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Obama Health Care Reform Ruling: Appeals Court Upholds Law

A conservative-leaning panel of federal appellate judges on Tuesday upheld President Barack Obama’s health care law as constitutional, helping set up a Supreme Court fight.

A panel of the U.S. Court of Appeals for the District of Columbia issued a split opinion upholding the law. The court agreed to dismiss a Christian legal group’s lawsuit claiming the requirement that all Americans get health insurance is unconstitutional and violates religious freedom.

The requirement has been the subject of several lawsuits, with some judges across the country ruling it unconstitutional and others upholding the law. That means the Supreme Court is sure to decide the fate of Obama’s signature law. The high court is expected to decide soon, perhaps within days, whether to accept appeals from some of those earlier rulings.

The suit in Washington was brought by the American Center for Law and Justice, a legal group founded by evangelist Pat Robertson. It claimed that the insurance mandate violates the religious freedom of those who choose not to have insurance because they rely on God to protect them from harm. But the court ruled that although the requirement is an encroachment on individual liberty, Congress had the power to pass it to ensure that all Americans can have health care coverage.

“The right to be free from federal regulation is not absolute and yields to the imperative that Congress be free to forge national solutions to national problems,” Judge Laurence Silberman, an appointee of President Ronald Reagan, wrote in the 2-1 opinion. Silberman was joined by Judge Harry Edwards, a Carter appointee.

Judge Brett Kavanaugh, a former top aide to President George W. Bush who appointed him to the bench, disagreed with the conclusion without taking a position on the merits of the law. He wrote a lengthy opinion arguing the court doesn’t have jurisdiction to review the health care mandate until after it takes effect in 2014.


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Japan Stocks Weak in Early Trading

Japanese stocks ticked lower in early Monday trading, with tech and pharmaceutical shares among the decliners. The Nikkei Stock Average JP:NIK -0.35% lost 0.4% to 8,764.87, with the Topix shedding 0.5%. Some tech exporters lost ground after strong gains on Friday, with Toshiba Corp. JP:6502 -1.94% TOSYY +0.59% down 1.7%, Elpida Memory Inc. JP:6665 -2.14% ELPDF -1.80% dropping 2.6%, and NEC Corp. JP:6701 -1.16% NIPNF -4.65% losing 1.7%. Shares of Takeda Pharmaceutical Co.JP:4502 -2.28% TKPHF -0.11% gave up 2.3% after the company posted a 6% fall in first-half net profit, with disappointing sales for its Actos diabetes drug. Rival pharma firm Daiichi Sankyo Co. JP:4568 -1.64% DSKYF -0.88% lost 1.9%


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Flash: Euro Holds Steady After Greek Deal

The euro was little changed against the dollar on Monday after Greek Prime Minister George Papandreou and opposition leader Antonis Samaras agreed on a new coalition government to approve a euro zone bailout deal before elections.

The euro was at $1.3781 in early Asia-Pacific trade, versus around $1.3764 in late trade in New York.

The agreement came after the two leaders held talks with the president in an effort to break a political deadlock and thrash out a deal for a national unity government demanded by the country’s European partners.


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Papa Greek and Opposition Reach Deal

Greek Prime Minister George Papandreou and opposition leader Antonis Samaras have agreed on a new coalition government to approve a euro zone bailout deal before elections, the office of the country’s president said on Sunday.

The agreement came after the two leaders held talks with the president in an effort to break a political deadlock and thrash out a deal for a national unity government demanded by the country’s European partners.

A presidency statement said they will meet again on Monday to discuss who would head the coalition government, but that Papandreou would not lead the new administration.

“Tomorrow there will be new communication between the prime minister and the opposition leader on who will be the leader of the new government,” the statement said.

The statement made no mention of how long the interim government would last.

The European Union gave Greece 24 hours on Sunday to explain how it will form a unity government to enact a bailout agreement.

Papandreou and his opponents have been scrambling to hammer out a deal ahead of a meeting by finance ministers of euro countries on Monday, to show that Greece is serious about taking steps needed to stave off bankruptcy.


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Greek Political Parties Continue to Bicker and Posture

Prime Minister George Papandreou launched his campaign on Saturday for a coalition to save Greece from bankruptcy, but rival parties showed little willingness to cooperate in tackling the nation’s economic, political and social crisis.

Papandreou said negotiations would start soon to form a broad-based government, tasked with ensuring parliament backs a euro zone bailout vital to keeping Greece afloat and preventing its crisis from bringing down much bigger economies.

But a government source said Papandreou’s deputy, Finance Minister Evangelos Venizelos, was already negotiating behind the scenes to win support from smaller parties for a government that Venizelos himself wants to lead.

“Venizelos is having contacts with party leaders to secure their agreement,” said a government official who requested anonymity.

Greece’s two top political forces — the ruling socialist PASOK party and conservative opposition New Democracy — displayed little appetite for working together to tackle a crisis that has driven Greece deep into recession, sent unemployment soaring and living standards tumbling.


New Democracy chief Antonis Samaras flatly rejected Papandreou’s proposal of a coalition which would rule for several months and shepherd the 130 billion euro bailout, Greece’s last financial lifeline, through parliament.

But in snubbing Papandreou, who survived a parliamentary confidence vote in the early hours of Saturday, the conservative opposition acknowledged the leading role being played by his financeminister in the maneuvering for power.

“Whenever we try to find a way out, the Papandreou-Venizelos government invents new obstacles to block it,” New Democracy chief Antonis Samaras said. “We made our offer and he (Papandreou) shut the door. The offer is still on the table. I hope he realizes his mistake.”

Samaras repeated his demand for Papandreou to make way for a short-lived national unity government before snap elections. “We did not seek a role in this government, only that Mr Papandreou, who has become dangerous for the country, resigns.”

Two opinion polls showed Greeks appeared to favor Papandreou’s option. One commissioned by Proto Thema newspaper showed 52 percent of respondents supported the coalition idea while 36 percent wanted snap elections as proposed by Samaras.

Another poll commissioned by Ethnos newspaper put support for the rival proposals at 45 and 41.7 percent respectively.

Papandreou, whose father and grandfather were famous Greek prime ministers, defeated Venizelos for the PASOK leadership in 2004. But as Greece’s economic crisis created political turmoil, he turned for support to Venizelos, a burly former law professor with a reputation as a political bruiser.

Sources close to negotiations insist that Papandreou — by contrast an athletic, U.S.-educated member of an elite family — is going through the motions of trying to form a coalition, and will eventually make way for Venizelos.

Far from being competing political forces, the sources say, the two are aware of what each other is doing under a deal allowing Papandreou to depart with honor after two years in which the government has imposed pay and pension cuts plus tax rises at the behest of Greece’s international lenders.

The cabinet is due to meet informally on Sunday afternoon.


Venizelos appeared to be reaching out to some unlikely bedfellows in his hunt for support. George Karatzaferis, who heads the far right LAOS party, said he had spoken to Venizelos in parliament during the confidence debate.

However, he played down the significance of their encounter, saying he would not join any coalition without New Democracy being there too and urged Samaras to change his mind.

“We need to realize that we haven’t got a prime minister. It’s all a formality. Papandreou resigned yesterday in parliament and the applause in the room was divided equally, for his speech and for his departure,” Karatzaferis said.

Papandreou officially opened his search for a coalition after meeting President Karolos Papoulias, saying Greece had to establish a political consensus to prove it wanted to keep the euro, while European leaders try to persuade the outside world that the currency bloc can overcome its huge problems.

“In order to create this wider cooperation, we will start the necessary procedures and contacts soon,” he told reporters. “A lack of consensus would worry our European partners over our country’s will to stay in the euro zone.”

Without saying when he might quit, Papandreou said during the confidence debate he was ready to discuss who should lead the new government. “The last thing I care about is my post. I don’t care even if I am not re-elected,” he said.

Under heavy domestic and international pressure, the prime minister retreated from a proposal for a referendum on the euro zone rescue. Greek voters could well have rejected the deal, potentially torpedoing euro zone leaders’ attempts to stop the debt crisis devastating economies such as Italy and Spain.


Weary Greeks expressed disgust at the political wrangling.

“I’m sick of politicians in Greece, and feel that things will now turn ugly. If only they could cooperate, everything would be much better,” said Tassos Pagonis, a 48-year-old Athens taxi driver. “But will Greece be saved? I’m afraid not. Europeans don’t trust us anymore, they will throw us out.”

Pensioner Yiannis Vlahos, 83, compared the fates of Greece and Germany, which occupied the country in World War Two.

“When the Germans left we had some hope. They were ruined by World War Two but they worked hard and became the strongest economy. We Greeks haven’t learned our lesson, we only steal,” he said. “We ourselves hate our beautiful country.”

The leaders of France and Germany told Papandreou this week that Greece would not get a cent more of aid if it failed to approve the bailout, meaning that the state would run out of money in December.


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Flash: Obama Gets Subpeonaed

Showing a growing frustration with the the Obama administration, congressional Republicans on Thursday authorized their second subpoena this week, demanding White House documents related to failed solar technology company Solyndra.

By a 14-9 party-line vote the Energy and Commerce Committee’s investigative subcommittee authorized issuing a subpoena for any White House documents related to Solyndra, which received renewable energy loan guarantees under President Obama’s stimulus program. The request for documents could include details of the president’s own travel and communications.

Democrats said it was “unprecedented” to subpoena documents from the president’s executive office like this, but Republicans said they’ve run out of patience with White House “stalling.”

“We simply cannot allow the executive branch at its highest levels to pick and choose what they will produce, or whether they will produce anything at all,” said Rep. Cliff Stearns, the Florida Republican who runs the investigative panel.

Thursday’s subpoena came just a day after the Judiciary Committee’s immigration subcommittee voted along party lines to authorize a subpoena for Homeland Security records related to illegal immigrants the department has declined to pursue deportation cases against.

**FILE** An auction sign is shown outside the Fremont, Calif., headquarters for bankrupt solar company Solyndra headquarters on Oct. 31, 2011, before the auction on the following day. Solyndra received a $500 million loan guarantee from the government before filing for bankruptcy in September. (Associated Press)**FILE** An auction sign is shown outside the Fremont, Calif., headquarters for bankrupt solar company Solyndra headquarters on Oct. 31, 2011, before the auction on the following day. Solyndra received a $500 million loan guarantee from the government before filing for bankruptcy in September. (Associated Press)

Together they mark an escalation as Republicans have become increasingly aggressive in pushing back against what they see as administration stonewalling of oversight by the new GOPmajority in the House.

In each case, the vote only authorizes a subpoena. It’s up to the chairmen of the full committees to actually issue them.

Democrats said both votes were premature. They pointed to ongoing discussions between Homeland Security and the Judiciary Committee on the one hand, and between theWhite House and the Energy and Commerce Committee on the other, as evidence the administration is acting in good faith.

“The White House repeatedly said they had turned over documents and they were willing to turn over more documents,” said Rep. Diana DeGette, the ranking Democrat on the investigations panel.

She also said the administration has already turned over tens of thousands of documents.

Each side now argues the other is acting in bad faith.

Republicans point to a lengthy effort to get documents, and said it is only when the committee begins to threaten subpoenas that things shake loose.

Rep. Fred Upton, Michigan Republican and chairman of the full committee, said several new boxes of documents were released to the press Wednesday night even before they were turned over to thecommittee. Those documents reportedly show the Obama administration mulled bailing Solyndra out just days before the solar panel manufacturer collapsed.

Democrats said they support legitimate requests for information and back the House’s right to investigate the administration. But they said the request for all potential Solyndra communications was a broad fishing expedition, and accused the GOP of short-circuiting usual negotiations.

“Apparently what the committee really wants is a confrontation with the president,” said Rep. Henry A. Waxman, the top Democrat on the full Energy and Commerce Committee.


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Flash: Groupon IPO Could Price $1/$2 Above Range

Groupon Inc could price shares in its initial public offering $1 or $2 above the current range of $16 to $18 per share, according to two investors who said they spoke with the lead underwriters on Wednesday.

Groupon is on file with the Securities and Exchange Commission to sell 30 million shares in the IPO, equivalent to a 4.7 percent stake. Books are expected to close later on Wednesday afternoon, with trading on the Nasdaq to begin on Friday.

If the IPO prices at $19 per share, that would value Groupon at $12.02 billion. If it prices at $20 per share, that would value the company at $12.7 billion.

No further information was immediately available. A spokesman for Groupon declined comment, as did a spokesman for lead underwriter Morgan Stanley. The other leads, Goldman Sachs and Credit Suisse, were not immediately available for comment.


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Senate Democrat Proposes Subsidies for Diapers

Sen. Richard Blumenthal (D-Conn.) on Tuesday introduced legislation that would allow federal block grants that states now use to subsidize child-care services to also allow for the purchase of diapers and “diapering supplies.”

The bill, S. 1778, would amend the Child Care and Development Block Grant Act of 1990 to allow diapers and related supplies to be bought with grant money provided to states. Under current law, the money is meant to subsidize child-care services to parents who are entering the labor force or are in job training and education programs. It also helps subsidize child-care services for certain eligible families.

Under the law, 4 percent of all funds must be used to improve the quality of child-care. A summary of Blumenthal’s bill indicates that it would allow the purchase of diapers under this provision, as it would “include the provision of diapers and diapering supplies among the activities for which funds may be employed to improve the quality of and access to child care.”

The federal program, called the Child Care and Development Fund, received $5 billion in fiscal 2011, which it distributed to all 50 states, the District of Columbia and scores of tribal governments. The program now helps to provide for an estimated 1.8 million children each month.

The program also received an extra $2 billion under the 2009 stimulus bill.


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Notes from Bernanke Presser

  •  Severity of Financial Crisis and Housing Slump Forced Downward Revision in Economic Outlook
  • Job of Federal Reserve to Stay Out Of Political Debates
  • Fed Has Been Aggressive

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Flash: FOMC Decision Much Ado About Nothing

Press Release

Release Date: November 2, 2011

For immediate release

Information received since the Federal Open Market Committee met in September indicates that economic growth strengthened somewhat in the third quarter, reflecting in part a reversal of the temporary factors that had weighed on growth earlier in the year. Nonetheless, recent indicators point to continuing weakness in overall labor market conditions, and the unemployment rate remains elevated. Household spending has increased at a somewhat faster pace in recent months. Business investment in equipment and software has continued to expand, but investment in nonresidential structures is still weak, and the housing sector remains depressed. Inflation appears to have moderated since earlier in the year as prices of energy and some commodities have declined from their peaks. Longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee continues to expect a moderate pace of economic growth over coming quarters and consequently anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate. Moreover, there are significant downside risks to the economic outlook, including strains in global financial markets. The Committee also anticipates that inflation will settle, over coming quarters, at levels at or below those consistent with the Committee’s dual mandate as the effects of past energy and other commodity price increases dissipate further. However, the Committee will continue to pay close attention to the evolution of inflation and inflation expectations.

To support a stronger economic recovery and to help ensure that inflation, over time, is at levels consistent with the dual mandate, the Committee decided today to continue its program to extend the average maturity of its holdings of securities as announced in September. The Committee is maintaining its existing policies of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee will regularly review the size and composition of its securities holdings and is prepared to adjust those holdings as appropriate.

The Committee also decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that economic conditions–including low rates of resource utilization and a subdued outlook for inflation over the medium run–are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013.

The Committee will continue to assess the economic outlook in light of incoming information and is prepared to employ its tools to promote a stronger economic recovery in a context of price stability.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Richard W. Fisher; Narayana Kocherlakota; Charles I. Plosser; Sarah Bloom Raskin; Daniel K. Tarullo; and Janet L. Yellen. Voting against the action was Charles L. Evans, who supported additional policy accommodation at this time.


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Flash: Now More than 1 Million Without Power on East Coast

A rare October snowstorm bore down on the heavily populated U.S. Northeast on Saturday, knocking out power to a million customers, delaying flights and threatening some areas with up to a foot of snow.

By 2 p.m. EDT, New York City had broken an October snow record with 1.3 inches in Central Park, making this the snowiest October there since records began being kept in 1869, NBC New York reported.

Snow was coming down hard from central Pennsylvania to southeastern New York and Connecticut after hitting parts of Virginia, West Virginia and Maryland earlier in the day.

More than 1.1 million customers lost power in Pennsylvania, Connecticut, New Jersey and Maryland, and utilities were bringing in crews from Ohio and Kentucky to help restore it. Officials had warned that the heavy, wet snow combined with fully leafed trees could lead to downed tree branches and power lines, resulting in power outages and blocked roads.

Delays were reported at Philadelphia International Airport and at New York area airports. At John F. Kennedy International Airport, some arrivals were delayed by more than four hours, and six hours at Newark Airport. One live flight tracking site, FlightAwaretweeted more than 1,000flights had been cancelled nationwide.

“It’s going to be wet, sticky and gloppy,” said NWS spokesman Chris Vaccaro. “It’s not going to be a dry, fluffy snow.”

Snow, snow and more
Communities inland are expected to get hit hardest by the storm. The heaviest snow was forecast for the Massachusetts Berkshires, the Litchfield Hills in northwestern Connecticut, southwestern New Hampshire and the southern Green Mountains.

Cherry Grove, W.Va., on the edge of the Monongahela National Forest, received at least 4 inches of snow, according to the National Weather Service.

Relatively warm water temperatures along the Atlantic seaboard could keep the snowfall totals much lower along the coast and in cities such as Boston, National Weather Service meteorologist Bill Simpson said, with 3 inches of snowfall forecast along the I-95 corridor.

While October snow is not unprecedented, this storm could be record-setting in terms of snow totals.

October snowfall records could be broken in parts of southern New England, especially at higher elevations, National Weather Service meteorologist Bill Simpson said. The October record for southern New England is 7.5 inches in Worcester in 1979.


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