All the papers lead with some take on the fiscal fiasco. The Washington Post runs a banner headline heralding the spread of the bailout to cover insurers, agreed to under pressure from the struggling insurance industry. The New York Times, Wall Street Journal, and Los Angeles Times lead with the international dimensions of the crisis, as currencies plunge, stock markets tumble, and traders look to Washington for even more help.
Hartford, Prudential, and MetLife have become the next entities that are too big to fail, the WP reports, as the Bush administration agreed to include them and dozens of regional insurers in a bailout along with banks. In the first high-profile example, the Treasury gave PNC Financial Services $7.7 billion to buy Cleveland’s National City. Meanwhile, the cost of saving AIG is still going up, as the company has already burned through most of the $123 billion in emergency loans it received in the opening salvoes of the crisis. The Journal highlights how this shows that the Treasury is becoming a piggy bank for ailing industries more broadly as automakers also look out hopefully for a lifeline (back in Weekend, the paper explains how they got there in the first place).
Bad news flowed in from around the globe as markets in Europe and Asia reported deep losses in what the WSJ called “a day when many people around the world became convinced the economy is in for a long recession.” (The paper also declared that the idea of the U.S. as the powerhouse of the international economy is now “in tatters.”) Japan was particularly gloomy, with the Nikkei tanking 9 percent and titans like Sony and Toyota finally showing signs of strain. Emerging economies have also been hard-hit, with companies from Brazil to Indonesia sagging badly, and leaders are begging the International Monetary Fund to take on a greater role in softening the blow. (First up: Iceland.) While the United States pumps billions into its finance industry, European governments have been less willing to swoop in to save their own, although governments are considering action to calm the soaring yen and dollar while salvaging the depressed euro, pound, peso, and ruble.
The Dow dove only about 100 points Friday, but the LAT reports that Goldman Sachs at least was advocating for another stimulus package, and traders are waiting on expected interest-rate cuts from the Fed to loosen up credit. Meanwhile, their wives are having to reconcile themselves to the idea of a slightly less lavish existence—even though bank salaries and bonuses have so far not caught up with the news—and the rest of us hold yard sales to raise extra cash.
In politics, the election has already begun, as early returns from Georgia, North Carolina, and Florida show Barack Obama—surprise!—racking up a heavy head start. That’s a change from previous years, the LAT reports, when Republicans were better able to mobilize their key constituencies before Election Day; this year, African Americans are voting early in much greater numbers. The NYT explains how the McCain camp took its eye off the ball in Florida, trailing Obama in registration numbers, a mistake that is now coming home to roost as the new early-voting system takes effect. Meanwhile, Obama is already picking his Cabinet, replacing the veepstakes as Washington’s new favorite parlor game. And things are also looking good for Al Franken in Minnesota, according to the WP’s front page, leading incumbent Norm Coleman by six points in the latest state poll.
The picture is not quite as gloomy for the GOP in statehouses, where the party is looking to flip at least half of the 12 chambers considered up for grabs.
The NYT takes an A-1 gander at what the U.S. is planning to do with the 5,000 Iraqi prisoners still considered dangerous when it hands over military operations to the Iraqi army. The 12,000 people still in detention is a decrease from last year’s peak of 26,000, but releasing the rest gets harder with each one. The LAT also fronts a look at allegations of misconduct at Guantanamo Bay, where Brig. Gen. Thomas Hartmann is accused of bullying cases to trial and using coerced evidence over prosecutors’ objections in an ambiguous legal space with fuzzy lines of authority.
But move on to the sports section today—there’s a World Series going on!