Today's Headlines

Bloomberg:

• Papandreou Says Greek 'Survival' at Stake in Talks. Greek Prime Minister George Papandreou said the country’s survival was at stake in talks to win a potential $159 billion European Union-led bailout in exchange for budget cuts denounced by unions as “savage.” “Now, today, immediately, what is at stake is the survival of the nation,” Papandreou said in parliament in Athens today. “This is the ‘red line.’” He said talks with the EU and International Monetary Fund were “tough,” with his government resisting “not in the street with rocks, but in negotiations.”
  
• Goldman Sachs(GS) Falls on U.S. Prosecutors' Review, BofA Dowgrade.
  
• Goldman(GS) Leads Credit Swap Rise on Criminal Probe as Banks Jump. Goldman Sachs Group Inc. led a jump in the cost to protect bank bonds as federal prosecutors investigate the firm to determine whether to pursue a criminal fraud case, according to two people familiar with the matter. Credit-default swaps on Goldman Sachs increased the most since the Securities and Exchange Commission’s civil lawsuit filing on April 16, as a federal review begins by the U.S. attorney in Manhattan, said two people familiar with the matter, who weren’t authorized to comment and spoke on condition of anonymity. Bank of America Corp. cut its rating on the shares to “neutral” from “buy,” citing the probe. Credit swaps on Goldman Sachs climbed 25.8 basis points to 157.4 basis points, according to CMA DataVision. Swaps on other banks, including Morgan Stanley to Bank of America, also rose. Swaps on Morgan Stanley rose 10.2 basis points to 162.7 basis points, CMA prices show. Contracts on Bank of America climbed 8.3 basis points to 135.7, and swaps on JPMorgan Chase & Co. increased 8 basis points to 82.6.
• Oil Rises to Two-Week High Above $86 on Weaker Dollar, Recovery. U.S. Interior Department inspectors began boarding deep- water platforms in the Gulf of Mexico and Louisiana asked for help from the National Guard, as an oil sheen reportedly washed ashore in the worst rig spill in four decades. The leak, five times bigger than previously estimated, prompted Louisiana Governor Bobby Jindal to declare a state of emergency, and led Senator Bill Nelson, a Florida Democrat, to ask President Barack Obama to indefinitely suspend plans to expand offshore drilling for oil and natural gas.
• Spain Pricks Solar Power Bubble as Greek Fate Looms. Spain is lancing an 18 billion-euro ($24 billion) investment bubble in solar energy that has boosted public liabilities, choking off new projects as it works to cut power prices and insulate itself from Greece’s debt crisis. Industry Minister Miguel Sebastian is negotiating reductions in subsidies for solar plants that would curb energy costs, a ministry spokesman said this week.
• China Reports Third Attack on School Children in as Many Days. China reported its third attack on school children in as many days, as domestic media called for tightening of security for students. A man in the eastern province of Shandong injured five kindergarten children and a teacher today when he attacked a local school armed with an iron hammer, the official Xinhua News Agency reported. The man then soaked himself in gasoline, grabbed two of the children and set himself on fire, according to the report. Teachers were able to pull the children away, while the attacker died at the scene, Xinhua reported. The incident follows an attack on a primary school in the southern province of Guangdong on April 28 that injured 18 students and a teacher, and an assault yesterday on a kindergarten in the eastern province of Jiangsu in which 29 children and three adults were hurt. Xu, who was detained by police, said the attacks were “his revenge on society” for business and personal humiliations, Xinhua reported today, citing Jiang Wenxiang, chief of the local security bureau. An initial police investigation found Xu was “reasonably well off” and owned eight apartments in downtown Taixing city, Xinhua reported. A day earlier, Chen Kangbing snuck into a primary school in Guangdong province’s Leizhou city armed with a knife and injured 16 children, five seriously, Xinhua reported. Chen, a 33-year- old art teacher, had been diagnosed as suffering from severe neurosis in 2008 and was undergoing an assessment of his metal state, Xinhua reported. A doctor in Fujian province convicted of killing eight students in a March 23 attack was executed on Aug. 28, China Daily reported today.
• U.S. Economy: Consumer Spending Picks Up, Sustaining Expansion.
  

Wall Street Journal:

• Oil Washes Up on Gulf Coast; Spill May Be Five Times Estimated Siz.

Bloomberg Businessweek:

• Beijing to Limit How Many Homes Residents May Buy. The city of Beijing will issues policies today limiting how many homes residents of the Chinese capital are allowed to buy, the Shanghai Securities News reported today, citing an unidentified person. The city will also “basically” stop loans for the purchase of third homes, as well as loans for those originally from outside Beijing who haven’t paid a year’s tax in the Chinese capital, the Shanghai-based newspaper reported.

CNBC:

• Should the White House Re-Think Its Position on Off-Shore Drilling? (Poll)

MarketWatch:

• Extraordinary Bullishness. Nasdaq timers now most bullish in nearly a decade.

Business Insider:

• IT BEGINS: No Drilling In New Areas Until Thorough Review Of Spill Is Complete. Yeah, so new offshore oil development in America is dead for the time being.
• Here's The Big Picture Behind China's New Housing Bubble Crackdown.
  

Zero Hedge:

• Did Paulson Have a $2 Billion Bear Stearns CDS Short in Late 2006?

Detroit News:

• GM 'Close to Commiting Fraud' in Ad, Lawmaker Says. A senior Republican criticized General Motors Co. decision to run television advertisements featuring the company's CEO that tout its repayment of $6.7 billion in government loans. Rep. Darrell Issa, R-Calif., the ranking member of the House Oversight and Government Reform Committee, said in a letter obtained by The Detroit News today to GM chairman and CEO Edward Whitacre Jr. that the company "has come dangerously close to committing fraud and that you might have colluded with the U.S. Treasury to deceive the American public." GM's ads featured Whitacre touting that fact that GM "repaid our government loan in full, with interest, five years ahead of the original schedule." Issa called on GM to stop running the television advertisements. But GM spokesman Dave Roman said the ads stopped running as scheduled on Tuesday night. At issue is the fact that GM received $50 billion in U.S. government bailout funds -- but about $43 billion of those were swapped by the government in exchange for a 61 percent majority stake in GM. GM had $17.4 billion of those funds in escrow -- and GM tapped unused funds from that account to repay the taxpayers for the loan portion. But it won't be clear for years whether taxpayers will be completely repaid until the government sells all of its shares in the company.

ETF Guide:

• ProShares Launches 4 Leveraged International ETFs. ProShares added four new ETFs that offer magnified exposure to stock indexes covering Europe, Pacific ex-Japan, Brazil and Mexico.

Intl. Copper Study Group:

• Copper Supply to Outpace Demand in 2010, 2011, ICSG Says.

The Hill:

• Dems Spark Alarm With Call for National ID Card. A plan by Senate Democratic leaders to reform the nation’s immigration laws ran into strong opposition from civil liberties defenders before lawmakers even unveiled it Thursday. Democratic leaders have proposed requiring every worker in the nation to carry a national identification card with biometric information, such as a fingerprint, within the next six years, according to a draft of the measure.

Rasmussen Reports:

• 66% See Tax Cuts as Better Way to Create Jobs Than More Government Spending. Most U.S. voters favor a new government program designed to create jobs but still think ultimately tax cuts and decisions by private business leaders will do more good in terms of job creation. A new Rasmussen Reports national telephone survey of Likely Voters finds that 66% believe cutting taxes is a better way to create new jobs than increasing government spending. That’s up seven points from January. Just 18% think increasing government spending is the better way to go.

Reuters:

• Discovery(DISCA) Profit Up 42%. Discovery Communications reported a 42 percent rise in quarterly profit, as the company's push to bring its hit cable TV programs abroad resulted in a sharp jump in international advertising sales.

Sky News:

• British banks are to warn of the possibility of a "double dip" recession, citing a "secret report" the broadcaster said it obtained. The report will be circulated after the upcoming general election.

Handelsblatt:

• The German government will ask the country's banks to increase investment in Greek bonds to help underpin aid for Greece. Banks' help will be voluntary.

Lidove Noviny:

• A majority of Czechs oppose adoption of the euro, citing a survey by the CVVM polling unit of the Academy of Science in Prague. The poll, the first to indicate a negative stance nationwide toward the currency switch, showed 55% of Czechs don't want to adopt the euro, compared with 38% who wish to join Europe's common currency.