Wagoner Shown the Door

President Obama is to announce details of the auto bailout plan today, but most of the news leaked out on Sunday. In a move that surprised Detroit and Washington, the Obama administration pushed General Motors CEO and Chairman Rick Wagoner out the door, the New York Times reports, as the White House intends "to keep a tight rein on the companies it is bailing out." The White House was not done there. On condition of receiving further funding, Chrysler was instructed to merge with the Italian automaker Fiat within 30 days, Forbes writes, adding, in the favored metaphor of the day, that "Obama takes the wheel in Detroit."

According to the Wall Street Journal, the Italians just may be Fiat's best hope. And even with a Chrysler-Fiat alliance and a reshuffling at GM, it looks like a rough road ahead for the ailing automakers. Citing a memo leaked from the auto task force, the WSJ writes that GM and Chrysler "may well require utilizing the bankruptcy code in a quick and surgical way." The newspaper continues, a "structured bankruptcy ... would be a tool to make it easier for General Motors and Chrysler to clear away old liabilities so they can get on a path to success."

The NYT is quick off the bat with a type of obituary for Wagoner. The newspaper notes that during his nine-year tenure Wagoner faced a relentless barrage of opposition, whether from Congress or rogue investor Kirk Kerkorian. Such hostility usually comes with the job when you are overseeing a company whose share price falls roughly 95 percent to less than $4 today and loses 10 percent market share in less than a decade.

Private-equity firms are once again active in the financial sector. According to the WSJ, in the first deal of its kind since September, private-equity-firm Advent International Corp. will pay $561 million in cash today for a majority share of the Fifth Third Bancorp's payment-processing unit. The back story will sound familiar. The Cincinnati-based Fifth Third was forced to sell the profitable unit to boost its capital base following a $3.45 billion injection from the government. Advent, a midsized Boston-based firm, beat out much bigger competition, namely Visa and MasterCard, to secure the deal, the newspaper reports. And what about the sector's progress in selling its less-desirable assets? The government is trying to make it as enticing as possible for private investors to join a federal program for buying toxic bank assets, Bloomberg reports, with Treasury Secretary Timothy Geithner warning against any attempt to tax investors who participate. It's evident private investors are desperately needed. The Treasury has only about $135 billion left in a financial-stability fund, Bloomberg reports.

Perhaps taking a respite from the debacle of his Tribune Co. buyout, real estate tycoon Sam Zell is looking to "restore his stature as an astute investor" in Brazil, the WSJ reports. Zell sees an opportunity in the pent-up demand for housing in Brazil and hopes to capitalize on it through a 19 percent stake in homebuilder Gafisa SA. And he might yet be helped by a $15 billion program launched by the government of President Luiz Inácio Lula da Silva to build 1 million new affordable houses like the ones built by Gafisa's Construtora Tenda SA. That initiative will increase urban sprawl "without doing anything about as many as six million vacant homes across Brazil," critics say. Zell plays down the idea of government intervention, telling the WSJ, "I have learned from being around for a really long time that I won't believe anything governments say until they actually do it."

The International Monetary Fund has long been a source of soft U.S. power, but with America currently on the ropes economically, global pretenders such as India and China want a greater say in the running of the IMF before they commit much-needed capital, the NYT reports. The United States wants the IMF to triple its lending capacity (for that it will need an extra $500 billion) and China has signaled its willingness to contribute ... but only if it gets a greater say in the running of the fund. Indeed, this week's G20 meeting in London, where the fund will be on the agenda, could be "the last hurrah for the U.S. and Europe rescuing the world economy,”  Simon Johnson, a former chief economist of the fund, tells the NYT.

And, finally, starting tomorrow Skype addicts will be able to make free VoIP calls from their iPhones, CNet giddily reports. The full details are expected to be announced tomorrow, but the NYT has a few more nuggets to leak. The newspaper reports that Skype will make its free software available immediately for the iPhone and iPod Touch, and, in May, for Blackberry devices. But there are already some limitations. Apple is expected to limit outgoing Skype calls to when customers are connected to a Wi-Fi network. Hackers, no doubt, will have fun trying to unlock that one.