Business Highlights

Economy Jolts Into Decline; Bad Recession Seen

WASHINGTON (AP) - The government reported Thursday that the economy shrank in the summer, sending the strongest signal yet that a recession may have already begun.

The Commerce Department reported that gross domestic product, the broadest measure of economic health, fell at an annual rate of 0.3 percent in the July-September period, a significant slowdown after growth of 2.8 percent in the prior quarter.

Consumer spending, which accounts for two-thirds of the economy, dropped by the largest amount in 28 years in the third quarter.

American Express To Cut 7,000 Jobs

NEW YORK (AP) - In a stark acknowledgment of the tough times ahead in the credit card industry, American Express Co. said Thursday that it plans to cut 7,000 jobs, or about 10 percent of its worldwide work force, in an effort to slash costs by $1.8 billion in 2009.

The New York-based credit card issuer - which has reported four straight quarters of profit declines as an increasing number of consumers struggle to pay off debt - said it is also suspending management-level salary increases next year and instituting a hiring freeze.

The job cuts will be across various business units, but will primarily focus on management positions, the company said.

Exxon Mobil Posts Biggest US Quarterly Profit Ever

HOUSTON (AP) - Exxon Mobil Corp., the world's largest publicly traded oil company, reported income Thursday that shattered its own record for the biggest profit from operations by a U.S. corporation, earning $14.83 billion in the third quarter.

Yet numbers contained within the company's most recent financial report revealed production numbers that continue to sag.

The Irving, Texas-based company has reported unprecedented back-to-back quarters, the end of the most recent coinciding with a rapid plunge in crude prices.

Exxon said net income jumped nearly 58 percent to $2.86 a share in the July-September period. That compares with $9.41 billion, or $1.70 a share, a year ago.

Stocks Up On GDP Report In Relatively Calm Session

NEW YORK (AP) - Wall Street showed some welcome signs of stability Thursday, taking a downbeat gross domestic product report in stride and driving the Dow Jones industrial average up nearly 190 points in relatively calm trading.

Even the last half-hour of the session, lately a period of turbulent activity, was comparatively quiet.

The market that a week ago was reeling from fears about recession was more composed after the Commerce Department's report that GDP fell at an annual rate of 0.3 percent during the third quarter - its worst showing in seven years. Analysts expected a 0.5 percent decline in GDP, the broadest measure of economic growth or contraction, but while the report was better than expected, it still pointed to an economy that is shrinking.

Banks Asking For Credit Card Debt Forgiveness

WASHINGTON (AP) - With defaults on credit card debt spiraling amid a global financial downturn, banks already reeling from the mortgage crisis are losing billions more from unpaid credit card bills.

Big banks have formed an unusual alliance with consumer advocates to urge the government to allow huge portions of credit card debt to be forgiven, a turnabout from recent years when the banking industry lobbied strenuously to make it harder for consumers to erase their credit card debts in bankruptcy.

The new pilot program - which the banks hope will become permanent - could involve as many as 50,000 people struggling with credit card debt. On an individual basis, the amount of debt to be forgiven would rise according to the severity of the borrower's financial situation, up to a maximum of 40 percent.