Congressional leaders have put the finishing touches on legislation aimed at rescuing the troubled financial markets, according to published media reports.

The Associated Press reported yesterday that lawmakers had released final legislation that would give the Treasury Department the authority to use $700 billion to acquire toxic mortgage-related securities. The House of Representatives plans to vote on the bill today, and, if the bill passes the House, the Senate is expected to follow later in the week.

The Los Angeles Times adds that the bailout bill unveiled yesterday "has tough language about curbing executives' appetite for enriching themselves through the government plan." The legislation does not "offer new solutions to the long-running attempt to rein in executive salaries." Instead, it merely builds "on existing rules regarding how much of their salaries a company can deduct for tax purposes and how liable top managers are for exaggerating company performance."

NPR.org carries both the proposed Emergency Economic Stabilization Act of 2008 and a summary of the bill.

The New York Times comments that to forge the deal, "all sides had to surrender something." The administration "had to accept limits on executive pay and tougher oversight" and "Democrats had to sacrifice a push to allow bankruptcy judges to rewrite mortgages." Republicans, meanwhile, "fell short in their effort to require that the federal government insure, rather than buy, the bad debt."

This morning, ahead of Wall Street's start, President George W. Bush urged passage of the government's $700 billion financial-rescue package, which now awaits final approval from Congress.

UPDATE: The House of Representatives failed to pass the plan, 228 votes to 205 votes. It needed 218 votes for passage; it fell 13 short of that target.

Initial Jobless Claims Jump After Hurricanes
New claims for unemployment benefits jumped the week ending Sept. 20 to their highest level in seven years due to the impact of a slowing economy and Hurricanes Ike and Gustav, the United States Department of Labor reported Thursday. The Labor Dept. said new requests for jobless benefits for the latest week increased by 32,000 to a seasonally adjusted 493,000.

The two hurricanes added about 50,000 new claims in Louisiana and Texas, the department said. The four-week moving average rose to 462,500 — the highest it has been since Nov. 3, 2001.

The level of new claims was the highest since shortly after the September 11, 2001 terrorist attacks, when it reached 517,000.

Durable Goods Orders Fall in August
New orders for manufactured durable goods in August decreased $9.9 billion, or 4.5 percent, to $208.5 billion," the U.S. Department of Commerce announced on Thursday. This was the largest percent decrease in new orders since January 2008 and followed three consecutive monthly increases, including a 0.8 percent July increase.

Meanwhile, the New York Times reports "a closely watched gauge of business spending, which measures orders for civilian capital goods outside of aircraft, fell two percent. And even outside the transportation sector, which has been squeezed by high oil prices, orders dropped three percent."

The drop in durable goods orders "suggests buying activity from retailers and consumers is already slowing, the Wall Street Journal notes. "And the manufacturing sector's ability to rely on strong foreign demand and export growth to offset the slowing U.S. economy may be short-lived as the U.K., the eurozone and Japan all join the U.S. in flirting with recession."

"Following the report on durable goods orders, economists at Morgan Stanley in New York cut their forecast for third-quarter economic growth in half, to a 0.5 percent annual pace, on expectations that business investment would drop more than previously estimated," according to Bloomberg News.

Eurozone Flirts with Recession, Pt. I
Business confidence in the eurozone has hit a multi-year low, according to surveys.

"Germany, France and Italy, the leading eurozone economies, appear on the brink of recession after business confidence surveys hit multi-year lows amid the global financial crisis," Agence France-Presse reports analysts as having said. "The prevailing gloom in the three countries included signs that even worse might lie ahead, raising pressure on the European Central Bank (ECB) to lower its key interest rate, they added.

"Business confidence in Germany, Europe's biggest economy, dropped for a fourth straight month in September to its lowest level since May 2005, economic research institute Ifo said on Sept. 24," AFP continues.

Eurozone Flirts with Recession, Pt. II
The Financial Times (subscription required) reports that the "eurozone has fallen into recession, with industry particularly badly hit by the fallout from global economic turmoil, survey results" released Tuesday indicated.

Eurozone purchasing managers' indices (PMI) showed that "private-sector output in the 15-country region has contracted in September for the fourth consecutive month." This "pace of decline is the fastest since the aftermath of the September 2001 terrorist attacks, with manufacturing faring worse than services." Markit Economics' eurozone composite purchasing managers' index, "covering services as well as manufacturing, fell from 48.2 in August to 47" in September.

"Slumping export orders and slowing activity in Germany dragged down the result," according to the Wall Street Journal (subscription required). The new data "imply that the 15-nation eurozone economy, second in size to the U.S., has barely grown in the third quarter and might even contract," economists said. Meanwhile, "weak new orders mean the chances of a recovery in European economic growth in the fourth quarter also are fading."

However, Eurozone factory orders did rise in July. AFP has reported that data released on Tuesday show that factories in the eurozone saw "a surprise jump in new orders [in July], although much of the improvement was due to orders for trains and planes." New factory orders for "the eurozone grew 1 percent in July from June and rose 1.6 percent compared with the same month in 2007."

WTO Director: Resist Protectionism
Pascal Lamy, director-general of the World Trade Organization (WTO), has warned that "calls for protectionism are likely to rise in the wake of the financial crisis, but should be resisted."

In an interview with the Financial Times (subscription required), Lamy said, "There is a real danger that people will be tempted down that path [of protectionism]. But I would ask them to consider. There is huge damage in closing markets." He believes "the fact that the social safety net in the U.S. was lower than in most other developed countries made the downside of globalisation more painful to people, for instance manufacturing workers whose jobs migrated overseas." Lamy "insisted that the correct way to deal with the current financial crisis was to continue work on lowering tariffs and other barriers to trade."

The move toward protectionism, Lamy noted, happened during the Great Depression, which "helped to deepen economic problems, and ultimately was one of the factors behind the Second World War."

Meanwhile, MarketWatch's chief economist wishes everyone would stop calling the spreading crisis another Great Depression.

Congress Approves $25 Billion Auto Industry Loans
While most of the nation and indeed much of the world has been focused on Washington's approach to Wall Street, Congress approved a $25 billion rescue plan for the U.S. automakers on Saturday. And with very little fanfare at that.

The Wall Street Journal (subscription required) reports that "the U.S. Congress moved Saturday to provide $25 billion in low-interest loans to the auto industry as part of an initiative to accelerate the development of fuel-efficient vehicles."

AP explains: "The loan package for automakers would reward them with $25 billion in below-market loans, costing taxpayers $7.5 billion to subsidize the retooling of plants and development of technologies to help U.S. carmakers to build cleaner, more fuel efficient cars." The automakers would not have to begin repaying the loans for five years.

According to the New York Times, the bill also includes funds "that would keep government agencies operating into next March" and a provision lifting "a ban on offshore drilling."

"The Energy Department, which will parcel out the 25-year loans, says it will take at least six months and possibly up to 18 months to get the program running after Congress on Saturday funded it as part of a giant spending bill," according to another AP report.

All total, "automakers will get up to 25 years to repay the loans," the Detroit News notes. "Because they have sub-investment grade credit, they would save more than $100 million per $1 billion borrowed in lending costs. They could also ask the Energy Department to defer repayment for up to five years."

The $25 billion in loan guarantees for the auto industry was "a top priority for Michigan lawmakers as well as manufacturers," as a spokesman for General Motors said the loans "will speed the transition to cleaner, more fuel-efficient vehicles." Ford Motor Co. said, "This is an important first step to providing access to capital for important investments in the future at a time when the capital markets are distressed."

North American Steel and Aluminum Shipments Decline in August
Shipments from North America's steel and aluminum service centers fell sharply in August, prolonging nearly a year of declining activity, according to the Metals Service Center Institute's latest data.

October 2007 was the last month in which U.S. centers reported increased shipment totals for steel products; April 2008 is the only month in the past 12 in which aluminum shipment totals increased. Canadian centers recorded increases for steel and aluminum shipments during February and April of 2008.

According to the Metals Service Center Institute, U.S. centers' shipments of steel products declined to 3.87 million tons in August 2008, 16.8 percent below the August 2007 shipment total. Canadian steel service centers' shipments dropped 18.2 percent from August 2007 totals, to 258,200 tons.

U.S. service centers' shipments of aluminum products declined to 86,000 tons, down 16.1 percent versus August 2007 totals. Canadian centers' August aluminum shipments totaled 9,300 tons, 8.7 percent below the August 2007 volume.

Packaging Machinery Shipments Climbed in 2007
Based on input from 369 packaging machinery manufacturers, the recently released 2008 Shipments and Outlook Study from the Packaging Machinery Manufacturers Institute (PMMI) estimates that U.S. shipments of packaging machinery climbed 3.9 percent in 2007 to an estimated $6.207 billion, marking the sixth consecutive year of growth.

Moreover, 16 of the 17 machinery categories that the PMMI monitors in its annual report experienced growth in 2007. Last year, exports increased by 17.8 percent; they accounted for 18.7 percent of all shipments, up from 16.6 percent the year prior.

However, domestic shipments grew by a modest 1.2 percent.