A GM dealership in Shanghai, China

Andrew Torgan
CNN Financial News Producer

After a six-week trip through bankruptcy, the “new” General Motors came into the world today — owned by the government and free of tens of billions in debt and minus its unaffordable brands, dealerships and plants.

The sale of the valuable assets of the old company to the new GM was completed this morning.

“This is an exciting day for General Motors, one that will allow every employee, including me, to get back to the business of designing, building and selling great cars and trucks and serving the needs of our customers,” GM CEO Fritz Henderson said.

“We deeply appreciate the support we’ve received. We’ll work hard to repay the trust, and the money, that so many have invested in GM,” Henderson added.

But he said he couldn’t promise that GM would repay the $50 billion the government has already given or promised to GM.

And while there are a lot of changes at the “new” General Motors, at least two things will stay the same: its name and its iconic blue logo. Keep reading

John Boehner is redoubling his attacks, accusing the vice president of lying about the economy.

Alex Isenstadt
Politico

Vice President Joe Biden is invading House Minority Leader John Boehner’s back yard tomorrow to tout the success of the stimulus package, but Boehner is redoubling his attacks, accusing the vice president of lying about the economy.

“I found it … interesting over the last couple of days to hear Vice President Biden and the president mention the fact that they didn’t realize how difficult an economic circumstance we were in,” Boehner said. “Now this is the greatest fabrication I have seen since I’ve been in Congress.”

“I’ve sat in meetings in the White House
with the vice president and the president. There’s not one person that sat in those rooms that didn’t understand how serious our economic crisis was,” Boehner said.

Boehner also took a shot at the idea of a second stimulus – something Biden said he was open to last week.

“All of this talk of a second stimulus bill, I think, is an admission on the part of the administration that their stimulus plan is not working,” Boehner said.

Read more…

In 2008, the U.S. became the world's leading provider of wind power. This wind farm is in Velva, North Dakota.

Andrew Torgan
CNN Financial News Producer

Are you unhappy at work? Well, you’re not alone.

The recession has left a lot of people out of a job, but many of those still employed aren’t very happy at the office. That’s because layoff survivors are often stuck with increased workloads, fewer benefits and even less pay.

But they’re staying put — at least for now.

Fifty-four percent of employed Americans plan to look for a new job once the economy rebounds, according to a survey from Adecco Group North America.

The sentiment is even stronger among younger workers. Of those ages 18-29, 71% say they are likely to look for new jobs once the economy turns around, the survey said.

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Gas prices dropped 7-tenths of a cent overnight to $2.604, the 16th straight day of declines.

Andrew Torgan
CNN Financial News Producer

Soaring unemployment and an economy mired in recession drove delinquencies on credit card debt to an all-time high in the first quarter as a record number of Americans fell behind on their bills.

Fallout from the battered housing market caused the rate of consumer loan payments at least 30 days late to rise to 3.23 percent in the January-to-March period, the American Bankers Association said.

Delinquencies were the highest since the ABA began tracking the data in 1974. And delinquencies on the value of all card debt soared to a record 6.60 percent from 5.52 percent in the fourth quarter.

Keep reading

Arnold Schwarzenegger
The Los Angeles Times

In San Luis Obispo County, a 20-year-old drug abuser who was the sole caretaker for his seriously disabled father provided such poor care that, according to the grand jury in that county, the father frequently had bedsores, he was not properly cleaned, adult protective services had to be called in and, ultimately, he died before he was 60 years old. Incredibly, the son was being paid by the state, through the In-Home Supportive Services Program, for this substandard care.

Though this kind of abuse of taxpayer dollars is not rampant, we know it exists. So how could the Legislature in good conscience propose its latest budget fix — one that would increase taxes, cut children off our healthcare rolls, reduce funding to education and put more strain on law enforcement — without first eliminating this kind of fraud and waste?

Legislators are continuing to draft solutions to our now $26.3-billion state budget deficit. We’re close to filling the gap, but I will not sign a package that raises taxes or fails to address the entire deficit. There is a need for compromise, and I have proposed a path forward that would include ensuring that tax dollars go to citizens in need of services and not to waste, fraud or excessive compensation for those who provide those services. These reforms won’t entirely address falling revenues and rising costs, but they will help immediately, and especially in the years to come. It’s time we take action on them.

Read more…

AC360°

The U.S. Department of Labor released unemployment numbers today and the results were worse than expected. The unemployment rate rose for the ninth straight month climbing to 9.5 percent. That’s the highest rate since August 1983.

And last month the U.S. economy lost 467,000 jobs. This was the first time in four months that the number of jobs lost rose from the prior month.

Approximately 3.4 million jobs have been lost during the first half of 2009, more than the 3.1 million lost in all of 2008.

Here is a break down of the numbers, by demographic.

Keep reading

Andrew Torgan
CNN Financial News Producer

We have new signs this morning that the housing market may finally be hitting bottom.

Home prices continued to tumble in April, falling more than 18% from a year earlier. But the month-over-month change narrowed sharply, indicating that housing markets may be starting to turn a corner.

The 20-city slice of the S&P/Case-Shiller Home Price Index recorded a drop of 0.6% from March to April, compared with a 2.2% drop in the prior month. The index has declined every month since July 2006.

And while S&P’s David Blitzer cautions that one month’s data cannot determine if a turnaround has begun, some stabilization may be appearing in some regions.

Consumer confidence drops

On the flip side, however, consumer confidence fell unexpectedly in June after two straight months of gains as Americans’ optimism over business and job conditions weakened.

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Goldman Sachs reportedly handing out massive bonuses this year

Suvro Banerji
AC360° Intern

Goldman Sachs, the investment bank has not only paid back the $10 billion in Troubled Asset Relief Program (TARP) money, but is also reportedly handing out massive bonuses this year. According to The Guardian, this is the largest bonus payouts in the company’s 140 year history.

In letters to Congress on June 16, Chief Executive Lloyd Blankfein made it clear that the company would ensure that “compensation reflects the true performance of the firm and motivates proper behavior.”

The big question…where did this money come from? The Wall Street Journal reported that a huge chunk of the company’s recent profit came from ‘its fixed-income business, a less-risky arena than the illiquid derivatives and others products it loaded up on amid the credit bubble and Goldman has reduced its overall leverage from a year ago.’ Also, insiders say the company has benefited because competitors like Lehman Brothers went bankrupt.

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Andrew Torgan
CNN Financial News Producer

Fed Chairman Ben Bernanke today denied accusations that he pressured Bank of America to follow through on its controversial purchase of Merrill Lynch or risk having top management removed.

Testifying on Capitol Hill, Bernanke countered charges made recently by BofA chief Ken Lewis, who maintained that Bernanke threatened him with his job when his company considered pulling out of the deal late last year.

“I did not tell Bank of America’s management that the Federal Reserve would take action against the board or management,” Bernanke said in prepared remarks.

The Fed chief also rejected charges by Lewis that he asked former Treasury Secretary Henry Paulson to act on his behalf, a charge made by Lewis earlier this year that came to light during a related investigation on Merrill Lynch bonuses.

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