Regional Business Digest

REGION

Gasoline prices drop

Gasoline prices dropped 1.3 cents per gallon this week in Northeast Ohio, where the average price for regular, unleaded, self-serve gasoline is $3.631, according to the AAA East Central Fuel Gauge. The average price during the week of Aug. 28, 2007, was $2.809.

Also, the national average price of self-serve regular gasoline moved lower for the 38th consecutive day, to $3.372.

Typical lower prices in the fall may be offset, however, by Hurricane Gustav, which at present is heading toward the Texas Gulf coast and the oil infrastructure there; and the continuing tension between Russia and the United States and Europe over Russia’s entry into Georgia; and finally, some investors are not convinced the rally of the U.S. dollar will be sustained.

These are the average prices of unleaded self-serve gasoline in Ohio cities: Alliance, $3.546; Ashtabula, $3.625; Cleveland, $3.621; and Niles, $3.572.

NATION

Fannie, Freddie shares up

WASHINGTON — Shares of Fannie Mae and Freddie Mac climbed for a third-straight day Wednesday, as analysts raised doubts about whether a bailout of the two companies was imminent.

Fannie shares rose 65 cents, or 11.6 percent, to $6.27 in midday trading, while Freddie advanced 53 cents, or 13.4 percent, to $4.50

McLean, Va.-based Freddie Mac completed a $2 billion debt sale Monday, and some Wall Street analysts say the government-sponsored mortgage finance companies have an adequate capital cushion to absorb billions of dollars in losses from soured mortgages in the near term, meaning a federal bailout could be avoided. Other analysts, however, continue to express a gloomier outlook.

Losses at thrifts mount

WASHINGTON — Federal regulators say U.S. thrifts lost $5.4 billion in the second quarter and set aside a record amount to cover losses from bad mortgages and other loans.

Data from the U.S. Office of Thrift Supervision show federally insured savings and loan institutions posted their second-largest quarterly loss ever in the April-June period, after the $8.8 billion loss in the fourth quarter of last year. Heavily focused on mortgage lending, thrifts have been stung by mounting home-loan defaults.

The $5.4 billion quarterly loss compared with net profits of $3.8 billion in the year-ago period, and a loss of $627 million in the first quarter.

The roughly 830 thrifts also set aside a record $14 billion to cover losses from bad mortgages and other loans.

Vindicator staff and wire reports