UPI NewsTrack Business

Boeing Co. machinists on picket lines

SEATTLE, Sept. 6 (UPI) -- Thousands of union machinists for Boeing Co. in Seattle began their second strike in three years Saturday, setting up picket lines just after midnight.

The 26,800 members of the Seattle-area International Machinists and Aerospace Workers voted overwhelming to strike earlier this week, saying they weren't satisfied with Boeing's offers on pay raises, healthcare coverage and job security, the Wall Street Journal reported.

The walk-out was delayed for two days after a federal mediator asked the union to continue talking with company representatives. The IAM last struck for 24 days in 2005, the newspaper said.

"Despite meeting late into the night and throughout the day, continued contract talks with the Boeing Company did not address our issues," Tom Wroblewski, the union's district president, said in a statement.

"Over the past two days, Boeing, the union and the federal mediator worked hard in pursuing good-faith explorations of options that could lead to an agreement. Unfortunately the differences were too great to close," Boeing Commercial Airplanes President Scott Carson said in an e-mail to employees.

McCain-connected Nevada bank fails

HENDERSON, Nev., Sept. 6 (UPI) -- U.S. banking officials have shut down a Nevada bank whose board once included the son of Republican U.S. presidential nominee John McCain.

Silver State Bank of Henderson, Nev., became the largest of 11 banks to fail so far this year in the wake of the credit crunch, the Wall Street Journal reported Saturday.

Andrew McCain, the adopted son of the U.S. senator from Arizona from his first marriage, is not accused of any wrongdoing in connection with the bank closure. The newspaper said Andrew McCain resigned from Silver State's board July 26 citing "personal reasons."

McCain, 46, is the chief financial officer of Hensley & Co. of Phoenix, the family-owned beer distributor. His father's presidential campaign issued a statement Friday saying: "Silver State, like many regional banks, is struggling in the midst of very difficult economic conditions. Andy realized after joining the Silver State board in April that the bank needed directors who could devote a great deal of time and attention to guiding the bank through this challenging time."

Regulators said the lender was overexposed to risky real-estate loans. Its failure will cost the already-strained Federal Deposit Insurance Corp. $450 million to $550 million, the Journal said.

Takeover of Fannie Mae, Freddie Mac likely

WASHINGTON, Sept. 5 (UPI) -- U.S. officials told Fannie Mae and Freddie Mac Friday the institutions will be placed in conservatorship, The New York Times reported.

Under the plan, the government would guarantee the two mortgage giants' debt. Top executives and the boards of both institutions would be ousted, and shareholders would lose most of their investment.

Senior Bush administration officials told the Times the executives were told in separate meetings that the plan would become public before Asian financial markets open for a new week Sunday.

President George W. Bush signed a law this summer allowing the government to provide Fannie Mae and Freddie Mac with capital through loans or direct investment. Treasury Secretary Henry Paulson said then that he thought the measure would restore confidence in the two lenders.

Both companies reported large losses in their quarterly financial statements last month and predicted further drops in housing prices.

NYT, Trib to dump stand-alone sections

NEW YORK, Sept. 6 (UPI) -- Two of the biggest U.S. newspapers are moving away from traditional stand-alone sections in bids to save money, sources say.

The New York Times said that editors have decided to incorporate its local New York metropolitan news section into its front section, while the Chicago Tribune is considering eliminating its stand-alone business and local news sections, unnamed sources told the Chicago Sun-Times.

At the Times, the new combined sections will go into effect Oct. 6 and will affect only local editions of the newspaper while its national edition will remain the same, Editor Bill Keller said in a memo to newsroom staff. The move will allow the Times to save money on printing costs at a time when revenues are shrinking.

In Chicago, the Sun-Times' sources said one aspect of the Tribune's upcoming redesign could result in significant reductions in the amount of space given to news by combining national and international news, local news, business reports and the editorial page all in the front section of the newspaper.

Tribune Co. Chairman Sam Zell has ordered cost cuts at all its newspapers to combat steep declines in advertising revenue.