U.S. economic worries derailing McCain's 'Straight Talk Express' campaign

WASHINGTON — John McCain's once-buoyant campaign appears to have stalled now that Americans have big worries about the shaky U.S. economy.

On almost every front, it's been a bad few days for the Republican presidential nominee, whose heady boost in the polls after his surprise pick of Alaska Gov. Sarah Palin as his running mate appears to be levelling off.

McCain was believed to have enjoyed a five-point lead over Democratic rival Barack Obama just a few days ago. Now, some polls are suggesting Obama may be back in the lead. A Gallup survey released Wednesday has Obama at 47-45 over McCain.

McCain's image troubles grew worse Wednesday over remarks he made over a federal bailout for insurance giant American International Group.

The Federal Reserve pumped $85 billion into AIG just a day after McCain said he was opposed to such a costly helping hand.

"I didn't want to do that," a tense-looking McCain told ABC News on Wednesday, saying the government was forced into the bailout. "And I don't think anybody I know wanted to do that."

"But there are literally millions of people whose retirement, whose investment, whose insurance were at risk here. They were going to have their lives destroyed because of the greed and excess and corruption."

His campaign couldn't offer any examples of corruption at AIG.

Just a day earlier, McCain was adamant that no federal help should be forthcoming for AIG, noting that the Fed had refused to bail out Lehman Brothers, the 158-year-old financial institution that sought bankruptcy protection Monday.

"No, I do not believe that the American taxpayer should be on the hook for AIG, and I'm glad that Secretary (Henry) Paulson has apparently taken the same line," McCain had said in an interview with NBC.

"They're on their own. We cannot have the taxpayers bail out AIG or anybody else. This is something that we're going to have to work through."

McCain, who's been selling himself as a straight-talking maverick on the campaign trail, is on the hot seat on another economic front - his sudden insistence that the financial industry is in desperate need of regulation.

The Arizona senator's new stance comes after voting consistently for years against regulation, just like the vast majority of his Republican colleagues.

"McCain has developed a reputation over the years as someone who was very disinclined to want to regulate, and in that sense he was not a maverick at all but in fact a very mainstream Republican," Paul Beck, political science professor at Ohio State University, said Wednesday.

"And now he's caught in a situation were there was insufficient regulation and the economy is in trouble. It puts him in a very bad position because there's a real credibility problem here."

"For someone who's really tried to be a straight talker, he's scrambling and the positions he's taken in the past are coming back to haunt him."

McCain has been roundly attacked not just for his flip-flops on economic issues but for statements branded as misleading - on issues such as Obama's tax proposals, his aim to teach young children about avoiding sexual predators, and Palin's handling of public finances in Alaska.

Even Republican mastermind Karl Rove had a gentle rebuke for the McCain campaign, telling Fox News it "has gone one step too far, attributing to Obama things that are, you know, beyond the 100 per cent truth test."

He said the Obama campaign, however, was doing the same thing.

The McCain campaign seems to realize the economy is on everyone's mind.

In two new television ads released Wednesday, McCain asserted that he is the right leader to keep Americans' savings safe.

"I'll meet this financial crisis head on," he says in one ad. "Reform Wall Street. New rules for fairness and honesty. I won't tolerate a system that puts you and your family at risk. Your savings, your jobs - I'll keep them safe."

But Beck says that as long as the economy continues to falter, Obama has the upper hand. Beck predicts that public opinion polls will soon show another dramatic turnaround in a march to the White House that has become a horse race.

"The polls were most certainly be affected - it's already starting to happen," Beck said.

"We are through the Palin surge period and things are going to settle down a bit. She will still draw strong support from the Republican base, and she's been very successful on that front, but swing voters are beginning to have second thoughts about Palin."

"The bloom is off the rose, and McCain will have to deal with that reality now and the fallout from events that he cannot control - like economic bad news."

Pennsylvania Treasurer Comments on Current Economic Climate

HARRISBURG, Pa., Sept 17, 2008 /PRNewswire-USNewswire via COMTEX/ -- Pennsylvania Treasurer Robin L. Wiessmann today issued the following open letter to Pennsylvanians:

Fellow Pennsylvanians,

Since late last summer, our nation has experienced considerable economic volatility and market turbulence, which continues to plague our economy. In this challenging economic climate, the Pennsylvania Treasury Department has been working tirelessly to protect and safeguard the Commonwealth's assets.

The latest in a recent string of upheavals on Wall Street came this past weekend, when our nation's financial system was shaken to its core by the news of Lehman Brothers' bankruptcy and the sale of Merrill Lynch.

While these actions were alarming due to their substantial impact on the structure of America's overall financial system, I am pleased to report that Treasury's investment professionals were well prepared to weather this latest storm. Proactive steps were taken over the last six months to minimize exposure to Lehman Brothers holdings. At close of market on Friday, September 12, 2008, Lehman Brothers holdings accounted for 0.05% of Treasury's approximately $18.7 billion in investments under management. Treasury has no Merrill Lynch and no AIG holdings in its portfolio.

Since my first day in office, it has been my goal as Pennsylvania Treasurer to provide effective stewardship of the Commonwealth's funds and investments through calm economic times as well as the rough seas we have been experiencing since last summer. That is why I made financial asset management a cornerstone of my agenda as your Treasurer.

Earlier this summer, I instructed Treasury staff to conduct a comprehensive investment and cash flow study, which resulted in the reallocation of $3.4 billion of the Treasury investment portfolio to ensure the liquidity and safety of the Commonwealth's funds, in addition to enhanced returns. My actions were guided by Treasury's stringent liquidity requirements because Treasury, as distinguished from the pension funds, is primarily a cash operation - we must be able to pay the Commonwealth's bills, especially as the economy continues to tighten.

In addition to securing and fortifying the Commonwealth's assets, we've been reviewing our Department budget in anticipation of the continuous weakening of the economy. We remain mindful of our own operations and will adjust our budget as necessary in this difficult fiscal environment.

We will continue to take precautions against any potential threats in the marketplace by maintaining our thorough portfolio reviews and remaining vigilant against future market threats.

Having worked on Wall Street for many years, I know first-hand that there is no way to know for certain where the markets are headed, but I am confident that we are conducting the necessary investment research and market analysis to safeguard the assets of Pennsylvania stakeholders.

SOURCE Pennsylvania Treasury Department

Dow Chemical Company Chairman & CEO to Address the Detroit Economic Club on a (New) Industrial Policy for the U.S.

DETROIT, Sept 17, 2008 /PRNewswire via COMTEX/ -- The Detroit Economic Club (DEC) is pleased to host Andrew Liveris, Chief Executive Officer & CEO of The Dow Chemical Company on Monday, September 22, 2008. The speech will begin at 12:30 p.m. and will be held at Cobo Center in Detroit, MI.

Mr. Liveris will discuss why the United States must construct a comprehensive industrial policy to restore vigor and strength to the American economy. He will outline the necessity to balance the needs for energy, the environment and manufacturing as the foundation to keep the US competitive in a world that is increasingly global, sophisticated and interdependent.

The Detroit Economic Club will also honor William Clay Ford, Jr. for his leadership as Chairman of the DEC from July 2005 through August 2008. The DEC will also welcome G. Richard Wagoner, Jr. (in absentia) as it's newly elected Chairman.

The meeting will conclude with a major announcement from the Detroit Economic Club.

The Detroit Economic Club was formed in 1934 as a platform for the discussion and debate of important business, government and social issues. It is known internationally as a top speaking forum for prominent business and government leaders, who address members and their guests at the Club's 35 meetings a season. With more than 3,000 members, the DEC is about vital issues, prominent voices, a commitment to education and inspiring leadership. The DEC is proud to have hosted every sitting U.S. President since Richard Nixon and proud to be ranked among the top speaking platforms in the world. Admission: $40 for DEC members, $50 for guests of members and $75 for nonmembers. Register at www.econclub.org.

SOURCE Detroit Economic Club

Economic Activity Shifts Campaigns' Focus to Wall Street

Calling Monday's economic climate the most serious financial crisis since the Great Depression, Democratic presidential nominee Sen. Barack Obama attacked Sen. John McCain, R-Ariz., for supporting what Obama called a failing economic philosophy.

On Sunday, the federal government declined to bail out Wall Street investment bank Lehman Brothers, another financial institution choked by the credit crisis. The ailing firm filed for bankruptcy this morning. Another Wall Street giant, Merrill Lynch & Co, narrowly avoided suffering the same fate by offering itself to Bank of America for sale.

While addressing a crowd in his first solo rally since adding Alaska Gov. Sarah Palin to the ticket, McCain acknowledged problems caused by the nation's economic state, but claimed the economy's "fundamentals" were sound.

"There's been tremendous turmoil in our financial markets in Wall Street and it is, people are frightened by these events," he said.

"Our economy, I think, still, the fundamentals of our economy are strong, but these are very, very difficult times and I promise you we will never put America in this position again," McCain continued, in an attempt to reassure the crowd.

During a campaign event in Grand Junction, Colo., Monday afternoon, Obama said that the news about Merrill Lynch and Lehman Brothers "offers more evidence that too many folks in Washington and on Wall Street weren't minding the store."

Obama said news of the Wall Street failures reminded him of the savings and loan crisis of the 1990s, when several of those financial institutions failed and thousands of businesses and families were financially ruined in the process. Obama told voters that, if they are comfortable with the current state of the U.S. economy, they would appreciate the position of his political rival, McCain.

"I certainly don't fault Sen. John McCain for these problems," the Illinois senator said.

"But I do fault the economic philosophy he subscribes to, because it's the same philosophy we've had for the last eight years," he added.

Obama accused McCain of having a hands-off approach to the financial crisis and maintaining a philosophy that says, "Even common sense regulations are unnecessary and unwise; one that says we should just stick our heads in the sand and ignore economic problems until they spiral into crisis."

(ABC News)

Obama then seized upon remarks McCain made in Jacksonville, Fla., that same morning, to paint his opponent as out of touch. The Republican presidential nominee admitted the difficulty caused by the nation's economic state, but claimed the economy's "fundamentals" were sound.

"Sen. McCain -- what economy are you talking about?" Obama asked the audience.

"What's more fundamental than the ability to find a job that pays the bills and can raise a family?" Obama asked, his voice rising.

"What's more fundamental than knowing that your life savings is secure, and that you can retire with dignity? What's more fundamental than knowing that you'll have a roof over your head at the end of the day?"

Running Mates Weigh In

At a "Road to Victory" rally, Republican running mate Palin delivered her standard stump speech, but also acknowledged the recent news from Wall Street.

"This is an issue of real concern," Palin told the large crowd gathered in Golden, Colo.

But, she then pointed out, "I'm glad to see the Federal Reserve has said no to using taxpayer money for a bailout."

The self-professed "Hockey Mom" also discussed her family's small business experience, saying that she had, too, experienced the stresses of the current economy.

"My family has faced the same challenges that many of you have and many across America today," she said.

"We've all built small businesses and worked hard to earn a living. We know the struggles out there," she continued.

In Michigan, Obama's running mate Sen. Joe Biden, D-Del., took the opportunity to pounce on McCain, as well.

"Ladies and gentlemen, ladies and gentlemen, I could walk from here to Lansing, and I wouldn't run into a single person who thought our economy was doing well, unless I ran into John McCain," he said.

"John McCain just doesn't seem to understand what middle-class people are going through today," Biden asserted.

At a later rally in Orlando, McCain tried to amend his earlier statement, which Obama has been mocking for months.

"Those fundamentals are being threatened today because of greed and corruption that some indulged in on Wall Street," he said. McCain has been making similar arguments about the economy for months, earlier this summer telling radio host Laura Ingraham, "I still believe the fundamentals of our economy are strong. We've got terribly big challenges now, whether it be housing or employment or so many of the other -- health care. It's very, very tough times. It's very tough. But we're still the most innovative, the most productive, the greatest exporter, the greatest importer. Every new advancement, literally, in technology that has created this new economy throughout the world, has come from the United States economy. Do we have a lot of things to fix, do we have big challenges? Yes. But I also believe America's best days are ahead of us."

www.abcnews.go.com

Bank of America Chief Saw Merrill Purchase as a Rare Opportunity

Last Friday, Kenneth D. Lewis, chief executive of the Bank of America Corporation, was in his headquarters in Charlotte, N.C., pondering a possible acquisition of Lehman Brothers, the foundering investment bank.

By the next morning, Mr. Lewis already had a new target in his sights: Merrill Lynch. John A. Thain, Merrill’s chief executive, phoned Mr. Lewis about a deal and by Saturday afternoon the two men were encamped in a Bank of America apartment in the Time Warner Center overlooking Central Park.

Mr. Lewis, who walked away from a Lehman acquisition because the government would not safeguard buyers from possible losses, said in an interview that he and Mr. Thain had decided in just an hour to move forward with the $50 billion deal.

“We wanted to get the deal done by Monday,” Mr. Lewis said. “We were very focused about getting the deal done.”

On Monday, investors responded unenthusiastically to the hurried merger, which gives Bank of America a footprint in almost every facet of the banking business and vaults it into the upper tier of the nation’s financial institutions.

The bank’s shares dropped 21.3 percent on the news, although the market as a whole was also down sharply. Shares of Merrill, a sprawling brokerage and investment banking firm, were largely unchanged at $17.06, well below Bank of America’s offering price — initially valued at about $29 a share but now worth less than $23 a share because of Monday’s decline in Bank of America’s stock price.

Mr. Lewis had been eyeing Merrill for months, and while the transaction bears hallmarks of some of his previous deals — patience, daring and transformative — some analysts said that it shared similarities with the shotgun marriage Bank of America consummated with the Countrywide Financial Corporation this year.

It also smacks of the pell-mell merger that regulators helped arrange this year between another troubled company, Bear Stearns, and a large acquirer, JPMorgan Chase & Company.

“This deal is equally as important as the Bear Stearns deal,” said Nancy A. Bush, a banking analyst. “I certainly think the regulators are happy this deal got done.”

Mr. Lewis said regulators had not pushed him to acquire Merrill. He said the reason he had moved forward so quickly — and offered to pay a premium for a company with potentially toxic assets sagging under financial stress — was that he had not wanted to risk another buyer swooping in ahead of him.

Two other firms, Morgan Stanley and HSBC Holdings, were also in talks with Merrill, according to people briefed on the situation who requested anonymity because the negotiations were confidential. Morgan Stanley declined to comment. HSBC did not return calls seeking comment.

Still, bank advisers briefed on Federal Reserve talks last weekend said that there had been a real fear that Merrill would not survive unless someone rescued it.

In that regard, Mr. Lewis, ever the opportunist, saw an opening and seized it. The Merrill takeover allows him to complete his goal of transforming what was once a backwater North Carolina bank into a market leader.

It also tilts the center of American banking toward Charlotte, the home of both Bank of America and the Wachovia Corporation, its deeply troubled rival.

Overnight, the deal will make Bank of America the county’s largest player in wealth management. It already runs the biggest branch banking network and it is the biggest issuer of small business, home equity and credit card loans. The Countrywide deal made it the nation’s biggest mortgage lender, too.

“Bigger is better and biggest is best,” in Mr. Lewis’s worldview, Ms. Bush said.

Even so, the Merrill deal is laced with some contradictions. Only a year ago, Bank of America appeared to have given up on investment banking after suffering extensive losses in a business in which it had little experience.

Mr. Lewis had spent more than $625 million to expand into investment banking, only to see all of its trading businesses soaked in red ink. A few months ago he said at a conference that he would not spend “petty cash” for an investment bank.

Apparently, Mr. Lewis was willing to forgo those misgivings because he saw a Merrill takeover as a once-in-a-lifetime opportunity after years of a frustration trying to build an investment bank from scratch.

The deal would vastly expand Bank of America’s reach into equities and emerging markets. It strengthens its roster of top investment banking executives. And it gives the bank Merrill’s brand and its “Thundering Herd” of 16,000 brokers to help push its credit cards and loans.

“This was almost a perfect fit, and we thought it was close enough to the bottom that we could make the deal work and be very good for our shareholders,” Mr. Lewis said. “I don’t think it will come out of the doldrums in the next week or so, but as soon as the market gets its legs again, you will see a higher value.”

The stock market is more hesitant, concerned that Mr. Lewis may have moved so quickly that he could eventually find himself exposed to more troubled Merrill assets than he bargained for — in addition to the risky mortgage portfolio he inherited from Countrywide.

Mr. Lewis said he was confident that the deal was the right move, but conceded possible hurdles in the near term.

“Even people who acknowledge it is a good strategic decision think it is a rocky road ahead of us,” he said.

Mr. Lewis has more than decade of experience engineering big deals. Alongside his mentor and predecessor, Hugh McColl, he helped transform NationsBank, a small regional lender, into a consumer powerhouse with bicoastal branches before it snapped up Bank of America and took on its name.

In 2003, it bought FleetBoston Financial, greatly expanding his network of branches on the East Coast. He also has picked off MBNA, the credit card issuer, and U.S. Trust, the private bank, in the last few years.

Some analysts, however, think that Mr. Lewis may be taking on more than he can handle. Besides Merrill Lynch, Bank of America is still digesting the Countrywide merger and a smaller takeover of LaSalle Bank in Chicago.

Each institution is in a different type of business, financial position and geographic market, and will test Bank of America’s agility and Mr. Lewis’s managerial talents.

Mr. Lewis said that he was up to the task and that his mentor blessed the Merrill takeover. When he returned to Charlotte Monday afternoon, he said he discovered a laudatory note from Mr. McColl.

Typhoons weaken central bank’s hopes on inflation

MANILA, Philippines—Inflation in September as measured by the increase in the consumer price index may reach 12.6-12.7 percent and exceed the 17-year-high 12.5 percent in August, the central bank said Thursday, citing adverse effects of recent typhoons.

“Without the typhoons, inflation could have peaked in August, but because of the typhoons, that will really send prices higher, particularly of food,” Deputy Governor Diwa Guinigundo of the central bank, Bangko Sentral ng Pilipinas (BSP), said at a news briefing.

Guinigundo said the inflation rate would not reach 13 percent.

“There are other areas like Mindanao that were not affected by the typhoon,” he said. “Rice [prices] continues to go down. NFA [National Food Authority] continues to receive shipments of imported rice, bombarding key distribution outlets with more rice.”

“So it may rise to 12.6 percent or 12.7 percent [in September] and then decline afterward,” he said. “It won’t reach 13 percent. It’s losing steam.”

Investment bank DBS expects Philippine inflation to peak at 13 percent in October because of the lingering effects of the spike in oil and food prices in previous months.

“As has been the case globally, food and fuel prices are the only two things that have really mattered in the run-up in inflation, and indications now are that these trends are at least stabilizing, if not reversing,” DBS said in its latest assessment of the Philippine economy.

Global food and oil prices are easing but these will be felt only in November, it said.

The BSP expects to get a better picture of inflation when its policymaking Monetary Board meets on Oct. 9, Guinigundo said.

He said the policymakers would continue to keep an eye out for global oil prices even if recent trends were favorable.

The Philippines has an oil inventory enough for 70 days on average, Guinigundo said. That would be until November.

Guinigundo added that the high season for money remittances from overseas Filipino workers would begin in November and give the country enough foreign exchange to buffer global oil price volatility.

Analysts expect the central bank to raise its benchmark interest rates further, by as much as half a percentage point this year to fight high inflation despite a sluggish first-semester economic growth.

RPT-WRAPUP 1-Indian inflation eases again, c.bank to stay firm

By Rajkumar Ray and Surojit Gupta

NEW DELHI, Sept 11 (Reuters) - Indian inflation eased for the third week running at the end of August and a top policy adviser said it may have peaked, but analysts said pressures remained and the central bank could still tighten policy again.

The wholesale price index , India's most widely watched price measure, rose 12.10 percent in the 12 months to Aug. 30, below the previous week's 12.34 percent rise but above a median forecast of 11.96 percent in a Reuters poll.

"This is the third observation which has given us a more comfortable number, but it's too premature to say that inflation has peaked," Rupa Rege Nitsure, chief economist at Bank of Baroda, said after the data on Thursday.

"In the (Oct-Dec) quarter the risks to the inflation scenario remain from foodgrain prices, prices of pulses, sugar, edible oil and cotton. Inflation will peak around 13.5 to 14 percent in the quarter and the central bank will continue with its tightening mode, especially the cash reserve ratio."

Other analysts said while the inflation rate would remain high, signs of easing price pressures meant the central bank did not need to raise interest rates further. The bank has used both liquidity measures and rates to manage demand.

In early August, the inflation rate was 12.63 percent, the highest reading since annual numbers in the current data series became available in April 1995.

Ahead of the data, the chairman of the prime minister's Economic Advisory Council, Suresh Tendulkar, told Reuters the inflation rate may have peaked and the central bank may pause in its rate tightenining.

"My gut feeling is that it has peaked," Tendulkar said in a telephone interview [ID:nDEL341970].

A Reuters poll before the data showed economists had scaled down expectations of further interest rate increases in 2008/09 as recent policy steps and falling oil prices are seen calming double-digit inflation. See [ID:nSP310570].

Slowing growth would also be a concern for the central bank, they said. The Reserve Bank of India lifted its main lending rate in both June and July to tame inflation, and it now stands at a seven-year high of nine percent.

Financial markets closed before the data was released. The 10-year benchmark bond yield ended at a three-month closing low of 8.28 percent on market talk inflation would be lower than expected.

The rupee fell 1 percent to 45.56/57 per dollar, close to the day's two-year low of 45.58, and the benchmark 30-share index fell 2.3 percent to 14,324.29.

New central bank governor Duvvuri Subbarao said on Tuesday inflation was showing signs of moderating but it was too early to conclude whether this was a trend, signalling he would wait and see before taking any fresh steps. [ID:nDEL306897]

The central bank aims to cut inflation to 7 percent by the end of the fiscal year in March.

The government has said the inflation rate would hit 13 percent this year, before moderating to 8.0-9.0 percent by the end of March. (Additional reporting by Saikat Chatterjee, Swati Bhat and India Treasury team) (Editing by John Mair)

India is as difficult as ever

The drop in India’s ranking by two places to 122 in the latest edition of World Bank’s Doing Business report after rising 12 notches last year does not mean India has become inhospitable for businesses over the past year. In the converse, other developing nations such as former CIS member Azerbaijan and a few African nations have reformed faster than the others.

While Azerbaijan was the top reformer between June 2007 and July 2008, India had only one reform to its credit — easier foreign trade. As the impact of Azerbaijan’s reforms programme illustrate, easing regulations yields results, sometimes very quickly. In Azerbaijan, registration of new businesses rose 40% in the first six months of creating a one-stop shop for start-ups.

The factors responsible for India’s low ranking — inefficient enforcement of contracts, outdated insolvency laws, delays in construction permits and under-developed online payment facilities — clearly cannot be fixed overnight. But a beginning must be made and it would help if bureaucracy shifted emphasis to quickening execution. And this applies for the government machinery, both at the Centre and in states. It is not enough for states to announce tax sops and other incentives to attract investors.

Once applications come, state governments must process them quickly and give all the appropriate clearances and permits quickly to enable the business to start operations. India’s contentious polity, with some regional leaders at odds with industrialisation, is also a cause for delays in projects, as seen in the case of Singur. L N Mittal has said his Orissa steel project could suffer cost escalation of up to 40% because of delay in clearances.

It must also be said the rankings on ease of doing business do not necessarily mean a country is qualitatively better placed to attract investments. Much of the decision to locate a business in a particular country or state would also depend on the country’s political environment and the overall macroeconomic conditions as well as the potential return on investment. For instance, better ranking for Pakistan (77) or Bangladesh (110) does not mean foreign investors would prefer those countries over India. Nonetheless, a report such as this gives a fair idea of how the investing community views the bureaucratic environment of a country.

New AT&T virtual help desk targets small businesses

AT&T Inc. has created a round-the-clock technology help desk targeting small businesses.

The Dallas-based communications giant says for an initial setup cost of $89 and a monthly fee starting at $19 per computer, AT&T Tech Support 360 will provide live, technical service for setup, configuration and troubleshooting for equipment ranging from laptops to routers and BlackBerrys.

AT&T (NYSE: T) tech support professionals will be available via a phone or online and will remotely connect to and access customers’ computers for diagnosis and troubleshooting.

“This innovative service provides customers with a virtual IT director to help them avoid the costs of bringing technicians in-house or wasting time trying to fix problems themselves,” says Roman Pacewicz, senior vice president, AT&T Regional Business Marketing.

The service plans will be sold both as one-time services and as yearly subscription plans.

Argus and TransUnion Launch Credit Dynamics 360(SM) Solution

WHITE PLAINS, N.Y., and CHICAGO, Sept 09, 2008 /PRNewswire via COMTEX/ -- Argus Information and Advisory Services and TransUnion today jointly launched Credit Dynamics 360(SM), the first solution that provides senior financial services executives with a comprehensive and customized view of the U.S. consumer credit landscape. With industry-trended data back through 1999 on 75 depersonalized key credit characteristics, the product allows financial services companies to compare and analyze performance going forward of their customers and their accounts as well as establish benchmarks against the industry overall and their competitors.

"As uncertainties continue in today's economic climate in the U.S. credit industry, the Credit Dynamics 360(SM) solution offered through Argus provides customized data that can help a financial institution better understand and adapt to changes in the economic market," said Steve Sassaman, executive vice president of TransUnion's Financial Services unit. "Financial services executives will be able to quickly pinpoint areas where their business is moving with or shifting against industry trends."

As part of the credit characteristic trend analysis, customers will receive detailed quarterly reports, executive summaries and bi-annual management presentations.

Some of the key areas of comparison Credit Dynamics 360(SM) offers include:

    --  Delinquencies
  --  Geography
  --  Account Originations
  --  Credit Line Management
  --  Outstanding Balance Trends
  --  Market Share

"Partnering with TransUnion allows us to expand both the breadth and depth of data we are providing to our clients," said Len Laufer, chief executive officer of Argus Information and Advisory Services. "There is no other source of credit industry benchmark data that allows companies to better understand how they are performing relative to key compare points."

Credit Dynamics 360(SM) is initially focused on credit card products and the first of several solutions that will be offered through the newly formed partnership of TransUnion and Argus. Start-up activities associated with Credit Dynamics 360(SM) are minimal and more information is available by contacting Lisa Bonalle (lbonalle@argusinformation.com) at 914-307-3140.

About Argus Information and Advisory Services

Argus is an innovative provider of information, scoring solutions and advisory services to financial institutions. Argus information solutions aggregate and validate consumer transaction, behavior and pricing data and provide information to support strategic, risk management and marketing decisions. Argus scoring solutions integrate data across production systems and provide accurate and timely account level profitability information. Our consultants work collaboratively with our clients focusing on customer and profitability management through leading-edge analytics and execution. Argus was founded in 1997 and maintains offices in White Plains, New York and London.

http://www.argusinformation.com

About TransUnion

As a global leader in credit and information management, TransUnion creates advantages for millions of people around the world by gathering, analyzing and delivering information. For businesses, TransUnion helps improve efficiency, manage risk, reduce costs and increase revenue by delivering comprehensive data and advanced analytics and decisioning. For consumers, TransUnion provides the tools, resources and education to help manage their credit health and achieve their financial goals. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Founded in 1968 and headquartered in Chicago, TransUnion employs more than 3,600 employees in more than 25 countries on five continents.

http://www.transunion.com/business

Graphics and/or photographs to accompany this release can be obtained by members of the media by contacting Cliff O'Neal (coneal@transunion.com) at 312-985-2540 or Dave Blumberg (dblumbe@transunion.com) at 312-985-3059.

SOURCE TransUnion

 http://www.transunion.com

TransUnion.com: Mortgage Loan Delinquency Rates Rise for the Sixth Straight Quarter, Up Nearly 9 Percent From the Previous Quarter

CHICAGO, Sept 08, 2008 /PRNewswire via COMTEX/ -- TransUnion.com released today the results of its analysis of trends in the mortgage industry for the second quarter of 2008. The report is part of an ongoing series of quarterly consumer lending sector analyses focusing on credit card, auto loan and mortgage data to be released on TransUnion's Web site.

Statistics

Mortgage loan delinquency (ratio of borrowers 60 or more days past due) increased for the sixth straight quarter, hitting a national average high of 3.53 percent for the second quarter of 2008. Traditionally seen as a precursor to foreclosures, this statistic is up more than nine percent from the previous quarter's 3.23 percent average and up approximately 51 percent from the same period last year.

Mortgage borrower delinquency rates in the second quarter of 2008 were highest in Nevada (6.63 percent) and Florida (6.47 percent) while the lowest mortgage delinquency rates were found in North Dakota (1.10 percent), South Dakota (1.5 percent) and Montana (1.54 percent). On a positive note, six states dropped in mortgage delinquency from the previous quarter: Missouri, Kansas, Nebraska, North Dakota, New Hampshire, and Montana. Nebraska dropped the most by 6.67 percent from 1.65 percent to 1.54 percent.

Average national mortgage debt per mortgage borrower rose slightly (0.4 percent) to $192,681 from the previous quarter's $191,917 total. However, the second quarter 2008 average represents a 3.35 percent increase compared to the second quarter 2007 average of $186,432.

The area with the highest average mortgage debt per borrower was California at $361,988, followed by the District of Columbia at $355,875 and Hawaii at $304,096. The lowest average mortgage debt per mortgage borrower was in West Virginia at $94,765. Quarter to quarter, Montana showed the greatest percent increase in mortgage debt (5.38 percent), followed by Idaho (2.62 percent) and South Dakota (2.38 percent). Areas showing the largest percentage drop in average mortgage debt were Georgia (-1.32 percent), Florida (-1.11 percent), and the District of Columbia (-1.04 percent).

Analysis

The market continues to see the effect of the mortgage crisis across the country as delinquency rates again increased over the previous period. The three areas showing the greatest percentage growth in delinquency from the previous quarter were Wyoming (28.3 percent), Oregon (23.5 percent) and Florida (20.2 percent). A number of states such as Montana, New Hampshire and North Dakota actually experienced a drop in borrower delinquency ratio over the previous quarter: (-6.6 percent, -6.5 percent, and -6.0 percent, respectively).

"The continued increase in the mortgage delinquency rate was not surprising," said Keith Carson, a senior consultant in TransUnion's financial services group. "The second quarter of 2008 showed not only a substantial increase in the nation's unemployment rate and unprecedented gas prices, but also a continued decline in consumer confidence. Furthermore and as we expected, the downward trend for housing prices continued at the national level as supply continues to exceed demand in certain markets."

Forecast

"The national 60-day mortgage delinquency rate among mortgage borrowers is expected to continue to rise throughout 2008 from a value of 3.53 percent in the second quarter of 2008 to just over 4 percent by year end," said Carson. "This is primarily due to the continued economic weakness in certain segments of the country combined with the continuing fallout of the mortgage crisis."

However, TransUnion forecasts that later in 2009 the rise in mortgage delinquency rates will taper off as economic conditions improve and home prices begin to stabilize. As far as state projections go, Nevada (8.7 percent) is anticipated to experience the highest average delinquency rate by the end of 2008, while North Dakota (1.3 percent) is expected to show the lowest level of delinquency.

     (Related Graphs:  http://newsroom.transunion.com/index.php?s=98)
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TransUnion's Trend Data database

The source of the underlying data used for this analysis is TransUnion's Trend Data, a one-of-a-kind database consisting of 27 million anonymous consumer records randomly sampled every quarter from TransUnion's national consumer credit database. Each record contains more than 200 credit variables that illustrate consumer credit usage and performance. Since 1992, TransUnion has been aggregating this information at the county, Metropolitan Statistical Area (MSA), state and national levels.

About TransUnion

As a global leader in credit and information management, TransUnion creates advantages for millions of people around the world by gathering, analyzing and delivering information. For businesses, TransUnion helps improve efficiency, manage risk, reduce costs and increase revenue by delivering comprehensive data and advanced analytics and decisioning. For consumers, TransUnion provides the tools, resources and education to help manage their credit health and achieve their financial goals. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Founded in 1968 and headquartered in Chicago, TransUnion employs more than 3,600 employees in more than 25 countries on five continents.

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Mortgage delinquencies continue to rise in Tampa

Mortgage loan delinquency in Tampa and around Florida continues to rise, a new survey by TransUnion.com shows.

The second quarter showed 6.47 percent of mortgages were at least 60 days past due in Tampa, continuing a trend being felt nationwide. That’s up from 5.38 percent in the first quarter and from 2.49 percent a year ago. The delinquencies represent an average mortgage debt of $197,331, up from $169,682 in the second quarter of 2006.

Statewide, late mortgage payments accounted for 5.58 percent of total loans, representing an average mortgage debt of $173,840, up from 4.93 percent in the first quarter and 2.38 percent a year ago.

Florida had the second highest mortgage delinquency rates in the country just behind Nevada, which is at 6.63 percent.

The average mortgage debt was slightly below that of Tampa’s at $192,681. California, the District of Columbia and Hawaii had the highest average mortgage debt in some sort of delinquency ranging from $361,988 to $304,096. The lowest was found in West Virginia, where the average delinquent debt was $94,765.

Keith Carson, a senior consultant in TransUnion’s financial services group, said the national delinquency rate could hit 4 percent by the end of the year, a number that’s at 3.53 percent now.

However, delinquency rates could start to fall in 2009 as economic conditions improve and home prices begin to stabilize.