. 1, and couples receiving a $1,000 tax cut would begin receiving an extra $40 in twice-monthly paychecks as the government tries to spark more consumer spending.

“The economy is very sick,” said Obama, who met privately with leaders of both parties at the Capitol. “The situation is getting worse. … We have to act and act now to break the momentum of this recession.”

Obama, who takes office two weeks from Tuesday, has said there can be only one president at a time — and he repeated that principle Monday “when it comes to foreign affairs.” But when it comes to the floundering economy, he clearly feels he cannot sit by until the swearing-in.

“The reason we are here today is because the people’s business cannot wait,” Obama said as he arrived on Capitol Hill.

“I expect to be able to sign a bill shortly after taking office,” he said. Pressed on the timing, he said, “By the end of January or the first of February.”

Obama’s proposal to stimulate the economy includes tax cuts of up to $300 billion — including $500 for most individuals and $1,000 for couples if one spouse is employed — as well as more than $100 billion for businesses, an Obama transition official said. The total value of the tax cuts would be significantly higher than had been signaled earlier.

New federal spending, also aimed at boosting the moribund economy, could push the overall package to the range of $800 billion or so. Some $77 billion would be used to extend unemployment benefits and to subsidize health care for people who have lost their jobs.

The rest would go toward job-creation projects such as roads and bridges and toward long-term goals such as alternative energy programs.

Meeting with Democratic House Speaker Nancy Pelosi, Obama set a tone of urgency for dealing with a financial situation that he described as “precarious.”

He said, “The speaker and her staff have been extraordinarily helpful in working with our team so we can shape an economic recovery plan and start putting people back to work.”

But he also met with Republicans in an effort to build broad support for quick action.

“This is not a Republican problem or a Democratic problem at this stage,” he said. “It is an American problem and we’re going to all have to chip in and do what the American people expect.”

At his meeting with bipartisan leaders of Congress, Obama said he would make his stimulus proposal available on the Internet, with a Google-like search function to show each proposed project or program, by congressional district, according to three people who attended.

After meeting with Obama, House Minority Leader John Boehner, R-Ohio, said he was concerned about the plan’s cost.

“This is not a package that’s ever going to be paid for by the current generation,” Boehner said. “It’s being paid for by our kids and grandkids.”

Republican lawmakers want more details, Boehner said, but he replied “yes” when asked if he expected a stimulus plan to be enacted within six weeks.

Said Pelosi: “It is a great honor and personal privilege to welcome you to this office. Tomorrow we will swear in a new Congress and we will hit the ground running on the initiatives … to ease the pain being felt by the American people.”

The Obama plan’s tax cuts for individuals and couples would be a bit different from the rebate checks sent out last year by the Bush administration and Congress in a bid to boost the slowing economy. The relief this time around would be awarded by withholding less from worker paychecks. That provision would cost about $140-150 billion over two years.

For businesses, the plan would allow firms incurring losses last year to take a credit against profits dating back five years instead of the two years currently allowed.

Another provision brought to the negotiations by the Obama team would award a one-year tax credit costing $40-50 billion to companies that hire new workers, and would provide other incentives for business investment in new equipment.

“We’ve got an extraordinary economic challenge ahead of us,” Obama said, and he predicted a jobs report at the end of the week would show new declines.

He had meetings with a broad array of House and Senate Democratic leaders and with a bipartisan group of key lawmakers. He had hoped to have Congress enact the recovery plan in time for him to sign when he takes office Jan. 20, but no one thinks that will happen now.

Obama has insisted that bold and quick action is necessary if the nation is to rebound from the greatest economic crisis since the Great Depression. He has said repeatedly he wants a plan that will create 3 million new jobs.

The economic teams of new presidents often work behind the scenes with congressional leaders before their administrations move in, but Obama’s direct and public involvement is highly unusual.

He arrived Sunday night in Washington and spent all of Monday at the Capitol before returning to the hotel where he has set up shop for the two weeks before his inauguration.

Later Obama attended a party at Bobby Van’s restaurant, thrown by Illinois Sen. Dick Durbin, the body’s second ranking Democrat, for new members of the House and Senate and the Chicago press corps. About 300 guests packed the restaurant’s 13-story atrium, jockeying for pictures with the president-elect and holding their cell phones aloft as he tried to walk into the room. He made about 25 feet in 30 minutes, then returned to the hotel.

Aides have said the package Obama has dubbed the American Recovery and Reinvestment Plan could cost as much as $775 billion. The president-elect has refused to put a price tag on the plan, and some members of Congress expect it to go higher.

___

Associated Press writer Charles Babington contributed to this report.

source : news.yahoo.com

Obama says economy ‘getting worse’

WASHINGTON: President-elect Barack Obama on Monday described the economy as “bad and getting worse.”

He’s been on Capitol Hill today, meeting with House and Senate leaders to talk about an economic stimulus plan.

Before meeting with Senate Majority Leader Harry Reid, Obama told reporters, “We have to act and act now,” in order to break what he called the “momentum of this recession.”

Obama earlier met with House Speaker Nancy Pelosi. He said he went to Capitol Hill ahead of his inauguration because “the people’s business cannot wait.”

source : jang.com.pk

Economy capable to fulfil defence requirements: Tarin

ISLAMABAD: Advisor to Prime Minister on Finance Shoukat Tarin said on Monday that Pakistani economy was fully capable to meet defence requirement of the country.

Talking to a TV channel, he said Defence Ministry had not put any undue burden on finance despite tension on eastern border and movement of troops.

Replying to a question, he said that government would never stop money for meeting the defence requirements.

He said the Finance Ministry had chalked out a comprehensive road map of nine points economic agenda to capture short, medium and long-term goals.

“Our agenda is to bring micro economic stability, increasing revenues, reducing fiscal deficit and rationalization of developmental budget and reduction in poverty”.

He said that besides disbursement of cash amount among poor, the government also wants to give them health insurance and creating more through skills development.

He said that despite tough challenges Pakistani economy was showing signs of improvement, adding due to international financial crunch stock markets of all the countries suffered.

He said inflation was dropping and hoped the government would succeed to bring it to a single digit by next year. He said inflation would drop by three per cent in next two months.

source : jang.com.pk

Japan production in historic plunge amid global slump

TOKYO (AFP) – Japanese production fell at the fastest rate on record in November as firms closed factories and cut jobs due to slumping demand brought on by the global economic crisis, according to data out Friday.

The government also said another 100,000 people were out of work compared with a year earlier and that more were set to lose their jobs as firms axe employees on temporary contracts.

Industrial output in the world’s second biggest economy plunged a record 8.1 percent in November from the previous month, the biggest drop since the Ministry of Economy, Trade and Industry began releasing the statistics in 1953.

It was much worse than market forecasts of a 6.7 percent fall.

Kaoru Yosano, the economy minister, warned that it was difficult to see when Japan would break out of its recession.

“The public, business people and politicians, we all must give our all so that the economy would not nosedive even below its lowest point,” Yosano said.

Prime Minister Taro Aso vowed to press parliament to enact a record-high budget unveiled this week by his government, which covers tax cuts, cash rebates and other measures aimed at stimulating the economy.

“Japan should be the first country to get out of recession. We will lead the initiative,” Aso told a meeting of the ruling Liberal Democratic Party.

But production was likely to continue falling, with the industry ministry expecting an 8.0 percent drop in December and another 2.1 percent decline in January, as the auto industry feels the pinch.

Some of Japan’s best known manufacturers, including Toyota Motor Corp., Sony Corp. and Canon Inc., have lowered production and cut jobs to adjust to the fall in demand for their exports.

“We have been seeing economic data and forecasts downgraded every month,” said Hiroshi Watanabe, economist at Daiwa Research Institute.

“From now on, I expect the weak exports will lead to a serious inventory adjustment. Shipments are weak, increasing the inventory. This in turn again lowers production,” he said.

Japan relies on exports as the key driver of its economic growth, but overseas-bound shipments also fell at their fastest-ever rate in November.

Japan is bearing the brunt of weak demand around the world, said Takeshi Minami, chief economist at Norinchukin Research Institute.

The Bank of Japan, which last week cut its key rate to just 0.1 percent, “will probably face more calls for further monetary easing,” Minami told Dow Jones Newswires.

Unemployment rose to 3.9 percent in November, up 0.2 percentage points from the previous month, the internal affairs ministry said Friday.

The figure was slightly below average market forecasts of 4.0 percent.

The number of people out of work increased by 100,000 from a year earlier to a total of 2.56 million.

The ratio of job offers to job seekers also fell to 0.76, meaning 76 jobs are available to 100 job seekers.

The job cuts have targeted mainly people on limited-term contracts or those who were recruited from temp agencies.

The labour ministry said a total of 85,012 temporary workers have already lost their jobs or know they will be laid off by March — a figure that has nearly trebled in a month.

“We expect the figure to rise even further towards the year-end and the end of the fiscal year” in March, a labour ministry official said.

The yen came under pressure in Asian trade after the gloomy figures. However, Tokyo’s benchmark Nikkei index rose 1.63 percent to a six-week high on bargain-hunting in thin holiday trade.

In other data, Japan said that core consumer prices rose 1.0 percent in November from a year earlier.

But prices eased by 0.8 percent from the previous month on lower energy prices, leading to concern that Japan may be relapsing into its decade-old scourge of growth-sapping deflation.

Consumer prices have been rising for more than a year, but most of the growth has been due to high energy and food prices.

source : news.yahoo.com

Electronic products’ sale plunge due to recession

KARACHI: Electronic products’ sale has plummeted by 65 percent in the wake of depreciated rupee and slowdown in the economy, while the small shopkeepers have shut down their business.

Karachi Electronic Traders Association (KETA) sources told Geo News that this being the wedding season was seen best for the sale of electronic items, yet the sale has significantly slumped due to economic slowdown, regulatory duty by the government and the hundred percent LC margin slapped by the Central Bank. The sale of washing machine, juicer, toaster and electronic heater has dropped by 35 percent, while fridge, deep freezer, and air conditioners’ sale has almost dissipated, he said. Sources said that the small shopkeepers running business in rented shops were hard hit and 25 percent of them have closed their business. On the other hand, State Bank data said that the imports of electronic products shot up by 20 percent have reached up to $350 million.

source : jang.com.pk

Gwadar Port: Govt. to review deal with Singaporean company

GWADAR: Minister of State for Port and Shipping Nabeel Gabol said Saturday that government is reviewing the contract inked with the Singaporean company in the context of Balochistan province.

Addressing a press conference in Gwadar he said that the deal could be canceled if it does not favour Balochistan as he termed Gwadar Port being the property of the people of Balochistan and vowed to make such decisions that are in the interest of Balochistan.

CM Balochistan on the occasion promised to make the Gwadar Port operational soon.

source : jang.com.pk

news

Stocks retreat as investors refocus on economy

NEW YORK – Wall Street retreated sharply from the previous session’s big gains Friday as investors absorbed another wave of downbeat economic news and took little comfort from hints that an additional interest rate cut might be possible. The Dow Jones industrials fell more than 230 points.

Some retrenchment was to be expected after such a big advance Thursday, in which the Dow rallied more than 550 points after falling near its lows for the year. But there was also plenty of discouraging news for investors to focus on, including comments from Federal Reserve Chairman Ben Bernanke that the markets remain under “severe strain” and a sobering report on October retail sales.

The Fed chief said during a speech in Frankfurt, Germany, that he would work closely with other central banks to try to alleviate the global financial crisis and left open the door to a fresh interest rate cut. The Fed is scheduled to meet Dec. 16 at its last regularly scheduled meeting this year.

While Wall Street would like to see another rate cut, many investors aren’t sure, given the litany of bad economic and corporate news, of how effective a rate reduction would be in the near term. Many investors are still trying to assimilate to the idea that the economy’s downturn would be protracted, lasting well into next year and perhaps longer.

“The economic news continues to be very negative,” said Ben Halliburton, chief investment officer of Tradition Capital Management. “Also, the realization that ‘09 is going to be a very bad year for economic activity is starting to dawn on people and they are starting to digest how bad it’s going to be.”

The Commerce Department reported that retail sales plunged by the largest amount on record in October as consumers cut back on spending in the wake of the financial crisis. Retail sales fell by 2.8 percent last month, surpassing the old mark of a 2.65 percent drop in November 2001 in the wake of the terrorist attacks that year.

The market got more disappointing consumer news from retailers Abercrombie & Fitch Co. and JCPenney Co. Both warned that profits will come in below Wall Street’s already lowered projections as retailers head into a holiday shopping season that could be among the slowest on record.

The great fear on the Street is that Americans’ reluctance to spend will extend what is already a serious economic downturn. A stream of negative consumer news sent stocks tumbling earlier in the week.

There was also disquieting news from the tech sector. Sun Microsystems Inc. said it will cut up to 6,000 workers, or about 18 percent of global staff, as part of a massive restructuring plan. And handset maker Nokia Corp. warned the global economic slowdown will weigh on sales next year.

But some analysts said technical factors contributed to Friday’s decline.

“We’re trying to test new lows,” said James Cox, managing partner at Harris Financial Group in Richmond, Va. “Obviously yesterday we had a successful test, and I think we’re going to have another run at it today.”

The imminent Nov. 15 deadline for redemption calls at hedge funds and mutual funds added to the losses, analysts said. Redemptions are when investors ask for their money back.

“Without a doubt, there is going to be some pressure on the market to continue to liquidate those positions,” said Jim Dunigan, chief investment officer for PNC Wealth Management in Philadelphia. “A lot of that has been done, but not all of it.”

In midday trading, the Dow tumbled 236.55, or 2.68 percent, to 8,598.70 after earlier falling more than 300.

The Standard & Poor’s 500 index dropped 28.90, or 3.17 percent, to 882.39, and the Nasdaq composite index stumbled 54.52, or 3.41 percent, to 1,542.18.

The Russell 2000 index of smaller companies fell 22.82, or 4.65 percent, to 468.41.

Declining issues outpaced advancers by about 5 to 1 on the New York Stock Exchange, where volume came to a light 518.83 million shares.

On Thursday, the Dow’s surge was the third-largest single-session point gain on record, following the 889-point rise on Oct. 28 and the 936-point surge on Oct. 13. The rally came after three days of selling that wiped out about $1 trillion in shareholder value.

Wall Street’s violent swings in recent weeks are part of the market’s ongoing “bottoming” process, analysts say, in which the market retests multiyear lows hit last month. The market is expected to remain volatile for some time — as evidenced by past recoveries from a bear market.

Some analysts said investors were also positioning themselves ahead of a meeting of Group of 20 international leaders in Washington this weekend. The meeting could bring decisions on how to help the troubled global financial system.

Government bond prices rose as investors looked for safety. The three-month Treasury bill’s yield fell to 0.14 percent from 0.20 percent late Thursday, and the yield on the benchmark 10-year Treasury note fell to 3.71 percent from 3.85 percent late Thursday. Lower yields indicate higher demand.

Meanwhile, the price of a barrel of light, sweet crude fell $1.39 to $56.85 a barrel on the New York Mercantile Exchange. Oil has been falling for the same reason as stocks — the fear of a deep global recession.

In corporate news, Ford Motor Co. and General Motors Corp. will be in focus as Senate Democrats pressed ahead with plans to vote next week on a $25 billion emergency loan plan. The bailout, which still faces strong GOP opposition, could come before Congress on Monday.

Ford shares fell 9 cents, or 4.8 percent, to $1.81. General Motors shares added 4 cents to $2.99.

Citigroup Inc. is cutting at least 10,000 jobs in its investment bank and other areas globally, The Wall Street Journal said Friday, citing people familiar with the matter. Citigroup shares fell 57 cents, or 6 percent, to $8.88.

Shares of major retailers fell. JCPenney lost $1.72, or 8.9 percent, to $17.56. Abercrombie & Fitch tumbled $3.02, or 13 percent, to $19.42, after falling to a new 52-week low of $19.37 earlier in the session.

The dollar rose against other major currencies. Gold prices also rose.

Overseas, Japan’s Nikkei closed up 2.72 percent and Hong Kong Hang Seng rose 2.43 percent. In European trading, London’s FTSE 100 was up 1.53 percent, Germany’s DAX rose 1.31 percent, and France’s CAC-40 added 0.98 percent.

Bush, Obama focus on economy in radio addresses

WASHINGTON – With the economy in a downward spiral, U.S. troops in Iraq and Afghanistan and the nation under threat from terrorists, President Bush pledged Saturday to make a smooth transition to an Obama administration a top priority for the rest of his days in office.

“Our
country faces economic challenges that will not pause to let a new
president settle in,” Bush said in his weekly radio address. “This will
also be America’s first wartime presidential transition in four
decades. We’re in a struggle against violent extremists determined to
attack us — and they would like nothing more than to exploit this
period of change to harm the American people.”

In the Democrats’ radio address, President-elect Obama stressed the nation must act swiftly to deal with continuing job losses and a financial meltdown that poses the “greatest economic challenge of our lifetime.” He noted that he was already meeting with economic advisers.

“While
we must recognize that we only have one president at a time and that
President Bush is the leader of our government, I want to ensure that
we hit the ground running on Jan. 20 because we don’t have a moment to
lose,” Obama said.

Obama underscored many of the economic talking points from his news conference Friday, the first held since his victory. He said his administration’s focus will be on creating jobs, stabilizing the financial markets while helping homeowners, and growing the middle class and strengthening the economy in the long-term.

“I
do not underestimate the enormity of the task that lies ahead,” Obama
said. “We’ve taken some major actions to date, and we will need further
actions during this transition and subsequent months. Some of those
choices will be difficult, but America is a strong and resilient
country.”

Bush said the White House and federal agencies have been working for more than a year to make sure the next administration can get off to a quick start.

Intelligence officials have briefed Obama, the Justice Department has approved security clearances
for members of his transition staff and, in the coming weeks,
administration officials will brief the Obama team on major policy
issues, including the Iraq war and the ailing financial markets. The
president said he also would keep Obama fully informed on any important
decisions he makes between now and when Obama takes over on Jan. 20.

Until then, Bush said he will continue to address the nation’s economic problems and urge Congress to approve free-trade deals with Colombia, Panama and South Korea and will host an international economic summit in Washington on Nov. 15 to address the global financial crisis.

“Earlier
this week, more than 120 million Americans went to the polls and voted
for a new president and Congress,” Bush said of the election in which
Democrats gained seats in both the House and Senate. “No matter how we
cast our ballots, all Americans have reason to be proud of our
democracy.”

Bush and first lady Laura Bush have invited Obama and his wife, Michelle, to the White House on Monday.

“I join the American people in wishing President-elect
Obama every success,” he said. “Laura and I wish the Obama family as
much joy and happiness as our family has found in this wonderful house.”

Obama said he and Michelle looked forward to the meeting.

“We
can’t afford to wait on moving forward on the key priorities that I
identified during the campaign, including clean energy, health care,
education and tax relief for middle class families,” Obama said.

Source: Yahoo News

Not a moment to lose on economy: Obama

CHICAGO: US President-elect Barack Obama called early Saturday for urgent action to prop up the flagging US economy and stop the hemorrhage of jobs, arguing that there was not “a moment to lose.”

In his first weekly radio address since his decisive election victory last Tuesday, the Illinois Democrat said he wanted to reassure Americans that his administration would “hit the ground running on January 20th because we don’t have a moment to lose.”

He argued that while the administration of President George W. Bush and Congress had taken steps to prop up the struggling financial sector and other parts of the economy, the United States “will need further actions during this transition and subsequent months.”

“First, we need a rescue plan for the middle class that invests in immediate efforts to create jobs and provides relief to families that are watching their paychecks shrink and their life savings disappear,” the president-elect said.

“Finally, we will move forward with a set of policies that will grow our middle-class and strengthen our economy in the long-term,” Obama promised.

He said he did not underestimate the enormity of the task ahead. “Some of those choices will be difficult, but America is a strong and resilient country,” he noted. “I know that we will succeed if we put aside partisanship and work together as one nation.”