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To: Sully- who wrote (44964)	12/10/2001 2:32:50 PM
From: stockman_scott	Respond to of 65232

Rate Cuts Seen as Economy is in Recession Monday December 10, 2:21 pm Eastern Time By Caren Bohan WASHINGTON (Reuters) - The Federal Reserve is widely believed to be poised to cut U.S. interest rates again on Tuesday, a move that analysts say will lend support to the troubled economy but won't work miracles. The federal funds rate, which governs overnight loans between banks, is already at a 40-year low of 2 percent. Economists are betting the Fed's policy arm, the Federal Open Market Committee, will lower short-term rates by a quarter point to 1.75 percent. Although the Fed's highly aggressive rate-cut campaign has been helpful, analysts said the economy has been frustratingly slow to respond to the medicine. Many attributed the economy's stubbornness to the major slump in business spending on new technology that is a key force in the recession. While lower rates can entice businesses to make capital purchases, many firms spent so heavily on such equipment in the 1990s that they are in no rush to buy more. ``This is a recession in which the Fed is a secondary player,'' said Fred Breimyer, chief economist at State Street Corp. in Boston. ``It can cushion the economy's fall but it can't control it.'' Further restraining the Fed's ability to re-ignite growth is the fact that long-term interest rates have crept higher in recent weeks -- something that could limit a boom in home-refinancing. Such re-financings have given households an important infusion of cash at a time when many of them have been buffeted by layoffs and cutbacks in work hours. The FOMC meeting kicks off at 9 a.m. EST (1400 GMT) on Tuesday. A decision is expected around 2:15 p.m. (1915 GMT). In a Reuters poll taken on Friday, all 24 of Wall Street's top bond firms predicted the FOMC will lower the federal funds rate by a quarter point. The odds appeared stacked toward a rate cut after Governor Laurence Meyer remarked last month that it would be ``misguided'' for the Fed to save its ammunition and refrain from further easings, given the risk the recession could worsen. Meyer, Fed Chairman Alan Greenspan and their colleagues will be joined on Tuesday by two newly sworn-in Fed governors, Susan Bies and Mark Olson. Fed Governor Edward Kelley, who announced this summer that he intended to step down once a replacement was approved, will not attend the meeting. The addition of the new governors is not expected to sway the leanings of the board much. SOME RAYS OF HOPE Since the Fed's last meeting on Nov. 6, economic data have been mixed. Some manufacturing and consumer spending reports have offered glimmers of hope for a recovery while other data, such as employment, have underscored the gloom. Richard Berner, chief economist at Morgan Stanley in New York, noted that the Labor Department's report Friday of a 331,000 drop in payrolls during November was particularly bleak in light of the mildness of the weather. Unusually warm weather during autumn and winter months often boosts hiring as it allows construction sites to keep operating. ``Last month was the second warmest November on record,'' Berner said. ``I would have thought we would have gotten more of a bounce from that in the data.'' According to the National Bureau of Economic Research, considered the arbiter of U.S. business cycles, the U.S. economy entered a recession in March, ending a 10-year expansion that was the longest in history. Since the recession began, the economy has lost close to 1.2 million jobs. Nearly 800,000 of those job losses occurred in the aftermath of the Sept. 11 attacks on the World Trade Center and Pentagon, which badly shook consumer confidence and dealt a big blow to an already fragile economy. Outside the job market, there have been a few hopeful economic signs. The closely watched National Association of Purchasing Management's gauge of economic activity rose in November to 44.5 from 39.8. The index remained below 50, which indicates factory production is still shrinking, but the improvement suggested some stabilization in the hard-hit sector. Also, the University of Michigan consumer sentiment index, released on Friday, showed a bounce in optimism. Anthony Chan, chief economist at Banc One Investment Advisors in Columbus, Ohio, said consumer confidence is the area where the Fed may be able to have the greatest impact. He noted that a rebound in business spending is unlikely to occur soon, which leaves households to pick up the slack. ``The consumer is the only game in town to get us out of this recession,'' Chan said.

To: Sully- who wrote (44964)	12/10/2001 7:33:27 PM
From: stockman_scott	Respond to of 65232

Corporate VC has backing in hard times December 10, 2001 (Reuters) — Despite posting billions of dollars in losses this year, most U.S. corporate leaders plan for their venture capital arms to continue investing to get the jump on new technologies and IPO prospects, according to survey findings released Monday. According to the survey by consulting company Accenture Ltd., 85 percent of U.S. executives have no plans to shut down their corporate venture efforts—something many analysts have predicted given the losses notched up by corporate venture units after taking stakes in risky private companies, especially technology start-ups. Corporate venture capital efforts took off in the 1990s as companies ranging from chip-making giant Intel Corp. to personal computer-maker Compaq Computer Corp. began investing profits in start-up companies that were developing new technology and promising big returns in a then-hot IPO market. The Accenture survey found 59 percent of executives fund venture capital efforts for strategic reasons—to find technology to use or to develop markets—and 29 percent pursue venture investments for financial reasons. Strategic investing requires corporations to hold on to stakes in private companies for long periods of time. Accenture found, however, that executives are not willing to shoulder too much risk in uncertain economic times by having their business units make venture investments on their own. The consulting company found 55 percent of executives plan to pursue corporate venturing through joint ventures, while only 17 percent said they would undertake corporate venturing through new stand-alone venture capital units.

To: Sully- who wrote (44964)	12/11/2001 11:43:22 AM
From: Clappy	Read Replies (4) \| Respond to of 65232

Does anyone here think members of the Northern Alliance should be held responsible for war crimes? -- Dozens of Taliban Died in Transit - Report NEW YORK (Reuters) - Witnesses described how dozens of Taliban prisoners died of asphyxiation inside shipping containers after surrendering to Northern Alliance forces, The New York Times reported on Tuesday. The deaths occurred while the prisoners were being transported in the containers from Kunduz to a prison in Shibarghan, Afghanistan (news - web sites), the newspaper said. Colonel General Jurabek, the commander in charge of about 3,000 prisoners, said that 43 prisoners had died in about half-a-dozen containers, either from asphyxiation or other injuries, the newspaper said. But various prisoners said many more had died in transit, apparently basing their estimates on extrapolations from what they themselves saw and experienced, The New York Times said. The newspaper quoted a young Pakistani prisoner named Omar as saying that all but seven people in his container had died from lack of air. Omar estimated that more than 100 had died, it added. The newspaper said several other prisoners described steep causality rates in their containers. The Northern Alliance had transported the prisoners after the surrender of Kunduz, packing them into containers for the journey of two to three days, it said. dailynews.yahoo.com