Wednesday, September 24, 2008
LEGISLATION
House Passes Credit Card Limits
The House of Representatives approved legislation that seeks to protect consumers from lending abuses by credit card companies. The measure, passed 312 to 112, requires a notice period for interest rate increases, prohibits interest charges on balances paid during grace periods and bars issuers from applying payments first to lower-interest debt while debt carrying a higher interest rate remains unpaid.
Lawmakers have accused card issuers such as Citigroup, American Express and Discover Financial Services of luring borrowers into signing up for cards with confusing terms, then penalizing them with high fees and rates.
The Bush administration said it opposed the credit card legislation because federal agencies, including the Federal Reserve, are drafting new credit card rules that should be released by the end of the year.
AUTOMOTIVEChrysler to Sell Electric Vehicles
Chrysler said it plans to develop a full line of plug-in electric vehicles and will start selling a battery-powered car in North America in 2010.
The company showed reporters three electric prototypes: a Dodge sports car, a Jeep Wrangler and a Chrysler minivan. The Wrangler and minivan plug into a standard wall outlet and can go 40 miles on battery power alone.
Chrysler said it does not know which vehicle it will launch first and would not reveal pricing. The Chevrolet Volt, introduced last week by General Motors, is expected to cost $30,000 to $40,000, far more than most conventional cars.
REGULATORSCox Urges Oversight on Swaps
Securities and Exchange Commission Chairman Christopher Cox said Congress should "immediately" grant authority to regulate credit-default swaps amid concern the bets are fueling the global financial crisis.
"Neither the SEC nor any regulator has authority over the CDS market, even to require minimal disclosure," Cox told the Senate banking committee at a hearing on the government's $700 billion financial rescue plan.
Calls for greater regulation of the $62 trillion market have grown since the federal government took over American International Group. Investors can use credit-default swaps to bet a company's financial condition will worsen. The swaps' value increases as perception of the company's stability deteriorates.
ENTERTAINMENTDeal Reached on Music Royalties
Record labels and online music companies reached an agreement on how much to pay songwriters and music publishers for some forms of digital distribution.
The deal, which doesn't cover permanent music downloads, establishes a rate of 10.5 percent for the "mechanical royalty," said industry groups, including the Digital Media Association and the Recording Industry Association of America said Tuesday. Payment rates have had to be negotiated separately with each music company.
The agreement, as proposed to the U.S. Copyright Royalty Board, covers interactive streaming of music and restricted downloads.
EARNINGSLennar, one of the nation's largest home builders, narrowed its third-quarter loss as it slashed costs to compensate for lower sales. The company reported a loss of $89 million in the period ended Aug. 31, down from a loss of $513.9 million in the corresponding period the year before. Revenue was $1.11 billion, a 53 percent decrease.
Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.
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