The Dow Jones Industrial Average slid 216.90, or 2.1%, to 10172.98, off 5.2% over its three-day slide. For the week, the Dow was off 4.1%. The S&P 500 plunged 2.2% to 1091.75, off 3.9% for the week. The tech-heavy Nasdaq Composite Index ended down 2.7%, the worst decline of the major indexes.

Swiss Central Bank Chief Backs Obama's Bank Rules            1/22/10

The new head of Switzerland's central bank endorsed the fresh banking regulatory push out of Washington and reiterated that he would fight any "excessive" appreciation of the Swiss franc. Philipp Hildebrand, who became president of the Swiss National Bank this month, also chided bankers for doling out big bonuses so soon after taxpayers had paid huge sums to rescue the financial system.

General Electric's Fourth-Quarter Net Income Falls 19%            1/22/10

General Electric's fourth-quarter net income fell 19% as the company was again dinged by a drop in earnings from its finance arm. GE posted a profit of $3.01 billion, or 28 cents a share, down from $3.72 billion, or 35 cents, a year earlier.

GE Capital saw profit drop 67% as revenue fell 15%.

Earnings at NBC Universal, which GE is selling majority control to Comcast, saw a 30% profit drop as revenue fell 4%.

Google Reports $1.97 Billion in Quarterly Net            1/21/10

Google reported fourth-quarter net of $1.97 billion, compared with $382 million a year earlier, as the search giant recorded strong growth in advertising clicks and shed big charges that weighed down prior-year results. Revenue jumped 17% to $6.67 billion. The results topped Wall Street's forecasts, though shares were down 4.8% in after-hours trading.

Obama Unveils Proposal Aimed at Restricting the Size and Activities of Largest U.S. Banks   1/21/10

President Barack Obama proposed Thursday new rules designed to restrict the size and activities of the U.S.'s largest biggest banks, the latest in a series of administration moves to curb Wall Street.

The White House wants commercial banks that take deposits from customers to be barred from investing on behalf of the bank itself--what's known as proprietary trading--and said the administration will seek new limits on the size and concentration of financial institutions.

Shares of big banks fell. Morgan Stanley's shares dropped sharply after the announcement, falling 7.4% to $28.37 in recent trading, as J.P. Morgan Chase declined 5.6% to $40.97. Citigroup fell 4.1% to $3.32 and Bank of America dropped 5% to $15.67.

Supreme Court Overturns Limits on Corporate Spending in Political Campaigns            1/21/10

The Supreme Court has ruled that corporations may spend freely to support or oppose candidates for president and Congress, easing decades-old limits on their participation in federal campaigns.

By a 5-4 vote, the court overturned a 20-year-old ruling that said corporations can be prohibited from using money from their general treasuries to pay for campaign ads. The decision, which almost certainly will also allow labor unions to participate more freely in campaigns, threatens similar limits imposed by 24 states. The justices also struck down part of the landmark

McCain-Feingold campaign finance bill that barred union- and corporate-paid issue ads in the closing days of election campaigns.

Goldman Sachs Posts $4.95 Billion Profit in Fourth Quarter            1/21/10

Goldman Sachs posted a fourth-quarter profit of $4.95 billion, compared with a loss of $2.29 billion a year earlier. Revenue was $9.62 billion. Goldman earned $8.20 a share, well above the $5.20 a share forecast from analysts surveyed by Thomson Reuters.

Investment banking revenue rose 82% from the previous quarter to $1.64 billion.

EU Clears Oracle to Buy Sun Microsystems            1/21/10

The European Commission cleared U.S. software giant Oracle to take over Sun Microsystems in a $7.38 billion deal.

"I am now satisfied that competition and innovation will be preserved on all the markets concerned. Oracle's acquisition of Sun has the potential to revitalize important assets and create new and innovative products," said Neelie Kroes, the European antitrust commissioner.

The clearance comes after an in-depth antitrust investigation, opened on Sept. 3 amid concerns that Oracle's acquisition of the world's leading open-source database MySQL would hamper competition in the database market.

BSkyB Loses Appeal, Must Sell ITV Stake            1/21/10

British Sky Broadcasting Group lost its latest attempt to stop the U.K. government from forcing it to divest a 17.9% holding in broadcaster ITV.

The U.K. satellite TV operator has made numerous legal attempts to challenge a ruling by the Competition Commission, the U.K. antitrust authority, that it must divest the stake in the broadcaster.

BSkyB, in which News Corp., owner of The Wall Street Journal, has a roughly 39% stake, bought shares in ITV in 2006, prompting widespread complaints from rivals and U.K. lawmakers.

Obama to Propose New Limits on Banks   1/20/10

President Barack Obama on Thursday is expected to propose new limits on the size and risk taken by the country's biggest banks, marking the administration's latest assault on Wall Street in what could mark a return -- at least in spirit -- to some of the curbs on finance put in place during the Great Depression.

The proposal represents a sharply different philosophical shift from the view of banking over the last decade, which saw widespread consolidation among large financial institutions to create huge banking titans. If Congress approves the proposal, the White House plan could permanently impose government constraints on the size and nature of banking.

China's GDP Rose 8.7% in 2009    1/20/10

China's economy expanded 8.7% in 2009, surpassing the 8% target the government had set early last year, when some economists were warning that growth might only reach 5% or so. The Chinese government said it sees uncertainties in domestic economic development and will maintain stable in it's macroeconomic policy.

Britain Suspends Direct Flights Between U.K., Yemen           1/20/10

Britain's government is suspending direct flights between the U.K. and Yemen over security concerns following the failed bomb attack on a Detroit-bound airliner.

Prime Minister Gordon Brown, in a statement to lawmakers Wednesday, confirmed the decision to halt services between London and Sana'a, the Yemeni capital.

Foreign Office minister Ivan Lewis said Tuesday flights will only be resumed once the Yemeni government enhances airport security.

Bank of America Loss Narrows in Fourth Quarter            1/20/10

Bank of America's fourth-quarter loss narrowed on a surge in noninterest income, joining peers which have also posted improved results a year after the depths of the financial crisis.

The bank's loss narrowed to $194 million from $1.78 billion in the quarter. Including preferred-stock dividends and costs from repaying the federal government its $45 billion in aid, the per-share loss widened to 60 cents from 48 cents.

MetLife Is in Final Negotiations for AIG's Alico Unit      1/19/10

MetLife is in final negotiations to purchase one of the biggest international life-insurance units of government-controlled American International Group, and will pay between $14 billion to $15 billion for the unit.

The sale of Alico would be the biggest step to date by AIG to pay back the U.S. government, which has committed a total of $182.3 billion to prop up the giant insurer. About $9 billion of proceeds would go back to U.S. coffers, AIG has previously indicated.

Cadbury Accepts Kraft's Offer                1/19/10

Kraft Foods closed a deal to acquire Cadbury PLC that values the company at 11.9 billion pounds ($19.44 billion), in a trans-Atlantic tie-up that would end the nearly 200-year independence of Britain's most famous candy company.

After more than four months of public sparring that followed Kraft's hostile-takeover approach for Cadbury, Kraft appeared to relent to the demands of Cadbury management and shareholders, sweetening its bid and adding cash. Under the terms of the deal, Cadbury shareholders will get cash and stock valued at 840 pence per share, plus a special dividend of 10 pence per Cadbury share.

Japan Airlines Files for Bankruptcy            1/19/10

Japan Airlines filed for court-led restructuring with the Tokyo District Court, a quasi-governmental turnaround agency said.

The Enterprise Turnaround Initiative Corp. of Japan said it had decided to support the restructuring of JAL, Asia's No. 1 carrier by revenue. JAL will revitalize its unprofitable operations with a capital injection from the agency, and by trimming its workforce and routes, ETIC said.

Under JAL's revamp plans, the carrier will reduce its capital to zero and ask for a debt-waiver worth about $8 billion (730 billion yen) on a group basis, while cutting costs by reducing its workforce by 15,700 employees -- a third of its 47,000 total.

Hershey Likely to Top Kraft's Bid for Cadbury Next Week               1/15/10

Hershey has concluded it has the financial muscle to top Kraft's $17.2 billion offer for Cadbury and will likely make a bid next week of at least $17.9 billion.

Obama to Campaign in Massachusetts Ahead of Tuesday's Special Election for Senate Seat          1/15/10

President Barack Obama will fly Sunday to Massachusetts to try to save Edward M. Kennedy's Massachusetts Senate seat for his party, and with it the Democrats' filibuster-proof majority.

Surging support for Republican candidate Scott Brown has White House and Democratic Party officials increasingly worried that Massachusetts' Democratic Attorney General Martha Coakley could lose a special election Tuesday and hand Republicans the first Bay State Senate seat since 1972.

Federal Suit Alleges J&J Made Kickbacks on Drug Sales                    1/15/10

Federal prosecutors alleged that Johnson & Johnson paid one of the nation's largest pharmacies serving nursing homes "tens of millions of dollars in kickbacks" to increase sales of drugs, including blockbuster antipsychotic Risperdal.

Prosecutors charged in a complaint filed in federal court in Boston on Friday that J&J illegally paid Omnicare to get the pharmacy company to buy J&J medicines and recommend their use to nursing homes. Omnicare purchases nearly tripled to $280 million, prosecutors alleged.

J.P. Morgan Chase Reports Jump in Fourth-Quarter Earnings            1/15/10

J.P. Morgan Chase's fourth-quarter earnings quadrupled to $3.28 billion, or 74 cents a share, as the banking giant closed out a year in which it made it through the financal crisis more strongly than its rivals.

But shares were lower in premarket trading. Revenue on a managed basis, which excludes the impact of credit-card securitizations and is on a tax-equivalent basis, jumped 32% to $25.23 billion, but was below analyst estimates. Managed credit-loss provisions were $8.9 billion, up from $8.54 billion a year earlier and down from $9.8 billion the previous quarter.

Chairman and CEO Jamie Dimon said: "While we are seeing some stability in delinquencies, consumer credit costs remain high, and weak employment and home prices persist. Accordingly, we remain cautious."

Banks Set for Record Pay            1/14/10

Major U.S. banks and securities firms are on pace to pay their people about $145 billion for 2009, a record sum that indicates how compensation is climbing despite fury over Wall Street's pay culture.

An analysis by The Wall Street Journal shows that executives, traders, investment bankers, money managers and others at 38 top financial companies can expect to earn nearly 18% more than they did last year -- and slightly more than in the record year of 2007. The conclusions are based on an examination of securities filings for the first nine months of 2009 and revenue estimates through year-end.

Democrats, Labor Leaders Reach Deal Over Taxing High-End Health Plans            1/14/10

Labor leaders and Democratic negotiators reached agreement over the issue of a proposed tax on high-end health plans, people familiar with the discussions said Thursday. The tax has been one of the key issues remaining as Democrats work through differences in the House and Senate health bills passed late last year. The details of the agreement couldn't immediately be learned.

The Senate bill includes a 40% tax on plans valued at more than $23,000 for a family and $8,500 for an individual. The House bill doesn't contain that tax. Unions fear it could hit some union members who have negotiated generous health benefits. However, President Barack Obama wants some version of the tax in the final health bill, aides have said.

Trichet Calls Idea of Greece's Exit From Euro Zone an 'Absurd Hypothesis'            1/14/10

ECB President Jean-Claude Trichet poured scorn on the notion that Greece may be forced to leave the euro zone because of its mounting problems with public deficits and debt levels.  At the same time, however, he also ruled out cutting Greek banks any slack in the context of the way the ECB extends credit to the euro-zone banking system. Trichet called the idea of Greece being forced out of the EU's currency union "an absurd hypothesis" and declined to comment on it further.

U.S. Retail Sales Fell in December; Jobless Claims Rose Last Week   1/14/10

U.S. retail sales fell an unexpected 0.3% in December, signaling restraint by consumers during the holidays as the economy wrestles with high unemployment. Economists surveyed by Dow Jones Newswires forecast a 0.5% increase. November sales, however, were adjusted upward to a 1.8% increase from a 1.3% gain.

In a separate report, the number of U.S. workers filing new claims for jobless benefits unexpectedly increased last week by 11,000. But a drop in the four-week moving average to its lowest level since August 2008 showed claims are still trending downward. Total claims lasting more than one week, meanwhile, decreased.

U.S. Bank Tax Would Force 50 Banks to Pay $90 Billion Over 10 Years            1/14/10

A new tax proposed by the White House -- called a "financial crisis responsibility fee" -- would force about 50 banks, insurance companies and large broker-dealers to collectively pay the federal government roughly $90 billion over 10 years, White House officials said. Of the 50, about 35 would be U.S. companies and 10 to 15 would be U.S. subsidiaries of foreign financial firms.

German Economy Posts Biggest Postwar Contraction            1/13/10

Germany's economy contracted 5% in 2009, its worst performance since World War II. The figure was in line with government predictions.

Germany's export-dependent economy, Europe's largest, emerged from a deep recession in the second quarter of 2009 and the government predicts growth of 1.2% in 2010.

The worst postwar performance to date was a 0.9% decline in West Germany's gross domestic product in 1975. The worst since German reunification was a 0.8% fall in 1993.

Google May Back Out of China Because of Cyberattacks                1/12/10

Google said it is "reviewing the feasibility of our business operations in China" and may back out of China entirely, as it disclosed it had been hit with major cyberattacks it believes originated from the country.

In a blog post, Google said it detected a "highly sophisticated and targeted attack on our corporate infrastructure originating from China" in mid-December and that the attack resulted in "the theft of intellectual property from Google."

U.S. Trade Gap Widens as Oil Prices Boost Imports            1/12/10

The U.S. trade deficit widened more than expected to $36.40 billion in November, as surging oil prices helped imports to outgain exports. Exports grew 0.9% from a month earlier to $138.24 billion, the highest level in a year, but imports surged 2.6% to $174.64 billion.

The U.S. trade deficit with China narrowed in November to $20.22 billion, as exports to China rose by to a record $7.33 billion.

Obama Administration Considering Fee on Banks to Recoup Bailout Funds            1/11/10

The Obama administration is considering levying a fee on banks to recoup more of the taxpayer funds spent to rescue the financial system, according to an administration official.

The proposal is still subject to discussion and no final decision has been made as to what form it might take. It's expected to be included in next month's budget, and as such could also be presented as a way to pay down the U.S.'s large deficit.Such a move comes as Wall Street banks, having regained their footing, are set to pay out large bonuses. Despite the mortgage meltdown, financial firms are coming off a blockbuster year. Revenue has rebounded to pre-crisis levels, and 2009 compensation is on pace to approach or surpass the record payouts of 2007.