NPR 2008-10-09

Global financial markets remain severely 1 strained according to Treasury 2 Secretary Henry Paulson who said it underscores the need for fast action on the part of government officials. Paulson said, however, in terms of allocating 3 the 700 billion dollars set aside under the government's financial rescue plan, it is more important the government get it right. "Yesterday we hold our first meeting of the program's oversight 4 board. And we're committed to transparency in all aspects of the program. We will implement 5 our new authorities with one simple goal, to restore capital flows to the consumers and businesses that form the core of our economy. " Paulson also said even with the government plan to buy up bad assets from financial firms, some banks will fail. His comments come on the same day the Federal Reserve and a number of other major central banks cut interest rates. The Fed instituted an emergency half a percent rate cut today.

Republican presidential hopeful John McCain says in order to solve the turmoil 6 in financial markets, the US will have to help struggling homeowners. NPR's Scott Horsley has more.

John McCain told supporters in Bethlehem, Pennsylvania the housing woes 7 are at the root of the nation's economic problems. He repeated a proposal he made during the presidential debate of having the federal government buy mortgages directly from home owners if their properties have lost value and they are having trouble making their monthly payments. "The dream of owning a home should not be crashed under the weight of a bad mortgage. " Under McCain's plan, borrowers could refinance into fixed-rate mortgages for the new lower value of their homes. Democrat 8 Barack Obama warns if the government overpays for the mortgages, it will be rewarding lenders who made the bad loans and leaving taxpayers 9 with the bill. Scott Horsely, NPR News, Strongsville, Ohio.

President Bush signed landmark 10 legislation today that opens civilian 11 nuclear trade with India for the first time in decades. NPR's Giles Snyder has that story.

Congress gave final approval to the bill last week, a foreign policy success for President Bush. The bill marks a reversal of a 30-year US ban on selling nuclear technology to India, which developed its program outside the Nuclear Non-Proliferation Treaty. The Bush administration says the bill will let the US develop stronger ties with India, but opponents say it will help foster the spread of nuclear weapons. Secretary of State Condoleezza Rice had been expected to sign a cooperation agreement when she was in the region last weekend but it was held up by administrative 12 issues. The State Department says she and India's external affairs minister will now sign the deal on Friday. Giles Snyder, NPR News, Washington.

Something of a mixed bag for the nation's retailers 14 last month. Wal-Mart, the world's largest retailer 13, along with wholesale 15 club operator Costco reported solid September sales numbers. However, Target says its sales last month fell by 3%. Many retailers are gearing up for a decrease in holiday spending due to the weak economy.

On Wall Street today, the Dow Jones Industrial Average fell 189 points to close at 9258. The NASDAQ lost 14 points. The S&P 500 fell 11 points.

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Giant Bank of America, which yesterday announced the sale of 10 billion dollars in shares as it struggles to raise capital, today said it would buy back up to 4.7 billion dollars in auction 16 rate securities to settle charges that it misled thousands of investors 17 about the risky 18 investments. The SEC announced a preliminary agreement with the Charlotte, North Carolina-based bank. BA yesterday suffered its biggest one day stock loss ever after announcing the stock sale. The bank, which saw shares plunge 19 26%, also reported a steeper-than-expected drop in quarterly profits and said it was cutting its dividend 20 in half.

For the past several days, General David Petraeus has been giving a PowerPoint presentation to various audiences in Washington on how he brought violence down in Iraq. In a few weeks, he takes over central command with responsibility for Iraq and Afghanistan. NPR's JJ Sutherland reports.

The introductions and the applause have been effusive 21. Everyone in Washington seems to be hailing General Petraeus as a returning hero. With his new position though, he will also be responsible for a war that is not going well at all, Afghanistan. He cautioned that what worked in Iraq may not work there, though he did say that some ideas might, including sitting down and talking with people on the other side of the fight. "If there are people that are willing to reconcile, then I think certainly that there would be a positive step in some of these areas that have actually been spiraling downward throughout the course of this year." This has been the worst year for coalition 22 casualties of the entire war. JJ Sutherland, NPR News, Washington.

Crude oil futures 23 ended the session lower. The near month contract for benchmark crude fell $1.11 today to end the session at $88.95 a barrel on the New York Mercantile Exchange.