Closely watched index shows home prices set record annual decline in 1st quarter
On Tuesday May 26, 2009, 10:23 am EDT


NEW YORK (AP) -- Home prices fell at the fastest annual rate on record in the first quarter, but the pace of month-to-month declines continues to slow, a closely watched housing index showed Tuesday.

The Standard & Poor's/Case-Shiller National Home Price index reported home prices tumbled by 19.1 percent in the first quarter, the most in its 21-year history.

Home prices have fallen 32.2 percent since peaking in the second quarter of 2006 and are at levels not seen since the end of 2002.

The 20-city index fell by 18.7 percent in March from the year before and the 10-city index lost 18.6 percent. Those declines were a bit better than February's and marked the second straight month the indexes didn't post record drops.

Still, there are no signs home prices have hit bottom.

"We see no evidence that a recovery in home prices has begun," said, David M. Blitzer, chairman of the S&P index committee.

All 20 cities showed monthly and annual price declines, with nine setting annual records. Fifteen cities posted double-digit drops and three cities -- Phoenix, Las Vegas and San Francisco -- all recorded declines of more than 30 percent.

Minneapolis posted a 6.1 percent decline from February to March, and the biggest monthly drop on record for all of the metro area.

Charlotte, North Carolina, and Denver home prices had the best performance in March over February, both edging up less than 1 percent. Home prices in Dallas were flat in March.

Facebook gets $200 million from Russian investor that values company at $10 billion
On Tuesday May 26, 2009, 12:34 pm EDT


NEW YORK (AP) -- Facebook is getting a $200 million investment from a Russian Internet investor that values the social networking company at $10 billion.

The investment gives Digital Sky Technologies a nearly 2 percent stake in the Palo Alto, California-based company's preferred stock. The deal presumes the company is worth $10 billion.

This is below the $15 billion valuation implied by a 2007 investment from Microsoft Corp., even though Facebook has substantially grown since then. However Facebook's own appraisal after the Microsoft deal gave the company a market value of about $3.7 billion, according to details revealed in a legal settlement.

NEW YORK (AP) -- A European bank that was among the biggest losers in the Bernard Madoff swindle has agreed to pay $235 million to resolve potential legal claims by the trustee trying to unwind the massive pyramid scam.

The payment by Banco Santander would return about 85 percent of the money that the bank's hedge fund affiliate, Optimal Investment Services, had withdrawn from its accounts with Madoff in the years before the fraud collapsed.

The settlement, announced Tuesday, still needs to be approved by a U.S. court. If authorized, the deal would swell the pool of money available to compensate Madoff's victims to more than $1.2 billion.

Irving Picard, the court-appointed trustee overseeing the remnants of Madoff's firm, has sued a number of banks and hedge funds that steered customers into the fraud, arguing that they should have figured out the operation wasn't legitimate.

He has also asked investors who withdrew profits from their Madoff accounts in recent years to return the money, saying the gains were fictitious. Madoff has admitted stealing billions of dollars from some investors to pay fraudulent profits to others.

Banco Santander has said that clients of Geneva-based Optimal saw more than $3 billion in presumed wealth evaporate in the fraud. Separately, it has offered to reimburse those clients for much of their lost