US economic growth rate in the third quarter fell to the lowest levels since 2001 thus confirming the onset of the worst recessions in the last quarter of a century.

A report issued by the US Commerce Department in Washington on Wednesday revealed that gross domestic product contracted at a 0.3 % annual pace, less than what was forecast. The report also showed that the consumer spending boom which had driven the US economy for two decades ended last quarter as the credit crunch put the brakes on any chance of economic recovery.

The Commerce Department report is the last major economic data before the country elects its next President. The dismal state of the economy and the recent credit crisis appear to have boosted the chances of Democrat nominee Sen. Barack Obama’s in the next week’s elections. A Bloomberg/Los Angeles Times survey conducted on August 15-18 had shown Republican nominee Sen. John McCain slightly leading with 42% support as opposed to Sen. Obama’s 41% support. However after five weeks in the aftermath of the credit crunch affecting almost every part of the economy opinion polls show that Sen. Obama is leading with s support of 49% to Sen McCain’s 45%.

The total cost of going to college in America is on the rise, according to a report released by the College Board on Wednesday.

According to the figures provided by the College Board the overall cost of attending a private four-year college increased to $34, 152 on average for the academic year 2008-2009, thus marking a rise of 4.8% from previous school year. the cost of going to in-state public colleges too recorded a rise of 5.7% from that of last year and stood at $14,333 for the current academic year. out of state students too paid more for attending a four-year public college this year, shelling out $25,200 which marked a rise of 5.2% from one year ago.

The figures were compiled by the College Board, a non-profit organisation including more than 5400 schools, colleges and universities. Total costs calculated by the association covered tuition fees, as well as boarding and lodging expenses.

However the report found out that after adjusting the average $10,200 received in grants and tax benefits, the cost for students of private colleges came down to $23,932 . similarly full-time undergrads at public four-year colleges too received around $3700 in aid and tax benefits which brought down the actual cost of attending public colleges to $10,633 for in-state students and $21,500 for out-of-state students.

Times Inc, the largest magazine publisher of the world, has plans to cut around 6% of its workforce and introduce changes at the organizational level of the company.

Times announced the revamping on Tuesday evening in a memorandum to its employees after The New York Times reported the job cuts on its online edition. The lay offs which are slated to begin in about two weeks will affect 6% of the company’s workforce or around 600 employees in all.

Times Inc officials said that while no magazines are scheduled to close, some might be drastically cut back. Among the organizational changes undertaken by the magazine company, will be a division of the magazines into three segments – news which will cover Fortune, Money, Time and Sports Illustrated; lifestyle publications which will include among others Real Simple, Coastal Living, Cottage Living and Southern Living; and finally a section devoted to style and entertainment which comprise of titles like People, InStyle and Entertainment Weekly.

Times Inc. is a division of the media conglomerate, Time Warner which includes other television channels like CNN, HBO, Turner Broadcasting , AOL as well as the Warner Brothers movie studio. Times Inc has been facing a loss of readers and advertising revenue for some time which has now been made worse by downturn affecting nearly every aspect of the economy.

The US Federal Reserve announced yet another rate cut on Wednesday, this time reducing the key interest rate by half a percentage point.

The most recent rate cut ordered by the Federal Reserve has now brought the federal funds rate in US down to one percent - a level last seen in 2003-2004. the last time the rate had gone lower than this was almost half a century ago, in 1958 when the country had Dwight Eisenhower as the President.

the federal funds rate is the rate at which banks lend to each other and is thus crucial in determining the flow of credit through an economy’s financial system. The recent market crisis and the massive losses incurred by banks had led to a virtual freeze in the lending system which is why federal agencies were required to step in and restore confidence. Also on Wednesday, the US government finally began distributing from the billions of dollars approved for finance rescue package.

However many finance experts warn that credit lines cannot be opened up merely by bringing about cuts in key interest rates. The huge losses incurred by the banks in bad mortgages have now made them reluctant to extend new loans.

Federal regulators ignored evidence when concluding that a chemical found in plastic baby bottles was safe, revealed an expert panel which was asked to review the FDA’s handling of the issue.

According to a report released on Wednesday, officials from the Food and Drug Administration ignored evidence on the dangers posed by a chemical found in baby bottles made of plastic. The chemical in question is called BPA or bisphenol A and the excluded studies suggest that BPA could pose harm to children at levels at least ten times lower than the level that the agency deemed safe.

The review of the FDA’s handling of the controversial issue was conducted by a panel of external scientists who also criticised the agency for relying on three industry-sponsored studies to decide the safety issue related to bisphenol A. The panel of experts further found out that the FDA had significantly underestimated the amount of BPA babies might ingest from several sources.

Another government agency, the National Toxicology Program, stated that results from independent studies need to be considered before bringing out a safety decision related to BPA in baby bottles. Last month the toxicology program concluded that there was some evidence to show that unsafe levels of BPA altered development of brain, prostrate and behaviour in children as well as fetuses.

Key officials in the Bush administration are putting the final touches on a plan that would provide relief to up to three million homeowners struggling with their mortgage payments and help them to avoid foreclosures, sources briefed on the plan said Wednesday.

Under the plan the government would undertake to bear half of the losses on home loans if mortgage companies agree to lower borrowers’ monthly payments for a minimum of five years. The plan is expected to cost from $40 billion to $50 billion and will form part of the $700 billion rescue package approved by the US Congress earlier this month. The money would be used for covering future losses on loans that would be restructured on the basis of new standards established by the government.

According to sources, officials from the Treasury Department and the Federal Deposit Insurance Corporation are working on the plan which is expected to be announced soon. Chairman of the FDIC, Sheila C Bair has been a strong proponent or the homeowners rescue proposal and a week ago became the first official to publicly discuss the idea. The plan, when completed, would be the most extensive government initiative directed at providing relief to homeowners since the mortgage crisis erupted last year

A host of reasons led US auto dealers to suffer substantial losses in the third quarter including declining sales, consumer credit squeeze as well as a weak economic climate made worse by hurricane-related damages.

Sonic, the third-largest auto dealer in the US said on Tuesday that it was putting on hold several planned showroom-related projects. Likewise the number four US auto dealer, Group 1, said that it would cut down on capital spending and detailed several cost-cutting measures which would save the dealer $35 million annually. Group 1 has already forecast a “substantial drop” in near-term revenue and has suspended its 2008 full-year outlook due to economic volatility in the US.

Several economic factors in the US and overseas markets have led to light vehicles recording the lowest sales in the past fifteen years. The most recent trigger was the market crisis which has led to stricter lending norms and difficulty in financing. While lenders are turning down loan applications with greater frequency, consumers are being discouraged by demands for higher down payments and higher rates of interest.

However both Sonic Automotive Inc and Group 1 Automotive Inc shares rose on Tuesday following announcements by the dealers on cost cutting measures as well as programs for conserving cash.

The Christian Science Monitor will become the first national newspaper in the US to abandon print when after a century of continuous publication, it will cease daily print editions and appears online only.

On Tuesday, the publisher of Christian Science Monitor announced that the newspaper which has been publishing print editions from Monday through Friday will turn into an online publication from April next year. At the same time the newspaper has plans of introducing a weekend publication. The editor of Christian Science Monitor, John Yemma, further revealed that moving to a Web version will enable the publication to keep its seven foreign bureaus in operational status.

The unprecedented cost cutting measure taken by Christian Science Monitor is a pointer to the dismal times that the newspaper industry is going through at present. In recent times, newspapers in United States have been struggling to survive by conducting lay-offs, closing bureaus and reducing the size of the product. However Lou Ureneck, chairman of the journalism department at Boston University pointed out that the Christian Science Monitor being a non-profit organization, its ceasing of daily print edition could not be taken as setting the trend for other newspapers.

The days of easy credit card offers and extravagant credit lines may be over for most Americans as lenders now seek to tighten both credit card eligibility as well as credit limits.

The pullback is expected to hit even credit-worthy consumers who are already reeling from the impact of an eroding economy. However a credit card crisis will come as the worst news for the beleaguered banking industry and pound it with another wave of losses after being at the receiving end of the recent mortgage crisis.

According to an estimate, Credit card lenders wrote off nearly $21 billion in bad credit card loans in the first half of 2008 as an increasingly higher number of borrowers defaulted on their payment. As the rate of unemployment rises and tens of thousands of workers are laid off, analysts estimate that the credit card industry will incur losses of up to $55 billion in the next year and a half.

The looming credit card crisis has compelled major lenders like American Express, Bank of America and Citigroup to enforce stricter standards for applicants and has led many to discard the riskiest customers from their portfolios. Customers appear to be the worst-hit as they lose once-easily available options like home equity and transfer balance to meet their credit card obligations.

Global electronics giant Sony reported a plunge of 72% in profits during the most recent quarter at its earnings suffered due to a strong yen as well as the general economic slowdown.

The Tokyo-based electronics and entertainment conglomerate reported that for three months through September this year, its net profit fell to 20.8 billion yen or $213.6 million as sales declined by 0.7% to 2.07 trillion yen or $21.3 billion.

Sony cited the gains made by yen against euro as the chief reason for the drop in profits. This is because a stronger yen negatively affects exporters like Sony by making their products more expensive in overseas market and reducing the yen value of the profits earned in foreign countries.

Another important reason for the sharp drop in Sony profits is the decline in sales of several of its core electronic products. For instance the sale of its flat-panel Bravia television sets and digital cameras fell faster than expected in October, leading the company to cut its annual profit forecast by as much as 58% for the fiscal year through March 2009.

Sony’s poor performance comes as the latest instance of a trend which has seen several Asian exporters like Canon, Samsung and Honda reported loss in earnings in recent days, leading all of them to slash annual earnings forecast.