U.S. markets wobble to close
NEW YORK, May 11 (UPI) -- U.S. markets turned lower in late trading, closing mixed after China released inflation figures that indicate the government may choose to slow growth.
With real estate prices up 12.8 percent in April, "it's inevitable that they've got to tighten a little more to keep their economy in line," Bill Quinn, chairman of American Beacon Advisors told The Wall Street Journal.
By close, the Dow Jones industrial average lost 36.88 points or 0.34 percent to 10,748.26. The Standard & Poor's 500 index lost 3.94 or 0.34 percent to 1,155.79. The Nasdaq composite index rose 0.64 or 0.03 percent to 2,375.31.
Dow component Intel, up early, dropped 1.2 percent. American Express closed up 0.56 percent. Entertainment giant Walt Disney gained 1.33 percent.
On the New York Stock Exchange, 1,706 stocks advanced and 1,355 declined on a volume of 5.8 billion shares traded.
The benchmark 10-year Treasury rose 1/32 to yield 3.537 percent.
The euro fell to $1.2686 from Monday's $1.2788. Against the yen, the dollar fell to 92.70 yen from Monday's 93.25 yen.
In Japan, the Nikkei 225 index lost 119.60 points, 1.14 percent, to 10,411.10.
In Britain, the FTSE 100 index fell 0.99 percent, 53.21, to 5,334.21.
U.S. senators agree to Fed audit
WASHINGTON, May 11 (UPI) -- U.S. senators voted 96-0 Tuesday to have auditors review the role of the Federal Reserve during the financial meltdown of 2008 and 2009.
"The Fed can no longer operate in virtual secrecy," said U.S. Sen. Bernard Sanders, Ind-Vt., who proposed the amendment, which will be attached to the 1,400-page regulatory reform bill.
"Let's be clear," Sanders said. "When trillions of dollars of taxpayer money are being lent out to the largest financial institutions in this country, the American people have a right to know who received that money and what they did with it. We also need to know what possible conflicts of interest exist involving the heads of large financial institutions who sat in the room helping to make those decisions."
Sanders has long proposed audits for the Fed, which has resisted the initiatives on the grounds that the Fed's Open Market Committee requires autonomy to make monetary policy decisions.
The audit senators approved Tuesday is a one-time audit, not an on-going review.
Earlier, senators rejected a tougher audit proposal that more closely matched the version in the House of Representatives bill, which allows for a complete Fed audit but provides for a 180-day delay before details are released concerning monetary policy decisions.
GM ads called a distortion 'slightly'
CHICAGO, May 11 (UPI) -- Former White House automobile industry adviser Steve Rattner said a General Motors Co. advertisement was "slightly" a distortion of the facts.
Before a speech in Chicago praising the government's efforts to revive the automobile industry, Rattner said GM "may have slightly elasticized the reality of things," in an ad in which GM Chairman and Chief Executive Officer Ed Whitacre Jr. says the company had repaid the taxpayer funded bailouts it received, The Detroit News reported Tuesday.
GM has repaid $6.7 billion in loans, but the government still owns 61 percent of the company, representing an investment of $43 billion.
"On balance, it is probably going as expected and better than we feared. (GM is) hitting or exceeding all the milestones," said Rattner, referring to GM's progress since falling into bankruptcy last summer.
In spite of the ads, which provoked complaints from conservative groups, Rattner called Whitacre a "hero."
"Thank God we have him," he said.
Rattner said taxpayers would probably not see $10 billion of the $50 billion the government invested in GM.
"For about $10 billion, we avoided economic and human calamities," he said.
Detroit home prices rise in tough economy
DETROIT, May 11 (UPI) -- The median sale price of homes in a 10-county region including Detroit jumped 61.3 percent from April 2009 to April 2010, a real estate group said.
Realcomp II Ltd., based in Farmington Hills, Mich., said the price of homes and condominiums surged from a year ago, but a separate study by CoreLogic Inc. said Michigan has the fourth highest percentage of homes in which the homeowner owes more on the mortgage than the home is worth, The Detroit News reported Tuesday.
The median price of homes more than doubled in Wayne County from April to April, rising to $36,900. In Oakland County, prices have jumped 30.2 percent to $110,000, the newspaper said.
Sales rose 16.9 percent in the 12 months in Wayne County and 16 percent in Oakland County. In Macomb County, north of Detroit, sales rose 4.3 percent.
CoreLogic said only Nevada, Arizona and Florida have higher percentages of homes underwater -- homes that are worth less than the amount owed. In Michigan, 38.6 percent of the homes are underwater, the News said.
