Citi, Wells Fargo seek to repay TARP loans

Citigroup Inc. and Wells Fargo & Co. are seeking to repay billions in federal bailout aid but so far haven't received permission from the government, people familiar with the talks told The Associated Press.

The main sticking point is how much capital the banks would need to raise to repay taxpayers the money they received at the height of the financial crisis, according to two people with direct knowledge of the talks who requested anonymity because the discussions are ongoing.

Citigroup received $45 billion in bailout money and is now 34 percent owned by the government. Wells Fargo received $25 billion.

Citigroup and Wells Fargo declined to comment. Treasury spokesman Andrew Williams would not discuss the negotiations but said banks "are pursuing discussions to understand what needs to be done to move ahead with repayment."

The efforts of Citigroup and Wells Fargo to repay the money come after Bank of America last week announced it would return $45 billion it had received, adding to the $71 billion already repaid by about 50 other financial companies. Bank of America is using available cash and $19 billion raised from a securities offering to repay its funds.

Bernanke: Too soon to tell if recovery will last

Federal Reserve Chairman Ben Bernanke warned Monday that it's too soon to know whether the economic recovery will last and again pledged to hold rates at record-low levels for an "extended period."

The Fed chief's speech to the Economic Club of Washington made clear he thinks the economy will struggle even as it recovers from the recession. He said the economy confronts "formidable headwinds" — including a weak job market, cautious consumers and tight credit.

Those forces "seem likely to keep the pace of expansion moderate," he said.

Asked about prospects for such a "double dip" recession, Bernanke said he could not guarantee it won't happen. He stuck with his forecast for a moderate recovery but said a "vigorous snapback" is less likely.

Bernanke said he expects "modest" economic growth next year. That should help push down the nation's unemployment rate — now at 10 percent — "but at a pace slower than we would like," he acknowledged.

Defense secretary visits Afghanistan

Defense Secretary Robert Gates arrived Tuesday in Afghanistan with plans to assure officials and American troops there that the United States is committed to winning the war despite plans to begin pulling forces out in 2011.

"We are in this thing to win," Gates told reporters while traveling to Kabul, where he plans to meet privately with Afghan President Hamid Karzai and later with troops bearing the brunt of combat.

The secretary's trip to Afghanistan is the first by a Cabinet member since President Barack Obama's announcement last week that he will deploy 30,000 more troops with the intention of starting to bring them home in July 2011.

McChrystal's appearance before the House Armed Services Committee starts the first of three days of congressional Afghanistan hearings that are expected to draw hard questions from both anti-war Democrats and conservative Republicans about Obama's stated intention to begin paring down the U.S. role in July 2011.

McChrystal's appearance before the House Armed Services Committee starts the first of three days of congressional Afghanistan hearings that are expected to draw hard questions from both anti-war Democrats and conservative Republicans about Obama's stated intention to begin paring down the U.S. role in July 2011.

U.S. missile kills 3 in Pakistan tribal area

Pakistani intelligence officials say a U.S. missile strike has killed at least three people in a troubled northwestern tribal region near the Afghan border.

The two officials said the two missiles early Tuesday destroyed a car carrying three people in a village near Mir Ali, which is a main town in North Waziristan.

The officials spoke on condition of anonymity because they were not authorized to speak publicly to the media.

Deadly bomb blasts rock Pakistani city

Bombings in two Pakistan cities killed 46 people Monday, as militants struck back in the wake of an army offensive against a Taliban stronghold in the northwest near the Afghan border.

Two synchronized bombs ripped through a market popular with women in the eastern Pakistani city of Lahore about 9 p.m., igniting a massive fire that killed 36 people, authorities said. Hours earlier a suicide bomber killed 10 people outside a courthouse in the northwestern city of Peshawar.

About 100 people were wounded in the attacks in Lahore, which were timed to take place when the Moon Market was as its busiest. Authorities initially said both bombs were believed to be remote-controlled, but they later said a suicide bomber was suspected to have carried out at least one of them.

Most of the militant attacks in recent weeks have been directed at security forces, though several have targeted crowded public spaces like markets, apparently to create public anger and increase pressure on the government to call a halt to the offensive. More than 400 people have been killed since the beginning of October, including 105 in a Peshawar market frequented by women. That attack occurred while U.S. Secretary of State Hillary Clinton was visiting Pakistan.

The Taliban generally claim responsibility for those attacks killing security officers, but they do not acknowledge carrying out the attacks targeting civilians. Government officials and security analysts say there is little doubt the militants are behind all the attacks.

8 killed, 26 injured in China school stampede

Chinese media say eight students have been killed and 26 others injured in a school stampede in the central province of Hunan.

The reports say the students were charging out of evening study sessions at 9:10 p.m. on Monday night at Xiangxiang city's private Yucai Middle School when students began to fall on top of one another in a stampede on the steps.

Leaders of the city 720 miles (1,160 kilometers) south of Beijing immediately removed the head of the education bureau and were questioning school officials as part of the accident investigation, the official Xinhua News Agency reported Tuesday.

Such deadly stampedes have occurred repeatedly in China's schools, usually as students are rushing to exams or charging out of class down tight corridors and narrow stairwells.

Monday's incident was among the deadliest since the crushing deaths of 21 children in a northern China middle school in 2002 after a railing collapsed as hundreds of children were funneling down a pitch-dark staircase after evening review classes

Microsoft, Yahoo seal search deal

Microsoft and Yahoo have signed off on their plan to team up against Google in Internet search.

The step announced Friday seals the terms of a preliminary agreement announced in late July.

Government regulators still must approve the proposed partnership before Microsoft and Yahoo can begin working together.

Microsoft and Yahoo were supposed to sign the final papers in late October, but held off to work out some fine points.

Combined, Microsoft and Yahoo handle 28 percent of the Internet searches in the United States, well behind Google's 65 percent, according to online measurement firm comScore Inc. Google is even more dominant in the rest of the world, with a global share of 67 percent compared to a combined 11 percent for Microsoft and Yahoo.