BUSINESS BRIEFS
Feds threatened bank's board to salvage Merrill Lynch deal
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NEW YORK — Federal Reserve Chairman Ben Bernanke and the Treasury secretary at the time, Henry Paulson Jr., threatened to remove the management and board of Bank of America late last year if it backed out of its deal to acquire ailing investment house Merrill Lynch, according to documents released yesterday by New York Attorney General Andrew Cuomo.
Kenneth Lewis, Bank of America's chief executive, told investigators he wanted to stop the merger because "devastating losses" at Merrill would be detrimental to his company, the documents show. But the threat from Paulson changed his mind, he told the attorney general's office. Paulson said he made the threat at the request of Bernanke, according to the documents, out of concern about the danger to the wider financial system.
GM SUMMER HIATUS WILL PUT A SHUDDER IN ECONOMY
DETROIT — General Motors' decision to shut down 13 assembly plants for up to 11 weeks this summer will disrupt far more than the lives of nearly 24,000 workers, rippling out to damage parts suppliers, local businesses and state economies.The Detroit automaker has little choice. GM, surviving on $13.4 billion in federal loans, must steady itself, slash costs and align production levels with the shrunken demand if it wants to survive much longer. Yesterday's announcement comes as GM races to meet the government's June 1 deadline to squeeze deeper concessions from bondholders and the United Auto Workers union.
MARCH HOME PRICES DOWN 12.4% FROM A YEAR AGO
WASHINGTON — Home prices continued to slide last month as foreclosed and other distressed properties drew first-time buyers and bargain hunters into the market.Although prices rose from February to March, the national median existing-home price for all housing types was $175,200, down 12.4 percent from March 2008, the National Association of Realtors reported yesterday.
Distressed homes made up about half of all sales, and about two-thirds of those were foreclosures. Those included bank-owned properties and short sales, in which homes are sold for less than the mortgage balance.
