NEWS AT A GLANCE
Bailout plan comes into focus
Congressional leaders and the Bush administration are getting close to a deal on the massive Wall Street bailout plan, with the White House agreeing to restrictions on executive pay at participating firms. Sticking points include whether to phase in the $700 billion and if the government gets any equity in the firms it bails out. (AP in Yahoo! Finance) President Bush is convening a meeting with key players in Congress, including presidential candidates Sens. John McCain and Barack Obama. (Reuters) Money-market rates rose as banks hoarded cash, in a sign that the markets think the bailout package could be delayed or diluted. (Bloomberg)
Washington Mutual looks for a buyer
Washington Mutual, the top U.S. savings and loan, has approached private equity funds about a potential takeover, after banks started to lose interest, The Wall Street Journal reported. One possible deal includes Carlyle Group and Blackstone teaming up with Texas billionaire Gerald J. Ford. (Reuters) Federal regulators have also stepped in to try to help broker a deal for the ailing bank. Washington Mutual’s position became more tenuous after Standard & Poor’s downgraded its shares further into junk status. (The New York Times) Washington Mutual says it’s “well capitalized.” The potential suitors “are all kind of playing a wait-and-see game right now,” said Joe Heider at Dawson Wealth Management. (AP in CNNMoney.com)
Oracle enters hardware market
Oracle, the No. 2 software maker, is entering the hardware market, pairing up with Hewlett-Packard to make servers. The HP Oracle Exadata server and separate Database Machine, designed to run on Oracle software, will help Oracle push into the expanding data warehousing market. (San Francisco Chronicle) Database software has been a big money-maker for Oracle—it controls about half the $17 billion market—helping it survive a broader falloff in business software. Oracle said it is selling servers to help speed up performance for companies running Oracle database software. “Anything you can do to reduce the cost of plumbing is a big win for customers,” says Bruce Richardson at AMR Research. (BusinessWeek.com)
U.S. prestige, intact so far
The fact that the U.S. needs to rescue Wall Street in a $700 billion bailout might, you’d think, lead other countries’ business communities to lose faith in the U.S. financial system. Surprisingly, it hasn’t, at least so far. That’s partly because many foreigners see the U.S. more in Silicon Valley and Hollywood than in Wall Street. It’s also because if the U.S. model fails, there isn’t another good one ready to take its place. “When it comes to democracy and free market economics, the U.S. is still the original article,” says Ulf Mark Schneider, the CEO of German health care provider Fresenius. “Nobody wants to see it fail.” (BusinessWeek.com)
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- Why is the Pentagon stuffing caves in Norway full of tanks?
- 43 TV shows to watch in 2014
- How to be the most productive person in your office — and still get home by 5:30 p.m.
- The U.S. government is actually trouncing Ebola. When will it get credit?
- The one thing the New Atheists get right about religion
- 3 horrific inaccuracies in Homeland's depiction of Islamabad
- Syrian women know how to defeat ISIS
- Gamergate has backfired spectacularly on its nincompoop perpetrators
- 5 baffling foreign-language versions of the Fresh Prince of Bel-Air theme song
- The simple trick to making better decisions in every aspect of life
Subscribe to the Week