Clem Lane here with another ABC NEWS Evening Editorial Note.
PRESIDENT OBAMA CHANNELS HIS INNER BULL-With the stock market still stuck below 7000, many investors have to (continue) to wonder what to do with their money. President Obama has a thought. Jake Tapper, filing for WORLD NEWS, notes that "during a visit with British Prime Minister Gordon Brown, President Obama seemed to suggest to investors that they should buy." President Obama’s quote? "Profit and earnings ratios are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it." In addition to the stimulus funds for infrastructure projects mentioned this morning (see note below), the President touted additional efforts to open up credit markets. Tapper tells us the President trumpeted "a new credit line from the Treasury Dept. and Federal Reserve..up to $200 billion in credit to finance small business, credit card, auto, student loans. Taxpayers can start applying today." This upbeat message was repeated across Capitol Hill today, where several members of President Obama’s financial team talked up the stimulus bill to Congressional committees. Treasury Secretary Tim Geithner told the House Ways and Means Committee that "those things are the direct effects of the actions that have been taken to try and make sure that there’s a stronger level of confidence across the country." Federal Reserve Chairman Ben Bernanke told the Senate Banking Committee that President Obama’s recently enacted $787 billion stimulus package of increased federal spending and tax cuts should help revive consumer spending, boost factory production and "mitigate the overall loss of employment and income that would otherwise occur." So why aren’t we convinced?
WALL STREET, INVESTORS NEED MORE-Betsy Stark spent the day on Wall Street talking with a number of veteran traders. She noted on WORLD NEWS that despite all the efforts taken so far to address the financial crisis, "investors don’t seem to like what they’ve been hearing." What do they want? Instant results for one thing. Not helping? Stark says that "stocks are down almost 19 percent since the Obama Administration took office, down more than 50 percent from their peak (in October 2007)." More telling? Stark tells us "One of the things we heard today is that investors will continue to sell stocks until they’re convinced they know the new rules of the game: who exactly will be bailed out? On what terms? And what happens to private investors?" All good reasons for a skittish investor to stay on the sidelines until the ground rules are written in indelible marker rather than the #2 pencil that seems to be the current rules writing implement. Perhaps most importantly, investors need some proof. Trader Doreen Mogavero told Stark that "as consumers and investors, we need to see something positive actually happen." So to recap-it’s Doubting Thomases still leading the Economic Cheerleaders at this point. Look no further than our own ABC NEWS CONSUMER CONFIDENCE INDEX for proof. Patrick Moynihan wrote: " Barack Obama’s initial moves on the economy have left consumer confidence flat so far: it remains in full duck-and-cover mode, not far from its low in 23 years of weekly polls. The ABC News Consumer Comfort Index stands at -49 on its scale of +100 to -100. That’s 5 points better than its record low at the end of January, thanks to a gain among Democrats celebrating Obama’s arrival. But it’s still dismal; the long-term average is -11. Obama today said consumer confidence should improve as his stimulus package creates jobs. History urges caution: Confidence in the last deep recession, in 1990-91, recovered very slowly, with the ABC CCI regaining its pre-recession levels only in late 1994."
THE BAIL-OUT-WHERE ARE WE GETTING ALL THIS MONEY?-I don’t know about you but I get dizzy sometimes trying to figure out how much money we are throwing at our economic crisis. John Berman tried to make some sense of it on WORLD NEWS, ticking off some of the $ amounts "$160 billion for AIG, $13 billion for GM, $789 billion for a stimulus plan…$11 trillion pledged to save this economy." That’s a lot of dosh…I don’t suppose there’s a rainy-day fund that big? Nope, Berman tells us, "we’re borrowing it. When someone buys a treasury note or bond, they are actually loaning the US Government money." Who’s buying? Berman notes that "U.S. notes are a big hit overseas. China owns more than $700 billion worth of US securities. Japan more than $600 billion." Sounds great but there are consequences-potential inflation thanks to all this government spending could be down the line. What’s definitely down the line is having to pay the debt off at some point but Berman notes that "economists concede that a battle to keep this economy afloat is HUGELY expensive. But the saying goes, it’s expensive to win a war…but it’s a lot cheaper than losing."
TRANSPORTATION STIMULUS FUNDS AT WORK-From Drew Millhon: "President Obama and Secretary of Transportation LaHood announced that stimulus funding for infrastructure projects will begin today. 102 projects across ten states (AR, ME, MD, MS, NY, OR, RI, UT, WV, TN) will receive $348,233,344, of an estimated $27.5 billion, today for ‘shovel-ready’ highway infrastructure projects. All fifty states will receive more funding as proposed ‘shovel-ready’ projects are verified and approved by the DOT." Big deal? Tapper reports that "those funds, (President Obama) said, would create or save 150 thousand jobs by the end of 2010-more than GM, Ford and Chrysler have lost in manufacturing over the past 3 years combined."
AUTO SALES-Too bad the American economy doesn’t come equipped with air bags. Another train wreck of a month for US auto sales. Charlie Herman says "The annual pace of U.S. auto sales fell to 9.12 million units, a drop of 41% from the rate a year ago. The annual rate of sales in February was the lowest since December 1981, the worst rate in more than 27 years. As General Motors and Chrysler continue to negotiate their fate with the government, unions and debt holders, it is becoming increasingly difficult for them as both companies sell fewer and fewer vehicles. GM sold 125,458 vehicles this past month, a 53% drop from a year ago. Chrysler sold 84,050 cars and trucks, a drop of 44% from a year ago. Ford, which has not taken a government bailout, also saw its sales drop 48% from a year ago, selling fewer than 100,000 vehicles.
All told the Detroit 3 (it wasn’t so long ago we called them the Big 3) sold 305,202 autos in February, a drop of more than 49% from last February.
Auto makers overseas didn’t fare much better as well. Asian auto makers saw sales drop 34% and sales of European cars fell 29%."
HIGH LEVEL LETTER-We learned today that President Obama opened the door on an important international issue just last month. Jake Tapper: "An administration official tells ABC NEWS that in Moscow sometime on or around February 11, Undersecretary of State for Political Affairs William Burns delivered a letter from President Obama to Russian President Dmitri Medvedev that addressed the missile defense program and Iran’s push for nuclear weapons." Martha Raddatz said this about the letter on World News: "According to an Administration official, the letter says that if the Russians help convince the Iranians to halt their nuclear weapons program…the US might halt its planned missile defense system based in Poland and the Czech Republic, an approach which is a clear departure from the Bush Administration." Martha’s been covering the second overseas trip by Secretary of State Clinton, now in Israel. Here’s what Clinton told Martha about the Russian overture: "I think it’s well known that we have a broad range of issues to discuss with the Russians. Iran’s pursuit of a nuclear weapon is deeply troubling to not only the U.S. but many people throughout the world. We are trying to enlist the assistance of every nation." For his part, President Medevdev seemed to indicate a willingness to discuss the matter. During a visit to Spain, he said: "Our American partners are ready to discuss this problem, and that’s already positive." But Medevdev said there would be no deal trading missile defense for help with Iran. (thanks to Ed Bailey for this entry)
F-18 CRASH/MARINES BRIEFING-Pretty remarkable stuff in here. From Luis Martinez: " The Marines briefing into last December’s deadly crash of an F-18 into a San Diego neighborhood is ongoing in California. Here’s an in-depth advance look provided earlier today. 13 marines have been disciplined for their actions — four officers relieved of duty and 9 receiving administrative reprimands. In short, the plane suffered a rare double-engine failure. But if proper procedures had been followed by the pilot and others on the ground assisting him the second engine’s failure could have been avoided. Marines began the news conference with an apology to the Yoon family, Dong Yun Yoon’s wife, two baby daughters and his mother-in-law were killed when the plane crashed into their home, short of the runway at Miramar Marine Corps Air Station. Mechanical issues prompted the emergency, but it was a series of human errors that caused greater equipment malfunctions that brought this plane down. Four officers have been relieved of duty, which means they keep their ranks, but have lost their commands. That effectively means their careers are over. An additional nine marines have received administrative punishments. This all started with right engine trouble that led to the proper shutdown of the engine. Flying on one engine, the pilot and others failed to understand what several left engine caution lights actually indicated. This meant that a plane full of fuel ended up dropping out of the sky because the left engine stopped receiving fuel, all because the pilot and the fellow Marine pilots helping him didn’t have a full picture of what was going on simply because they weren’t following the book/checklist. If they had, this all could have been avoided."
SCOTUS OPINIONS TODAY-From Jan Crawford-Greenburg: " The Supreme Court today issued two narrow decisions on legal standing and immigration. The justices will issue additional opinions tomorrow at !0 a.m.
In one case today, the Court shot down a lawsuit by the Sierra Club and other environmental groups over regulations the Forest Service uses when it sells fire-damaged timber. The Court said the parties lacked standing to file suit, because they weren’t challenging an imminent proposed sale of timber, but were instead attacking the regulations in general. The decision limits somewhat the ability of civic organizations to sue. The Court said the case turned on the fact that the government had decided to abandon the sale of fire-damage timber in the project at issue, so there was no imminent dispute.
In the other case of the day, the justices sided with an Eritrean/Ethiopian national who was seeking asylum in the United States, but ordered departed. The Board of Immigration Appeals ruled that he was not entitled to asylum because he had worked as a prison guard in Eritrea, and was therefore was barred from getting refugee status in this country because he had persecuted others. The man claimed he was forced to work as a guard, and had escaped, but the Board said that was irrelevant in light of a past Supreme Court decision. In the opinion today, the justices said the Board had interpreted that decision incorrectly and ordered the board to reevaluate the issue.
–We learned more today about the engineer who was texting when his METROLINK COMMUTER TRAIN crashed last year killing 25 people was apparently planning on turning over the controls of the train to a teenage boy/train enthusiast later the same night of the crash. The transcript of messages sent and received by engineer Robert Sanchez came as the National Transportation Safety Board opened a two-day hearing. Lisa Stark reported on the story tonight for WORLD NEWS.
–The Coast Guard has suspended its search for MISSING BOATERS off Florida’s Gulf Coast. Crews had narrowed their search for Oakland Raiders linebacker Marquis Cooper, free-agent NFL defensive lineman Corey Smith and former University of South Florida player William Bleakley after finding a survivor yesterday but were unable to locate anyone today.
–Rich Esposito tells us that tomorrow’s hearing in the US VS. BERNARD MADOFF has been adjourned until next week for "scheduling reasons". BTW, Esposito and Brian Ross tell us " Bernard Madoff’s criminal defense attorney, Ira Lee Sorkin has received death threats, hostile e-mails and now an anti-Semitic threat, ABC News has learned." You can read their full Blotter report at here.
– The UNITED STATES IS SENDING TWO DIPLOMATS TO SYRIA for "preliminary conversations", Secretary of State Hillary Clinton announced today. Relations between the two countries haven’t been friendly since the the Bush Administration yanked its’ ambassador Margaret Scobey back in 2005 to protest Syria’s suspected role in the assassination of former Lebanese Prime Minister Rafik Hariri.
–So how many folks took advantage of Oregon’s ASSISTED SUICIDE law last year? The annual report on assisted suicide for terminally ill patients in Oregon shows 60 people ended their lives last year by taking a lethal drug dose prescribed under the Death With Dignity Act. It was the highest annual total in the 11-year history of the law twice approved by Oregon voters and upheld by the U.S. Supreme Court. But state health officials said the pattern remains the same -nearly all the patients were older, suffered from cancer and died at home.
–An arrest warrant has finally been issued in the death of CHANDRA LEVY. As Pierre Thomas has reported, the suspect is Salvadoran immigrant Ingmar Guandique. Guandique is accused of killing Levy on May 1, 2001, as she jogged through Rock Creek Park in Washington, D.C. Guandique is already serving time in a federal prison in Adelanto, Calif., for attacking two women in the same park in the weeks following Levy’s disappearance.