Panel approves Obama picks for Federal Reserve

A Senate panel has approved three of President Obama’s picks for the Federal Reserve, including his nominee to be the central bank’s second-highest ranking official.

Janet Yellen has won the Senate Banking Committee’s approval to be the Fed’s vice chairwoman. The panel also approved Sarah Raskin and Peter Diamond to be on the Fed board.

All three nominations now go to the full Senate for a vote.

If they are confirmed, Obama will have appointed five of the seven members of the Federal Reserve Board in Washington.

The committee approval of the Fed nominees comes as the central bank is trying to steer the fragile economy into a lasting recovery. The Fed will also play a leading role in implementing a new financial overhaul law.

U.S. factory orders decline in June for big-ticket items

Orders to U.S. factories for big-ticket manufactured goods fell in June as demand for commercial aircraft plummeted. But businesses increased spending on capital goods for a second straight month, a sign that manufacturing continues to help keep the economic recovery afloat.

Demand for durable goods dropped 1 percent last month to a seasonally adjusted $190.5 billion, the Commerce Department said Wednesday. It was the second straight monthly decline and the largest drop since August 2009.

June unemployment rises in most of largest metro areas

The unemployment rate in about three-quarters of the nation’s largest metro areas rose last month as nearly one million teenagers entered the work force looking for summer jobs.

The Labor Department said Wednesday that the unemployment rate rose in 291 of 374 areas in June from May. It fell in 55 areas and was flat in 28. That reverses the trend of the previous three months, when joblessness fell in most metro areas.

But the report does not adjust the figures to take into account seasonal trends, such as high school or college students looking for work during the summer. As a result the figures tend to be volatile from month to month.

Billionaire owner of Aldi Group grocery stores dies

Theo Albrecht, whose expansion of no-frills Aldi Group grocery stores made him Germany’s third-richest man, has died. He was 88. Albrecht passed away in the western Germany city of Essen on July 24, Aldi Nord said Wednesday in a faxed statement. Der Spiegel reported that the reclusive billionaire, who also owned Trader Joe’s stores in the United States, had been ill since a fall a year ago and was buried in a private ceremony early Wednesday.

Ex-money manager pleads guilty to securities fraud

A former money manager pleaded guilty Wednesday to securities fraud, admitting that he cheated charities, schools, pension funds and others out of at least $331 million, using a portion of the funds to buy collectible teddy bears and to invest in $100,000 horses.

Paul Greenwood, 63, entered the plea in U.S. District Court in Manhattan in a cooperation deal that could win him leniency at sentencing, which was tentatively set for Dec. 1. He would otherwise face up to 85 years in prison.

Greenwood, of North Salem, N.Y., told Judge Miriam Goldman Cedarbaum that he conspired with others from at least 1996 through last year to divert funds that were supposed to be invested into personal accounts.

The institutional investors entrusted Greenwood and his partners with $7.6 billion that was supposed to be invested conservatively. Instead, Greenwood said, the partners invested a portion of the money in a company that failed. “We ended up losing a lot of money,” Greenwood said.

He said he initially thought the partners could make back the lost money through other investments but later realized that was not possible. “As time went on the hole got bigger and bigger,” Greenwood said.

 

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