U.S. markets slide into red Thursday
NEW YORK, Sept. 8 (UPI) -- U.S. markets slipped in late trading Thursday after Federal Reserve Chairman Ben Bernanke described the economic recovery as disappointing.
"It is clear that the recovery from the crisis has been much less robust than we had hoped," he said in a speech at the Economic Club of Minnesota.
In a morning report, the Bureau of Economic Analysis said the trade deficit shrank in July, which gave stocks an early boost. But gains were weak and did not hold.
In Germany, the European Central Bank said it would keep lending rates intact at 1.5 percent, while it kept an eye on rising inflation. In Britain, the Bank of England said its lending rate would stay at 0.5 percent for another month.
By close of trading on Wall Street, the Dow Jones industrial average shed 119.05 points, 1.04 percent, to 11,295.81. The Standard & Poor's 500 index lost 12.72 points or 1.06 percent to 1,185.90. The Nasdaq composite index gave up 19.80 points, 0.78 percent, to 2,529.14.
On the New York Stock Exchange, 667 stocks advanced and 2,362 declined on a volume of 3.6 billion shares traded.
The benchmark 10-year treasury note rose 21/32 to yield 1.98 percent.
The euro fell to $1.3882 from Wednesday's $1.4097. Against the yen, the dollar rose to 77.52 yen from Wednesday's 77.26 yen.
In Tokyo, the Nikkei 225 index rose 0.34 percent, 29.71, to 8,793.12.
In London, the FTSE 100 index gained 0.41 percent, 21.79, to 5,340.38.
SEC halts record purging
WASHINGTON, Sept. 8 (UPI) -- Securities and Exchange Commission General Counsel Mark Cahn has told SEC staff to stop destroying case records following accusations of illegal purging.
Cahn sent a memo to staff informing them of the new policy in the wake of an accusation the SEC was illegally destroying records that could point to the regulator as being soft on Wall Street malfeasance, The Washington Post reported Thursday.
"The decision to stop destroying these records is a key step to opening the windows into the SEC to see how it operates," said Gary Aguirre, a former SEC official who is representing Darcy Flynn, the enforcement lawyer who has twice raised a stir at the SEC over the issue of purging pertinent records.
"The SEC windows have been sealed closed and shuttered for too long," Aguirre said.
John Nester, a spokesman for the Wall Street regulatory agency, said the SEC was attempting to develop a new policy that covers how long SEC case records will be kept.
The old policy was on hold "out of an abundance of caution," Nester told the Post.
Geithner takes swipe at gridlock
WASHINGTON, Sept. 8 (UPI) -- U.S. Treasury Secretary Timothy Geithner said "political paralysis" was now the biggest hurdle preventing economies in developed nations from faster growth.
In an article published in the Financial Times, Geithner said there were three critical steps required to get an economic recovery back on track. The first was, essentially, more economic stimulus that President Barack Obama is set to propose including a "very substantial package of public investments, tax incentives and targeted job measures."
The second necessary step was for European countries to "take more forceful action to generate confidence that it can and will resolve its crisis."
The third step, he said, was for developing countries, especially China, to increase domestic demand and to allow its currency to adjust to market forces.
Currently, "The outlook is not all dark," he said. But the largest economic hurdles, at present, "have less to do with … economic realities and more to do with political paralysis, misplaced fears about inflation and moral hazard, and unwarranted disaffection with the efficacy of the traditional fiscal tools of tax cuts and investment to encourage growth," he said.
"Recovery was always going to be slow, fragile, and take time. We have more work to do. We are better off doing it together," he added.
FBI raids bankrupt solar company near S.F.
FREMONT, Calif., Sept. 8 (UPI) -- The FBI declined to say what its agents were looking for Thursday when they searched offices of a bankrupt solar-panel company in the San Francisco Bay Area.
A squad of agents armed with a search warrant and accompanied by agents from the Department of Energy showed up at the Solyndra campus in Fremont, which recently announced it was closing its doors because it was unable to compete with lower-priced imports from Asia.
"Everything is under seal," FBI spokeswoman Julianne Sohn told the San Jose (Calif.) Mercury News.
The newspaper said a Solyndra spokesman speculated the search had something to do with $535 million on loan guarantees the company had received from the DOE. There have also been concerns voiced about a potential buyer dismantling the company's production equipment and shipping it overseas.
Solyndra filed for Chapter 11 bankruptcy protection and also laid off more than 1,000 employees. The company had a skeleton staff on hand Thursday closing down the operations and handling the last of the accounting and human-resources paperwork.
