Today's Headlines

Bloomberg:
- Tumbling prices for natural gas, nickel and corn are turning July into the worst month in 28 years for the Reuters/Jefferies CRB Commodity Index. The CRB Index of 19 commodities has slumped 10 percent since June 30, the biggest decline since a 10.5 percent drop in March 1980. Natural gas plunged 31 percent to lead July's biggest losers. Corn was down 18 percent and nickel sank 16 percent. The dollar's rebound from a record low against the euro eroded the appeal of raw materials as an alternative to stocks and bonds, especially for investors who snapped up commodities earlier this year and sent prices to records. Demand also is easing in China, which expanded at the slowest pace since 2005 in the second quarter, Lehman Brothers Holdings Inc. analyst Edward Morse said in a report on July 23.
- Freddie Mac(FRE), the second-largest U.S. mortgage-finance company, doubled the amount of money it will pay to loan servicers for helping borrowers avoid foreclosures by establishing repayment plans or reworking delinquent loans.
- The cost of borrowing dollars overnight dropped to the lowest this week after the Federal Reserve extended its emergency lending programs to Wall Street firms yesterday to encourage loans between banks. The London interbank offered rate, or Libor, fell 3 basis points to 2.32 percent today, the lowest level since July 28, the British Bankers' Association said. The three-month rate for dollars declined 1 basis point to 2.79 percent. ``The Fed's move is going to help market confidence and push Libor rates lower,'' said Orlando Green, a fixed-income strategist in London at Calyon, the investment-banking arm of Credit Agricole SA, France's second-biggest bank.
- Wheat and corn production will be higher than previously expected because of favorable weather in some producing nations, the International Grains Council said.
- Corn fell .6%, heading for the biggest monthly drop in more than a decade, as warm, wet weather helped U.S. crops recover from the worst flooding in 15 years.
- Crude oil declined on speculation that high prices and slowing economic growth will further reduce demand in the U.S., the world's biggest energy user. U.S. fuel consumption averaged 20.2 million barrels a day in the past four weeks, down 2.4 percent from a year earlier, according to a weekly report by the Energy Department yesterday. Nigeria, the U.S.'s fourth-largest supplier, said production remains close to 2 million barrels a day even after recent pipeline attacks. The price ``is not sustainable,'' said Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt. ``We've seen some demand destruction already. Prices will go back to $120, and $110 before the end of the year.'' ``On closer examination the gasoline data should not be regarded as that supportive,'' said Gareth Lewis-Davies, research analyst at Dresdner Kleinwort Group Ltd. ``Deliveries from refineries and terminals into the wholesale market were very large indeed, while other data has shown continuing weak retail gasoline sales.''
- Treasury Secretary Henry Paulson said he expects the government's fiscal stimulus plan will boost economic growth in the second half of the year, offsetting a housing downturn and high energy prices.
- The Federal Reserve Bank of New York expanded efforts to clean up trading in the privately negotiated derivatives markets to include contracts linked to interest rates, commodities and currencies.
- International Paper Co.(IP), the world's largest maker of office paper, gained the most in more than seven years in New York trading after second-quarter profit rose, topping analysts' estimates.
- President George W. Bush scolded Congress for a third straight day for refusing to vote on measures that would expand domestic oil drilling and exploration. ``I'd rather be buying our oil from U.S. producers than sending our money overseas,,'' said Bush in a speech to the West Virginia Coal Association at The Greenbrier resort in White Sulphur Springs.
- General Motors Corp.(GM), Ford Motor Co.(F) and Chrysler LLC had their credit ratings lowered one step further into junk status by Standard & Poor's over concern that deteriorating U.S. auto sales will reduce cash flow.
- Exxon Mobil Corp.(XOM), the world's biggest oil company, posted a smaller increase in second-quarter profit than analysts estimated after production slid the most in at least a decade, sending its shares lower.
- U.K. house prices declined the most in almost two decades in July and consumer confidence fell to a record low as the economy edged closer to a recession. The average value of a home dropped 8.1 percent from a year earlier, the biggest decline since at least 1991, Nationwide Building Society, Britain's fourth-biggest mortgage lender, said today.
- Taiwan Semiconductor Manufacturing Co., the world's largest custom-chip maker, posted a 13 percent gain in second-quarter profit as price increases boosted revenue.
- If cable TV is unfulfilling or the video store too inconvenient, the answer might be a video-on- demand set-top box, a device that plays movies straight to your television at the push of button. Several new and improved devices have finally arrived. The latest contender is from Netflix Inc. The popular DVD- by-mail service teamed up with device maker Roku Inc. to develop the $100 Netflix Player. Meanwhile, Vudu Inc., based in Santa Clara, California, enhanced its Vudu Box in June with the addition of a wireless kit ($349 for the bundle). The third device I checked out is the Apple TV (starts at $229).

Wall Street Journal:
- Google(GOOG) to Extend Reach With Venture-Capital Arm.
- Acorn, a non-profit housing advocacy group that holds voter drives for Democrats, will get funding from the housing bill signed into law yesterday. The legislation, which will provide almost $5 billion for affordable housing, financial counseling and mortgage help for overextended borrowers, will also fund groups like Acorn, whose activities include voter registration drives for low-income minorities.
- In a race supposedly dominated by the economy, both Barack Obama and John McCain have spent a lot of time talking about Iraq. Why? Because both men have Iraq problems that are causing difficulties for their campaigns.
- You Know Gas Prices Are High When Texans Start Driving Golf Carts. Low-Speed Electric Vehicles Catch On; Peters Family Jaunts in the Land of Giants.

NY Times:
- Jeweler Cartier Sets Up Site on MySpace.

San Francisco Chronicle:
- A majority of Californians favor more oil drilling off the coast, according to a statewide survey released Wednesday, for the first time since oil prices spiked nearly three decades ago. The support by 51 percent of residents polled this month by the Public Policy Institute of California represents a shift caused by renewed Republican advocacy for drilling as well as motorists' reaction to soaring pump prices, according to the pollster. With high oil prices and calls from President Bush and Republican presidential aspirant Sen. John McCain to open coastal waters to domestic production, support for drilling has jumped, particularly among Republicans, the poll says. Support increases with age and is slightly higher among men than women. But as the price of oil hovers around $120 per barrel, double the cost a year ago, support for drilling has increased even among Democrats and independents, says the survey of 2,504 adult residents polled across the state July 8-22.

New York Post:
- If the Securities and Exchange Commission expands its clampdown on short-selling, it is widely expected to slam hedge funds like Stephen Cohen's SAC Capital and James Simon's Renaissance Technologies, which profit from fast-and-furious trading, experts predicted. That's because under the long-accepted rules of the short-selling game, these hedge funds, which often trade through sophisticated computer programs, have been able to skip the process of borrowing the shares needed to cap off their short positions. But that luxury is now being challenged by the SEC's mandate requiring investors who short 19 financial stocks, including Fannie Mae and Freddie Mac, to borrow the shares they short before they bet against the stock whose price they predict will fall. "The guys who do the rapid trading stuff, they're shorting without having to borrow because they know they're going to close out by the end of the day," said one hedge fund manager. "Those are the people who are going to be most impacted by this." Under the new rules, "if a prime broker does not have it physically pre-borrowed, those trading opportunities may be gone," said well-known short trader Jim Chanos, speaking on behalf of his organization, which is lobbying against the SEC's rules. Among those most likely to be affected are day-trading shops like SAC, Renaissance and Ken Griffin's Citadel Investment Group, which trade shares so quickly they rarely need the shares to be delivered.

Reuters:
- Pension funds to trim commodities exposure. Many have invested in commodities to diversify their portfolios away from traditional assets such as stocks. "For pension funds already at their desired allocation to passive commodities, they would indeed have to sell commodities to maintain that exposure," said Laura Ambroseno, an executive director at Morgan Stanley Investment Management. Fund managers say many pension funds have a benchmark allocation of between 2 and 5 percent to commodities. But those numbers have gone awry as prices have surged. Research by Barclays Capital shows total commodity assets under management rose to $270 billion in the second quarter, a rise of $43 billion from the first quarter. Barclays estimates that new money inflows into commodities in the second quarter fell by 51 percent from the first quarter to $6.4 billion.

Financial Times:
- AK Steel Holding(AKS) has been in talks with potential buyers and is seeking an all-cash bid. AK Steel’s shareholders may be holding out for an all-cash offer close to the shares’ recent highs above $70.

Business Standard:
- India’s inflation was below 12% in the week ended July 19. However, the rate of inflation will be higher than the 11.89% reported in the previous week.

Sabah:
- Exxon Mobil(XOM) is in talks to explore for oil in Turkey’s eastern Black Sea.