Finance topics

The Greek government teetered and stock markets around the world plummeted Tuesday after a hard-won European plan to save the Greek economy was suddenly thrown into doubt by the prospect of a public vote.

One day after Prime Minister George Papandreou stunned Europe by calling for a referendum, the ripples reached from Athens, where some of his own lawmakers rebelled against him, to Wall Street, where the Dow Jones industrial average plunged almost 300 points.

Papandreou convened his ministers Tuesday night, and a spokesman said the prime minister was sticking to his decision to hold the referendum, which would be the first since Greeks voted to abolish the monarchy in 1974. Papandreou has also called a vote of confidence in his government, to be held midnight Friday.

“The government is not falling,” said Angelos Tolkas, a deputy government spokesman.

Under a recently amended law, a referendum can be called by presidential decree on issues of grave national concern, if it is proposed by the cabinet and approved by absolute majority in the 300-member parliament.

With several of his lawmakers rebelling, it was unclear whether Papandreou would have enough support to push the idea through. Although he had not set a specific question or date for the referendum, ministers indicated it would likely be held in January.

Papandreou’s decision upended a deal that was the product of months of work by European leaders who were trying, sometimes opposed by their own people, to agree the details of a second bailout for Greece and shore up their own economies in the name of saving the euro, the common currency.

The deal would require banks that hold Greek government bonds to accept 50 percent losses and provide Greece with about $140 billion in rescue loans from European nations and the International Monetary Fund.

But Greeks have been outraged by repeated rounds of tax increases and salary and pension cuts imposed as the government struggles to meet the conditions of a first, $153 billion bailout the country has been relying on since May 2010. With Greece facing a fourth year of recession next year, unions have held frequent strikes, and protests have often degenerated into riots.

A Greek rejection of the second rescue package could cause bank failures in Europe and perhaps a new recession in Europe, the market for 20 percent of American exports. It could also cause Greece to leave the alliance of 17 nations that use the euro.

European leaders made no secret of their displeasure.

“This announcement surprised all of Europe,” said a clearly annoyed French President Nicolas Sarkozy, who has been scrambling to save face for Europe before he hosts leaders of the Group of 20 major world economies later this week.

“Giving the people a say is always legitimate, but the solidarity of all countries of the eurozone cannot work unless each one consents to the necessary efforts,” he said.

French lawmaker Christian Estrosi was even more direct. He told France-Info radio that the move was “totally irresponsible” and reflected “a wind of panic” blowing on Papandreou and his party.

“I want to tell the Greek government that when you are in a situation of crisis, and others want to help you, it is insulting to try to save your skin instead of assuming your responsibilities,” Estrosi said.

Sarkozy and German Chancellor Angela Merkel, who have been at the forefront of Europe’s efforts to contain national debt, talked by phone and agreed to convene emergency talks Wednesday in Cannes, France. Papandreou will also attend.

Merkel also spoke by telephone Tuesday with Papandreou, his office said.

The response was brutal in the international financial markets, especially in Europe. Greece’s general price index plunged to close down 6.92 percent, while in Germany the Dax index, the major stock market average, lost 5 percent _ the equivalent of about 600 points on the Dow.

The French stock market closed down 5.4 percent, the Italian 6.7 percent and London 2.2 percent.

“Talk about your all-time bonehead moves,” said Benjamin Reitzes, an analyst at BMO Capital Markets free business cards.

In New York, the stocks of major banks like Citigroup and JPMorgan Chase were hit hard. The value of the dollar rose, and bond prices jumped so dramatically that analysts said they were stunned.

Analysts said the bond action reflected fears that the turmoil in Greece would tear at the fabric of Europe’s financial system and create a crisis that could engulf the entire European Union, which together forms the world’s largest economy.

“This brings all of the concerns about Europe back to the front burner,” said Scott Brown, chief economist at Raymond James. “If this ends up turning into a financial catastrophe in Europe, then no one will escape it.”

Papandreou’s decision was such a surprise that even the finance minister, Evangelos Venizelos, apparently did not know about it ahead of time. He was unable to make the ministers’ meeting Tuesday after being hospitalized with stomach pains. He was to remain in the clinic overnight.

The main opposition conservatives called for Papandreou’s resignation. But criticism was also intense from Papandreou’s own Socialists, who have been clinging to a shrinking parliamentary majority.

A public vote would allow the party, vilified by an increasingly hostile public during months of strikes, sit-ins and violent protests over austerity measures, to shift responsibility for the country’s fate to the Greek people themselves.

But it was unclear whether Papandreou’s government would last long enough for the referendum to take place _ or even until Friday’s confidence vote.

Several Socialist lawmakers openly rebelled, with one going as far as defecting. Milena Apostolaki’s departure whittled Papandreou’s parliamentary majority to just two deputies, leaving the party with 152 seats in the 300-member legislature.

Apostolaki’s departure “shows clearly that the government itself is losing gradually its cohesion,” said George Tzogopoulos, a political analyst from the Hellenic Foundation for European and Foreign Policy.

He estimated that “that the government will not be able to remain in power for many days” and said it was likely that Papandreou “will call an early election very soon.”

Papandreou did not ask for a vote last year, when Greece got its first round of international bailouts, about the same size as what is being debated now. Some lawmakers wondered why he called for one this time.

“Yesterday’s surprise and irrational announcement of the referendum has led me to doubt something that I considered certain until yesterday: That I am a member of a group that is striving to save our country from bankruptcy,” Socialist deputy Hara Kefalidou said in a letter to Papandreou. “I cannot back a referendum which is a subterfuge by a government that appears unwilling to govern.”

Jean-Claude Juncker, who chairs eurozone ministerial meetings, said the referendum was a dangerous decision that could endanger Greece’s next installment of bailout loans _ without which the country will run out of money in mid-November.

Juncker told RTL radio in Luxembourg that the vote proposal changes the conditions of that deal, according to his spokesman, Guy Schuller.

It was not only international leaders who were taken by surprise.

Venizelos, the finance minister, “found out about it along with all other Greeks” during Papandreou’s speech, which was televised live, an official close to Venizelos told The Associated Press. The official spoke on condition of anonymity to discuss sensitive details.

From his hospital bed, Venizelos launched a telephone campaign to shore up international support for the debt deal, speaking with the German finance minister, the head of Deutsche Bank and the monetary affairs chief for the European Union, among others.

____

Associated Press writers Derek Gatopoulos and Nicholas Paphitis, and APTN producer Ted Tongas in Athens, Angela Charlton in Paris, Raf Casert in Brussels and David McHugh in Berlin contributed.

Source

The 17-nation eurozone is considering two forms of leveraging to boost its euro440 billion ($600 billion) bailout fund’s capacity in a bid to contain the debt turmoil that threatens to engulf more European nations.

A document obtained by The Associated Press, which Germany’s government was sharing with key lawmakers Monday, shows the currency zone wants to give the bailout fund the ability to provide investors with a partial insurance against losses from its member states’ government bonds.

The eurozone document also foresees setting up a special investment vehicle that seeks to attract outside investors such as sovereign wealth funds, combining “public and private capital to enlarge the resources available to” the European Financial Stability Fund, or EFSF.

Leading German opposition lawmakers, who were briefed earlier Monday by Chancellor Angela Merkel on the plan, said the fund’s capacity will be boosted “beyond euro1 trillion” ($1.39 trillion) under the new rules.

But the draft document by the eurozone working group did not provide a headline figure for the bailout fund, stressing “a more precise number on the extent of leverage can only be determined after contacts with potential investors” and rating agencies.

Eurozone governments hope that the enhanced EFSF will be able to protect countries such as Italy and Spain from being engulfed in the debt crisis. To do that, however, it needs to be bigger or see its lending powers magnified.

German lawmakers will vote on the bailout funds’ new rules Wednesday, hours before an EU summit in Brussels is set to adopt them.

The draft document stressed that the EFSF would “benefit from the flexibility to deploy both options, which are not mutually exclusive.” The insurance model is designed to increase the demand for newly issued eurozone government bonds, lower the yields “thereby supporting the sustainability of public finances,” the document said.

Lowering the yields for troubled eurozone governments is a key step to counter the widening debt crisis, because spiraling yields on debt issued by Greece, Portugal and Ireland eventually cut them off from market financing, forcing the eurozone to provide those nations which an emergency loan package.

In the event of a default, “the investor could surrender the partial protection certificate” and “receive payment in kind with an EFSF bond,” the document said, referring to the insurance option.

The new investment facility, a so-called special investment purpose investment vehicle, is meant to allow the EFSF “to attract a broad class of international public and private investors.” The investment structure aims at creating “additional liquidity and market capacity to extend loans, for bank recapitalization via a member state and for buying bonds in the primary and secondary market,” the eurozone draft document said.

Beefing up the bailout fund is one part of a three-pronged eurozone plan to solve the crisis.

The other two parts are reducing Greece’s debt burden so the country eventually can stand on its own and forcing banks to raise more money so they can take losses on the Greek debt and ride out the financial storm that will entail.

Source

China’s trade with its close ally North Korea nearly doubled in the first seven months of the year compared with the same period in 2010, state media reported Sunday.

The 87 percent increase to $3.1 billion was announced at the start of a visit to the North by Chinese Vice Premier Li Keqiang that reaffirms strong ties between the communist neighbors.

Li said China was hoping for better relations between North and South Korea and a resumption of long-stalled six-nation nuclear disarmament talks.

China wants to work with all parties in promoting the denuclearization of the Korean peninsula and safeguarding regional peace and development, the official Xinhua News Agency quoted Li’s statement as saying.

North Korea relies heavily on China for food and fuel aid and many consumer products. Chinese companies are the main investors in North Korean mining, and the sides recently signed agreements on road building and jointly developing an industrial park on an island near the Chinese city of Dandong.

“The economic and trade cooperation between the two countries has shown great potential, with bilateral trade and investment volume reaching new highs,” Xinhua said, citing the Chinese ambassador to Pyongyang, Liu Hongcai.

Bilateral trade between China and North Korea still is dwarfed by economic ties between China and South Korea. China is South Korea’s largest trade partner.

Trade between Beijing and Seoul rose more than 20 percent in the first eight months of the year to $159 billion and is expected to hit about $250 billion for all of 2011.

Source

Unemployment rates fell in half of U.S. states last month, a sign that September’s pickup in hiring was felt around the country.

The Labor Department says unemployment rates dropped in 25 states, rose in 14 and stayed the same in 11. That’s a modest improvement from August, when unemployment rose in 26 states.

Nationwide, employers added 103,000 net jobs in September, nearly double the number created in August. Still, that’s not enough to lower the unemployment rate, which stayed at 9.1 percent for the third straight month.

Nevada reported the highest unemployment rate for the 16th straight month. It stayed at 13.4 percent for the second consecutive month. California was next. The rate there fell from 12.1 in August to 11.9 percent. Michigan had the third-highest rate, at 11.1 percent.

Layoffs have slowed at a national level in recent months. The number of people applying for unemployment benefits has fallen to a six-month low, according to a four-week average calculated by the government. That has helped calm fears that the economy was sliding into another recession, as have other recent data.

Manufacturers in the Philadelphia region grew in October after contracting for two straight months, according to a survey by the Federal Reserve Bank of Philadelphia. In September, consumers boosted their spending on retail goods by the most in seven months.

Still, the national unemployment rate has been stuck near 9 percent for more than two years payday loan. Employers have added an average of only 72,000 jobs per month in the past five months. That’s far below the 100,000 per month needed to keep up with population growth. And it’s down from an average of 180,000 in the first four months of this year.

Americans are pessimistic about the economy. And more than half say President Barack Obama does not inspire confidence about a recovery.

A sizable majority _ more than 7 in 10 _ believe the country is headed in the wrong direction, according to a new Associated Press-GfK poll. And 43 percent describe the nation’s economy as “very poor,” a new high. Among those surveyed, less than 40 percent say Obama’s proposed remedies for high unemployment would increase jobs significantly.

Employers pulled back on hiring this spring after seeing less demand from consumers. Higher food and gas prices forced consumers to rein in spending. Consumer spending accounts for 70 percent of economic activity.

Job growth is critical to a recovery in the housing market, which many economists say is years away.

The number of Americans who bought previously occupied homes fell in September to a seasonally adjusted annual rate of 4.91 million homes, the National Association of Realtors said Thursday. The pace matches last year’s sales figures, which were the worst since 1997.

Source

Libyan bulldozers began knocking down the green walls surrounding Moammar Gadhafi’s main Tripoli compound known as Bab al-Aziziya on Sunday, as the new leaders said it was time “to tear down this symbol of tyranny.”

The sprawling, fortress-like compound has long been hated by Libyans who feared to even walk nearby during Gadhafi’s more than four decades in power and its capture was seen as a turning point in the civil war as revolutionaries overran the capital in late August.

Ahmad Ghargory, commander of a revolutionary brigade, said the area will be turned into a public park.

“It’s the revolutionary decision to tear down this symbol of tyranny,” Ghargory said. “We were busy with the war, but now we have the space to do this.”

Already, Libyans have turned the courtyard in front of Gadhafi’s former house, which he used for many fiery speeches trying to rally supporters during the uprising, into a weekly pet market. Tripoli residents roam the premises as if at a museum, with vendors selling revolutionary flags and other souvenirs.

The Bab al-Aziziya compound had been a mystery to most Libyans. Though it is one of the city’s largest landmarks, no streets signs indicate where it is. Few ever entered, and many Tripoli residents said they wouldn’t even walk nearby, fearing security guards on the compound’s high green walls would get suspicious and arrest or shoot them.

“I was never able to enter this building or even pass by these walls before. We won’t have any more walls in our lives,” Ghargory said.

The compound was one of the main targets for NATO airstrikes during the months leading to Gadhafi’s ouster in late August.

Libyan fighters overran the area on Aug. 23 during fierce fighting for the capital, jubilantly rampaging through the remnants of barracks, personal living quarters and offices seen as the most defining symbol of Gadhafi’s nearly 42-year rule.

Gadhafi’s residence, now gutted and covered with graffiti, was also targeted in a U.S. bombing raid in April 1986, after Washington held Libya responsible for a blast at a Berlin disco that killed two U.S. servicemen. A sculpture of a clenched fist crushing a U.S. fighter jet that had been erected after the strike has been removed.

Gadhafi entertained guests in a Bedouin-style tent pitched near two tennis courts about 200 yards (meters) from the family home.

“All the bad things that happened, happened inside these walls. And he kept his mercenaries and tortured people inside these walls,” said Tarek Saleh, a 25-year-old revolutionary. “Before we were never able to enter this site, and we’re tearing these walls down so we don’t have to remember those dark days.”

Libyans are eager to move on after decades of repression, even though fighting continues on two fronts and tensions between supporters of the former regime and revolutionary forces remain high _ even in Tripoli.

Revolutionary forces have squeezed Gadhafi loyalists into one main district in his hometown of Sirte after weeks of fighting, but some said fears of friendly fire as well as a lack of coordination and communications were slowing their advance. Fighters from the eastern city of Benghazi and Misrata to the west were trying to reorganize themselves to solve that problem.

“We have them cornered in a 900 by 700 meter area, but the fighting is difficult because we are worried about firing on our own forces, they are mixed together,” Benghazi field commander Khaled al-Magrabi said Sunday.

Commanders said they have agreed to divide the remaining loyalist area between them to prevent confusion.

Libyan fighters also faced discord over the looting of buildings, including the airport and houses in Sirte, on the coast 250 miles (400 kilometers) southeast of Tripoli.

Associated Press Television News reporters saw trucks carting off tractors, industrial generators and heavy machinery on the road from Sirte to nearby Misrata, which was under siege by Gadhafi forces for months and saw some of the fiercest fighting of the war.

Trucks also carried off equipment from Sirte’s airport, including red-carpeted mobile staircases, baggage carts, airplane towing vehicles and security screening equipment, all apparently meant for Misrata’s badly damaged airport.

Smaller pickups were loaded with rugs, freezers, refrigerators, furniture and other household goods, apparently taken by civilians and fighters to be used in their homes or resold.

The looting was an indication that reconciliation and unity may be difficult to achieve in post-Gadhafi Libya.

Commanders tried to rein in looting by ordering fighters to refrain from entering private homes and to detain anybody not authorized to be in the area. Benghazi fighters arrested three men for looting on Saturday.

Revolutionary forces also distributed fliers at checkpoints leading into the city that read, “Dear Muslims, avoid God’s wrath. Do not steal from people’s homes, their cars, or take their personal possessions.”

Source

House Democrats are advising Congress’ supercommittee to create jobs, raise revenues and avoid damaging cuts to crucial public works, education and health programs as the panel searches for ways to curb the government’s growing debt.

A day ahead of a deadline for submitting advice to the supercommittee, minority Democrats from 16 House committees released letters they are sending the panel with their recommendations. Some propose specific savings such as boosting government fees on financial firms and defunding old water projects. All emphasize the need to protect programs that keep the economy strong, especially at a time of high unemployment and a faltering economy.

“Democrats strongly believe that economic growth is an integral component of such a proposal, because creating jobs is the most effective way to reduce the deficit,” House Minority Leader Nancy Pelosi, D-Calif., wrote in her own letter to the supercommittee.

The fact that House Democrats wrote their own letters _ as opposed to joint letters co-signed by committee Republicans _ underscores the wide partisan divide over how the $14 trillion federal debt should be tamed. Congressional Democrats and President Barack Obama want some tax increases included in any debt-reduction package, an idea that the GOP rejects.

Democrats on the House Appropriations Committee, which controls over $1 trillion in annual agency spending, proposed no specific cuts but emphasized the damage that would be done by across-the-board cuts that would be automatically triggered if the supercommittee doesn’t produce a package of savings that Congress approves.

Democrats on the House Ways and Means Committee, which oversees taxes and large health care programs, wrote that the supercommittee must “spur job creation and economic health today.” They urged higher taxes on the wealthy while providing tax incentives for companies that create jobs, and protection for Social Security, unemployment benefits and health care coverage.

Republicans and Senate committees will be sending additional letters to the supercommittee over the next two days. The panel is charged with finding at least $1.2 trillion in savings over the coming decade.

Among letters already sent to the supercommittee, Sen. Tom Harkin, D-Iowa, who heads the Senate Health and Education Committee, asked the panel to take “bold and immediate action to create jobs” while embracing deficit reduction that would take effect after the unemployment rate drops.

Harkin suggests raising taxes and saving money by giving brand-name drugmakers fewer years of patent protection against generic competitors and encouraging students to take education loans directly from their colleges _ both policies that have been favored by the Obama administration. Harkin wrote that the supercommittee should avoid cuts to programs including job training, Obama’s health care overhaul and aid to the disabled.

The leaders of the Senate Environment and Public Works Committee, Chairman Barbara Boxer, D-Calif., and Sen. James Inhofe, R-Okla., combined on a letter asking the supercommittee to “not neglect America’s transportation needs.”

Sen. Kay Bailey Hutchison, R-Texas, encouraged the committee to pare savings from Social Security by gradually raising the future retirement age from 67 to 69 and, in some years, trimming annual inflation adjustments in benefits by 1 percentage point. Hutchison has been offering that proposal for weeks; it’s opposed by the seniors group AARP.

Senate Armed Services Committee Chairman Carl Levin, D-Mich., said he and the panel’s top Republican, Sen. John McCain of Arizona, hope to write a bipartisan letter that other Armed Services members could support.

The top Republican on the Senate Finance Committee, Sen. Orrin Hatch, R-Utah, said he is trying to unite minority Republicans on that panel behind their own letter.

Senate Finance Committee Chairman Max Baucus, D-Mont., who is also on the supercommittee, is considered unlikely to send a recommendation letter, as is another supercommittee member, House Ways and Means Committee Chairman Dave Camp, R-Mich.

The supercommittee has until Nov. 23 to send a package of savings to Congress. Lawmakers will have until Dec. 23 to vote on the measure, with failure meaning $1.2 trillion in cuts in defense and many domestic programs will begin taking effect in 2013.

Warren Buffett has also brought his fight to raise taxes on the super-wealthy to the deficit-reduction panel.

In an exchange of letters between the billionaire investor and a Republican congressman that Buffett sent the committee this week, Buffett is offering to release his federal tax returns _ with a condition.

“If you could get other ultra rich Americans to publish their returns along with mine, that would be very useful to the tax dialogue and intelligent reform,” Buffett wrote.

Buffett’s views have become central to the struggle between Obama and Congress over how to control the federal debt. Obama has used the “Buffett Rule” to describe his fight to clamp taxes on the wealthy that are at least as high as those paid by lower earners, a drive that Republicans oppose.

Source

Dudes don’t drink diet.

Or at least that’s the idea behind Dr. Pepper Ten, a 10-calorie soft drink Dr Pepper Snapple Group is rolling out on Monday with a macho ad campaign that proclaims “It’s not for women.” The soft drink was developed after the company’s research found that men shy away from diet drinks that aren’t perceived as “manly” enough.

To appeal to men, Dr. Pepper made its Ten drink 180 degrees different than Diet Dr. Pepper. It has calories and sugar unlike its diet counterpart. Instead of the dainty tan bubbles on the diet can, Ten will be wrapped in gunmetal grey packaging with silver bullets. And while Diet Dr. Pepper’s marketing is women-friendly, the ad campaign for Ten goes out of its way to eschew women.

For instance, there’s a Dr. Pepper Ten Facebook page for men only. And TV commercials are heavy on the machismo, including one spot that shows muscular men in the jungle battling snakes and bad guys and appear to shoot lasers at each other.

“Hey ladies. Enjoying the film? Of course not. Because this is our movie and this is our soda,” a man says as he attempts to pour the soda into a glass during a bumpy ATV ride. “You can keep the romantic comedies and lady drinks. We’re goo

Dr. Pepper Ten is not the first diet soda aimed at men. (Think: Coke Zero and Pepsi Max.) But Dr. Pepper Ten’s ad campaign is the first to be so overt about courting men who want to drink a soda with fewer calories. The ads come at a time when overall sales in the $74 billon soft drink industry are slowing as more Americans buy healthier options like juice and bottled water. Volume has fallen from slightly over 10 billion cases in 2005 to 9.4 billion cases in 2010, according to Beverage Digest data.

“Regular sugared soft drinks have declined in recent years, and some consumers have taste issues with some of the diet sodas,” said John Sicher, editor and publisher of Beverage Digest, said.

Dr. Pepper said men, in particular, are dissatisfied with the taste and image of diet drinks guaranteed high risk personal loans. The company wouldn’t disclose the formula of Dr. Pepper Ten, but said that the drink has 10 calories and 2 grams of sugar, which gives it a sweeter taste. Dr Pepper said there are 23 flavors in its regular soda, (which has 150 calories and 27 grams of sugar per can) and Dr. Pepper Ten contains all of them.

The company, which declined to give figures for how much was spent on the campaign, also worked hard to craft a macho message. The company said ads for Dr. Pepper Ten will air on all major networks, FX and ESPN during college football games.

A Facebook page for the drink contains an application that allows it to exclude women from viewing content, which includes games and videos aimed at being “manly.” For instance, there’s a shooting gallery where you shoot things like high heels and lipstick, for example. There is also a “man quiz” with questions on activities like fishing and hunting.

Whether the ads will resonate with men remains to be seen. Paul McDonald, 25, who works in green energy contracts in Berkley, Calif., says he drinks soda labeled diet and doesn’t think there is any stigma attached.

“No one has ever made fun of me for drinking a Diet Coke, and I’m on a rugby team we make fun of each other for everything,” he said.

And women? Jim Trebilcock, executive vice president of marketing for Dr Pepper, said he’s not worried that they’ll be offended by the campaign. The drink and marketing were tested in six different markets across the country before being rolled out nationally, and women weren’t offended, he said. In fact, about 40 percent of people who have tried the soda so far are women.

“Women get the joke,” he said. “`Is this really for men or really for women?’ is a way to start the conversation that can spread and get people engaged in the product.”

Source

Libyan revolutionary forces claimed to have captured parts of a sprawling convention center that loyalists of Moammar Gadhafi have used as their main base in the ousted leader’s hometown and were shelling the city to try to rout snipers from rooftops in their offensive aimed at crushing this key bastion of the old regime.

The inability to take Sirte, the most important remaining stronghold of Gadhafi supporters, more than six weeks after the capital fell has stalled efforts by Libya’s new leaders to set a timeline for elections and move forward with a transition to democracy.

Gadhafi supporters also hold the enclave of Bani Walid, where revolutionary forces have been stymied by a challenging terrain. But the transitional leadership has said it will declare liberation after Sirte’s capture because that will mean it holds all of the seaports and harbors in the oil-rich Mediterranean coastal country.

British Defense Secretary Liam Fox pledged to keep up NATO airstrikes even after Sirte’s fall, saying the international military action would continue as long as the remnants of the regime pose a risk to the people of Libya.

“We have a message for those who are still fighting for Gadhafi that the game is over, you have been rejected by the people of Libya,” he told reporters Saturday in Tripoli before flying to Misrata.

Revolutionary forces began a major attack on Sirte on Friday after a three week siege from the outskirts of the coastal city, during which they said they were giving civilians time to flee. On Saturday, fighters fired rockets into the city from the backs of pickup trucks, though visibility was severely limited by a sandstorm.

Libya’s de facto leader, Mustafa Abdul-Jalil, the head of the governing National Transitional Council, said the battle for Sirte has been “ferocious,” with 15 revolutionary fighters killed and 180 wounded on Friday.

“Our fighters today are still dealing with the snipers positioned on the high buildings and we sustained heavy casualties,” he said at a joint news conference in Tripoli with Fox and Italian Defense Secretary Ignazio La Russa.

Abdel-Basit Haroun, a revolutionary field commander, said 32 people had been killed in two days of fighting, while the military council in the nearby city of Misrata, which has sent many fighters to Sirte, reported 80 wounded.

The council said revolutionary forces were attacking houses to try to eliminate the “overwhelming hordes of snipers out there.”

Sirte, 250 miles (400 kilometers) southeast of Tripoli, is key to the physical unity of the nation of some 6 million people, since it lies roughly in the center of the coastal plain where most Libyans live, blocking the easiest routes between east and west.

Mohammed al-Rajali, spokesman for the brigades attacking the city from the east, said the fighters have gained control of the Ouagadougou Convention Center, an ornate complex in the city center that Gadhafi frequently used for international summits. But they were meeting heavy resistance from villas behind the building so were focusing on firing artillery from the outskirts.

“After the intensive shelling, we will move forward,” he said.

A military spokesman in Tripoli, Abdul-Rahman Busin, and several commanders and fighters confirmed the center was under control of revolutionary forces.

“We have passed the area and we moved on to the residential area behind it,” brigade commander Musbah Alhadar said. “Our forces are camping around the center because the center itself has been destroyed by the NATO airstrikes and our artillery.”

Seizing the convention center complex, named after the capital of the West African nation of Burkino Faso, would be a significant gain for the attackers. Throughout the siege, Gadhafi fighters have used the walled complex as a base and stronghold. From there they were able to dominate surrounding neighborhoods and assault revolutionaries trying to enter Sirte.

Anti-Gadhafi forces also have surrounded the central Green Square and a presidential palace after fierce street fighting in the heart of the city.

Loyalist forces have been driven away from Ibn Sina Hospital where hundreds of civilians have sought refuge from the fighting, according to another commander, Suleiman Ali.

NATO warplanes flew overhead but no strikes were immediately reported.

Abdul-Jalil, meanwhile, called on the international community to help Libyans treat the wounded, saying they could deduct the cost from Libyan assets that were frozen under Gadhafi’s regime.

The international community has rallied around Libya’s efforts to move forward with forming a new government, with transitional leaders promising elections within eight months after liberation is declared.

Fox announced 500,000 pounds ($775,000) and extra military expertise to help Libya prevent the proliferation of weapons, including portable missiles capable of shooting down aircraft.

Source

Ford Motor Co. said Tuesday it will add 5,750 jobs and invest $4.8 billion in its U.S. factories as part of a new contract deal with the United Auto Workers union.

The four-year deal was reached early Tuesday after eight straight days of bargaining. UAW leaders were expected to release further details of the contract later Tuesday at a meeting of union leaders in Detroit. The deal is subject to a vote by union members.

John Fleming, Ford vice president of manufacturing, said most of the new hires will be paid a lower wage than Ford’s older workers. The agreement is expected to lower Ford’s labor costs, which are the highest in the U.S. auto industry.

“The tentative agreement will enable us to improve our overall competitiveness here in the United States,” Fleming told reporters at Ford’s headquarters in Dearborn.

Fleming would not give details about where the new jobs would go. He said the jobs are in addition to 7,000 new positions that Ford announced earlier this year. The $4.8 billion in investments is also in addition to $1.4 billion previously announced.

Ford likely matched some of the provisions in the General Motors Co. agreement that was reached last month. The GM deal gives workers $5,000 signing bonuses, $1,000 a year for three years to cover inflation and at least $3,500 in profit-sharing this year. GM was able to avoid a pension increase for the first time since 1953, and Ford’s terms are expected to match that.

The pact still must be approved by Ford’s 41,000 UAW members, who work at 27 plants and other facilities around the country. Voting is expected next week. Approval could be a problem because many expected the company to restore pay raises and other benefits they sacrificed to help Ford through tough financial times starting in 2007.

UAW leaders said the contract keeps Ford’s costs and prices competitive but increases profit sharing.

“UAW members sacrificed when the company was struggling and now will share in Ford’s prosperity,” UAW Vice President Jimmy Settles said in a statement.

Up next is Chrysler Group LLC, where the talks could be more contentious. The company isn’t making as much money as Ford and GM and probably can’t afford the same deals.

The UAW talks are watched closely because they set wages for more than 112,000 workers in the auto industry and set the bar for pay at auto parts makers and foreign-owned automakers.

Ford shares fell 22 cents to $9.15 a share in morning trading Tuesday after sinking to a 52-week low of $9.05 earlier in the session.

Source

The Securities and Exchange Commission is considering taking civil action against Standard & Poor’s for its rating of a 2007 mortgage debt offering low rates payday advance. Such action could be just the first shot in a legal assault against the major credit rating agencies.

The three major agencies