NATIONAL BRIEFING

Wednesday, December 31, 2008

MORTGAGE FINANCE

Fed Picks Securities Managers

The Federal Reserve selected four firms -- BlackRock, Goldman Sachs Asset Management, Pacific Investment Management and Wellington Management -- to manage a $500 billion purchase of mortgage-backed securities that it plans to complete by June, the central bank said.

"Only fixed-rate agency mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae are eligible assets for the program," the central bank said in a statement. "The investment managers will be required to purchase securities frequently and to disclose the Federal Reserve as principal."

Fed officials announced the program Nov. 25 and said the action was taken to "reduce the cost and increase the availability of credit for the purchase of houses."

TELEVISION

Viacom Fights Time Warner Cable

Viacom is threatening to pull MTV, Comedy Central, Nickelodeon and 16 other channels from Time Warner Cable if a new carriage-fee deal is not agreed on by the new year.

If realized, the move could shut off the channels to 13 million subscribers, said spokesman Alex Dudley, a vice president at Time Warner Cable, the nation's second-largest cable operator.

Viacom has asked for fee increases of 22 to 36 percent per channel, adding up to tens of millions of dollars per year, an amount that could increase customers' cable bills, Dudley said.

Viacom said in a statement that the increases would cost less than 25 cents a month per subscriber.

BANKRUPTCY

WaMu Confidentiality Bid Denied

A federal bankruptcy judge denied a request by Washington Mutual to keep details of certain asset sales secret. WaMu wants to sell some equity holdings and interests in venture capital funds to generate value for the company and its creditors and sought permission to redact details of asset purchase prices from sale notices that would be sent to interested parties.

A WaMu lawyer told Judge Mary Walrath that disclosing pricing details could hurt the value the company might receive and "chill future transactions."

Walrath sided with a lawyer for the U.S. trustee that the assets do not meet the definition of confidential commercial information whose disclosure could give WaMu's competitors an unfair advantage.

$28 Million for Madoff Trustee

A U.S. bankruptcy judge approved $28.1 million to cover salaries and other expenses tied to the liquidation of the investment firm run by Bernard L. Madoff, accused of running a Ponzi scheme that cost investors up to $50 billion. A lawyer for the trustee said the money is coming from a frozen account and will not affect any recovery for investors.

CONTRACTING

Award Protests Hit 10-Year High

There were more challenges to federal contracts in 2008 than any year in the past decade as companies fought over fewer multibillion-dollar projects.

While federal auditors found errors in few of the government's decisions, more than $70 billion in defense contracts alone were delayed this year due to losing bidders lodging protests.

More than 1,600 protests were filed by U.S. businesses with federal auditors in 2008. That's up 17 percent from last year and the highest level since 1998, according an annual report by the Government Accountability Office.

Boeing Wins Missile Deal

Boeing received a $397.9 million contract from the Pentagon's Missile Defense Agency to continue development of the Ground-Based Midcourse Missile Defense program.

Boeing is the prime contractor for the Ground-Based Midcourse Missile Defense system and holds a 10-year, $15.4 billion contract. The system, with interceptors in Alaska and California, is designed to shoot down long-range ballistic missiles in space.

The system has destroyed targets successfully in eight of 13 tests since 1999.

SEC

Enforcement Accountant Leaves

The top accountant in the Securities and Exchange Commission's enforcement branch is leaving for a private-sector job next month in what could herald a wave of departures from the embattled agency. Susan Markel, chief accountant in the agency's division of enforcement, is taking a job in the corporate investigations practice of AlixPartners, a turnaround consulting firm. She had been at the SEC since 1994 and took her current position in 2003.

Alleged Ponzi Scheme Halted

The Securities and Exchange Commission, under congressional scrutiny for failing to detect Bernard L. Madoff's alleged Ponzi scheme, said it halted an unrelated $23.4 million scam targeting Haitian Americans. A federal court in Florida agreed to freeze assets and appoint a receiver after the agency sued George Theodule and two entities he controlled, the SEC said.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.