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The relentless drumbeat of financial headlines relaxed just a tiny bit. The crisis was still Story of the Day as the Treasury Department made its formal announcement that it had partially nationalized several major banks with a $250bn infusion of capital. The nation's money now plays a major role in JP Morgan, Bank of America, Citigroup and Wells Fargo plus the two surviving investment banks--Goldman Sachs and Morgan Stanley--that recently decided to switch and take deposits. Yet only NBC led with the deal. ABC chose the plummeting price of gasoline at the pump, now averaging $3.15/gallon nationwide, down from $4.11 as recently as July. CBS led with Campaign '08 self-promotion, as it published its own national public opinion poll, conducted with The New York Times, that has Barack Obama widening his lead over John McCain.

The Treasury Department's involvement in the banking system is not confined to part ownership. It will also guarantee some business deposits and some interbank loans and will allow businesses to borrow money from the Federal Reserve Board. In return the banks promised to pay the Treasury a 5% dividend on the capital for the next five years. CBS' Anthony Mason observed an "air of resignation" with which President George Bush and Treasury Secretary Henry Paulson "threw out the free market playbook." NBC's Tom Costello called it "the boldest government action in the banking system since the Great Depression." Is the tide turning on the financial crisis? "Many think it is," ABC's Betsy Stark suggested, yet "the economy has taken a pounding and a recession is in the cards."

Gasoline is costing less than in July because "consumers put the brakes on their driving; world economies stumbled; demand fell," explained ABC's Sharyn Alfonsi, trying to put a bright face on terrible times. Some airlines have even started reducing their fuel surcharge to make travel cheaper. Then Alfonsi's cheer closed with this caveat: "Next month OPEC ministers will meet. They could decide to cut production and the would send prices back up."


Andrew Tyndall 10/15/08 11:07:11 pm

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