Cyberattack Aftermath

The Wall Street Journal leads and the Washington Post tops its Business section with the targeted "cyber blitz" that hit the United States and South Korea this week. Though the Journal calls the siege a series of "relatively unsophisticated attacks"—which were possibly from North Korea—it says that it's still among the "broadest and longest-lasting assaults perpetrated on government and commercial Web sites in both countries." The paper also says that "U.S. officials noted that the attacks, which appear to have started primarily in South Korea on July 4, coincided with North Korea's latest missile launches and followed a United Nations decision to impose new sanctions." On the list of private sites that seem to have been attacked: the Web sites of the New York Stock Exchange, Nasdaq, the Washington Post (WPO), Amazon.com (AMZN), and MarketWatch. The Post reports that at least 35 government and commercial Web sites in the United States and South Korea were hit.

According to a front-page New York Times analysis, cities have gotten the short shrift when it comes to transportation funding from the federal stimulus. Despite the fact that two-thirds of the country lives in large metropolitan areas, those cities and their surrounding regions are getting far less than two-thirds of the $26.6 billion in funds intended for highways, bridges, and other transportation projects. The allocation of spending was largely up to the states, which according to one critic, "take this peanut-butter approach, taking the dollars and spreading them around very thinly, rather than taking the dollars and concentrating them where the most complex transportation problems are." The paper says, "Of 5,274 transportation projects approved so far—the most complete look yet at how states plan to spend their stimulus money—the 100 largest metropolitan areas are getting less than half the money from the biggest pot of transportation stimulus money."

Also in the Times, the paper retells what the Guardian reported yesterday: that Rupert Murdoch's British newspaper subsidiary may have paid about $1.6 million to settle court cases involving claims that its reporters had hacked into the cell phone messages of various public figures, including the former deputy prime minister and at least one other Cabinet minister. The Guardian story could not be independently verified by the Times and was rebuffed by Murdoch. Quoted in Bloomberg, he said, "If that had happened, I would know about it."

The federal program to relieve banks of their toxic assets has arrived but in watered-down form. According to the Washington Post, the plan, "once touted by officials as critical to reviving the financial system, was instead unveiled yesterday as a modest safety net aimed at preventing the banking sector from suffering a relapse." The government will invest up to $30 billion to finance purchasing of as much as $180 billion in toxic securities, the paper says. When Timothy Geithner discussed the program months ago, he said that the Treasury could provide up to $100 billion in two initiatives for purchasing up to $500 billion in toxic assets. The New York Times calls the new plan "frugal," noting that, "[t]he Treasury conceded that the program was ‘modest' but that it could be expanded if the economy or financial markets deteriorated."

An SEC official who led probes of Bernie Madoff's business—and failed to uncover the multibillion-dollar fraud—is resigning, the Washington Post reports. After directing the Office of Compliance Inspections and Examinations for 14 years, Lori Richards is stepping down. "Her office reviewed his firm at least three times, in 1999, 2004 and 2005, without finding the multibillion-dollar fraud he was conducting," the paper says. With a 700-person staff, the OCIE is responsible for ensuring compliance with securities laws.

Today's Financial Times brings semi-good news: The IMF says that the world is starting to pull out of the recession. Yet, while IMF Chief Economist Oliver Blanchard says that "the recovery is coming," he also mentions that it's likely to be a "weak" one. According to the paper, "The IMF now forecasts global growth of 2.5 per cent next year, up from 1.9 per cent in April, led by strong growth in China and India, a rebound in Japan and positive but sub-trend growth in the US."

Finally, the New York Times reports an apology from the Wall Street analyst who predicted that Disney's (DIS) animated movie Up would flop. Calling his prediction "dead wrong," the analyst wrote, "the recent success of Disney-Pixar's 'Up' (well ahead of our forecasts) has renewed investor confidence in Disney's creative capabilities." Over the weekend, Up became Pixar's second-highest grossing film ever in North America, beat out only by Finding Nemo.