Evening Edition

A chastened president instead blamed the loss of the House of Representatives and Republican gains in the Senate on deep voter frustration at the sluggish recovery and his failure to clean up the “ugly mess” in Washington.

“It feels bad,” Obama said, digesting his defeat in a White House news conference setting the tone for a looming period of divided government and political confrontation in which he must now chart his 2012 re-election bid.

Obama’s Democrats steeled for a rebuke from fearful voters furious at the slow economic recovery, as Republicans anticipated the seizure of the House of Representatives and hoped to draw close to parity in the Senate.

Veteran politician Dan Coats pulled off the first Republican victory, picking up a Senate seat formerly held by the Democrats in midwestern Indiana.

Hours after Republicans captured the House of Representatives and slashed the Democratic majority in the Senate, a subdued Obama said in a White House news conference that voters were mostly preoccupied with the slow recovery.

“I think that there is no doubt that people’s number one concern is the economy,” Obama said. “And what they were expressing great frustration about is the fact that we haven’t made enough progress on the economy.”

Resurgent Republicans, led by the ultra-conservative Tea Party insurgency, steamrolled Democrats in Tuesday’s key mid-term election by taking at least 60 seats and a commanding majority in the House. It was one of the chamber’s largest political swings of the past century.

Beleaguered Democrats clung onto the Senate, but the Republicans netted six seats, with two more battleground states, Colorado and Washington, yet to be declared. They needed an unlikely 10 pickups to take the Senate as well.

“All the evidence so far clearly shows that these incidents have nothing to do with any kind of organised international terrorism,” Foreign Minister Dimitris Droutsas told reporters in Athens.

Thirteen parcel bombs have so far been accounted for, including one that reached the German chancellery in Berlin and another found on board a courier plane to Paris after it was diverted to Bologna.

While authorities came under fire for failing to contain the plot, police appealed for information which could lead to the capture of five men suspected of trying to attack embassies in Athens and the offices of several European leaders.

“Democracy cannot be terrorised,” said Prime Minister George Papandreou, who said the campaign was designed to “hurt” Greece as it struggles against an unprecedented debt crisis that nearly bankrupted it this year.

“All Christian centres, organisations and institutions, leaders and followers, are legitimate targets for the mujahedeen (holy warriors) wherever they can reach them,” said a statement by the self-proclaimed Islamic State of Iraq (ISI), the local branch of Osama bin Laden’s jihadist network.

The group had already said its gunmen were behind a hostage-taking at a Baghdad cathedral on Sunday that ended in the deaths of 46 worshippers, including two priests.

The Fed’s top policy panel cast aside its long-held reluctance to micro-managing the economy, as members faced down the prospect of a lost decade of growth.

The Federal Open Market Committee (FOMC) said it would buy up new Treasury debt at a rate of around 75 billion dollars a month, a scale not seen since the depths of the economic crisis.

The central bank’s open market committee (FOMC) is expected to approve massive stimulus spending not seen since the depths of the economic crisis.

At the conclusion of the meeting Wednesday, the Fed is expected to announce it will resume the large-scale purchase of long-term US bonds — essentially printing billions of dollars — in the hope of boosting a weak recovery.

The Fed’s top policy-making panel was set to cast aside its long-held reluctance to micro-manage the economy in a bid to avoid a lost decade of growth, a move that redefines the central bank’s role.

The Federal Open Market Committee (FOMC) was likely to approve stimulus spending worth hundreds of billions of dollars, a scale not seen since the depths of the economic crisis.

Spanish-owned Santander UK later named his replacement as Ana Patricia Botin, who is the daughter of Santander’s executive chairman and will become the first female chief executive of a British retail bank.

Lloyds Banking Group (LBG), which is slowly recovering after a massive government bailout, said 46-year-old Portuguese national Horta-Osorio would replace current chief executive Eric Daniels in March 2011.

British Prime Minister David Cameron and French President Nicolas Sarkozy signed two treaties which they say will allow them to remain global players while cutting defence budgets in the wake of the financial crisis.

The neighbouring NATO members — rivals for centuries who fell out spectacularly over the 2003 Iraq invasion — insisted the pact would not deprive their militaries of the ability to act independently.

The firm’s founder and former chairman B. Ramalinga Raju — a one-time poster boy for Indian economic progress — was present for a preliminary hearing in the southern city of Hyderabad.

His declaration in January 2009 that he had falsified profits plunged the Indian business world into turmoil.

Although many people in Europe and the United States are worrying about recovery from the economic crisis and unemployment, as evidenced in a swing against US Barack Obama in US elections, luxury car makers in Germany are riding high, largely on demand from emerging markets.

Latest data on auto sales in Europe generally show a slump from levels last year which were stimulated by now phased-out government subsidies.

This finely choreographed global ballet of speeding metal, fuel and flesh moved almost five billion passengers in 2009, according to data from Airports Council International.

But what if all those screens went blank?

Swan promised sweeping reforms to loosen the grip of Australia’s “big four” lenders, slamming a move by Commonwealth Bank to lift borrowing rates above Tuesday’s official 25-basis-point rise.

“The behaviour of the Commonwealth Bank has been arrogant in the extreme,” Swan told reporters as he left on a trip to China.

The bank based its new prediction on the “still surprisingly strong” 9.6 percent growth in gross domestic product seen in the third quarter, and said the prospects for the world’s second-largest economy “remain sound”.

The Washington-based bank forecast 2011 growth of a more modest but still robust 8.7 percent, slightly up from its previous estimate of 8.5 percent, in its latest quarterly update on China.

GM’s filing with the U.S. Securities and Exchange Commission is the final step before it begins marketing what is expected to be one of the largest-ever IPOs. The investors are expected to span the globe and include sovereign wealth funds.

The automaker plans to sell 365 million common shares at $26 to $29 each, raising about $10 billion at the midpoint, according to updated initial public offering papers filed with the SEC.

The decision, which takes the Fed into largely uncharted waters, is aimed at further lowering borrowing costs for consumers and businesses still suffering in the aftermath of the worst recession since the Great Depression.

The U.S. central bank said it would buy about $75 billion in longer-term Treasury bonds per month as part of the new program. It said it would regularly review the pace and size of its purchases and adjust as needed depending on the path of the recovery.

But on issue after issue, Obama gave little ground on his positions as the two sides gear up for negotiations over how to tackle the sluggish economy, the main reason the electorate has soured on his leadership.

At a White House news conference, Obama confessed to having suffered a long night on Tuesday as Republicans seized control of the House of Representatives and made gains in the Senate, handing him the biggest defeat of his career and threatening to block his agenda for the second half of his term.

“It’s pretty clear the American people want a smaller, less costly and more accountable government,” Republican John Boehner, in line to become the next House of Representatives speaker, told reporters. “Our pledge is to listen to the American people.”

Voters, anxious about unemployment and unhappy with Obama’s leadership, punished Democrats in an election rout on Tuesday that gave House control to Republicans and weakened the Democratic majority in the Senate.

The emerging Tea Party bloc could prove to be a headache to both Democrats and Republicans in the Congress next year and complicate any attempts by the two parties to reach across the aisle for compromise.

Republicans Marco Rubio of Florida and Rand Paul of Kentucky were high-profile entries to the Tea Party club in winning Senate races in their home states.

In March 2009, with the United States on the brink of recession and the stock market at 12-year lows, President Barack Obama met with the Business Roundtable, an association of chief executives from top U.S. firms. The two sides said they would work together to rescue the economy and signaled openness to tackling long-term problems like tax reform and deficit reduction.

Obama hailed the “entrepreneurial spirit” of the CEOs and said his goal was “not to disparage wealth but to expand its reach; not to stifle the market,” but to help spur innovation.

Small bombs exploded at the Swiss and Russian embassies in Athens on Tuesday, a parcel with explosives was intercepted at the German chancellor’s office and another package addressed to Italy’s prime minister caught fire when it was checked.

The bombs may be intended to spur an anti-government vote in Sunday’s local elections in protest against Prime Minister George Papandreou’s austerity plan, agreed with the EU and International Monetary Fund to deal with Greece’s debt mountain.

Iraq has been without a new government since an inconclusive March election. The Sunni-backed cross sectarian Iraqiya bloc won the most seats, but Maliki’s faction has since combined with other Shi’ite groups and reached deals with minority Kurds, and that may keep him in power.

In a sign that some in Iraqiya no longer believe it can form a government, one of its lawmakers said a group of up to 30 of its parliamentarians intended to back a government led by Maliki.

“The authorities in Tehran have given the go-ahead to Tabriz prison for the execution of Iran stoning case Sakineh Mohammadi Ashtiani,” the International Committee against Stoning, a German-based campaign group, said on its website.

“It has been reported that she is to be executed this Wednesday, 3 November.”

Bush’s book, “Decision Points,” is full of anecdotes and behind-the-scenes details of eight eventful years that began with the September 11 in 2001 attacks and ended with an economic meltdown in which “I felt like the captain of a sinking ship.”

Bush wrote of many errors involving the Iraq campaign and the failure to find weapons of mass destruction there, despite numerous intelligence reports pointing to their existence.

Obama ruefully called the Republican victories “a shellacking” and acknowledged that his own connection with the public had frayed.

At a White House news conference, the president said that when Congress returns, “my goal is to make sure we don’t have a huge spike in taxes for middle class families.” He made no mention of his campaign-long insistence that tax cuts be permitted to expire on upper-income families, a position he said would avoid swelling the deficit but put him in conflict with Republicans.

He called the election a “shellacking.”

After two years with fellow Democrats leading Congress, Obama now must deal for the rest of his term with the jarring reality of Republican control of the House, a diminished Democratic majority in the Senate and a new flock of lawmakers sworn to downsize government at every chance.

The activists promised to keep up the pressure on their favored lawmakers to fight a Washington establishment they say is broken and doesn’t work for the best interests of the American people. That could make trouble for congressional leaders who need compromise and dealmaking to get any work done.

Several tea party winners said in interviews that they were reaching out to one another in the wake of the election to form a coalition for their conservative principles. Rep. Michele Bachmann, R-Minn., formed a tea party caucus this summer with a couple dozen members, and the freshmen said it’s unclear if they would join her group or start one of their own.

Senate Majority Leader Harry Reid of Nevada survived a fierce challenge from tea party Republican Sharron Angle. However, Republicans ousted two Democratic senators and picked up Democratic-held seats in four other states, leaving Reid with a greatly diminished majority.

Reid’s win, plus Democratic victories in California and West Virginia, kept Republicans short of the 10-seat gain they needed to control the 100-member chamber. Races in Alaska, Colorado and Washington were too close to call.

The GOP’s reward: Governing a fickle, angry electorate in a time of busted state budgets and high anxiety about jobs and joblessness. And for voters in states that flipped from Democratic to Republican control, what they sought – change – is definitely in store.

In Ohio and Wisconsin, high-speed rail projects may be scuttled. In Pennsylvania, privatization of the state liquor stores is back on the table. In the Democratic stronghold of Minnesota, long-dormant GOP proposals to establish racetrack gambling, require a photo ID for voting and amend the state Constitution to ban gay marriage may find new life. And everywhere, they promised to focus on the economy.

On both sides of the marriage debate, the Iowa vote was seen as a signal that judges in other states could face similar punitive challenges.

The congressional results further clouded the prospects for repealing the “don’t ask, don’t tell” policy so that gays could serve openly in the military. Democratic leaders, including President Barack Obama, hope for a repeal vote in the Senate during the upcoming lame-duck session, but the post-election climate may strengthen the hand of conservatives wary of repeal.

On an Election Day that seemed a long way from 2008, disappointment was the theme.

“I’d like to find somebody to blame,” said Kimberly Abrudan, a customer service manager who had voted at a Delaware charter school for Democrat Chris Coons for Senate. “It would make things a lot easier. But I’m not convinced that it’s any one man.”

The tight votes signaled how closely divided American voters are in an election that produced a split Congress, with Republicans taking control of the House and Democrats maintaining power in the Senate.

The candidates in the Washington state and Colorado Senate races were separated by a few thousand votes after campaigns that attracted tens of millions of dollars in spending. The Republican nominee in the Alaska Senate race was already gearing up for a legal fight and sending lawyers to the state.

This is in addition to an expected $250 billion to $300 billion in Fed purchases over the same period from reinvesting proceeds from its mortgage portfolio.

The idea is for cheaper loans to get people to spend more and stimulate hiring. The Fed said it will monitor whether adjustments are needed depending on how the economy is performing.

The Fed is all but certain to detail its plan for buying more government bonds when it wraps up its two-day meeting Wednesday. Those purchases should further lower interest rates on mortgages and other loans. Cheaper loans could lead people and companies to borrow and spend. That might help invigorate the economy, and lead companies to step up hiring.

Still, many question whether the Fed’s new plan will provide much benefit.

In that classic movie, the audience sees her back before a new camera perspective shows her face. Such a wraparound view of a moving image was just movie-trick fantasy in the 1977 film, but now?

“It is actually very, very close to reality. We have demonstrated the concept that it works. It’s no longer something that is science fiction,” said Nasser Peyghambarian of the University of Arizona.

The Islamic State of Iraq, which has claimed responsibility for Sunday’s assault on a Catholic church during Mass in downtown Baghdad, said its deadline for Egypt’s Copts to release the women had expired and its fighters would attack Christians wherever they can be reached.

“We will open upon them the doors of destruction and rivers of blood,” the insurgent group said in a statement posted late Tuesday on militant websites.

But while the slimmer loss, and recent glimmerings such as a slowing rate of new soured loans coming onto Freddie’s books, may be positive signs, they don’t mean the end of the company’s travails, experts say.

“The fact that losses are better is good. But it’s not necessarily a forecast for future earnings growth,” said Anthony Sanders, a professor of real estate finance at George Mason University in Fairfax, Va. “The problem still remains that we are faced with a deteriorating housing market.”

The spirited campaign over Proposition 19 pitted the state’s political and law enforcement establishment against determined activists seeking to end the prohibition of pot.

It was by far the highest-profile of the 160 ballot measures being decided in 37 states. Other topics included abortion, tax cuts and health care reform.

DeLay, the once powerful but polarizing lawmaker, is accused of using his political action committee to illegally funnel $190,000 in corporate donations into Texas legislative races eight years ago. DeLay has denied any wrongdoing and says no corporate money went to Texas candidates.

The six witnesses that prosecutors have presented to jurors since testimony began Monday have detailed how the PAC was run, how it raised money and DeLay’s role in its operation.

The open-top, 2011 E350 and E550 look pretty on the road, ride smoothly and have the latest amenities and technology to make even cool-weather driving more comfortable than expected. But like past Mercedes Cabriolets of the early 1990s, the E-Class Cabrios have fabric soft tops, not the more complicated and weighty retractable hardtops that are common today. And so the E-Class convertibles offer a good amount of trunk space.

Starting manufacturer’s suggested retail price, including destination charge, for the E350 Cabriolet with 268-horsepower V-6 is $57,725. The uplevel E550 with 382-horsepower V-8 starts at $65,675.