The End Of The World As We Know It

Bloomberg and the Washington Post continue to give top billing to the stimulus bill's executive pay restrictions, while the Wall Street Journal devotes its Sunday coverage to G7 talks over China's currency and the New York Times highlights global joblessness. The stories about the $787 billion package's stringent limits on outsized compensation provide virtually no new information from yesterday after the bill had passed through Congress on Friday and was slated to go to President Obama. The primary concern for the administration, writes the WP, is that the provision will "prompt financial institutions to do whatever they can to pay back the government funds, undermining its efforts to stimulate lending and coax the economy into recovery." Nonetheless, Obama has said he will sign the bill Tuesday during a trip to Denver.

From the G7 assembly in Rome, the WSJ reports that the United States and its major allies "softened their criticism of China's controversial currency policy," even praising Beijing for its "continued commitment to move to a more flexible exchange rate" and for shoring up its own financial system with a $581 billion stimulus package. This comes just a few weeks after Treasury Secretary Timothy Geithner accused China of manipulating its currency to gain an edge on foreign trade. Geithner's tone "reflects the West's eagerness for Beijing's help in resolving the global financial and economic crisis," the Journal says.

In fact, the paper writes, Geithner came to Rome ready to urge the rest of the G7 to be more aggressive in its actions to "address financial chaos and an economic contraction," however, once there, "he struck a delicate balance between praising his counterparts for their grasp of the severity of the problems, and reminding them of the risks of doing too little or stopping too soon."

The NYT reports that worldwide job losses could reach 50 million by the end of 2009 and that growing fear has led to civil unrest in "countries as varied as Latvia, Chile, Greece, Bulgaria and Iceland and contributed to strikes in Britain and France." Last week, Dennis C. Blair, the director of national intelligence, told Congress that "instability caused by the global economic crisis had become the biggest security threat facing the United States, outpacing terrorism." The article provides vignettes of the worsening situation in a number of developed and emerging countries, weaving together a rather disturbing picture.

The NYT this morning also provides a fascinating profile of Akio Toyoda, the grandson of Toyota founder Kiichiro Toyoda, who will be taking over the Japanese car manufacturer in June after a 25-year apprenticeship. The story lays out Toyoda's game plan for his company's survival, which does not include asking the Japanese government for aid, and is sprinkled with fun facts, like why the family spells its companies' names differently than its own (so they would be easier to write in Japanese characters). Part of those plans includes rethinking the "lineup of cars for every region of the world and accelerating offerings of more environmentally friendly vehicles." The company is already planning for 2030, "when it envisions a world in which hybrid vehicles-and other types, like those that run on hydrogen-dominate the roads as traditional internal combustion engines fade in importance," the Times writes.

Meanwhile, Bloomberg is reporting that talks between GM and Chrysler and the United Auto Workers have stalled because the union objects to the companies' proposals to modify a retiree health-care fund. UAW lobbyist Alan Reuther said Feb. 13 that the proposal went beyond the requirements of the $17.4 billion U.S. Treasury loans. Ford, on the other hand, has continued its separate talks with the union, reflecting a more amicable relationship. As part of the terms of a loan provided by the U.S. Treasury, GM and Chrysler must restructure their debt and "convince the UAW to accept half of scheduled payments into a union-run retiree health-care fund next year in equity instead of cash." In addition, the companies want to get rid of supplemental unemployment pay and to change plant work rules to cut costs, Bloomberg says.

A kerfuffle at Trump Entertainment Resorts is also making headlines. Donald Trump's resignation from the company's board Friday may "kill the $270 million sale of the company's Trump Marina Hotel Casino," a 27-story hotel with a casino, theater, nightclub, and spa on 14 acres in Atlantic City, Bloomberg reports. In fact, the company's bondholders may push Trump Entertainment into involuntary bankruptcy this week, and would then be "stuck with all three casinos in the declining Atlantic City market" should the sale fall through.

During a phone interview with Bloomberg, Trump said he "strongly disagreed with the bondholders' decisions and actions." He speculated: "Part of the reason that these bondholders can't make a deal is they've lost so much money on other deals, they've lost so much money on this deal, and they're probably going to lose so much money on other deals, that my impression is they don't care."