BUSINESS BRIEFS
3 former Horizon Lines executives headed for jail
Associated Press
Three former executives with Horizon Lines Inc. agreed to plead guilty and will serve jail time for conspiring to fix prices, rig bids and set aside market shares for their customers, according to Bloomberg News Service.
The executives — Kevin Gill and Gregory Glova, of Charlotte, N.C., and Gabriel Serra of San Juan, Puerto Rico — will serve jail time and pay fines, according to a company statement.
Two other shipping officials also agreed to plead guilty. Peter Baci, of Jacksonville, Fla., will plead guilty to conspiracy, and Alexander Chisholm of Jacksonville is pleading guilty to destroying evidence, the Justice Department said.
In May, Charlotte-based Horizon Lines, the second-largest shipping company serving Hawai'i, placed six employees on administrative leave amid a federal antitrust probe of industry pricing.
CREDIT MARKETS CONTINUE TO BALK
NEW YORK — The credit markets remained choked late yesterday, keeping key lending rates and demand for Treasurys at lofty levels after the Senate passed the U.S. financial rescue plan.
There was no discernible change in the markets after the Senate approved the plan last night and sent it on to the House, which defeated an earlier version of the proposal on Monday.
President Bush and congressional leaders yesterday expressed optimism that the $700 billion bill to take risky mortgage-backed assets off banks' books would pass, after the addition of a provision that would boost insurance for people's deposits.
But investors were not expected to cheer even if the House does approve the plan — they are unsure how effective the plan will be. "It can only be effective if it marshals private confidence," said Citigroup economist Steven Wieting.
BUFFETT INVESTS $3 BILLION IN GE
OMAHA, Neb. — Warren Buffett's Berkshire Hathaway Inc. is investing $3 billion in General Electric Co., a huge vote of confidence for an iconic American company battered by the financial crisis.
For the second time in just over a week, Berkshire Hathaway has moved to shore up a company long known for its ironclad fiscal health. Buffett's company invested $5 billion in Goldman Sachs last week after the famed investment bank's shares had slumped. Investors feared Goldman could face similar funding squeezes as Bear Stearns and Lehman Brothers.
For GE, the cash infusion marks another dramatic turn in a turbulent 2008. The company, which makes everything from light bulbs to jet engines and owns NBC Universal, has cut its earnings forecast twice since April due to problems with its financing unit, GE Capital.
400,000 WILL GET MORTGAGE ASSIST
WASHINGTON — The government kicked off a program yesterday that aims to prevent foreclosures by letting an estimated 400,000 troubled homeowners swap their mortgages for more affordable loans.
Lenders, rather than borrowers, will decide whether to participate in the program, which requires them to take a loss on the initial loan. The $300 billion, three-year program is designed to help borrowers who owe more on their loans than their homes are worth.
To qualify, borrowers must be spending more than 31 percent of their income on mortgage payments. Loans made this year are excluded, except for those completed on Jan 1. Borrowers must have made six months of payments on their loans."For homeowners in trouble, this may be the help that they need," Housing and Urban Development Secretary Steve Preston said yesterday.
Officials said they did not have an updated estimate of how many homeowners were likely to qualify, beyond the Congressional Budget Office's projection from earlier this year that 400,000 borrowers would participate.
