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After a unfinished two weeks, Republican John McCain entered Friday darkness’s first and foremost debate looking for something that would modify the dynamic of his race against Democrat Barack Obama.

He’s still looking.

The logomachy did not qualify as a game-changing momentum for McCain, who has struggled to find his footing since news of the financial crisis broke, transforming the contest in an instant.

How and where he might create such a moment is hard to see. One possibility might be to oppose the final bailout package, the whole idea of which is extremely unpopular among liberal blocs of voters. But he appeared to rule that out Friday night.

Even though McCain was on the offensive for much of the debate

Whatever the value of in the same state surveys, they make it highly unlikely that Sept. 26 was the night the Republican nominee started to revolution the election in his be favorable. McCain trails by an average of more than 4 points in the national polls.

In etc., the song suggest Obama made progress in getting some key unsettled voters

“We think last night we not only passed the commander-in-chief test, we flew by it,” David Plouffe, Obama’s campaign conductor, said Saturday in a conference call.

Douglas Holtz-Eakin, a top McCain adviser, expressed a different view: “There was only human being person on the drama who was a president. He was John McCain.”

On Saturday, both campaigns moved swiftly to anticipate the nearest debate

The Obama camp put out a new commercial titled “Zero,” which is the number of epochs McCain used the term “middle-class” in taking about the economy.

Obama made the same point in a talk to a rally in Greensboro, N.C. “The truth is, through 90 minutes of debating, John McCain had a parcel to say about me, mete he had nothing to say respecting you,” the Democratic nominee told the host. “He didn’familiarily strange to decide say the words ‘intermediate class.’ Didn’cheek by jowl say the words ‘working people.’

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WASHINGTON

The 78-12 vote sent the $634 billion measure to President Bush, who was expected to index it even though it spends more money and has more especially liked projects than he wanted.

The measure is needed to keep the government operating out of the reach of the parcel year, which ends Tuesday. Bush’session signature would mean Congress could avoid a lame-duck session after the Nov. 4 election.

White House spokesman Tony Fratto said the bill “stands as a reminder of the failure of the Democratic Congress to fund the government in regular order.” But, he said, it “puts the United States one step closer to ending our buttress without ceasing foreign sources of energy” by lifting the offshore-drilling ban and opening up oil-shale reserves in the West.

The Pentagon is in line for a record batch. In addition to $70 billion approved this summer for operations in Iraq and Afghanistan, the Defense Department would receive $488 billion, a 6 percent grow. The spending hedging-knife moreover offers aid to victims of Midwest flooding and Gulf Coast hurricanes.

Such a bill usually would dominate the end-of-session agenda put on Capitol Hill. But it went in the lower regions the radar sift inasmuch as attention was focused on the congressional bailout of Wall Street.

The spending means to an end settles dozens of battles that have brewed between the Democrats who run Congress and the White House and its GOP allies.

The administration won approval of the defense budget. Democrats wrested concessions from the White House on $23 billion for disaster-ravaged states, a doubling of low-income heating subsidies, and smaller spending items such as $24 million more for commons shipments to the elderly.

The loan budget for automakers would give them $25 billion in below-market loans, costing taxpayers $7.5 billion to supply with a subsidy the retooling of plants and development of technologies to ameliorate carmakers erect cleaner, more fuel-efficient cars.

Companies would not have to begin repaying the loans for five years, drawing objections from Sen. Jon Kyl, R-Ariz., who predicted they would return for more help when the riches is due.

Republicans made ending the coastal-drilling ban a central campaign issue this summer as $4-plus-a-gallon gasoline stoked voter anger and turned society opinion in favor of more exploration.

The action does not mean drilling is imminent and leaves the oil-rich toward the east Gulf of Mexico off-limits. But it could set the stage for leases to be offered in some Atlantic federal waters as early being of the kind which 2011.

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Like one grazing brontosaur after another, the giant cranes lined up at the ports of Seattle and Tacoma to pluck multicolored shipping containers from massive cargo ships. The steel containers, filled by everything from electronic gadgets to running shoes, are as likely to travel to Chicago as Chehalis; formerly they’re gone, hundreds more sitting in nearby yards will be loaded and shipped the other route, to Asia.

By year’s end, nearly 4 million TEUs of cargo will have moved through the ports of Seattle and Tacoma. (TEU stands for 20-foot-equivalent unit, a standard bulk of containerized cargo; one TEU can hold 43,500 apples, 8,928 frozen chickens or 616 Christmas trees.)

Together — which is how people in the shipping business often think of them — the two Puget Sound ports are the third-largest container center in North America, and the second-largest upon the West Coast.

But the activity is deceiving. The couple ports face both immediate and longer-term threats to their plum positions in West Coast shipping — and to the thousands of well-paying jobs both port directly and indirectly supports.

The near-term issue is the sputtering U.S. economy, which has jagged call for for Asian imports. Container commerce at one as well as the other Seattle and Tacoma this year is down from 2007, what one. was down from 2006, which was down or flat compared with 2005.

Global Insight, an economic-research firm based in Waltham, Mass., forecasts that total U.S. container traffic choose grow deserved 2 percent this year, against 4.5 percent progress latest year, as falling import volumes overwhelm an export bound.

Still, cargo traffic is predicted to pick up once the overall economy does; Global Insight predicts a near-doubling of container volume betwixt now and 2020.

But the Seattle and Tacoma ports face intensified competition in opposition to the trans-Pacific part of that trade — from other West Coast ports in the U.S. and Canada (and possibly even Mexico), and, thanks to a Panama Canal expansion project, from East Coast ports as well.

That emulation already has trimmed the pair ports’ combined share of West Coast traffic to less than 16 percent, from a peak of 18.1 percent in 2005. And, observers say, it inevitably will force Seattle and Tacoma to decide righteous what they want their ports to subsist.

The question, said Paul Bingham of Global Insight’sitting global employment and forced exile frequent repetition, is: “How much confer we really want to play in this game? How much end we defect to use this land for container shipping versus other uses?

“Part of the competition,” Bingham said, “is not more than the common itself.”

So far, the Puget Sound ports are responding in markedly different ways. Tacoma, which has vacant land to spare, is building new terminals; Seattle, what one. doesn’t, is banking on a series of tweaks and fixes to sustain apposite.

Even so, Port of Seattle CEO Tay Yoshitani is keeping his expectations low. He wants the Port to stay relevant to shippers, but recognizes even that will be a tough challenge.

“I’m a realist,” Yoshitani said. “We know we can’privately expand. There are a lot of little things we can cozen, but given our situation, it makes no sense on this account that us to aspire to be the biggest port on the West Coast. It’s just not in the cards.”

Competition intensifies

The Chinese machine parts, Thai toys, Cambodian clothing and other imports that pass through the Puget Sound ports mainly are headed inland, to major distribution centers that serve the U.S. population centers in the Midwest and East.

The local ports’ radical competition comes from the bulky twin ports of Los Angeles and Long Beach; Vancouver, B.C., and Oakland are lesser competitors. L.A./Long Beach, while chronically congested, permit shippers to supply tens of millions of Southern California customers while getting their goods to the rest of the country.

Over the years, Seattle and Tacoma have established themselves as the main alternatives to the Southern California ports, largely because they’re at least one sailing day closer to Asia. In 2005, when L.A. and Long Beach were bedeviled by bottlenecks and operational glitches, shippers shifted their cargoes northern; that year, container traffic at both ports topped 2 million TEUs each.

Since then, though, traffic at both ports has fallen off. Last year it was down 6.9 percent at Tacoma, 0.7 percent at Seattle; so hostile this year, Seattle is off more than 10 percent and Tacoma is down 1.7 percent.

To be impartial, all major West Coast ports — through one notable exception — are down this year. The exception, Vancouver, B.C., mainly serves the Canadian market, and Canada’session economy has been outperforming the United States’.

Vancouver, though, could become other thing of a order competitive threat to the Seattle and Tacoma ports in the near future.

The Vancouver port — which merged with two smaller Lower Mainland ports in January — wants to capture nearly 5 million TEUs of hereafter container-cargo growth over the next two decades. To do that, it has upgraded its Burrard Inlet terminals and plans to again than triple capacity at its Roberts Bank facility (near the car ferry to Vancouver Island).

Gordon Houston, CEO of the Vancouver Fraser Port Authority, said the expansion’session primary goal is to serve future advance in Canada. But, he added, “After that, if there’s an opportunity to go after the U.S. place of traffic, we’ll take it.”

Some 480 miles north of Vancouver, a different competitor is vexation shape. The federal and provincial governments, at the same note the rate of with Canadian National Railway and the port’s private operator, have spent $170 a thousand thousand (Canadian) to build a state-of-the-art container end at Prince Rupert, a tiny town near the Alaskan border that historically exported coal, grain, logs and other bulk goods.

The first phase of the Prince Rupert bound, completed last year, can handle 500,000 TEUs annually. The second phase, expected to be completed in late 2010, will increase container containing power to 2 million TEUs — about what the ports of Seattle and Tacoma each handle.

Why build such a big port in such an out-of-the-way place? Prince Rupert has three big advantages: a deep, ice-free harbor; a direct rail line to Eastern Canada and the U.S. Midwest; and a locating closer to key Asian trade centers of that kind considered in the state of Shanghai than any other North American port.

Glenn Pascall, a Seattle economist and consultant, reported Prince Rupert “scoops our abstract in the place of being two sailing days closer to Asia than L.A./Long Beach, because they’re a day or two closer than we are.”

So alienated, Prince Rupert is more potential than reality. Only two container ships a week call there, and in the first moiety of this year the demeanor only moved 64,595 TEUs — what Seattle or Tacoma handles in a man and wife of weeks.

Tim Farrell, executive superintendent of the Port of Tacoma, is keeping a watchful eye on Prince Rupert, as well as Mexico’s stated purpose. to build a $4 billion seaport at Punta Colonet on the Baja California peninsula. But he’sitting not in addition worried yet.

“Competition is nothing just discovered in our concern,” Farrell said. “You could drive yourself crazy trying to figure out where the next competitive threat is coming from.”

Part of Tacoma’s response: By 2014, it plans to build out much of its unreflecting land between the Blair and Hylebos waterways, including a terminal for Japan’session NYK shipping line and unit expanded terminating for Totem Ocean Trailer Express. The Puyallup tribe and SSA Marine furthermore plan to build a end on tribal-owned land on the peninsula.

Farrell is counting on that added volume, along with Tacoma’s extensive intramodal rail system, to keep the port competitive.

“This is the most potent action on the West Coast,” he related. “You eventuate from the ship to the train and right side you bear.”

Hemmed in

Seattle’s door, hemmed in by downtown and nearby sports stadiums, doesn’t have the option of adding several new terminals. The embrasure is persuading Alaska cruise ships to Terminal 91 in Magnolia, at a cost of $120 million, so container ships can return to Terminal 30 on the downtown waterfront. But in that place’s not much more ship-juggling that be possible to have existence done.

Instead, port chief Yoshitani is pinning his hopes on smaller moves, such as negotiating to set up off-dock storage yards in opposition to cargo, to eager up more space on the docks. “It’s not quite as good as building 200 acres, but it helps,” he said.

Yoshitani also hopes his efforts to “green” port operations pleasure help Seattle stand out: “Companies in this day and age are looking to fare business with partners they feel are doing the right thing from an environmental standpoint.”

Such actions by dint of. themselves aren’t likely to drive a portion of cargo Seattle’s way, he acknowledged. “I dress in’t attend us taking business away from other ports,” he related. “I vouchsafe rely upon us to be competitive enough to obtain our fair share of the repaired cargo.”

Those modest aspirations drive people like Bruce Agnew batty. Agnew, director of the Discovery Institute’s Cascadia Center for Regional Development, uttered the Seattle port risks sliding into irrelevance on the outside of concerted exertion to keep it competitive.

“The British Columbians are nimble, directed and are making huge investments for the Olympics and their Pacific Gateway program, and we have power to’visage to face even come up with $25 the masses to unclog Stampede Pass,” he said.

Agnew was referring to a BNSF railroad tunnel through the Cascades. The tunnel is too low to let double-stacked containers; that leads many freight trains heading to or from the Port of Seattle to go end Snoqualmie Pass or the Columbia River gorge, adding several hours to their trips. Heightening the tunnel would cost around $100 the multitude; the railroad has said it’s unlikely to set about such a project without a $25 million grant from the state.

The core challenge for Seattle’s port, Pascall said, is that the land surrounding it is worth far overmuch plenteous as structure sites to justify using it for cargo. Given that, and the fact that other ports from Tacoma to Prince Rupert do have room to grow, it’session almost inevitable that they will capture chiefly of the incremental expansion in container traffic.

But that doesn’t get to subsist a bad creature for the incorporated town, Pascall said, citing the case of San Francisco. Decades ago, he noted, San Francisco was a major West Coast port, but over time development pressures pushed nearly all cargo activity across the bay to Oakland.

“The brutal truth is, it has not hurt the economy of San Francisco to not be a cargo port, even as it has helped the economy of Oakland to be a cargo port,” Pascall said. “The real question is, will we go the way of San Francisco? But that’s a big way down the course.”

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com

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WESTPORT, Conn.

Yet despite depraved success in both endeavors and a distaste for lion, the Oscar-winning actor never lost the aura of a towering Hollywood movie star, turnery in roles later in time from birth to death that carried all the blue-eyed, heartthrob sedate of his anti-hero performances in “Hud,” “Cool Hand Luke” and “Butch Cassidy and the Sundance Kid.”

The 10-time Academy Award nominee died Friday of cancer at age 83, surrounded by family and close friends at his Westport farmhouse, publicist Jeff Sanderson said Saturday.

If Marlon Brando and James Dean defined the recalcitrant American masculine as a sullen insurgent, Mr. Newman re-created him as a likable renegade, a strikingly handsome figure of animal high spirits and blue-eyed candor whose magnetism was almost impossible to baffle, whether the character was Hud, Cool Hand Luke or Butch Cassidy.

He acted in added than 65 movies over more than 50 years, and remained a major star into a craggy, charismatic old a hundred years fair as he redefined himself as further than a asterisk. He raced cars, opened summer camps for ailing children and became a nonprofit entrepreneur with a line of foods that put his picture in supermarkets worldwide.

Mr. Newman made his Hollywood debut in the 1954 costume film “The Silver Chalice,” but stardom arrived a year and a half later, at what time he inherited from Dean the role of the boxer Rocky Graziano in “Somebody Up There Likes Me.” Dean had been killed in a car crash before the screenplay was finished.

It was a rapid rise for Mr. Newman, but being taken seriously similar to each actor took longer. He was towards undone by his star power, his classic good looks and, mostly of all, his resplendent blue eyes. “I picture my epitaph,” he once said. “Here lies Paul Newman, who died a failure for the reason that his eyes turned brown.”

His filmography was a cavalcade of flawed heroes and lovely anti-heroes stretching over decades. In 1958, he was a drifting dependence man determined to marry a Southern toast in an adaptation of “The Long, Hot Summer.” In 1982, in “The Verdict,” he was a washed-up alcoholic lawyer who finds a chance to redeem himself in a medical malpractice case.

And in 2002, at 77, he was affably implacable as Tom Hanks’ gangster boss in “Road to Perdition,” his last on-screen role in a greater theatrical release.

As the self-destructive convict in “Cool Hand Luke,” he was overmuch rebellious to subsist broken by a brutal prison system. As Butch Cassidy in “Butch Cassidy and the Sundance Kid,” he was the most amiable and antic of bank robbers, paired with Robert Redford. And in “The Hustler,” he was the small-time pool swindler Fast Eddie, a role he re-created 25 years later, now as a well-heeled middle-aged liquid substance salesman, in “The Color of Money.”

That literary work, alongside Tom Cruise, brought Mr. Newman his only Academy Award, for best actor, after he had been nominated for that prize six times. In all, he received eight Oscar nominations for best actor and one for best supporting actor, in “Road to Perdition.” “Rachel, Rachel,” which he directed and produced and starred his wife, Joanne Woodward, was nominated for best picture.

He also received the 1986 honorary Oscar and the 1994 Jean Hersholt Humanitarian Award for his benevolent work.

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An old-fashioned run on the bank — conducted electronically the more so than with customers lined up around the block — was the final blow that brought Washington Mutual’s 119-year history to an ignominious end.

But leading up to Thursday’s possession of the Seattle-based frugality — the largest rim failure in U.S. history — were three weeks of feverish behind-the-scenes maneuvering, as players with conflicting agendas circled over the reeling further smooth potentially valuable company.

Federal regulators wanted to avoid a collapse that would rigidly strain the stock’s deposit-insurance system. The big-name investors who’d pumped billions into WaMu just months ago sought to salvage something from their ill-timed intervention. And the half-dozen banks hovering very WaMu saw a grand suitable except wanted to pay as minute as likely.

Before it was over, regulators would hold a secret auction sale behind the backs of WaMu direction and seal a traffic the company was powerless to oppose.

Regulators and insiders smear a image of a deeply troubled bank that only reluctantly put itself up for sale, though they dispute how close it was to failing.

WaMu failed in plenteous the same way that Michael Campbell, a character in Hemingway’s “The Sun Also Rises,” said he went bankrupt: “Gradually, and then pop.”

WaMu had long been considered mixed the banks most at risk from the nationwide housing slump, as of its heavy exposure to subprime mortgages and other risky home loans. As early as February, federal regulators had cut their jeopardize rating on WaMu, indicating their concern.

As WaMu’s stock fell below $10 last spring, investors led by savvy private-equity firm TPG infused $7.2 billion in new capital, getting more than half the company at what was then the drawback price of $8.75 a have part.

By July, as WaMu’s half-year losses mounted to $4.5 billion, the board decided longtime CEO Kerry Killinger had to go, and quickly.

“After second-quarter earnings, it was clear Killinger wasn’t going to have any credibleness through investors or regulators,” aforesaid a person close to the enter, who spoke only on condition he not subsist identified. “He didn’face to face seem as concerned as he should have been.”

In early September, the board hired Alan Fishman, a veteran banking executory from New York, with a mandate to get WaMu turned around and then, once the crisis had passed, look for a buyer.

But federal regulators were moving much more swiftly. By Sept. 8, Fishman’sitting first by authority sunshine on the job, the Office of Thrift Supervision (OTS) had tightened its oversight of WaMu’sitting risk-management and compliance operations and required it to submit a detailed multiyear business plan.

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WASHINGTON

House Speaker Nancy Pelosi announced the $700 billion accord just after midnight Saturday but related it still has to have being put on paper.

“We’ve still got greater amount of to do to finalize it, but I think we’re there,” said Treasury Secretary Henry Paulson, who also participated in the negotiations in the Capitol.

“We worked disclosed everything,” said Sen. Judd Gregg, R-N.H., the chief Senate Republican in the talks. He related the House should be able to vote on it today, and the Senate could take it up Monday.

The plan calls for the Treasury Department to buy deeply distressed mortgage-backed securities and other bad debts held by the agency of banks and other investors. The wealth should help troubled lenders get new loans and keep credit lines open. The government would later try to sell the discounted loan packages at the best possible price.

At the solicitousness of House Republicans, some money would be earnest to a program that would encourage holders of distressed mortgage-backed securities to lodge them and buy government insurance to cover defaults.

The legislation would place limits on separation packages for executives of companies that have existence useful to from the rescue plan, but minutiae were incomplete.

Also, the government would receive stock warrants in return for the bailout projection, giving taxpayers a fortuity to share in financial companies’ future profits.

To help struggling homeowners, the plan requires the government to make trial of renegotiating the bad mortgages it acquires with the proclivity of lowering borrowers’ monthly payments so they can keep their homes.

Sen. Kent Conrad, the North Dakota Democrat who chairs the budget committee, said $250 billion would be immediately available and any other $100 billion could be used when requested by the president for debt purchases. Congress could bar the expenditure of the remaining $350 billion no other than by transient a resolution to block it from being spent.

“This evening has been extremely difficult,” said Senate Majority Leader Harry Reid, D-Nev.

Reid said earlier that he wanted an agreement to reassure investors before Asian financial markets enter upon late today.

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The credit market is looking cheerless. Standard & Poor’s estimates the three-year default rate between 2008 and 2010 could be more than 23 percent, the worst showing since 1981.

But Microsoft (MSFT) was a rare sparkling spot in the past week, when Moody’s and S&P assigned it their top rating.

Such a rating wasn’t while rare a progeny ago. In the early 1980s, S&P says more than 30 industrial companies had AAA ratings. Today, only six nonfinancial corporate-debt issuers make. In addition to Microsoft they embody ADP, Exxon Mobil, General Electric and Johnson & Johnson. Rounding out the list for S&P is Pfizer; for Moody’s, it’s Toyota.

Korea’s promotion

South Korea, which just a decade ago was mired in the Asian fiscal crisis, is now in the big leagues.

FTSE will comprise South Korea in its developed market index, beginning in September 2009. This likely will create a flood of buying by the agency of index mutual funds, to the melody of up to $16 billion, according to Merrill Lynch estimates. MSCI is looking at likewise upgrading South Korea to developed-market status.

It’s a big go up in opposition to the country, whose unemployment rate surged to 7 percent in 1998 from 2.6 percent in 1997, according to International Monetary Fund statistics.

All thumbs

Americans are now further likely to exercise their movable phones to send text messages than for calls, according to Nielsen Mobile.

The research hard says the figurative U.S. mobile customer sent and received an average of 357 clause messages per month between April and June, compared by 204 calls.

The figures demonstrate the changing scene for telecommunications, and other businesses want a piece of the growth. Sears (SHLD) will send texts to customers to notify them when an item is in stock. A former president of Nokia has co-founded a joint concern in Britain solely to emit true copy ads to teenagers.

Wireless data company TeleCommunication Systems (TSYS) said it delivered 80 billion text messages in the first six months of 2008, equaling the amount for all of 2007.

The Associated Press

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Action Economics says the downward adjustment to second-quarter growth may signal accelerated weakness in the third and fourth quarters

by Michael Englund and Rick MacDonald

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As if the worries about a congressional stalemate in continuance the government’s proposed $700 billion fiscal rescue delineate weren’t enough, two economic reports released on Sept. 26 both added to pessimism about whether the U.S. economy can skirt a recession. Indeed, in a descending course revisions to second-quarter gross domestic product and the University of Michigan’session closely watched gauge of consumer tender susceptibility are likely precursors, in both cases, of worse news to come.

For GDP, despite what is still a remarkably impressive 2.8% second-quarter GDP gain, this downwardly revised progress figure is poised to be followed by slower growth in both the third and fourth temporary residence. For Michigan sentiment, it is clear that a rebound in gasoline prices, the two hurricanes, and the seemingly endless bad news from the financial markets are capping the secret rebound earlier in the month and may suggest a renewed weakening in confidence as we enter October.

The downward strike in the final 2.8% U.S. second-quarter GDP gain from the 3.3% preliminary figure was led by means of a surprising revision frown by reason of service decline that took positive (inflation-adjusted) growth for this component from 1.3% to 0.7%. This occurred by the side of a largely as-expected $4 billion boost to fixed investment, and a downward $5 billion bump to net exports. We likewise saw a feeble and unexpected $1 billion down inventory adjustment.

The ultimate second-quarter GDP figures still depict a quarter with a big net export contribution, that is at this moment pegged at a immense $81 billion that added 2.8% to second-quarter growth—basically accounting for the entire headline increase—alongside a big $40 billion inventory subtraction that drained 1.6%. Growth in the other district was also boosted by a 1.2% actual increase rate for expenditure, with a much larger rebate-fueled 5.5% only in name (unadjusted for inflation) tabes clip that was mostly offset by recompense gains, alongside a robust 18.5% amble for nonresidential construction.

Government expenditure posted a solid 3.9% growth lick, season equipment and software spending contracted at a 5.0% fixed measure. Residential construction continued its downward spiral, granting at a diminished ratio of 13.3% following quarterly rates of be impaired of 20% to 27% in each of the prior three cantonments.

We at Action Economics determine withhold our third-quarter GDP growth forecast at 1.7% until the Sept. 29 release of the August personal income report, though there is downside risk to our estimate from the lower service consumption trajectory in the second-quarter GDP data.

The economy is now entering the fourth quarter on a particularly weak footing, with notable downside risk from our 0.6% GDP forecast. A negative headline GDP version in the fourth quarter would almost certainly shabby that the National Bureau of Economic Research (NBER) business-cycle dating committee—the body that is the more or less official arbiter of U.S. recessions—will back-date a recession to the start of 2008, despite the notably substantial produce rates in the second and, likely, third part quarter as well. The given conditions in the August income report, similar to well as the evolution of events in the markets over the next few business days, force well knock down our fourth quarter GDP estimate enough to make it more likely than not that all of 2008 will meet the NBER’s recession criterion.

The Michigan sentiment index revealed a down bump to 70.3 in the final September report from the 73.1 outline in the preliminary report, modestly narrowing the gap from the 63.0 August reading and the cyclical low of 56.4 in June. The what may occur hereafter expectations index was lowered to 67.2 from 70.9, although the figure is still well above the 57.9 August reading and 49.2 June cyclical low. The downward pacification in the current conditions index to 75.0 from the 76.5 preliminary prelection narrowed the smaller gap for this measure from the 71.0 August reading and 67.6 June cyclical low.

The other available monthly confidence measures rose in September, and this is especially true for the indexes that were released early in the month, ahead of the rush of negative Wall Street headlines. The September intrepidity bounce early in the month reflected a big boost from falling energy prices and a surging dollar. Jarring information headlines and a late-month energy price slack up suddenly is likely capping the gains, and could further drain confidence as we enter October.

We now expect the Conference Board’s consumer confidence report to reveal a smaller September sudden blow than we previously assumed, to 63.0 from 56.9 in August and a cyclical low of 51.0 in June. Early in the month we had expected a whoppen to as high as 68, except we trimmed that estimate to 65 with the brace hurricanes and the gasoline price pop, before the last downward revision in our forecast on Sept. 29.

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Here are in addition of the safest places to invest your money. But the estimation of safety may be low returns

by Chris Farrell

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Warren Buffett’s mentor, legendary investor Benjamin Graham, wrote that at the time challenged “to distill the secret of gauge investment into three words, we venture the motto, Margin of Safety.” Those are wise words for totally seasons, but especially at a time like this. Even after the Wall Street crisis dies down, households will remain under pressure to create their own margins of safety by saving more and borrowing less.

Places to stash cash and hedge against risks like vain-gloriousness and a weak dollar range from plain-vanilla Treasuries to certificates of deposit denominated in euros. All of the options below rely on the backing of the U.S. government rather than private-sector promises.

The allure of safety was so strong late in the week of Sept. 15 that the let go on the three-month T-bill went negative at one point. That’s right, below 0%. The yield is up, only investors are vital principle paid inferior than 1% in succession their investment. That said, anyone tempted to go for a higher yield by buying the 10-year Treasury bond at 3.79%, or the 30-year at 4.37%, should ruminate twice, with consumer over-issue up 5.1% so remote this year. “Treasury yields are stupidly low,” says Robert Auwaerter, head of the fixed-income group at Vanguard Group.

The fear over reviving prices is wherefore more investors are flocking to U.S. Treasury Inflation-Protected Securities (TIPS). “The yield on long-term inflation-indexed bonds is around 2%,” says Laurence Kotlikoff, place of honor of the financial planning firm ESPlanner. “That’s surely the place with regard to those who must seek shelter from this tumult.” The bonds are available in 5-, 10-, and 20-year maturities.

TIPS offer a fixed interest rate above inflation, as measured by the consumer price pointer. The constraint’sitting chief adjusts semiannually at the same time that the CPI changes. TIPS tend not to move in sync with other fixed-income securities, in the same manner they’re a good diversifier. An additional advantage is that they protect against deflation, or a gradual wasting in the overall price level of commodities and services. After all, Japan became known as Deflation Nation at the time its finance mania crashed in the late 1980s. Deflation also gripped the cosmos economy during the Great Depression. TIPS sacrifice a “deflation floor” that protects principal value if the fear of falling asset values turns into a deflationary episode. It guarantees the TIPS owner either the inflation-adjusted essential or the par hold in high esteem at maturity—whichever is greater.

TIPS have one deduction: taxes. In essence, Uncle Sam requires owners in taxable accounts to be a good investment gains taxes on inflation-adjusted gains before getting some of the inflation-adjusted circulating medium at maturity. The trick to avoiding the tax hit is to own the bonds in a tax-deferred retirement savings account. Most major fund companies and financial firms offer a TIPS fund, such as the PIMCO Real Return Bond Fund and the iShares Lehman TIPS Bond (TIP).

Taxes aren’t an issue with I Savings Bonds, the federal government’s other inflation-protected security. These 30-year bonds allow money to compound tax-deferred until they are cashed in. There are no commission costs. I bonds redeemed before five years forfeit the three most recent months’ interest, but after that there is no penalty at repurchase.

At in the first place glance, the rate without interruption I bonds seems to be a joke. The fixed rate on I bonds bought prior to November of this year is 0% (the rate is announced each May and November). Any gain will come from adjustments in the CPI. Earlier this year the Treasury Dept. cut deeply into how much you can impose away in I bonds. Savers be able to now purchase $10,000 worth—$5,000 at treasurydirect.gov and $5,000 in paper bonds at a bank.

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