Well, this is it. 

 Chrysler is filing for bankruptcy.  Chrysler officials had no comment on the bankruptcy report, but the filing came after some of the company’s smaller lenders, including some hedge funds, refused a Treasury Department demand to reduce the amount of money Chrysler owed them.  Bankruptcy doesn’t mean the company will stop working…the administration plans, with the agreement of the UAW, to merge it with Fiat.  “The agreement of all other key stakeholders ensured that no hedge fund could have a veto over Chrysler’s future success,” said an administration official.  Imagine the gall of loaning shareholder money and wanting it back again!  Let’s hope there’s a limit to arbitrary government interference before companies stop doing business with each other altogether.

Record unemployment, but slowed jobless claims
The US Labor Department said the number of initial jobless claims for fell again last week, but the number of people collecting benefits overall hitting a new record high of 6.27 million.  In the week ended April 25, there were 631,000 initial jobless claims filed, down 14,000 from a revised-up 645,000 the previous week.  the decline in initial claims may be nothing more than a correction from the jump due to Lehman Bros collapse, but of course  there’s always someone around waiting to say nice things about it.  “The past few weeks’ claims data are beginning to look increasingly like a peak,” wrote Ian Shepherdson, an economist at High Frequency Economics, adding that it may not mean all that much in the grand scheme of things.  Meanwhile, 6,271,000 people continued filing for unemployment insurance in the week ended April 18.  That’s a record high, and an increase of 133,000 from the previous week.

NAR fighting new mortgage rule changes
The National Association of Realtors (NAR) is trying to delay new Fannie Mae and Freddie Mac rules governing real estate appraisals from going into effect on May 1.  The goal of the change is to eliminate alleged collusion between mortgage lenders and appraisers by stopping brokers from ordering appraisals directly, but it will also mean that mortgage brokers will be required to go through lenders to get appraisals.  Mortgage brokers say this will make it hard for them to compete with lenders, because borrowers looking for the best rate may have to pay for multiple appraisals.

Consumer spending down, income growth down
The US Commerce Department reported that consumer spending dropped by 0.2 percent in March, worse than the 0.1 percent decline that economists had expected, and incomes dropped by 0.3 percent, worse than the 0.2 percent dip that had been expected.  Personal savings edged up to 4.2 percent, compared to 4 percent in February and near zero a year ago.  Consumer spending accounts for 70 percent of total economic activity, so a drop in spending is not a good sign, but certainly understandable in view of the massive layoffs across the country.  The Federal Reserve, which slashed a key interest rate to near zero last December in an effort to fight the downturn, announced it would keep rates low for the foreseeable future.