Today's Headlines

Bloomberg:
- The benchmark index for U.S. stock options exceeded 80 for the first time in its 18-year history, driven higher by equities extending the biggest slide since 1987 on concern the economy will continue deteriorating. Europe's volatility benchmarks also jumped to records. The VIX, as the Chicago Board Options Exchange Volatility Index is known, rose a third day, adding 9.6 percent to 75.92 at 12:50 p.m. in New York after climbing as high as 81.17.

- Money-market rates in London fell after central banks provided $254 billion of emergency cash to ease the paralysis in the credit markets and UBS AG got a $59 billion government bailout. The London interbank offered rate, or Libor, that banks charge each other for three-month loans in dollars declined for a fourth day, sliding 5 basis points, or 0.05 percentage point, to 4.50 percent today, the British Bankers' Association said. The overnight rate fell 20 basis points to 1.94 percent, the lowest level since November 2004 though still 44 basis points above the Federal Reserve's target. Asian rates also dropped.

- Emerging-market banks plunged after Standard & Poor's warned that South Korean lenders will struggle to refinance debt, raising pressure on developing nations to bail out their own institutions. All emerging stock markets fell, led by declines in Russia, South Korea, Peru, Hungary and Brazil.

- U.S. Treasury Secretary Henry Paulson said his plan to inject capital into financial companies is focused on banks and thrifts, indicating unregulated firms such as hedge funds won't initially get government aid.

- Tumbling prices for energy and metals led commodities to their lowest since September 2004 on signs of plunging demand for raw materials as the U.S. economy slows. Crude oil fell as much as 8 percent, dropping below $70 a barrel in New York for the first time since August 2007. Gold dipped below $800 an ounce for the first time in four weeks. The Reuters/Jefferies CRB Index of 19 commodities fell as much as 3.2 percent to 273.95, the lowest since Sept. 21, 2004. ``Global conditions are no longer commodity-supportive,'' analysts at Standard Chartered Plc wrote in a report today. ``Demand for commodities is already suffering and we expect further weakness.''

- Morgan Stanley(MS) Chief Executive Officer John Mack said tumbling markets may drive some hedge funds out of business. ``Some of my friends in that community say that by year- end, you'll see the number of firms in the hedge-fund area shrink, I've heard as large as 30 percent,'' Mack, 63, told CNBC today.

- Microsoft Corp.(MSFT) Chief Executive Officer Steve Ballmer said a deal with Yahoo! Inc.(YHOO) may still make economic sense for shareholders of both companies, pushing Yahoo stock up as much as 17 percent.

- Highland Capital Management LP will close its flagship Highland Crusader Fund and another hedge fund after losses on high-yield, high-risk loans and other types of debt, according to a person with knowledge of the decision.

- Andy Lipow, president of Lipow Oil Associates LLC, says oil may fall to $65/bbl. (video)

- US farmers probably will apply less fertilizer per acre on crops next year to reduce costs amid falling wheat, corn and soybean prices, said Mike Rahm, Mosiac Co.’s(MOS) vice president of market analysis.

- Gold declined to a one-month low on speculation that investors will sell the precious metal to cover losses in other markets. Silver fell to the lowest since February 2006.

Wall Street Journal:

- In the campaign's final two weeks, voters will take a last serious look at both presidential candidates. The outcome of the race isn't cast in stone yet.

NY Post:

- The bankers, Joseph Sauvage, Todd Guenther and Jack Paris, who had been brought into Barclays Capital as a part of its purchase of Lehman, are expected to start work at Citi next month.

- Renowned New York hedge-fund honcho and political powerbroker Richard Perry is facing down his first losing year in hedge-fund investing since launching his fund some 20 years ago. The ex-Goldman Sachs billionaire manager of Perry Capital is shrinking his staff and battening down the hatches at his firm, which boasts tony digs in the General Motors Building. His flagship fund Perry Partners International recorded a third-quarter loss of 6.13 percent, bringing his year-to-date performance down 9.32 percent, according to people familiar with the matter.

MSNBC.com:
- The FBI is investigating whether federal money was misused when Democratic Congressman Tim Mahoney hired a mistress to work in his office, a senior federal law enforcement official said Thursday. Federal agents also are examining whether a second affair Mahoney was having with a high-level official in his Florida district was behind his push for federal funds for her county.

Powerpage.org:

- Apple(AAPL) to Release Revised 17” MacBook by Early 2009.

CFO.com:

- Few who know anything about executive compensation, it seems, are fans of how the government's financial-services rescue programs address the issue.

SF1 television:
- UBS AG(UBS) CEO Marcel Rohner said the worst is “definitely” over for Switzerland’s largest bank after the country’s government agreed to a $59.2 billion package to relieve it of toxic assets. While the bank’s losses have “clearly” damaged confidence in UBS, today’s announcement means “the problem of illiquid assets is definitely solved” for the bank, Rohner said.