Obama says bad decisions caused US economic woes

By MIKE GLOVER

WASHINGTON (AP) — Democratic presidential candidate Barack Obama on Monday blamed "irresponsible decisions" by the Bush administration and Wall Street for the country's economic woes as government officials said the budget deficit would soar to record heights next year.

Turning to domestic problems after a week's tour of the Middle East and Europe, Obama met with more than a dozen economic advisers, appearing with them briefly before retreating for a two-hour closed meeting. The new deficit numbers were the latest sign of an economy in decline, with foreclosures rising, home prices falling, soaring energy prices and nearly a half-million job losses since January.

"It was not an accident or a normal part of the business cycle that led us to this situation," Obama said. "There were some irresponsible decisions that were made on Wall Street and in Washington."

Obama said the economy needs both short- and long-term fixes, including another round of "stimulus" measures from Congress to revive the economy and a longer-term focus on renewable energy to curb high gas prices and on universal health care to trim costs. He said he would move "rapidly and vigorously" to respond.

"We are also going to have to provide some short-term relief," Obama said. "People are hurting right now. We need to respond rapidly and vigorously to problems, and to anticipate the problems that may be on the horizon."

Obama says bad decisions caused US economic woes....

Treasury Acts to Save Mortgage Giants

By STEPHEN LABATON

WASHINGTON — Alarmed by the sharply eroding confidence in the nation’s two largest mortgage finance companies, the Bush administration on Sunday asked Congress to approve a sweeping rescue package that would give officials the power to inject billions of federal dollars into the beleaguered companies through investments and loans.

In a separate announcement, the Federal Reserve said that it would make one of its short-term lending programs available to the two companies, Fannie Mae and Freddie Mac. The Fed said that it had made its decision “to promote the availability of home mortgage credit during a period of stress in financial markets.”

An official said the Fed’s decision to permit the companies to borrow from its so-called discount window was approved at the request of the Treasury, but that it was temporary and would probably end once Congress approved Treasury’s plan. Some officials briefed on the plan said Congress could be asked to extend the total line of credit to the institutions to $300 billion.

Treasury Acts to Save Mortgage Giants....