Fear and foreboding took hold on Wall Street yesterday, as the stock market again plunged and investors became convinced that the nation is on the verge of a deep and prolonged recession. The rout continued in Japan, where stocks plummeted in early trading today.

During her first months in office, Alaska Gov. Sarah Palin kept a relatively light schedule on her workdays in Juneau, making ceremonial appearances at sports events and funerals, meeting with state lawmakers, and conducting interviews with Alaska magazines, radio stations and newspapers.

The worst financial crisis since the Great Depression is claiming another casualty: American-style capitalism.

RICHMOND, Oct. 9 -- Virginia Gov. Timothy M. Kaine announced Thursday that he is laying off nearly 600 state workers, closing some prisons and cutting funding for higher education by about 6 percent as the state struggles with one of its worst financial crises in modern times.

REYKJAVIK, Iceland, Oct. 9 -- The bad news just keeps coming for Icelanders, who in the last week have seen the international financial empire that they built on this remote North Atlantic island start to crumble, piece by piece.

DETROIT -- First it was the outsourcing of components, and then vehicle assembly. Then gasoline prices shot up, slashing demand for trucks and sport-utility vehicles. Now, just when things seemed as if they could not get any worse here, the credit crunch and the subsequent stock market meltdown have...

A Democratic senator who has been a longtime friend of Sen. Ted Stevens took the witness stand yesterday to defend the integrity of the powerful Alaska Republican, who is battling corruption charges.

President Bush created a special council yesterday to guide the transition to a new administration, another step toward the end of Bush's eight tumultuous years in office.

The international Cassini space probe flew within 16 miles of the surface of Saturn's moon Enceladus yesterday -- a breathtakingly close flyby designed to gather dust and water particles that will help scientists better understand the recently discovered geysers that spew constantly from the moon's...

· An Oct. 9 A-section article about a British government program to strengthen banks incorrectly said that all eight participating banks would take injections of government capital. Two of the banks, HSBC and Standard Chartered, said they would not accept injections of government capital and would...

Facing a free-speech uproar, the University of Texas backed down yesterday from punishing two students who refused to remove political signs from their dormitory windows. The roommates, cousins Connor, left, and Blake Kincaid, said they were barred from registering for spring classes over their...

PORTSMOUTH, Ohio, Oct. 9 -- Democratic presidential candidate Barack Obama on Thursday said rival John McCain's mortgage rescue plan "punishes" taxpayers and rewards lending institutions that created the crisis, while McCain charged that his opponent's response showed a lack of concern for...

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WAUKESHA, Wis., Oct. 9 -- There were shouts of "Nobama" and "Socialist" at the mention of the Democratic presidential nominee. There were boos, middle fingers turned up and thumbs turned down as a media caravan moved through the crowd Thursday for a midday town hall gathering featuring John McCain...

Former Oklahoma governor Frank Keating, a co-chair of John McCain's presidential campaign, called Barack Obama "very extreme" on a radio show Thursday and raised the issue of Obama's past drug use.

The chairman of the Senate intelligence committee is looking into allegations that a U.S. spy agency improperly eavesdropped on the phone calls of hundreds of Americans overseas, including aid workers and U.S. military personnel talking to their spouses at home.

Libya has started making payments into a nearly $2 billion fund to compensate the families of American victims of Libyan-linked terror attacks in the 1980s, another step in the full normalization of long-strained ties between Washington and Tripoli, the State Department said Thursday.

Although Maryland has no plans for widespread layoffs to ease its budget crunch, state workers might be required to take several days of unpaid leave in coming months, Gov. Martin O'Malley (D) said yesterday.

PARIS, Oct. 9 -- Three weeks ago, as the Bush administration struggled to salvage collapsing U.S. investment banks, European leaders calmly reassured their people. Banks on this side of the Atlantic are more wisely regulated, they said, and unlikely to succumb to the chaos on Wall Street.

ISLAMABAD, Pakistan, Oct. 9 -- The television advertisement that debuted this week starts with a simple scene: A mother is waiting on a street corner for her child to get out of school. It looks like any other sunny day in any one of Pakistan's major cities.

Arctic ice cover improved somewhat this September from last September's record low, but it was thinner and thus more prone to melting in the future. At the end of the Arctic summer, ice covered 1.8 million square miles, up from 1.65 million last year. But about three-fourths of the ice coverage is...

BUDAPEST, Oct. 9 -- Defense Secretary Robert M. Gates called on NATO allies Thursday to target Afghanistan's drug traffickers as part of a wider effort to confront a resurgent Taliban, which he said is using heroin money to fund the insurgency.

BAGHDAD, Oct. 9 -- A senior lawmaker loyal to anti-American Shiite cleric Moqtada al-Sadr was fatally wounded Thursday morning in a roadside bombing in Baghdad, raising concerns about the potential for violence ahead of provincial elections expected early next year.

The Bush administration appears poised to provisionally remove North Korea from the State Department's list of state sponsors of terrorism, perhaps as soon as today, sources close to the administration said.

BANGKOK, Oct. 9 -- When Thailand's political stalemate erupted into open conflict this week, government opponents had hoped for a decisive battle. But the country is now even more divided and further than ever from a solution.

Hundreds of houses in ethnic Georgian villages in South Ossetia were torched in August, after Russian troops took control of the area, according to an analysis of satellite images released Thursday.

Lots of law firms, consultants and lobbyists have been working to advise their increasingly frantic clients as profits and balances quickly tumble.