CNN Financial News Producer
The nation's economic slide during the last three months of 2008 was even sharper than previously estimated, with the broadest measure of economic activity suffering its worst decline in 26 years.
Gross Domestic Product, which measures the output of goods and services produced in the United States, fell at an annual rate of 6.2% in the fourth quarter. That’s far worse than the 3.8% drop reported in the previous reading just last month.
Citigroup and the Treasury Dept. announced a deal early today that will give the government control over up to 36% of the bank's common stock.
The deal - which doesn’t involve any additional taxpayer dollars - will convert preferred shares that Treasury already holds in the bank for common shares, a shift that is designed to better protect shareholders against future losses and improve the embattled bank's capital base, which in turn will hopefully allow it increase lending.
The U.S. government has already given Citigroup $45 billion, for which it received preferred shares and warrants in the company.
Bank of America's CEO spent four hours on Thursday testifying in an investigation into the $3.6 billion in bonuses that Merrill Lynch paid out just before it was acquired by the bank last year, but still refused to give out the details of those payments.
The New York Attorney General's Office served a subpoena on Bank of America during CEO Ken Lewis' testimony Thursday evening, seeking the full list of individual bonus recipients at Merrill Lynch, according to Benjamin M. Lawsky, a special assistant to Attorney General Andrew Cuomo.
Hammered by the ailing housing market, mortgage finance giant Fannie Mae said late Thursday it would tap its lifeline from the Treasury Dept. after reporting nearly $60 billion in losses for 2008.
The company, a crucial source of funding for mortgage lenders, said it would draw down $15.2 billion of its $200 billion federal line of credit. In return, the government will receive preferred shares.
Gas prices rose 1-tenth of a cent overnight to $1.882 a gallon, snapping a string of 11 straight increases. 8 states have regular unleaded gas prices of $2 and higher. 42 states and the District of Columbia have regular unleaded gas prices below $2. The highest gas prices are in Alaska ($2.519). The cheapest gas prices are in Missouri ($1.674)
And finally, CNNMoney.com asks the question: “Is Citigroup the next AIG?”
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