Mortgage rates fall to new record low

WASHINGTON (AP) — Rates on 30-year fixed-rate mortgages fell to a record low for the second straight week, causing refinancing applications to surge to the highest level in more than five years, a month after the Federal Reserve pledged to channel billions to prop up the sinking U.S. housing market.

While homeowners around the country are taking advantage of historically low rates to refinance their loans, the opportunity isn't available to those with poor credit or little equity in their homes, and foreclosures are still likely to surge.

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Founder's grandson may take over struggling Toyota

TOKYO (AP) — As Toyota Motor Corp. faces its biggest crisis, speculation is growing that the charismatic grandson of the company's founder may take over leadership of the automaker sooner than expected.

Japan's nationally circulated Asahi newspaper reported that Akio Toyoda — long groomed for the top job — will replace current president Katsuaki Watanabe as soon as April. The newspaper did not cite sources and Toyota denied any decision has been made.

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AIG buys $16B of CDOs in risk reduction effort

NEW YORK (AP) — Insurer American International Group Inc. said it purchased $16 billion of complex financial instruments in an effort to further reduce its exposure to insurance guarantees written against them.

AIG bought about $16 billion in investments known as collateralized debt obligations, or CDOs, through a financing company set up by the insurer and the government to help relieve AIG of its exposure to the riskiest portion of the credit markets.

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Gov't aims to complete IndyMac sale by year end

WASHINGTON (AP) — Federal regulators are moving to sell the remnants of failed IndyMac Bank before year end, mopping up from the second-largest bank failure this year.

It was unclear whether the government would sell off IndyMac as a whole or in pieces, and an announcement wasn't expected until today at the earliest. The Pasadena, Calif-based lender, which specialized in loans made with little down payment or proof of assets, went under in July as the U.S. housing market bubble collapsed.

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SEC to charge execs at failed money market fund

NEW YORK (AP) — Reserve Management Co., which is facing a slew of investor lawsuits after its money market fund fell below a key safety benchmark, said the Securities and Exchange Commission plans to charge the company and its management with violations of securities laws.

The fund, whose assets exceeded $62 billion in mid-September, is in the process of liquidating.

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Southwest sells aircraft, modifies fuel hedges

ATLANTA (AP) — Discount carrier Southwest Airlines Co. sold five aircraft for $175 million and agreed to lease the planes back from the buyer for 12 years.

The Dallas-based airline also modified its fuel hedge portfolio to limit its exposure from falling oil prices.

The disclosures were made in a Securities and Exchange Commission filing.