Wall Street in Turmoil

There’s lots going on in the financial markets today — the stock market has plummetted on news that our country’s major financial firms are suffering from the ongoing housing and credit crisis.  

Here’s what I’ve pieced together – 

 

Bloomberg says its “the biggest reshaping of the financial industry since the Great Depression.”  One analyst said: “The tectonic plates beneath the world financial system are shifting, and there is going to be a new financial world order that will be born of this.”  Here’s what’s happened so far:

 

• Lehman Brothers, a 158-year-old global financial services firm, “filed for Chapter 11 bankruptcy protection after failing to find a buyer.”  
  
• Merrill Lynch, 94 years old and the world’s largest brokerage firm, “agreed to sell itself to Bank of America for $50 billion in an emergency deal.”
• And the world’s largest insurance company, AIG, asked the government for a $40 million bridge loan 
• “The dollar lost traction against the yen but rallied against other major currencies” (CNBC).
• The price of oil dropped to below $100 per barrel, the first time since February.  It’s trading around $94 currently, showing that the price is “responding to the turmoil in financial markets more than Hurricane Ike” (CNBC).
• In global trade, European markets tumbled in the afternoon and Asian stocks ended lower. Many major Asian markets, including Tokyo and Hong Kong, were closed for holidays.

Here’s why:  ”The engines that powered record growth in the financial industry over the last decade — cheap credit and surging property values — have been thrust into reverse. Companies that once thrived on making real estate loans and holding assets bought with borrowed money are now under siege, giving the upper hand to those less reliant on leverage and holding the fewest assets tied to property” (Bloomberg).

The government, which helped out Bear Stearns and J.P Morgan Chase earlier this year and most recently took over Fannie Mae and Freddie Mac last week, “steered clear of a bailout,” but “the Federal Reserve is expected to take new steps to stabilize the broader financial system. These steps, expected to be temporary, would make it easier for banks and securities firms to borrow from the central bank by using a wider range of collateral. Bankers say these financial institutions might need short-term funds as they unwind their many trading positions with Lehman” (WSJ). 

What’s going on in Iran

[From the RP News Network -- click here to join]

I’ve been meaning to send this out for a while but just haven’t been able to. If you haven’t heard, there’s a lot of news coming out of Iran this week. Here’s why:

Basically, Iran captured/arrested 15 British military officers who were patrolling in a river between Iraq and Iran. Iran says that the crew entered their waters 6 times before they were arrested. The waterway has been controversial for several years, with both Iraq and Iran claiming jurisdiction over the waterway. Iran claims the crew was in their waters; Britian says that per UN Mandate, they were Iraqi waters. The group is now in their 6th day of captivity.

Edwards won’t regret a run

The New York Times interviewed John and Elizabeth Edwards yesterday to talk about his decision to stay in the race.  Elizabeth said that she made the decision in the hospital room.

As she spoke with the nurses, Mrs. Edwards recalled: “They said they really supported John, and I started sort of breaking apart. I said, ‘It’s really important that he run.’ ”

John said that no matter what happens to his wife, he won’t regret running for the presidency:

Mr. Edwards said he could not anticipate a situation in which he would ever regret running for the presidency or serving, even if his wife’s illness brought her an early death. “Honestly I don’t,” he said.

“He shouldn’t,” Mrs. Edwards interjected.

Edwards campaign continues as wife’s breast cancer returns

John Edwards announced today that his wife’s breast cancer has returned, but that his campaign will go on.

The money quote: “The campaign goes on. The campaign goes on strongly.”

He added: “Any time, any place I need to be with Elizabeth I will be there — period.”

Elizabeth Edwards went to the doctor on Monday complaining that he rib hurt. XRays showed that a tumor that was removed had returned. The tumor is small but the cancer is not cureable.

John said the campaign will continue as planned; they will both be in California tomorrow.

Developing…

News Corp, NBC take on YouTube

News Corp and NBC Universal announced today they will launch an online video distribution service that will offer content from television and film in a direct challenge to Google’s YouTube.

It won’t be direct competition to YouTube; it’s just a distribution service that will offer sites video content.  The initial distribution partners are Google’s biggest rivals — AOL, Microsoft, and Yahoo!  Initial advertisers include Cadbury Schweppes, Cisco, Esurance, Intel, and GM.

So, this new service will offer what YouTube legally can’t: there will be TV shows and movie clips that will now be legally distributed online.

From the release, via Drudge:

At launch, full episodes and clips from current hit shows, including Heroes, 24, House, My Name Is Earl, Saturday Night Live, Friday Night Lights, The Riches, 30 Rock, The Simpsons, The Tonight Show, Prison Break, Are You Smarter than a 5th Grader and Top Chef, plus hits from the studios’ vast television libraries, will be available free, on an ad-supported basis, within a rich consumer experience featuring personalized video playlists, mashups, online communities and video search. Plus, the extensive programming lineup will include fan favorite films like Borat, Little Miss Sunshine, Devil Wears Prada, The Bourne Identity and Bourne Supremacy with bonus materials and movie trailers. Post- launch, plans will be considered for acquiring additional content as well as producing and licensing original programming for the new site’s audience.

...

Each distribution partner will feature the site’s content in an embedded player customized with a look and feel consistent with each site, making the offering organic to each destination. The new company will offer innovative advertising sales propositions by being able to sell cross-platform -- on-air and on-line. Post-launch, sites affiliated with founding companies, including iVillage and IGN, will also have the opportunity to become distribution partners.

The new company will be located in New York and Los Angeles. A transitional management team led by NBC Universal’s Chief Digital Officer George Kliavkoff, along with an experienced group of executives from NBC Universal and News Corporation, will work together to launch the site. The company’s permanent management will be announced shortly, along with branding details and additional advertising partners. Each company will devote a significant marketing and promotional budget to the new site’s launch.

The new site will launch in the summer.

Florida moves its primary to 1/29

Just when you thought it couldn’t get earlier, it has.  In an effort to become more relevant during the primary process, the Florida legislature voted yesterday, 115-1, to move its primary to Jan. 29,  right after NH and IA and right before “Tsunami Tuesday” on 2/5, when California, New York and half the other states will hold their primaries.   FL Gov still needs to sign the bill into a law.

John Edwards to hold presser with wife

BREAKING NEWS – John Edwards will hold a press conference from North Carolina tomorrow with his wife, who has been treated for breast cancer. After Elizabeth visited doctors on Wednesday, John canceled events in Iowa to be with his wife. The news conference will be held in Chapel Hill to discuss her health.

Will John Edwards drop out? If his wife’s health took a turn for the worse, can he possibly run for president?

Inside ObamaHQ

The New York Observer will run a really interesting look in its next issue at Barack Obama‘s campaign HQ in Chicago. The really smart people at The Hotline summarized the tour of the office as such:

• The field operations office “is cramped into a small corner room overlooking downtown Chicago. … The walls are papered in maps and yellow strips of oversized legal pads, one of which listed more than 20 states” looking to move up their primary.
• A sign reading “Welcome to the Jungle” hangs on the door of the press shop, “located outside the campaign’s main offices and opposite the locked bathrooms.”
• Elsewhere, “the people charge with finding the means to close that gap” between Obama and HRC “are plying their trade in a drab, gray-carpeted horseshoe of an office space behind the counter of the reception desk.”
• “Down the hall, policy experts without ties conferred with the campaign management in the corner office.”
• “Back toward the reception area, Eureka Gilkey,” Obama’s dep political dir, and Josh Dubois, who runs Obama’s religious-outreach operation, “sit back to back in a stuffy room that smells of scented hand lotion.”
• The entire campaign will soon move to the larger 11th floor, “filled with bullpens, conference rooms, cushioned orange seats and ample electrical outlets.” The new media team is up there now.

Axelrod works out of an office on North Franklin Street. He “almost seems to be the campaign’s token feet-on-the group realist, not only keeping the idealistic staff grounded in a day-by-day campaign approach, but keeping the young candidate himself from revealing as much of himself as the press might wish.” Both Gibbs and Axelrod say that substantive policy proposals will come in time. Axelrod: “This campaign just began, and we have 10 months to go.”

He also talks to Chris Hughes, who is the head of the new media dept., and is, at 23 (!), the youngest staffer. He comes directly from Facebook. I’m so jealous in so many ways.

SEIU Meets The Candidates, Praises Mitt Romney

[Originally posted on Hotline On Call on 1/27/07]:

This weekend, the 60-member SEIU exec. board is meeting with 8 Dem WH candidates during their annual exec. board meeting this weekend at Gallaudet University. On Friday, they met with Sens. Clinton, Biden, Edwards, Obama and Kucinich.

SEIU, you’ll recall, is the largest, most innovative union in the country.

SEIU Sec./Treas. Anna Burger said that the ’08 cycle “has allowed time for candidates to learn more about our members and our members about our candidates.” The union is starting the endorsements process so early so that SEIU can be part of the primary process and “make them the best candidate they can be for working families,” she said.

The candidates were given as much time as they took to speak and answer questions about the “issues of the working family,” which include health care, social security, immigration, and the war. The Dems’ three leading candidates—Clinton, Obama, and Edwards—impressed the members, said one attendee; Obama and Edwards even took an important step and “worked the crowd.” (One attendee implied that Sen. Biden talked too much.)

The response from the Dem candidates so early shows how important the labor vote is, especially with the union-heavy IA and NV listed as an early primary state.

On 3/24, SEIU and the Center for American Progress will host a bipartisan health care forum in Las Vegas with the Center for American Progress.

As part of SEIU endorsement process, candidates will spend a day with a member in IA or NH to “experience what they experience.” Burger: “We think that it’s really important for all candidates, Democrats or Republicans, to spend time with our members learning what it feels like to be worried about your kids having a worse life.” Candidates will also answer specific questions that will be distributed by videotape to the SIEU’s 2M members.

Burger said that she did not expect an endorsement to come out before Sept. and that the SEIU will look engage all of their members and look at both Dem and GOP candidates. [RIKI PARIKH]