TOPICS > Economy

News Wrap: Stocks Tumble on Consumer Sentiment, Earnings Numbers

July 16, 2010 at 12:00 AM EDT

HARI SREENIVASAN: The bears were back on Wall Street today. Stocks tumbled after a survey of consumer sentiment fell sharply, and after earnings by big banks and Google disappointed investors.

The Dow Jones industrial average lost 261 points to close below 10098. The Nasdaq fell 70 points to close at 2179. For the week, the Dow lost 1 percent; the Nasdaq fell nearly 1 percent.

Federal authorities announced the largest ever crackdown on Medicare fraud today. It involved charging for treatments and therapy that never happened and for medical equipment that wasn’t needed. The alleged scams totaled $250 million. Thirty-six people were arrested in raids across five states from Florida to Texas. They included several doctors and nurses.

Attorney General Eric Holder and the health and human services secretary, Kathleen Sebelius, made the announcement at a health care fraud summit in Miami.

ERIC HOLDER, U.S. attorney general: With today’s arrests, we’re putting would-be criminals on notice. Health care fraud is no longer a safe bet. It’s no longer easy money. If you choose to engage in health care fraud, you will be found, you will be stopped, and you will be brought to justice.

HARI SREENIVASAN: Medicare fraud costs the government between $60 billion and $90 billion a year. Cleaning up the problem is supposed to help to pay for the president’s health care overhaul.

West Virginia is getting a new temporary U.S. senator. Governor Joe Manchin today tapped Carte Goodwin, his former general counsel. He’s 36 years old. Goodwin will succeed the late Robert Byrd, who died last month at the age of 92. The state legislature is likely to call a special election in November. Goodwin is expected to step aside so that Governor Manchin can run for the final
two years of Byrd’s term.

Apple moved today to address the so-called death grip problem with its latest iPhone. Users have reported that holding the phone with your bare hand can obstruct part of the antenna and muffle the signal. Apple CEO Steve Jobs announced buyers will get free protective cases to fix the problem.

He spoke at company headquarters in Cupertino, California.

STEVE JOBS, CEO, Apple: We’re not perfect. We know that. You know that. And phones aren’t perfect either. But we want to make it — make all of our users happy. And if you don’t know that about Apple, you don’t know Apple.

HARI SREENIVASAN: Jobs also said only five of every 1,000 iPhone users have reported any problems, and he complained this has been blown so out of proportion that it’s incredible.

Those are some of the day’s major stories — now back to Jeff.