The airlines' woes portend badly not only for employees and shareholders, but for taxpayers. Delta warned that more layoffs and benefit cuts are coming. US Airways Chairman David Bronner gave his carrier a "1 to 2 percent" chance of surviving if it has to seek Chapter 11 again. And United said it likely will terminate its pension plans and dump more than $6 billion of obligations onto the feds' already-strapped Pension Benefit Guaranty Corp. If others follow, the PBGC may need a taxpayer bailout.
Googling to the Bank
They started the week as the amateurish visionaries who shirked Wall Street norms at their peril, gave an interview to Playboy that was published before the end of their mandated "quiet period" and had to slash the opening price of their shares from as high as $135 to $85. But the Google guys got the last giggle, as the stock rose 18 percent on the first day of trading. The company raised $1.7 billion, among the biggest tech IPOs ever. And bumblers Larry Page and Sergey Brin ended the day worth nearly $3.8 billion each.
Rouse Co., the visionary real estate firm that transformed the landscape of the Washington-Baltimore region over three decades, was swallowed Friday by a far less flamboyant shopping-mall manager from the Midwest. Chicago-based General Growth Properties Inc. shocked the Washington business community with its $12.6 billion deal to acquire Rouse, the firm that founded the city of Columbia, revitalized Harborplace in Baltimore and built Faneuil Hall in Boston and South Street Seaport in New York City.
The Securities and Exchange Commission put Freddie Mac on notice that it is likely to slap the mortgage giant with civil charges of manipulating earnings. Freddie has acknowledged that it misstated profits by $5 billion from 2000 through 2002. Nevertheless, Freddie and its larger rival, Fannie Mae, have been fighting efforts by the Bush administration to impose stronger oversight. Meanwhile, Fannie got its own bad news in the form of accounting-practice subpoenas from the Office of Federal Housing Enterprise Oversight.
On Monday, the oil-services giant once headed by Vice President Cheney said the Army had granted it more time to justify billing claims for its logistical operations in Iraq. The next morning, Halliburton said the Army would withhold 15 percent of its payments. Hours later, the Army put off that decision, granting Halliburton its third reprieve this year. Then Wednesday, the deputy commander of the Army Field Support Command said that his command did not have enough personnel trained to assess the company's bills.