[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/POLITICS/12/06/obama.jobs/art.ceos.gi.jpg caption="The chief executives of ailing automakers GM, Chrysler and Ford testify before Congress on Friday."]
CNN Financial News Producer
The proposed plan to rescue Detroit’s Big Three is now in President Bush’s court. Negotiators are said to be close to an agreement on a plan that would provide the automakers with a total of $15 billion in federal loans as soon as next Monday. And a so-called "car czar" would be appointed to oversee the restructuring of the auto industry.
This is by no means a done deal, and it raises all sort of questions: What happens to employee retirement plans if the automakers fail? Why do any of the CEOs still have a job? And my personal favorite… Why doesn't the government just give us all a large amount of money so we can go buy their cars? Check out CNNMoney.com's story answering CNN viewer questions about the proposed auto rescue.
And now that President-elect Obama has suggested that General Motors and the rest of the Detroit Three may need to install new management as a condition of a bailout, the question is: Who might become GM's next CEO?
Another day, another brutal round of job cuts… Three major companies - Sony, Danaher and Wyndham Worldwide - have announced cuts totaling nearly 14,000 jobs this morning. Tokyo-based Sony announced the most sweeping cuts of the three, saying it planned to reduce headcount in its electronics business by 8,000. Wyndham – which operates hotels including the Ramada, Days Inn and Super 8 chains – is cutting 4,000 jobs; manufacturer Danaher will lay off 1,700.
And employers are taking a cautious approach to hiring. More than two thirds employers plan to hold staff levels steady for the first quarter of 2009, according to a survey by employment firm Manpower. But some industries are hiring - including education, health services and accounting.
Merrill Lynch's chief executive John Thain has dropped his controversial request for a $10 million annual bonus after being blasted by New York Attorney General Andrew Cuomo. Thain requested at a board meeting on Monday that Merrill's compensation committee not award him a bonus for 2008, and the board of directors accepted that request. Thain had previously asked for the bonus despite Merrill racking up more than $11 billion in losses this year - arguing things would have been even worse without him. And Morgan Stanley's CEO John Mack is also forgoing his bonus for the second year running amid the worst financial crisis since the Great Depression.
Stocks are surrendering nearly all of yesterday’s big gains, thanks to profit warnings from Texas Instruments and FedEx, and the latest round of job cuts. The Dow surged 3% Monday as Detroit’s Big Three neared a deal that would keep them out of bankruptcy and President-elect Barack Obama pledged to stimulate the economy. Oil prices are drifting lower, around $42 a barrel, after climbing nearly $3 Monday amid the signs of an auto bailout.
Gas prices fell 1.8 cents to about $1.698 a gallon. That’s the 83rd consecutive decrease. According to AAA, the last time the national average price for a gallon of regular unleaded gasoline was near the current price was in 2004.
Former top executives at Fannie Mae and Freddie Mac are taking fire on Capitol Hill amid charges they ignored repeated warnings - before the housing market collapsed - about all their risky loans. The latest figures on the fallout out today - home sales beat expectations in October, but that's just because deeply discounted foreclosures and distressed sales made up nearly half of transactions. The witness list is a rogue's gallery of former Fannie and Freddie executives.
And here's a thought for fixing the economy: Imagine capturing waste energy from dirty industrial smokestacks and turning it into clean power. It’s called “recycled energy” and the potential is enormous. Experts in this field say it could generate as much as 40% of the power we use as a country, and could cut greenhouse gas emissions by 20%. Europeans are the world leaders in recycled energy, and other countries like China are catching up. So why aren’t more American companies doing it?
A House committee looking to uncover the roots of the subprime mortgage meltdown and the ensuing credit crisis on grilled several former CEOs of mortgage finance giants Fannie Mae and Freddie Mac today. Committee chairman Henry Waxman said the companies “made irresponsible investments that are now costing federal taxpayers hundreds of billions of dollars." He added, "Their own risk managers raised warning after warning about the dangers of investing heavily in the subprime and alternative mortgage market. But these warnings were ignored."
One rare bit of good news… pending sales of existing homes fell less than expected in October, raising cautious optimism of some stability in the distressed housing market.
Anderson Cooper goes beyond the headlines to tell stories from many points of view, so you can make up your own mind about the news. Tune in weeknights at 8 and 10 ET on CNN.
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