BUSINESS BRIEFS
Lawmaker wants rest of bailout fund released
Associated Press
WASHINGTON — A key House Democrat is pushing to get the second half of the $700 billion rescue fund released next month, before President-elect Barack Obama is inaugurated, in part to help stimulate the economy.
Barney Frank, D-Mass., chairman of the House Financial Services Committee, said yesterday he is preparing legislation to require that some of the money be spent for specific purposes, such as stemming foreclosures and reducing mortgage rates.
At the same time, commercial real estate developers and other companies are seeking their own share of the bailout pot.
Frank's bill would impose tighter restrictions on the second $350 billion of the bailout funds, such as requiring banks to report on their new lending every quarter and toughening limits on executive compensation. Many U.S. banks have received federal capital in an effort to stimulate lending.
"I don't want to wait until Obama," Frank said in a phone interview. "I think we can do it now."
CHINA'S LENDING RATE CUT YET AGAIN
BEIJING — China cut interest rates yesterday for the fifth time in four months in a new effort to revive economic growth amid government anxiety about spreading job losses and worker protests.
The benchmark one-year lending rate will fall by 0.27 percentage point to 2.25 percent, effective today, the central bank said.
That came just four weeks after China's biggest rate cut in 11 years and left the benchmark rate at its lowest level since February 2004.
CATERPILLAR TO CUT EXEC PAY BY 50%
Caterpillar Inc., the world's largest maker of mining and construction equipment, said yesterday it will cut executive compensation by up to 50 percent next year due to slower demand amid the global economic downturn.
The Peoria, Ill., company also said it was offering voluntary buyouts to about 25,000 U.S.-based managers and support employees and had instituted a global hiring freeze.
Caterpillar, which employs about 112,000 people worldwide, has expanded dramatically in recent years, driven partly by demand from infrastructure projects in developing countries.
AIG SELLING UNIT TO REPAY U.S. LOAN
CHARLOTTE, N.C. — American International Group Inc. said yesterday that it will sell its Hartford Steam Boiler unit to German reinsurer Munich Re for $742 million as the embattled New York-based insurer divests itself of units to pay back a U.S. government bailout loan.
The purchase price is considered well below HSB Group Inc.'s value — estimated at between $1 billion and $2 billion by the Financial Times.
CHINA REQUESTS WTO INQUIRY
GENEVA — China has asked the World Trade Organization to investigate whether the United States is illegally taxing Chinese goods such as steel pipes and off-road tires.
It's the first time Beijing has ever sought a WTO panel in a trade dispute.
Washington delayed the panel's establishment at a meeting of the WTO's dispute body yesterday, but an investigation will likely be launched early next year.
OIL FALLS NEARLY 6%, BELOW $40
Oil prices tumbled below $40 a barrel yesterday as reports from manufacturers such as Toyota and Caterpillar pointed to a worsening global economic climate and serious deterioration in energy demand.
Light, sweet crude for February delivery fell $2.45, or nearly 6 percent, to settle at $39.91 a barrel on the New York Mercantile Exchange. Crude prices have tumbled 70 percent since peaking above $147 in July.
