• Washington Mutual’s branch system and deposits bought by JP Morgan after regulators seized the savings and loan.  This now represents the largest bank failure in U.S. history. (This happened after the close of business)
  

• Weekly initial jobless claims  jumped 32,000 to a seven-year high of 493,000.

• Durable goods orders fell 4.5% in August, well below the estimate of a 1.9% decline.

• New home sales  fell 11.5% in August to an annual rate of 460,000, short of the estimate of a 1.0% decline to 510,000. The supply of homes rose from 10.3 months to 10.9 months.
• Existing Home Sales were down in August following a gain in July as tight mortgage credit was blamed on the slow down. Nationally, existing-home sales declined 2.2%.
  

It looks like further negotiations are needed to come to an agreement on how to handle this mess as the meeting/photo op at the White House today was unsuccessful in building a consensus.  Secretary Paulson provided a 2 1/2 page outline of what he and Chairman Bernanke would like to do, which included little to no oversight, no accountability and a $700 billion price tag.

Congress is asking for:

• Legislation to help homeowners avoid foreclosure;
• limiting compensation to executives of troubled firms receiving assistance, ie, no golden parachutes;
• greater oversight than the limited bi-annual reporting requested in the current proposal;
• giving taxpayers an equity stake in companies;
• decreasing the timeframe for the Treasury workout from two years to one; and
• limiting the initial outlay followed by a reassessment early next year prior to providing additional funds.
  

Much critical thinking and brainstorming will be needed to solve this mess.