The Economy

The morning papers carried more bad news about the economy. The Los Angeles Times reported that Americans' confidence is withering amid a toxic combination of surging food and energy costs and falling home values. The Wall Street Journal reported the decline in U.S. home prices accelerated in the fourth quarter, compounding two of the biggest threats facing the nation's economy: faltering consumer spending and tight credit markets. The New York Times reported that gasoline prices, which for mont

The morning papers carried more bad news about the economy. The Los Angeles Times reported that Americans' confidence is withering amid a toxic combination of surging food and energy costs and falling home values. The Wall Street Journal reported the decline in U.S. home prices accelerated in the fourth quarter, compounding two of the biggest threats facing the nation's economy: faltering consumer spending and tight credit markets. The New York Times reported that gasoline prices, which for months lagged behind the big run-up in the price of oil, are suddenly rising quickly, with some experts saying they could approach $4 a gallon by spring. The Washington Post reported that congressional leaders yesterday gathered support for aggressive changes to bankruptcy laws that would help troubled homeowners, even as the Bush administration threatened to veto the plan. In the latest effort to jumpstart the sputtering economy, the Senate is considering the bankruptcy bill as a way to help homeowners forestall foreclosures. Senator Bernie Sanders said, "The hundreds of thousands of people about to be thrown out on the street want the government to stand with them. When they are going bankrupt and their homes are being foreclosed, they want to be able to sit in front of a bankruptcy judge and be able to see lower interest rates so they can hang onto their homes. That's good for the people. That's good for the economy."

The bill would help struggling families keep their homes by letting them refinance out of subprime loans and also by helping more than 600,000 families modify their mortgages in bankruptcy. The measure also would help communities harmed by foreclosures recover so property values do not decline further; help businesses weather this economic downtown so they may continue to invest and employ workers; and help families avoid future foreclosures by giving them better mortgage and financing information.

Sanders commented on the legislation during a discussion of the economy on the CNBC program Kudlow & Company. To watch the clip click here.