On the Big $700 Billion Bailout
Following up on last week's historic downfall of major financial banks, "the Bush administration has filled in one big unknown about its proposed bailout of the banking system — the price tag," according to CNNMoney. "The $700 billion plan, the most sweeping intervention in the financial markets since the Great Depression, is aimed at stemming the credit crisis roiling Wall Street and threatening the global markets."

The United States Treasury, Federal Reserve and Securities and Exchange Commission said Friday that they were taking action to stem the loss of investor confidence in financial markets. "Several of the moves, although technical in nature, were designed to apply a tourniquet to money-market funds, which have been bleeding assets," says MarketWatch. "Together, the plans were designed to give Congress time to put together what is shaping up as the biggest bailout of toxic debt in U.S. history."

The proposed $700 billion financial rescue took fuller shape this morning. See CNNMoney here, here and here for a rundown of what is known of the plan so far.

Federal Aid to Detroit Inches Forward
"After a series of government interventions in the private markets, one seemingly more astonishing than the next, lawmakers found themselves confronted on Wednesday with the question of when and where to draw the line on future aid," the New York Times reports. Yet "support seemed to be growing quickly on Capitol Hill for $25 billion in loan guarantees to assist the ailing auto industry."

"House Speaker Nancy Pelosi (D-Calif.) said the U.S. House likely will consider the loans as part of the budget resolution that keeps the government running through the elections," according to the Detroit Free Press. "Such a move would be positive for Detroit automakers, since it's the only bill that must get passed and signed by President George W. Bush before Congress adjourns as early as Sept. 26."

The "Congressional Budget Office expects the cost of providing these loans to total about $7.5 billion, double earlier estimates," reports the Financial Times (Subscription required).

"The loans — estimated to cost $7.5 billion — were approved but not paid for in last year's energy bill, as part of the compromise to raise fuel economy standards to 35 m.p.g.," the Detroit Free Press continues. "With credit markets effectively closed to Detroit automakers with shaky balance sheets, executives contend the $25 billion is urgently needed to pay for more efficient vehicles."

GM Celebrates Centennial, Taps into Revolving Credit Line
General Motors Corp. marked its 100th anniversary on Tuesday, focusing on the Detroit automaker's future in a global economy rather than dwelling on the past. GM's centennial program, called GMnext, began with short presentations from countries all over the world, each emphasizing the company's global growth and diversity, rather than market share and the bottom-line losses the company has dealt with in the United States in recent years.

On Friday, GM announced its intention to "draw down $3.5 billion of a $4.5 billion secured credit facility for its restructuring in what it called 'uncertain times in the capital markets,'" the Associated Press reports.

Jobless Claims Rise
The number of individuals filing new claims for unemployment insurance rose unexpectedly in the latest week due to the first wave of claims related to Hurricane Gustav, the U.S. Department of Labor reported Thursday. The number of first-time claims filed in the week ending Sept. 13 rose 10,000 from the previous week to 455,000, the highest level seen since the week of Aug. 2. The Labor Dept. said much of the unexpected gain came as Louisiana reported the first wave of unemployment claims related to Hurricane Gustav.

The four-week moving average for initial claims rose by 5,000 to 445,000. Still, many economists see claims above 400,000 as a possible signal of recession.

"Consumer spending, which was briefly invigorated by government stimulus checks sent out earlier this year, has deteriorated. U.S. industrial production has fallen for three consecutive quarters," reports the Wall Street Journal. "Economists are predicting the slide will continue through the first quarter of next year. Unemployment shot up to 6.1 percent in August from 5.7 percent in July. A global economic slowdown is threatening to cut into U.S. exports, one of the economy's few bright spots."

U.S.-Canada Trade Deficit Soars
The U.S. Bureau of Economic Analysis recently announced that the U.S. trade deficit with Canada "shot above $8 billion in July," the Dayton Business Journal reports (via BizJournals.com). U.S. businesses "exported $22.34 billion of goods to Canada in July, but U.S. consumers purchased $30.68 billion of Canadian imports.

"China was the only country to run up a larger trade imbalance with the U.S. in July, at $24.88 billion," the Ohio newspaper notes.

U.S. Contract Manufacturers Profiting From Anti-Offshoring Backlash?
We've already called it reverse globalization, and now a growing number of American manufacturers seem to be profiting from it. Inc.com reports that across the country, "mid-size U.S. contract manufacturers are successfully wooing new business by promising lower costs than the competition. The only thing surprising about their success is that the competition they're beating is China."

Despite China's still-lower wages relative to U.S. wage costs as well as a larger talent pool (due to much higher population) and significantly fewer labor unions in China, Inc. points out that many small and medium companies "cannot always justify the expense of shipping to China. The price for sending a 40-foot shipping container from Shanghai to the West Coast is $6,000."

Add to that "China's export tax (up to 20 percent of the value of the goods) plus land transport in China and the U.S., [and] the total shipping price tag runs closer to $8,000." The magazine notes that manufacturers are also drawing business away from China through customer service and customization.

Rebuilt Minnesota Bridge Opens
At 6 a.m. EST on Thursday, traffic began to flow across the new Interstate 35W bridge in Minneapolis, Minn., a little more than a year after the old one collapsed into the Mississippi River, killing 13 people and injuring 145.

"The state put the replacement on the fast track, and contractors had it ready for traffic in just 11 months," AP states.

The new $234 million bridge "will be one of the most monitored bridges in the country," says Minnesota Public Radio, with "323 sensors that will generate an extensive record of how it handles the stresses and strains of traffic and Minnesota's harsh weather," AP notes.

"The purpose of the 'smart bridge' technology isn't to warn of another impending disaster; it's to detect small problems before they become big ones," Alan Phipps, design manager for the project with Florida-based Figg Engineering Group Inc., told AP.