Life in OUR America, The Livyjr Files Volume 7 Options

[Livyjr]

"Women weigh in: Why do wronged political spouses stand by their men?"

By JOCELYN NOVECK, Associated Press

Last updated: 7:34 p.m., Tuesday, March 11, 2008

NEW YORK -- When Silda Wall Spitzer stood beside her husband in ashen-faced misery the other day as the governor made his brief apology in the prostitution scandal, she uttered not a word.

Yet she launched a thousand conversations.

"Why is she standing there?" many women wondered.

"Should she be?"

"Would I be?"

And for many, who've seen a long line of wronged political spouses do the same, from Hillary Rodham Clinton to Dina Matos McGreevey to Suzanne Craig, the immediate answer was a resounding, "Hell, no."

"I watched her and I thought, 'Again, the wife is standing there,'" said Jessica Thorpe, a 38-year-old mother of three in Larchmont, N.Y.

"And I had a visceral reaction."

"I just don't get it."

"Why does it always have to be that way in politics?"

"What will she get out of standing there?"

The blogosphere was buzzing, too, with the same questions.

"Why do they show up?" asked blogger Amy Ephron on huffingtonpost.com.

She proposed her own fantasy:

"I just want one of them -- Hillary, Silda -- to stand on the steps of the White House, the governor's mansion, and stamp their foot and say, 'And another thing, I'm keeping the house.'"

Yet many women also understood that Silda Spitzer was obviously in pain, and in the unforgiving glare of the public spotlight.

So while Donna Webster, a product development executive in Boston, wished the New York governor had been forced to face the music alone, she also empathized with his wife's choice, which she assumed was for the sake of her three daughters.

"I've been thinking about this constantly."

"I cringed when I saw her next to him," said Webster, 59.

"I think he should have taken it like a man -- without her."

But, she added, "She was in crisis mode."

"She was like a mother bear protecting her cubs."

"When crisis hits, you do what you think you need to for your family."

"Later, you can step back and think about protecting yourself."

Amid the din, one of the most poignant voices defending Silda Spitzer was Matos McGreevey, who stood next to her husband, New Jersey Gov. Jim McGreevey, in 2004 as he told the world he was gay, claimed he had an affair with a male aide and resigned.

"I'm reliving that moment and what it was like standing there next to Jim," Matos McGreevey told The Associated Press Monday night.

"I wanted to embrace her and say, 'Be strong, you'll survive this.'"

In another interview on CNN, she referred to others who'd also stood by their spouses at moments of deep humiliation -- Clinton, during the Monica Lewinsky scandal, and Suzanne Craig, the wife of Idaho Sen. Larry Craig, who was accused of soliciting sex in an airport bathroom.

"We all do it for personal reasons," said Matos McGreevey, now going through a contentious divorce with the former governor.

"I did it because he was my husband."

"I had always supported him."

"I loved him."

"I had a daughter ... I wanted her to know I was there for her father."

One therapist who deals with couples in crisis says most wronged women do want to at least try to work things out.

"Your lives are intertwined, emotionally, financially and physically," said Gail Saltz, who practices in New York City.

"You share children."

"Just because someone has hurt and betrayed you deeply doesn't mean you stop loving them."

"It's very complicated for any woman who finds her husband has betrayed her."

And the fact that the alleged betrayal was with a prostitute is a double-edged sword, says Saltz.

On the one hand, "this isn't a woman that he fell in love with."

"On the other, many women would find the prostitution part particularly humiliating."

Joanna Coles, editor in chief of the women's magazine Marie Claire, feels that at least for the moment, Silda Spitzer had no choice but to stand publicly by her husband, for whom she gave up an active career as a corporate lawyer.

"People are very quick to judge her, but that's the deal that you make when one of you decides to give up your career so that the other can go all out for his," said Coles.

"I think it would have been odd if she wasn't there."

"It's the pact that they made."

"She chose to be the wife of a governor, and she's done it very conscientiously, and very well."

Ashley Shapiro, a 24-year-old event planner in Miami, says her friends are split on the issue of whether Silda Spitzer and other wronged political spouses have been right to stand by their men.

As for her, she thinks it's the only human thing to do.

"You don't turn your back on a loved one," Shapiro said.

"You support them."

"You don't want your kids to see you abandoning their father in his time of need."

"You express your support publicly."

"Then you handle the rest privately."

"And all that," Shapiro says, "is none of our business."

----

AP Writer Angela Delli Anti in Trenton, N.J. contributed to this report.

[Livyjr]

"NY Gov Eliot Spitzer's problems a dream topic for comedians"

By DAVID BAUDER, Associated Press

Last updated: 7:03 p.m., Tuesday, March 11, 2008

NEW YORK -- A prominent politician, especially one known for a certain righteousness, is alleged to be a customer of high-priced call girls.

For comics, that's a hanging curveball over the plate.

New York Gov. Eliot Spitzer became the butt of jokes faster than, well, faster than it would take a john to ride Amtrak from New York to Washington.

"I sat next to the guy three times and I didn't pick up on any of this," said Comedy Central's Stephen Colbert, "and I usually have excellent whore-dar."

Bam!

"It's just mind-blowing that he spent $4,300 on a hooker," said New York comic Lisa Landry.

"It just shows how high the cost of living is in New York."

"That same hooker would cost $50 in Newark."

Smack!

"Let me ask you a question," said David Letterman.

"Do you think it's too soon to be hitting on Mrs. Eliot Spitzer?"

Boom!

Even amateurs couldn't resist, with soul music Kenny Gamble talking about the 1970s hit he wrote about an adulterous affair, "Me and Mrs. Jones," while he was accepting induction Monday into the Rock and Roll Hall of Fame.

"There's a little 'Me and Mrs. Jones' going on here in New York," Gamble told an audience at New York's Waldorf-Astoria.

The development Monday afternoon appeared to agonize Jon Stewart of Comedy Central's "The Daily Show."

He said his staff spent a weekend preparing material and he didn't want to throw it all out for Spitzer jokes.

Jay Leno on NBC's "Tonight" show quickly rattled off four jokes.

Yet unlike most news stories, he felt compelled to explain it to an audience for whom the information was so fresh they might not have heard it before coming to his show.

Spitzer's admission that he was involved in a prostitution ring "means that Hillary Clinton is now only the second-angriest wife in the state of New York," Leno said.

It's ready-made topical humor for the late-night hosts, said Vince Averill, a stand-up comic who just taped an episode of Comedy Central's "Live at Gotham."

But he, like Landry, wondered whether the story will last long enough for comics to make it a big part of their act or if Spitzer is known enough throughout the country.

"He wasn't such a popular figure that people are going to want to keep talking about this," said Landry, a frequent performer at New York's Comic Strip Live.

Averill said he hadn't written a joke on the topic.

When you think about it, it's almost too easy, he said, and he wasn't interested in going for the cheap laugh.

"I'm sure there's going to be no shortage of people trying to do something with it," he said.

Conan O'Brien on NBC's "Late Night" tried, noting that Spitzer was quoted as saying he had violated his obligation to his family and his sense of right and wrong.

"Spitzer also admitted violating someone named Amber," he said.

Another New York-based show, Letterman's "Late Show" on CBS, went straight for the jugular.

"You've got to say one thing about this," he said.

"He's caught soliciting a hooker, but thank God, on the bright side, it did not involve an airport's men's room."

And his writer's came up with a top-10 list of "Eliot Spitzer excuses."

No. 1: "I thought Bill Clinton legalized this years ago."

[Livyjr]

"Lawyer wants Spitzer suspended from NY bar"

Associated Press

Last updated: 4:43 p.m., Tuesday, March 11, 2008

ALBANY -- A Florida attorney is urging Gov. Eliot Spitzer's immediate suspension as a lawyer in New York following reports he patronized a high-priced prostitution ring.

Jack Thompson, a conservative Republican from Coral Gables, says the Disciplinary Committee for the Appellate Division's First Department should stop Spitzer from practicing law until the matter is resolved.

Alan Friedberg, the committee's chief counsel, declined to comment.

Calls to Spitzer's office and his lawyer were not immediately returned.

Thompson, who says he filed an early disbarment complaint against former President Bill Clinton in Arkansas, notes that Spitzer didn't claim innocence in his apology Monday.

[Livyjr]

"Spitzer resigning - Governor readies to quit over prostitution scandal as lawyers negotiate with prosecutors; Lt. Gov. Paterson keeps low profile"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

First published: Wednesday, March 12, 2008

ALBANY -- Gov. Eliot Spitzer holed up in his Manhattan apartment Tuesday and prepared to resign today over a prostitution scandal that has rocked the state, according to a high-ranking aide.

In a strategy used to give his lawyers time to negotiate with federal officials, the aide said, Spitzer needed to hold onto the governorship as leverage to work out a deal involving criminal charges.

Two well-placed sources in the Capitol said Spitzer will likely step down today.

As some Republicans talked of impeachment and some Democrats were studying the process, too, the scandal-scarred Spitzer essentially remained executive an extra day before what most considered to be the inevitable end of his relatively brief tenure.

Expectations were that he would leave it to Lt. Gov. David Paterson to serve the nearly three years left in his term.

Paterson kept a low profile Tuesday and prepared for the prospect of succeeding Spitzer, according to people close to the governor.

Spitzer's lawyer spent most of Tuesday conferring with prosecutors with the U.S. Attorney's Office as the scandal continued to reverberate throughout the media-encircled Capitol a day after word of the scandal broke.

Director of Operations Paul Francis largely ran the government.

Top commissioners tried to rally their agencies.

Yet officials in the Spitzer administration expected their boss to step down today.

The "profound sadness" enveloping the administration, as one Spitzer loyalist described it, followed disclosures on Monday that the governor was caught through wiretaps and financial records as being a patron of high-priced prostitutes.

"I have seen press reports that the governor's resignation is imminent, and that is not true," Senior Adviser Lloyd Constantine told the Times Union Tuesday afternoon as Spitzer lawyer Michele Hirshman was working with the U.S. Attorney's Office, several sources said.

Constantine declined to elaborate.

Paterson stayed out of the public limelight, but his aides took a few questions, including one about his health.

A fainting spell last summer during a flight, the aide said, was checked out by experts who said Paterson is in good health but has a condition that is easily remedied if he stops sleeping with his collar buttoned.

The Harlem Democrat, poised to become New York's first African-American governor, is readying to take over Spitzer's job under provisions of succession in the state constitution.

"He'd be foolish not to," a close aide to Spitzer said.

Republican leaders urged the governor to resign promptly.

Assembly Minority Leader James Tedisco said impeachment proceedings should commence if Spitzer holds the Capitol hostage much longer.

Negotiations for the state budget, due April 1, have all but halted because of the scandal.

Less than 24 hours after the news of Spitzer's alleged participation in a prostitution ring, Tedisco, R-Schenectady, said the governor must step down within 48 hours or he would call for impeachment.

One Democratic assemblyman, who declined to be named, said he was considering the wisdom of forcing the governor out and was carrying the legal procedure for impeachments in his briefcase.

Yet most Democrats expected Assembly Speaker Sheldon Silver to block any such action from his 107-member conference.

"That kind of discussion (is) a bit premature," Silver said.

"All the facts are not out yet ..."

"The governor should have time to reflect and repair the damage he's done to his family."

Impeachment cases must be brought by the Assembly and prosecuted by the full GOP-led Senate, which has almost as many Democrats, allies of Spitzer, as Republicans.

From beyond the Capitol, U.S. Rep. Kirsten Gillibrand, D-Greenport, said Spitzer, who campaigned with her in 2006, should step down if he was indeed involved with a prostitution ring.

"This is very grave and sad news."

"My heart goes out to the governor's family," Gillibrand said in a prepared statement.

"If these serious allegations are true, the governor will have no choice but to resign."

Some supporters spoke on Spitzer's behalf.

Assemblyman Carl E. Heastie, D-Bronx, was among several Democrats who said some lawmakers are unfairly judging Spitzer.

Critics portray him as a hypocrite who made a name for himself partly by prosecuting prostitution rings in 2004.

Now he is accused of hiring high-priced prostitutes, according to federal records and interviews, and some say he would lack credibility if he stayed on.

"It's a wait-and-see; you gotta have compassion for the situation, for his family and the state as a whole," Heastie said.

"I'm not passing any judgment until it plays out; I think that's the fairest thing to do for everyone."

"The business of the state is continuing."

"Not any one person is more important than the business of the state."

However, little legislative business got done.

The Republican-led Senate held back on issuing its budget plan, but planned to pass a resolution today with legislation to follow.

"It's bizarre," said Assemblyman Adam Clayton Powell IV.

"I have never seen anything like this in my 20 years as a politician."
Powell, who recently was charged with driving while intoxicated, said he understands that people can be wrongly charged:

"I will not jump to any conclusions ..."

"He has not been charged with anything."

Spitzer got caught up in the sex ring as a result of a financial investigation started by the IRS, according to a government source, and it became a public corruption case when it was taken up by the FBI and the U.S. Attorney's Office.

The story of Spitzer's alleged sex romps with prostitutes working for Emperors Club VIP is generating attention from Troy to Taipei.

Some 40 news vehicles parked around the Capitol with broadcast teams awaiting news of Spitzer's resignation.

Reporters in the Capitol were being besieged by producers to appear on network, cable and radio shows.

The scandal dominated talk shows, with some hosts and callers questioning Spitzer's State Police security teams for allowing the governor to enter into illegal trysts.

Acting Police Superintendent Preston Felton declined to respond to the attacks.

"I can't get into that, and I think it would be inappropriate to do so at this time."

"We'll never discuss a governor's personal security."

James M. Odato can be reached at 454-5083 or by e-mail at jodato@timesunion.com

[Livyjr]

FORBES

"Credit Crunch - What To Do About Wall Street"

Liz Moyer, 02.14.08, 3:05 PM ET

So who's to blame for the subprime mess?

Banks?

Investors?

Regulators?

Ratings agencies?

The epicenter of all this finger-pointing: Capitol Hill Thursday, as lawmakers, regulators, and executives gathered to debate how to deal with the crisis gripping the credit markets, particularly the perilous state of the mortgage bond industry.

New York Governor Eliot Spitzer, in testimony to the House of Representatives finance committee, laid the blame at the feet of federal regulators and ratings agencies, who failed to stop the growth of the subprime mortgage bubble before it got out of control.

And he said a swift resolution to the severe capital pressures the bond insurers are facing is necessary to stop a "tsunami" of problems in the financial markets.

http://www.forbes.com/2008/02/14/washingto...artner=yahootix

THE NEW YORK POST

"HIS PUSHY PLAN TO BE IN DC FOR TRYST"

By DAPHNE RETTER Post Correspondent

March 12, 2008 -- WASHINGTON - Gov. Eliot Spitzer himself sought to testify before a congressional subcommittee that hadn't invited him to appear - possibly to give him an excuse to be away from home and see a hooker, officials revealed yesterday.

When Spitzer did show up before the panel on Feb. 14, the day after he'd been with a prostitute, Rep. Spencer Bachus (R-Alabama) said that the typically unflappable Spitzer "came unglued" under questioning during the hearing.

Bachus, a former prosecutor himself, added that Spitzer also seemed unprepared, making at least one statement that Bachus has since informed the committee was inaccurate.

Now, though, it all makes sense, Bachus said.

"I realize that he may have been a little sleep-deprived," Bachus said with a grin in an interview yesterday.

"When we haven't had a good night's sleep, we can all get a little cranky."

A recording of the hearing shows Spitzer angrily speaking over Bachus as he questioned the governor on New York's efforts to regulate bond insurance.

"Mr. Bachus, Mr. Bachus, you are involved in a finger-pointing exercise," a clearly agitated Spitzer said into the microphones.

At one point in the tense exchange, which was later played on cable news channels, Spitzer flouted the format of the hearing and instead demanded answers from Bachus.

The subcommittee had originally requested the appearance of New York State Insurance Superintendent Eric R. Dinallo as a representative of Spitzer's administration, but the governor requested his own invitation "within a day or two" of the meeting, according to committee aides.

Spitzer's office alerted New York reporters that he would be in Washington less than a day before the 11:30 a.m. congressional hearing.

daphne.retter@nypost.com

http://www.nypost.com/seven/03122008/news/...ryst_101577.htm

[Livyjr]

"Officials say Spitzer spent tens of thousands of dollars _ maybe $80,000 _ on call-girl ring"

By MICHAEL GORMLEY, Associated Press

Last updated: 7:42 p.m., Tuesday, March 11, 2008

ALBANY -- With pressure mounting on Gov. Eliot Spitzer to resign over a call-girl scandal, investigators said Tuesday he was clearly a repeat customer who spent tens of thousands of dollars -- perhaps as much as $80,000 -- with the high-priced prostitution service over an extended period of time.

A death watch of sorts began at the state Capitol, where whispers of "What have you heard?" echoed through nearly every hallway of the ornate, 109-year-old building.

Meanwhile, Albany insiders on Tuesday said the governor was still trying to decide how to proceed.

Options included quitting immediately, or waiting to use resignation as a bargaining chip with federal prosecutors to avoid indictment.

Democrats privately floated another option, telling The Associated Press that Spitzer was considering what was almost unthinkable immediately after Monday's bombshell apology: hanging on.

"If the public is fine, he'll stay," said a Democrat who spoke on condition of anonymity because of the sensitivity of the subject.

"Poll: New Yorkers want Spitzer to quit"

By MICHAEL GORMLEY, Associated Press

Last updated: 6:32 a.m., Wednesday, March 12, 2008

ALBANY -- Bloggers, commentators and comedians have already weighed in on the prostitution scandal that has imperiled Gov. Eliot Spitzer.

Now New Yorkers are getting a shot and their view is clear: He should resign or be removed from office.

A poll released late Tuesday found that 70 percent of New Yorkers think Spitzer should resign, while 66 percent believe he should be impeached and removed from office if he doesn't.

"It's a big thumbs down," said Lee Miringoff, director of the Marist College Institute for Public Opinion, which conducted the poll.

"It points to just how politically untenable his position is right now."

The poll comes a day after allegations that Spitzer hired a high-priced call girl, vaporizing his straight-arrow persona.

Investigators said Tuesday he was a repeat customer who spent tens of thousands of dollars.

While Spitzer and his family remained huddled in their Manhattan apartment, insiders said the governor was trying to decide how to proceed.

Republicans began talking impeachment, and few if any fellow Democrats came forward to defend him.

The scandal erupted Monday when allegations surfaced that Spitzer, a 48-year-old married man with three teenage daughters, spent thousands of dollars on a call girl named Kristen at a swanky Washington hotel on the night before Valentine's Day.

The case started when banks noticed frequent cash transfers from several accounts and filed suspicious activity reports with the Internal Revenue Service, a law enforcement official told The Associated Press.

The accounts were traced back to Spitzer, leading public corruption investigators to open an inquiry.

A law enforcement official said Tuesday that Spitzer had spent tens of thousands of dollars with the call-girl service Emperors Club VIP.

Another official said the amount could be as high as $80,000.

It was not clear over what period of time that was spent.

Still another law enforcement official said investigators found that during the Washington tryst, Spitzer used two rooms at the Mayflower Hotel -- one for himself, the other for the prostitute.

Sometime around 10 p.m., Spitzer sneaked away from his security detail and made his way to her room, the official said.

The officials spoke to the AP on condition of anonymity because of the sensitivity of the case.

According to an affidavit, a federal judge approved wiretaps on the escort service's telephone in January and February.

FBI agents in Washington had the Mayflower under surveillance when Spitzer was in town, a senior law enforcement official told the AP.

In the court papers, an Emperors Club employee was quoted as telling Kristen that Client 9 -- identified as Spitzer, according to investigators -- might ask to do things "you might not think were safe," and Kristen responded by saying: "I have a way of dealing with that."

A law enforcement official said Tuesday the discussion had to do with Spitzer's preference not to wear a condom.

Meanwhile, Albany insiders said the governor was still weighing his options, including quitting immediately or waiting to use resignation as a bargaining chip with federal prosecutors to avoid indictment.

Democrats privately floated another option, telling the AP that Spitzer was considering what was almost unthinkable immediately after Monday's bombshell apology: hanging on.

"If the public is fine, he'll stay," said a Democrat who spoke on condition of anonymity because of the sensitivity of the subject.

The poll indicated dissension among voters.

Spitzer's approval rating was 30 percent, down from 35 percent in January.

In November 2006, he won office with a historic 69 percent of the vote.

Even if Spitzer resigns, 49 percent of New Yorkers said he should face criminal charges.

The telephone poll conducted Tuesday surveyed 624 registered voters and had a margin of error of plus or minus 4 percentage points.

Spitzer has not been charged, and prosecutors would not comment on the case.

Michele Hirshman, Spitzer's former deputy attorney general and now a member of a high-powered New York law firm, has been retained to represent the governor.

In Albany, legislative leaders said Democratic Lt. Gov. David Paterson, who would become governor if Spitzer resigned, was talking to them about a possible transition.

Paterson's office wouldn't confirm the conversations.

Assembly Republican leader James Tedisco warned that if Spitzer did not resign within 48 hours, he would call for impeachment.

But any impeachment would face a difficult road in the Democratic-controlled Assembly, where articles of impeachment would require a majority vote to go to a trial.

A trial would be decided by a combined vote of the full Senate, which has a slim GOP majority, and the Court of Appeals.

Privately, several Democrats in both the Legislature and in the administration said resignation appeared inevitable.

"He's weighing the rest of his life," one Democratic official said sadly.

Late Tuesday, freshman Rep. Kirsten Gillibrand became the first Democratic member of New York's congressional delegation to mention resignation.

"This is very grave and sad news," she said.

"If these serious allegations are true, the governor will have no choice but to resign."

But more than a day after the scandal broke, Sen. Hillary Rodham Clinton and other senior Democrats in the delegation had yet to call on Spitzer to quit.

On Wall Street, where Spitzer built his reputation as a crusader against shady practices and overly generous compensation, cheers and laughter erupted Monday from the trading floor when news broke of his potential ruin.

"The irony and the hypocrisy is almost too good to be true," said Bryn Dolan, a fundraiser who works with many Wall Street employees.

"If he had any shame, he would've already resigned."

------

Associated Press writers Valerie Bauman and Michael Virtanen in Albany, and Vinnee Tong in New York contributed to this report.

[Livyjr]

"Oil prices hover near $109 a barrel"

By GILLIAN WONG, Associated Press

Last updated: 4:22 a.m., Wednesday, March 12, 2008

SINGAPORE -- Oil prices held steady Wednesday after falling back from an overnight record near $110 a barrel, supported by the further weakening of the U.S. dollar.

In Tokyo currency trading Wednesday, the greenback fell against the yen in Asia despite the U.S. Federal Reserve's plan to pump $200 billion into the financial markets to help ease the strain from the credit crisis.

The Fed, the European Central Bank and the Bank of England announced that they were joining with other central banks to provide more relief in the credit crisis.

The relief plan is seen as likely to remove pressure on the Fed to cut interest rates before its next meeting.

"The end result of what the Fed did yesterday would be still to eventually increase liquidity, and that would still have the effect of weakening the U.S. dollar," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.

"That's going to support crude oil pricing," he said.

Light, sweet crude for April delivery fell 28 cents to $108.64 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore.

On Tuesday, crude futures settled at a record finish of $108.75 a barrel, still up 85 cents on the day after falling back from an all-time trading high of $109.72 a barrel.

The dollar's weakness has fueled much of oil's recent run-up, as investment funds seek a hedge in hard assets.

Speculation that rising prices for oil and other commodities will offset the falling dollar has been the main drivers of oil's rally from $87 a barrel in January.

Shum noted that the surge in investors' demand for commodities as a hedge against inflation has created a self-fulfilling cycle that causes prices to keep rising.

"As oil prices go higher and the inflation pressure continues to build, that further attracts investors to buy into oil and other commodities to get better returns," he said.

Oil's growing strength has also come amid warnings that there were no signs of relief from high oil prices on the immediate horizon.

Two prominent forecasters warned Tuesday that brisk demand in China and other emerging markets is likely to offset any downturn in demand in the U.S.

The Paris-based International Energy Agency on Tuesday said high crude prices continue to chip away at oil consumption in the U.S. and other industrialized nations, but warned of continuing strong demand in China and other emerging markets.

The energy watchdog agency for the world's most industrialized nations slightly cut its projection for world oil demand, which it now sees at 87.5 million barrels a day for this year, up 2 percent from 2007.

Separately, the U.S. Energy Information Administration said Tuesday it expects a slowing economy and record high oil prices to hold U.S. oil demand growth to just 40,000 barrels a day in 2008, bringing daily consumption to 20.74 million barrels.

Traders were also eyeing the release of data later Wednesday that is expected to show U.S. petroleum stockpiles grew last week, according to a Dow Jones Newswires survey of analysts.

The report is expected to show that U.S. crude oil stockpiles grew 1.6 million barrels, gasoline stockpiles grew 300,000 barrels, and stocks of distillates, which include diesel fuel and heating oil, fell 2 million barrels.

In other Nymex trading, heating oil futures lost 0.47 cent to $2.991 a gallon while gasoline prices lost 1.01 cents to $2.716 a gallon.

Natural gas futures lost 2.3 cents to $9.977 per 1,000 cubic feet.

In London, Brent crude futures fell 24 cents to $105.01 a barrel on the ICE Futures exchange.

[Livyjr]

"Japan revises down 4Q economy growth"

By YURI KAGEYAMA, Associated Press

Last updated: 4:32 a.m., Wednesday, March 12, 2008

TOKYO -- Japan lowered its reading for economic growth in the fourth quarter on Wednesday, but the revised 3.5 percent annual pace was healthier than expected.

The revision down from a 3.7 percent pace was due largely to weaker-than-expected business investment, according to the Cabinet Office.

Economists had projected the government would lower the annualized growth rate to 2.3 percent for the October-December period.

Still, analysts worry that a slowdown in the United States, a vital export market, could drag on Japan's economy.

They warn that private-sector investments, which underpinned a six-year economic expansion in Japan, may dwindle in months ahead.

Although the numbers appear positive at first glance, the downward revision was in the private sector, signaling risks ahead, said Yasuo Yamamoto, senior economist for Mizuho Research Institute in Tokyo.

"It looks like robust growth, but when you analyze the details then the news was bad," he said, forecasting growth to slow to an annualized pace of 1 percent in the first quarter.

Yamamoto and other analysts say Japan still relies heavily on exports to keep growth going, and that could slow with the credit crunch in the U.S.

For the time being, healthy exports to emerging markets, including Russia and China, were helping offset any declines.

Compared to the previous quarter, Japan's gross domestic product, the value of goods and services a nation produces, rose 0.9 percent, unchanged from the preliminary report.

Capital spending, which caused the downward revision, accounts for about 15 percent of GDP.

It rose 2.0 percent on quarter, downgraded from a preliminary 2.9 percent increase.

Consumer spending, which makes up about 55 percent of GDP, was unchanged from a preliminary 0.2 percent rise.

Economy Minister Hiroko Ota reiterated the government view that the economy is still recovering, but acknowledged that risks were growing since the beginning of this year.

"The effects from a U.S. economic slowdown and high crude oil prices are gradually emerging, so we have to watch economic developments carefully from now on," she told reporters.

Morgan Stanley economist Takehiro Sato was especially pessimistic about growth driven by internal demand.

Consumer spending has been weak lately because companies are holding down wages to cut costs at a time when prices on some goods have been rising.

Sato said domestic demand was likely to become even more sluggish.

"We expect the October-December period was the peak of the current economic recovery and a mini-recession lies ahead," he told Dow Jones Newswires.

[Livyjr]

"Upper house rejects BOJ chief nomination"

By YURI KAGEYAMA, Associated Press

Last updated: 8:14 a.m., Wednesday, March 12, 2008

TOKYO -- The upper house of parliament voted down the government's nominee to head the Bank of Japan on Wednesday, setting up a political showdown with a week left before the current central bank chief's term ends.

The stalemate in legislature is a major embarrassment to the Japanese government, as escalating fears of a global slowdown prompted central banks around the world to synch efforts this week to calm jittery markets.

The opposition, which controls the upper house, made good on threats to block the appointment of Toshiro Muto, the Bank of Japan's deputy governor, claiming his long history as a former bureaucrat at the Ministry of Finance would undermine the central bank's independence.

The opposition is also rejecting Muto because of outrage toward the ruling Liberal Democratic Party, which has used its edge in the more powerful lower house to ram through some bills that require approval from only that chamber.

Bank of Japan Gov. Toshihiko Fukui steps down March 19.

The appointment of his successor and two deputy governors at the central bank needs approval from both houses of parliament.

Muto was rejected by a vote of 129-106.

The opposition approved one of the government appointments for deputy, former BOJ Executive Director Masaaki Shirakawa.

If there is a delay in agreeing on the appointments, Shirakawa is likely to step in to serve as interim bank chief.

The ruling coalition set the lower house vote on approving Muto and others' nominations for Thursday, a parliamentary official said.

But even if Muto wins approval there, as he is sure to, that won't overrule the upper house rejection and so the standoff will continue.

The popularity ratings of Prime Minister Yasuo Fukuda have been dropping lately, particularly over the scandal-plagued defense ministry's mishandling of a collision between a military ship and a fishing boat.

Many Japanese are eager to see new political leadership.

But opinion is mixed about the opposition's handling of the Bank of Japan appointment.

Major Japanese newspapers were critical of the Democrats in Wednesday's editions.

"The Democrats are irresponsible," the editorial in the Nikkei, the nation's biggest business daily, said.

"The Democrats were opposed from the start."

"Is that the proper response for a responsible political party?"

In confirmation hearings Tuesday, Muto pledged to do his utmost and carry out extensive analysis to promote growth and ensure stable prices amid burgeoning risks, including a possible U.S. slowdown and surging oil prices.

He also promised to uphold the independence of the Bank of Japan.

While few expect the political scuffling to have any immediate damage to Japan's economy, the prospect of a vacuum from such a high-profile position has raised concerns about future monetary policy.

The Bank of Japan has kept its key interest rate at a low 0.5 percent in an effort to sustain the country's modest economic growth.

Some analysts say the economy is already showing signs of slowing.

Earlier Wednesday, the government revised down the fourth quarter economic growth figure to a still strong 3.5 percent annual pace.

The preliminary estimate had been 3.7 percent.

Chief government spokesman Nobutaka Machimura urged the Democrats to approve Muto.

"What parliament should do is hold discussions at various levels to avoid a vacuum," he told reporters.

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"Consumer confidence plunges in Australia"

Associated Press

Last updated: 3:02 a.m., Wednesday, March 12, 2008

SYDNEY, Australia -- Confidence among Australian consumers weakened sharply in March to its lowest level since 1993, according to data released Wednesday, sparking economists' predictions that the central bank is unlikely to continue a run of interest rate hikes.

The index of consumer sentiment fell a seasonally adjusted 9.1 percent in March to 88.6 points, from 97.4 points in February, compilers Westpac Banking Corp. and the Melbourne Institute said.

The index was down 23 percent from a year earlier.

Westpac said the fall in the index over the last three months is the sharpest three-month decline since the index was first measured in January 1975.

"The results from this survey are very important," said Bill Evans, Westpac's chief economist.

"They indicate that the Reserve Bank's last rate hike, combined with further independent (rate rises) from the mortgage lenders, may have finally slowed demand such that inflationary pressures will ease."

The Reserve Bank of Australia last week to raise its cash rate target by 25 basis points to 7.25 percent, the highest rate in 12 years.

The bank has bucked a trend among some central banks, particularly the U.S. Reserve, of cutting interest rates or holding them steady amid concerns of a global economic slowdown.

Australia's economy is booming compared to many countries, with voracious demand for coal, iron ore and other resources from China and elsewhere driving growth and fueling inflation.

After the last interest rate rise, 13 of 16 economists surveyed by Dow Jones Newswires said they expected a further rate rise in May.

But after Wednesday's consumer confidence data caused two brokerages, Westpac and TD Securities, to switch and say they now no longer expect a rate rise.

The survey was conducted in the week following the central bank's most recent rate hike.

Evans said there were signs that commercial banks may continue increasing interest rates even if the central bank does not, because the global credit crunch is raising their lending costs.

"This development takes even more pressure off the (central bank) to raise its rates," he said.

"As such, we do not expect that the bank will raise rates again in the cycle."

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"Stock futures pare early gains"

By JOE BEL BRUNO, Associated Press

Last updated: 8:24 a.m., Wednesday, March 12, 2008

NEW YORK -- Wall Street appeared headed to a mixed opening Wednesday, a day after a move by the Federal Reserve and other central banks to pump more liquidity into distressed financial markets sparked a global rally.

The tone in markets around the world was clearly improved after investors sent stocks sharply higher on Tuesday, including a 416-point surge in the Dow Jones industrials, their biggest one-day point gain since 2002.

Major Asian and European markets rose more than 1.3 percent on Wednesday.

However, those big gains might be short lived given the market's volatility in the past few weeks.

And rattled investors might use recent gains to sell and take profits.

Dow futures, which earlier rose more than 25 points, pared their gains as the market opening approached.

The indicator was unchanged at 12,190.

Standard & Poor's 500 futures were up 0.50, or 0.04 percent, at 1,324.40, while the Nasdaq 100 futures added 1.50, or 0.09 percent, to 1,752.005.

Investors still remain cautious about economic data due out later this week, and what the Fed will do when it meets Tuesday.

While Wall Street seems to want the Fed to cut interest rates further, there are also concerns that this still won't be enough to help the economy.

The Fed said Tuesday it plans to lend Treasurys in exchange for mortgage-backed securities and other battered debt that all but collapsed in the subprime mortgage crisis.

Global financial institutions have written down almost $200 billion due to the credit crisis, and big U.S. investment banks next week are expected to report more losses when they issue first-quarter results.

There's also continued concern with the high-flying commodity markets as both oil and retail gasoline reach records.

Commodities traders are waiting for government data during the session that is forecast to show crude oil inventories rose last week after an unexpected drop the previous week.

Ahead of that report, light, sweet crude rose 9 cents to $108.84 in electronic trading on the New York Mercantile Exchange.

It was well below the trading record of almost $110 a barrel set Tuesday.

Treasurys are seen opening higher after the sharp sell-off Tuesday in reaction to the Fed's latest liquidity injection.

The yield on the 10-year Treasury note, which moves opposite its price, fell to 3.57 percent in premarket trading from 3.59 percent late Tuesday.

In corporate news, Take-Two Interactive Software Inc. may advance after the company predicted profitability with the April release of its flagship "Grand Theft Auto IV" game.

The company is in the midst of a $2 billion takeover bid by rival Electronic Arts Inc.

Caterpillar Inc. may also rise after it raised its sales forecast for 2010 by 20 percent, exceeding analysts' expectations.

Overseas, Japan's Nikkei 225 stock average rose 1.60 percent, while Hong Kong's market closed up 1.86 percent higher.

In afternoon trading, Britain's FTSE-100 rose 1.31 percent, Germany was up 1.60 percent, and France added 1.66 percent.

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On the Net:

New York Stock Exchange: http://www.nyse.com

Nasdaq Stock Market: http://www.nasdaq.com

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"Asian stocks advance on Fed's move"

By MALCOLM FOSTER, Associated Press

Last updated: 5:52 a.m., Wednesday, March 12, 2008

BANGKOK, Thailand -- Asian stocks rose Wednesday as investors welcomed the move by the U.S. Federal Reserve and other central banks to ease pressure on the world's credit markets.

Wall Street's big rally also boosted market sentiment in Asia, but many analysts remained wary, pointing to recent data indicating the U.S. economy -- a vital export market -- could be sliding into a recession.

Stocks in Japan and Hong Kong pared gains in afternoon trading after the initial euphoria wore off.

"There is some hope that the Fed's move can restore the stability of the financial system," said Ernie Hon, a strategist at ICEA Securities in Hong Kong.

"But over the longer-term, I think the (Hong Kong) market will continue its downtrend."

Japan's Nikkei 225 index closed 1.6 percent higher at 12,861.13 after rising as much as 3.2 percent.

Hong Kong's Hang Seng index pared gains to close 1.9 percent higher at 23,422.76.

Markets in Australia, South Korea, Malaysia and Taiwan also rose, while China's key index fell to a seven-month low.

U.S. stock index futures were down slightly, suggesting that Wall Street would open lower Wednesday a day after the Dow Jones industrial average surged 416.66, or 3.55 percent, to 12,156.81.

That was it's biggest one-day point gain since July 2002.

That surge was spurred by news Tuesday that the Fed -- acting in concert with the European Central Bank, the Bank of Canada and the Swiss National Bank -- agreed to loan investment banks $200 billion in exchange for debt, including slumping mortgage-backed securities.

The move was meant to essentially create a market for assets that investors have been too scared to buy.

That freeze-up in demand had sent asset values plunging and caused huge losses for some of the world's biggest banks.

In Tokyo trading, the biggest gainers were financial shares, including Mizuho Financial Group, which rose 4 percent.

Real estate company Sumitomo Realty & Development advanced 4.4 percent.

But traders in Tokyo and Hong Kong believed the rally in their markets was only temporary.

"Consumption in the U.S. is still weak," said ICEA's Hon.

"April will still be bad (for Hong Kong stocks), but after that it might get better," partly due to an expected rise in investor sentiment ahead of the Beijing Olympics in August.

In Australia, the market finished below its intraday highs, with the benchmark S&P/ASX 200 rising 2.4 percent to 5,257.9.

In South Korea, too, shares trimmed gains as some technology stocks turned lower and airline stocks fell.

The Kospi index climbed 1.1 percent to 1,658.83.

Chinese stocks fell to their lowest level in more than seven months, reversing early gains as renewed worries over moves to combat inflation overshadowed Wall Street's overnight rally.

The Shanghai Composite Index lost 2.3 percent, or 95.76 points, to close at 4,070.12, after opening 2.1 percent higher.

The release Tuesday of data showing that China's key inflation index jumped 8.7 percent in February reinforced fears that authorities will raise tighten interest rates or otherwise tighten credit, analysts said.

Hours before New York trading resumed Wednesday, Dow futures were down 12 points, or 0.1 percent, at 12,178, while Standard & Poor's 500 futures were down 1.2 points, or 0.1 percent, at 1,322.7.

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"Fed's loan rescue sparks big stock rally"

By JEANNINE AVERSA, Associated Press

Last updated: 8:02 p.m., Tuesday, March 11, 2008

WASHINGTON -- Staring at spreading financial dangers, the Federal Reserve announced a rescue package Tuesday that would pour as much as $200 billion into banks and investment houses and allow them to put up risky home-loan packages as collateral.

Wall Street rebounded with its biggest rally since 2002 -- and hoped the Fed had even more cards to play.

The Federal Reserve's maneuver, coordinated with central banks overseas, was its latest effort to stem the global credit crisis and severe housing woes that threaten to bury the United States in its first recession since 2001.

Fed Chairman Ben Bernanke and his colleagues have been stretching for new and imaginative ways to confront the situation.

They are hoping to bring relief where it is sorely needed: in the market for mortgage securities.

Home loan financing has become much harder to get as nervous lenders have hunkered down.

"It is a highly significant move."

"The Fed is innovating in a way that is going to push liquidity directly into the mortgage markets, where it is most needed," said David Jones, president of DJM Advisors.

On Wall Street, the Fed's action propelled stocks upward.

The Dow Jones industrials jumped 416.66 points -- the biggest one-day point gain since July 29, 2002.

Traders will be looking for still more action.

Recent stock rallies have been followed by renewed selloffs by investors who believe the economy is still headed for recession, if it isn't there already.

Assuming Tuesday's action helps to stabilize turbulent financial markets, that could reduce the chances that the Fed will order a deep, three-quarters of a percentage point cut in its key interest rate next week to further encourage lending and other economic activity.

An increasing number of economists now believe the Fed is more likely to cut rates by a half-point, though that could newly roil Wall Street.

The Federal Reserve announced it would allow squeezed financial institutions -- including big investment houses and banks -- to borrow up to $200 billion in super-safe Treasury securities by using some of their more risky investments as collateral.

The Fed announced the creation of a new Term Securities Lending Facility (TSLF) to provide financial institutions with 28-day loans of Treasury securities, rather than overnight loans.

The institutions would pledge other securities -- including federal agency residential-mortgage-backed securities, such as those of mortgage giants Fannie Mae and Freddie Mac -- as collateral for the loans.

Fed officials said it's the first time they'll be accepting mortgage-backed securities through this type of lending program.

"Firms that were having difficulty financing their mortgage positions have been thrown a lifeline," said Stephen Stanley, chief economist at RBS Greenwich Capital.

By allowing financial institutions to put up mortgage-backed securities -- for which there's little market appetite -- in return for safe securities that are in high demand, the Fed hopes to take pressure off financial companies and make them more inclined to lend to individuals and to businesses.

If the effort works, it should in time help to keep home loan rates down, especially on those backed by Fannie Mae and Freddie Mac, which are the few remaining sources of mortgage financing as credit has increasing dried up elsewhere, said Mark Zandi, chief economist at Moody's Economy.com.

The housing meltdown -- leading to sagging home prices and record-high foreclosures -- has caused financial institutes to rack up huge losses in bad mortgage investments.

Fannie Mae and Freddie Mac recently reported fourth-quarter losses totaling $6.1 billion and predicted multibillion-dollar losses throughout this year, amplifying concerns about their stability.

Prices also have plunged recently for the billions of dollars of mortgage securities that Fannie Mae and Freddie Mac guarantee, package and sell to investors as supply has outstripped demand.

The Fed's move comes as banks and other financial institutions face cash crunches.

"Pressures in some of these markets have recently increased again," the Fed said in a statement.

"We all continue to work together and will take appropriate steps to address those liquidity pressures."

The other banks involved are the Bank of Canada, the Bank of England, the European Central Bank and the Swiss National Bank.

The loans of Treasury securities would be made available through weekly auctions, beginning on March 27.

For now, up to $200 billion of Treasury securities is envisioned being made available.

Fed officials, however, didn't rule out additional operations of this sort down the road.

Next steps?

Some economists said the Fed might move to accept an even wider array of collateral for the auctions.

"This will not turn the economy around or fix all the problems in the markets but it should reduce the liquidity issue, at least for now," said Ian Shepherdson, chief economist at High Frequency Economics.

White House press secretary Dana Perino said President Bush welcomed the latest step and "has full confidence in Ben Bernanke at the Fed."

Since December, the Federal Reserve has been making short-term loans of cash available to banks through a new auction setup.

With the latest bank auction results announced Tuesday, the Fed has now made $210 billion available to squeezed banks in hopes it will help them to continue lending to individuals and companies.

Separately, the Fed also on Tuesday said it has authorized increases in existing programs called "swap lines" with the European Central Bank and the Swiss National Bank

"These arrangements will now provide dollars in amounts of up to $30 billion and $6 billion to the ECB and the SNB respectively," the Fed said, extending the term of these swap lines through Sept. 30.

The European Central Bank, in conjunction with the Fed, said it would offer U.S. dollars to euro money markets of up to $15 billion.

It took similar action in December and January.

The Frankfurt-based central bank for the 15 countries that use the euro said it has been working closely with other central banks.

A meltdown in the housing and credit markets has made banks and other financial institutions reluctant to lend to each other, causing a cash crunch.

Financial companies racked up multibillion-dollar losses as investments in mortgage-backed securities soured with the housing market's bust.

Problems first started in the market for subprime mortgages-- those made to people with blemished credit histories. However, troubles have spread to other areas.

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AP Business Writer Matt Moore in Frankfurt, Germany, and Associated Press Writer Harry Dunphy in Washington contributed to this report.

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"Disgraced Spitzer resigns - Lt. Gov. David Paterson prepares to take state helm Monday"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

Last updated: 3:47 p.m., Wednesday, March 12, 2008

ALBANY -- A disgraced Gov. Eliot Spitzer announced this morning that he will resign from his post Monday, giving Lt. Gov. David Paterson time to have a smoother transition.

Paterson will become the state's first African-American governor, and the first blind chief executive of any state.

With his wife, Silda, by his side, Spitzer, a former prosecutor caught up in a prostitution scandal, said he had spent his life holding people accountable and had to do the same for himself.

He acknowledged he had let people down and apologied to "every New Yorker and all those who believed in what I tried to stand for."

"I look at my time as Governor with a sense of what might have been," he said.

"I am deeply sorry that I did not live up to what is expected of me," said Spitzer during his brief statement.

The event, called for 11:30 a.m., started about 20 minutes late, and lasted less than two minutes.

One wall of the packed press room in his New York City office was lined with staffers who stood quietly and listened intently as the governor read his resignation, some leaning on each other.

Other than one reporter who shouted, "Governor, did you ever think it would come to this?" as the Spitzer's left the room, the press asked no questions.

Spitzer did not reply.

Spitzer had remained holed up in his New York City apartment Tuesday in a strategy to hold onto his governorship a little longer as leverage for his lawyers to negotiate with federal officials, the aide said.

Michael Garcia, the U.S. Attorney for the Southern District, issued a statement today that no deal has been made.

Senate Majority Leader Joseph Bruno, who has warred openly with Spitzer this year and last, said he took no satisfaction in Spitzer's downfall, and said he was focused on passing a budget by April 1 and governing.

"There is no pleasure in what is going on in this state in anybody's life," he said.

As some Republicans talked of impeachment and some Democrats were studying the process, too, the scandal-scarred Spitzer essentially remained executive an extra day before what most considered to be the inevitable end of his relatively brief tenure.

It will fall to Paterson to serve the nearly three years left in his term.

Paterson has kept a low profile as he prepared for the prospect of succeeding Spitzer, according to people close to the governor.

Spitzer's lawyer spent most of Tuesday conferring with prosecutors with the U.S. Attorney's Office as the scandal continued to reverberate throughout the media-encircled Capitol a day after word of the scandal broke.

Director of Operations Paul Francis largely ran the government.

Top commissioners tried to rally their agencies.

A "profound sadness" enveloping the administration, as one Spitzer loyalist described it, following disclosures on Monday that the governor was caught through wiretaps and financial records as being a patron of high-priced prostitutes.

While Paterson stayed out of the limelight, his aides took a few questions, including one about his health.

A fainting spell last summer during a flight, the aide said, was checked out by experts who said Paterson is in good health but has a condition that is easily remedied if he stops sleeping with his collar buttoned.

Republican leaders on Tuesday had urged the governor to resign promptly.

Assembly Minority Leader James Tedisco said impeachment proceedings should commence if Spitzer held the Capitol hostage for more than 48 hours.

One Democratic assemblyman, who declined to be named, said he was considering the wisdom of forcing the governor out and was carrying the legal procedure for impeachments in his briefcase.

Tomas Dinges of the Stabile Center for Investigative Journalism contributed to this report.

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"Spitzer making infamous history as governor"

By MICHAEL VIRTANEN, Associated Press

Last updated: 3:03 p.m., Wednesday, March 12, 2008

ALBANY -- Eliot Spitzer's dizzying fall from power in the grip of a call-girl scandal is unprecedented in the 230 years since George Clinton became the first New York governor.

The nearest likeness is Gov. William Sulzer, who was impeached and removed in 1913 over his campaign records.

But many historians believe Sulzer, a sometimes abrasive reformer like Spitzer, was railroaded by Tammany Hall political bosses.

Spitzer resigned Wednesday after being named as a client of a high-priced prostitution ring.

His plummet from the state's highest office was especially stunning since the former crusading state attorney general was once touted as the next in line among state leaders who enjoyed national influence.

"I don't believe any previous governor was involved in a scandal like this, but I believe most importantly, certainly in the era of strong governors, this is by far the most shocking development we've seen," said Robert Ward, deputy director of the Rockefeller Institute of Government.

Ward reeled off powerful New York governors to whom a pre-scandal Spitzer was often compared: Teddy Roosevelt, Al Smith and Nelson Rockefeller.

"And Eliot Spitzer came in holding the promise of being another Rockefeller in his impact on the state," Ward said.

"Obviously, that did not happen."

Others in that prestigious line include Franklin Roosevelt (four term president), Thomas Dewey (crime-busting U.S. attorney), Charles Evans Hughes (Supreme Court justice) and Mario Cuomo (lofty orator, liberal icon).

Four New York governors have gone on to be president: Both Roosevelts, Martin Van Buren and Grover Cleveland.

Other elected officials have been hurt by sex scandals.

President Clinton denied having sexual relations with former White House intern Monica Lewinsky, only to be forced into a humiliating reversal.

He was impeached by the House and then acquitted in a 1999 Senate trial.

New Jersey Gov. Jim McGreevey resigned after acknowledging an affair with male aide.

Sen. Larry Craig of Idaho pleaded guilty to disorderly conduct after being accused of soliciting sex in a Minneapolis airport men's room.

Craig insisted his actions were misconstrued and he refused to resign.

Spitzer, a Democrat, was elected in 2006 with almost 70 percent of the vote, largely on a strident campaign to reform all that ailed a dysfunctional Albany.

After early successes enacting workers' compensation, budget and ethics reforms, he spent much of 2007 in conflict with Republican lawmakers.

Most of the year, Spitzer was bogged down by a plot hatched by aides to use the state police to track the travels of his political rival in an effort to discredit him.

But Troopergate, as the tabloids dubbed that early scandal, was nothing compared to what unfolded this week.

Democratic Assemblyman John McEneny of Albany, a political historian, agreed that New York has never seen a fall like Spitzer's.

It's more typical for governors here, like Rockefeller, to leave in pursuit of national office or else retire.

He was the last to leave office before his term expired.

Since 1777, the state has had 54 governors, and only Sulzer previously was forced out.

"I think particularly there have been few if any governors that have entered office with the hopes that the people placed in Eliot Spitzer, and you might say that no one started as high and no one, unfortunately, finished so low," Ward said.

Sulzer made a brief comeback.

The year after his removal, he was elected to the Assembly as an independent.

"He ultimately was vindicated by the voters," Ward said.

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"Smog rule tightened; 345 counties fail"

By H. JOSEF HEBERT, Associated Press

Last updated: 7:33 p.m., Wednesday, March 12, 2008

WASHINGTON -- The air in hundreds of U.S. counties is simply too dirty to breathe, the government said Wednesday, ordering a multibillion-dollar expansion of efforts to clean up smog in cities and towns nationwide.

The Environmental Protection Agency announced it was tightening the amount of ozone, commonly known as smog, that will be allowed in the air.

But the lower standard still falls short of what most health experts say is needed to significantly reduce heart and asthma attacks from breathing smog-clogged air.

EPA Administrator Stephen Johnson called the new smog requirements "the most stringent standards ever," and he said they will require 345 counties -- out of more than 700 that are monitored -- to make air quality improvements because they now have dirtier air than is healthy.

Johnson said that state and local officials have considerable time to meet the new requirements -- as much as 20 years for some that have the most serious pollution problems.

EPA estimates that by 2020 the number of counties failing to meet the new health standard will drop to about 28.

About 85 counties fall short of the old standard enacted a decade ago.

Johnson's decision is likely to be met with sharp criticism from health experts and some members of Congress because it goes counter to the recommendations of two of his agency's scientific advisory panels -- one on air quality and the other on protection of children.

The new EPA standard will lower the allowable concentration of ozone in the air to no more than 75 parts per billion, compared with the old standard of 80.

The science boards had told the agency that limits of 60 to 70 parts per billion are needed to protect the nation's most vulnerable citizens, especially children, the elderly and people suffering from asthma and other respiratory illnesses.

Johnson said he took those recommendations into account, but disagreed with the scientists.

"In the end it is a judgment."

"I followed my obligation."

"I followed the law."

"I adhered to the science," said Johnson in a conference call with reporters.

Johnson said he did not take into account the cost of meeting the new requirements.

States and counties would have to require emission reductions from factories, power plants and cars to meet the tougher health rules.

The EPA has estimated that compliance with a 75 parts per billion smog standard would cost as much as $8.8 billion a year by 2020 when many of the counties are expected to be meeting the requirement.

That estimate, however, does not take into account balancing reductions in health care costs that could be even greater.

Electric utilities, oil companies and other businesses had lobbied hard for leaving the smog rule alone, saying the high cost of lower limits could hurt the economy.

The federal Clean Air Act requires that health standards for ozone and a handful of other air pollutants not take costs into account.

But Johnson said that ought to change.

He said the Bush administration plans to propose legislation to Congress to overhaul the 1970 law so that in the future costs can be considered when setting health standards.

Any such move is likely to be met with strong opposition in Congress.

Health experts and environmentalists view the setting of health standards without consideration of cost as essential for assuring public health.

Clean air advocates called the latest EPA reduction a move in the right direction -- but also a political compromise that did not go far enough.

"It's disheartening that once again EPA has missed a critical opportunity to protect public health and welfare by ignoring the unanimous recommendations of its independent science advisers," said William Becker, executive director of the National Association of Clean Air Agencies, whose members will be developing programs to meet the federal air quality requirement.

Becker acknowledged that the tighter the standard the more difficult it will be to meet, but he said:

"The public deserves the right to know whether the air they breathe is healthy."

In recent weeks, some of the most powerful industry groups in Washington have waged an intense lobbying campaign at the White House, urging the administration to keep the current standard.

Electric utilities, the oil and chemical industries and manufacturing groups argued that lowering the standard would require states and local officials to impose new pollution controls, harming economic growth, when the science has yet to determine the health benefits conclusively.

The 80 parts per billion standard was enacted by the EPA in 1997, but its implementation was delayed for several years because of court challenges by industry groups.

"Hundreds of counties haven't been able to meet the current standard set a decade ago," said John Kinsman, senior director for environment at the Edison Electric Institute, which represents most of the country's power companies.

"Moving the goalpost again will inflict economic hardship on those areas without speeding air quality improvements."

The EPA has said, based on various studies, cutting smog from 80 to 75 parts per billion would prevent between 900 and 1,100 premature deaths a year and mean 1,400 fewer nonfatal heart attacks and 5,600 fewer hospital or emergency room visits.

A separate study suggests that tightening the standard to 70 parts per billion could avoid as many s 3,800 premature deaths nationwide.

The EPA by law is not supposed to consider economic cost in establishing the federal health standard for air quality.

The agency has estimated that new pollution control efforts to comply with a 75 parts per billion standard would cost as much as $8.8 billion a year, although it acknowledged that does not take into account reductions in health care costs that could be even greater.

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On the Net:

Environmental Protection Agency: http://www.epa.gov

[Livyjr]

"Stocks dip a day after huge rally"

By MADLEN READ, Associated Press

Last updated: 6:32 p.m., Wednesday, March 12, 2008

NEW YORK -- Wall Street's euphoria over a $200 billion plan from the Federal Reserve turned to caution Wednesday, leading stocks to retreat a day after their biggest rally in more than five years.

Investors largely regard the plan the Fed announced Tuesday to lend Treasurys in exchange for debt tied to mortgages as an innovative means of bringing some relief to the tight credit markets.

But they are hesitant to pour more money into stocks without signs that the decision will help turn around the economy -- particularly with data on retail sales and consumer prices scheduled to arrive later this week.

"Does it address the main concern, and that's weaker housing?"

"That has not been resolved just yet," said Steven Goldman, chief market strategist at Weeden & Co.

"If we are in the midst of a recession, and only a couple months into the recession, we might need a couple more months to plod our way through this."

After shooting higher Tuesday, most bank stocks declined again Wednesday.

Even if the credit markets ease up a bit, banks and other lenders still face a deteriorating climate for consumer credit and many are low on cash.

"We're still in a great deal of flux here."

"The fact that the Fed has gone from lender of last resort to lender of first resort worries me," said John O'Donoghue, co-head of equities at Cowen & Co.

Volatile energy prices added to the market's anxiety.

Oil prices initially fell after the Energy Department said crude and gasoline supplies rose by unexpectedly large amounts last week, but then they returned on their record-setting streak to briefly surpass $110 a barrel.

If oil keeps hitting record levels, inflation pressures could rise and limit the Federal Reserve's ability to reduce interest rates further and boost lending efforts to spur the economy.

The Dow Jones industrial average fell 46.57, or 0.38 percent, to 12,110.24.

It initially dipped, shot up more than 140 points, then dropped again.

On Tuesday, the Dow surged 416 points, the blue chips' biggest one-day point gain since 2002.

Broader stock indicators also finished lower after a seesaw day. The Standard & Poor's 500 index fell 11.88, or 0.90 percent, to 1,308.77, and the Nasdaq composite index fell 11.89, or 0.53 percent, to 2,243.87.

Treasury prices rose as stocks pulled back.

The yield on the 10-year Treasury note, which moves opposite its price, fell to 3.44 percent from 3.59 percent late Tuesday.

The dollar fell against most other major currencies, and sank to another record low against the euro.

Gold prices rose, while crude finished at a record settlement of $109.92 a barrel on the New York Mercantile Exchange.

Investors are unsure how economic data due out later this week will influence the Fed's decision on interest rates when policy makers meet next Tuesday, but they are angling for another big reduction.

Traders who bet on the Fed's rate moves are pricing in a full chance of a half-point cut to 2.5 percent in the key rate and a strong chance of a three-quarter-point cut to 2.25 percent.

Some companies appear to be sailing through the credit crunch with little damage to profits.

Caterpillar Inc. advanced $2.74, or 3.7 percent, to $75.35 after it raised its sales forecast for 2010 by 20 percent, exceeding analysts' expectations.

Caterpillar is one of the 30 stocks that comprise the Dow industrials.

But now investors are concerned they were too optimistic about the health insurance sector.

Health insurers tumbled for a second day in a row after Humana Inc. lowered its 2008 outlook, heightening anxiety about higher-than-expected costs weighing on the industry.

Humana sank $6.50, or 13.7 percent, to $40.88.

And the financial sector weakened following a big day on Tuesday.

Citigroup Inc. slipped 28 cents to $21.21 after surging about 10 percent on Tuesday; Washington Mutual Inc. fell 24 cents, or 2 percent, to $11.64; Wachovia Corp. fell $1.73, or 5.8 percent, to $28.05; and Wells Fargo & Co. fell $1.28, or 4.2 percent, to $29.54.

Freddie Mac shares finished 12 cents lower at $20.02 even after the chief financial officer of the nation's second-largest U.S. buyer and guarantor of home mortgages said it has adequate capital and will not need to dilute its shares by issuing more stock.

Declining issues outnumbered advancers by about 5 to 3 on the New York Stock Exchange.

Consolidated volume came to 4.27 billion shares, down from 5.17 billion on Tuesday.

The Russell 2000 index of smaller companies fell 6.50, or 0.96 percent, to 667.31.

Overseas, Japan's Nikkei 225 stock average jumped 1.60 percent, while Hong Kong's market closed up 1.86 percent higher.

Britain's FTSE 100 finished up 1.51 percent, Germany's DAX index rose 1.15 percent, and France's CAC-40 added 1.50 percent.

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On the Net:

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[Livyjr]

"Gas prices jump, oil hits $110"

By JOHN WILEN, Associated Press

Last updated: 4:22 p.m., Wednesday, March 12, 2008

NEW YORK -- Gasoline and oil prices extended their record-setting streaks Wednesday, with gas at the pump reaching a new high of nearly $3.25 and crude surpassing $110 for the first time.

The gains came as a weakening dollar led investors to shrug off an Energy Department report that crude oil and gasoline supplies jumped last week.

The national average price of a gallon of regular gas rose by 1.9 cents overnight to $3.246 a gallon, a new record, according to AAA and the Oil Price Information Service.

Pump prices are following crude's recent surge, and could rise as high as $3.75 a gallon this spring, analysts say.

Meanwhile, light, sweet crude for April delivery rose $1.17 to settle at a record $109.92 a barrel on the New York Mercantile Exchange after earlier rising to a new trading record of $110.20.

The dollar weakened throughout the day Wednesday, setting a number of new lows against the euro and attracting new buyers to the oil market.

Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is weak.

Many analysts believe the dollar's decline is the reason crude futures have surged to new records in 12 of the past 13 sessions, despite the fact that crude supplies have risen 10.2 percent since early January.

"It's almost like people are worried they're going to miss the ... train," said Linda Rafield, senior oil analyst at Platts, the energy research arm of McGraw-Hill Cos., of investors' dollar driven enthusiasm for oil futures.

For consumers also facing rising food prices and a drop in housing values, the dollar-fed oil rally simply means more pain at the pump.

Analysts see little reason for the dollar to stop falling, or for oil and gas prices to stop rising, any time soon.

And with gas prices certain to rise as the summer driving season approaches, consumers will be even more cash-strapped.

In part, the dollar is falling in anticipation of another interest rate cut by the Federal Reserve next week.

Lower rates tend to weaken the dollar.

The importance of dollar weakness to crude prices is reflected in the fact that oil's latest record came the same day the Energy Department's Energy Information Administration said crude supplies jumped by 6.2 million barrels last week, more than three times the 1.6 million barrel forecast of analysts surveyed by Dow Jones Newswires.

The EIA also reported that gasoline supplies rose by 1.7 million barrels last week, well above the expected 300,000 barrel increase, and distillate supplies dropped by 1.2 million barrels, less than the expected 2 million barrel decline.

It was the eighth increase in crude supplies in nine weeks, putting oil inventories back on a growth track after a one-week decline.

Meanwhile, forecasters including the Energy Department, the International Energy Agency and OPEC have consistently reduced their demand growth predictions for this year.

Wednesday's EIA report offered more evidence demand is falling: Gasoline consumption fell 0.7 percent last week compared to the same week last year.

Normally, gas consumption grows about 1.5 percent year-over-year, just to keep pace with population growth.

"Product demand remains quite weak," said Tim Evans, an analyst at Citigroup Inc., in a research note.

"This was another set of consistently bearish data."

Yet negative supply and demand fundamentals don't seem to matter to oil investors as long as the dollar keeps falling.

In other Nymex trading Wednesday, April gasoline futures rose 0.25 cent to settle at $2.7286 a gallon on the Nymex, and April heating oil futures rose 2.87 cents to settle at a record $3.0244 a gallon.

April natural gas futures rose 1.1 cents to settle at $10.011 per 1,000 cubic feet.

In London, April Brent crude futures rose $1.02 to settle at $106.27 a barrel on the ICE Futures exchange.

[Livyjr]

"Target in talks on credit card biz"

By JOSHUA FREED, Associated Press

Last updated: 7:33 p.m., Wednesday, March 12, 2008

MINNEAPOLIS -- Target Corp., which has been balancing pressure to sell a credit card portfolio that it once pledged to keep, said Wednesday that it may have found a solution.

Target said it was in talks to sell half of its credit card receivables for about $4 billion.

Target did not disclose the potential buyer.

Target said the proposed transaction is subject to conditions including "acceptable economics at the time of closing."

A deteriorating economy has made some people worry that Target's credit card portfolio could suffer, although Target has said that it maintains adequate reserves for losses.

If it sells half the portfolio, it will lock in a gain now in exchange for giving up some future credit card profits.

Target made the announcement after the stock market closed.

Its shares rose $1.05, or 2.1 percent in after-hours trading after rising 49 cents to end the regular session at $51.09.

Target has long said that its credit cards were an important part of its retail operation.

They were certainly an important part of its profits.

For 2007, Target credit cards contributed $600 million in pretax earnings, or 13 percent of the company's profit.

Investor Bill Ackman has been agitating for Target to do something to boost its share price since last year.

As of January, Ackman said he controlled roughly 10 percent of Target's shares, either by owning them outright or through options.

Ackman did not return a phone message Wednesday after the announcement.

Target said that if a transaction is completed, closing it during the April-June quarter "seems possible at this time."

Target said in November that it would buy back $10 billion in shares, funded in part by additional debt.

On Wednesday, without mentioning the buyback, Target said the credit card deal would be a way for it to get cash, or liquidity, without going to the credit markets.

"But liquidity for what, is the $64,000 question," Gimme Credit analyst Carol Levenson wrote in a note.

Levenson said the gain from such a sale might not be worth giving up half of a profitable business.

Many retailers have been selling off part or all of their credit card operations, including Kohl's Corp. and Pier 1 Imports Inc. in 2006 and Neiman Marcus in 2005.

Target had resisted that trend.

So why sell now?

"It's driven by the economy."

"It's driven by the fact that you have more and more concerns over the fate of the receivables portfolio," said Gwenn Bezard, who follows financial services for the Aite Group in Boston.

"Target over the past few years has been very aggressive in growing the portfolio."

[Livyjr]

NEW YORK MAGAZINE

"The Steamroller in the Swamp - Is Eliot Spitzer changing Albany? Or is Albany changing him?"

By Steve Fishman

At one afternoon barbecue in Rye—the family had moved there from Riverdale—the day had begun with tennis.

As Mayer was coming off the court, Eliot’s mother told him, “I hope you kicked Eliot’s ass.”

Congressman Charlie Rangel, the powerful New York City Democrat, called Spitzer “the world’s smartest man,” which he didn’t mean as a compliment.

His moment of revelation came in 1994.

One week before the birth of their third child, Spitzer had a brief conversation with his wife, Silda, in which he mentioned he might like to run for attorney general.

Silda, a North Carolina Baptist who met Spitzer at Harvard Law, was stunned.

The notion upended Silda’s expectations for their life together.

“This wasn’t part of the bargain,” she later told him.

But Silda, who seems to view her husband as a fragile creature, decided it was important to be supportive, though she knew it meant abandoning her career.

http://nymag.com/news/features/34730/

"Disgraced NY governor won't need new job"

By DAVID B. CARUSO, Associated Press

Last updated: 7:33 p.m., Wednesday, March 12, 2008

NEW YORK -- Eliot Spitzer probably doesn't need to get a day job when he leaves the governor's office next week.

The scion of a wealthy Manhattan real estate developer, Spitzer is a millionaire who could easily live off his share of his father's real estate business.

But that doesn't mean there won't be financial wrinkles ahead for Spitzer, who announced his resignation Wednesday after becoming ensnared in a prostitution scandal.

If he were to lose his law license, his ability to return to private law practice might be compromised.

There's also the possibility that his wife could divorce her cheating husband and walk away with a chunk of the family fortune.

"Any judge who is going to decide this case is going to bend over backward to give her a break, considering what she's been through," said Albert Momjian, a prominent Philadelphia divorce lawyer.

Silda Wall Spitzer gave up a lucrative career in corporate law in 1994, the year that her husband made his first run for public office.

Since then, she has worked unpaid jobs in philanthropy and founded a charity called Children for Children.

Spitzer's fall may have one indirect financial benefit.

He will probably have to give up what appears to be his most expensive vice: high-priced prostitutes.

When the scandal broke, allegations surfaced that he had shelled out $4,300 to a call girl the night before Valentine's Day.

A law enforcement official speaking on condition of anonymity later told The Associated Press that Spitzer was a regular customer who spent as much as $80,000 on a call-girl service over several years.

Until this week, the governor's Mr. Clean image extended to his spending, too.

His staffers always boasted that their millionaire boss was a frugal guy who owned only a few pairs of shoes and drove a minivan.

"He was certainly not free with the dollars."

"He was very, very careful," said Hank Sheinkopf, a New York political consultant who worked on Spitzer's first two campaigns.

"This is not the kind of guy who would take $50,000 out of his own bank account one weekend and blow it in Atlantic City."

Spitzer could have afforded many more luxuries.

He reported $1.9 million in income to the IRS in 2006, according to his last publicly available tax return.

Not including last year, his earnings have been $14.9 million since 1998, and that total only hints at his family's wealth.

His father, Bernard Spitzer, is said to be worth at least $500 million.

Spitzer's tax returns show that a majority of his income comes from rents collected on apartments and shops owned by the family.

As governor, he earned $179,000 a year.

For years, the family spent weekends in a modest, rented home in Columbia County, south of Albany.

The Spitzers recently paid $4 million to buy the entire 160-acre property.

The family's main residence continues to be a luxurious Fifth Avenue apartment in a tower built by his father in 1968.

Spitzer lives there rent-free, courtesy of his father, who owns at least 10 such apartment towers.

When his three children were younger, Spitzer shelled out nearly $50,000 a year for nannies.

Now the kids attend the Horace Mann School, where tuition exceeds $29,000 per student -- nearly $100,000 in education expenses alone.

Spitzer and his wife have also given generously to charity, donating $474,509 between 2000 and 2006.

All of those spending habits pale in comparison to what Spitzer spent on politics: He financed his losing 1994 and winning 1998 campaigns for state attorney general with millions of dollars in personal loans.

Much of that debt was retired when the governor sold his share of a family owned apartment building back to his father.

If there is a divorce, Silda Spitzer would likely be entitled to half of whatever assets the family acquired during their 20-year marriage -- although discussion of a split may be premature.

Silda Spitzer stood next to her husband when he announced his resignation Wednesday and some observers said they believe the marriage may survive.

"She has grounds for 50 different divorces here," said Raoul Felder, a divorce lawyer and state judicial board chairman who lived in Spitzer's apartment building for 19 years, and later feuded with the governor over an off-color book he co-wrote with the comic Jackie Mason.

"But will she stick?"

"I think she will," Felder said.

"She's stood by him so far."

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Associated Press investigative researcher Randy Herschaft contributed to this report.