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News Wrap: San Bernardino to File for Bankruptcy

July 11, 2012 at 12:00 AM EST
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HARI SREENIVASAN: Stocks slid again today on disappointing news from the Federal Reserve. Minutes from the Fed’s June meeting showed policy-makers are divided over the need for new stimulus measures.

That news disappointed investors. And the Dow Jones industrial average lost more than 48 points to close at 12604. The Nasdaq fell 14 points to close just below 2888.

The city of San Bernardino has joined the ranks of California cities now heading for bankruptcy court. The city council voted last night to take that step, as it faces a $45 million budget hole. San Bernardino is still suffering the effects of the housing market crash and continued high unemployment. It is the third California community to file for municipal bankruptcy in recent weeks.

The government of Spain has imposed a new round of austerity measures one day after the European Union approved a major bailout for Spanish banks. The austerity plan includes new sales tax increases coupled with another round of spending cuts. The announcement came as thousands of coal miners protested in the streets of Madrid against any more cuts. Later, some of the demonstrators fought with police, who fired rubber bullets to disperse the crowd.

The president of Florida A&M University handed in his resignation today, in the latest fallout from a hazing scandal. James Ammons was heavily criticized after the death of a drum major in the school marching band. Robert Champion was badly beaten in a hazing incident last November, and died of his injuries. Eleven band members face trial on criminal charges in the case.