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JPMorgan, Citigroup Helped Cause Lehman’s Collapse (Update4) JPMorgan Chase & Co. and Citigroup Inc. helped cause the collapse of Lehman Brothers Holding Inc. by demanding more collateral and changing guarantee agreements, the bankrupt bank’s examiner said today in a report.

Buffett Gets $100,000 Berkshire Salary for 29th Straight Year Warren Buffett, the billionaire chairman of Berkshire Hathaway Inc. who pays the company for postage and personal phone calls, received a $100,000 salary for a 29th straight year as he arranged a $27 billion acquisition.

California Lifts Tax-Exempt Bond Sale to $2.5 Billion (Update2) California boosted the size of its debt sale to $2.5 billion, adding $500 million to its first issue of tax-exempt bonds since November after individuals placed orders for more than half the securities initially marketed, according to two people who have seen the offering information.

Biggest Rally in 76 Years Not Dead as Seers See Gains (Update2) Laszlo Birinyi will never forget the moment a year ago when the last ounce of confidence disappeared. Everyone from billionaire Warren Buffett to New York University Professor Nouriel Roubini was convinced that the economy was in a free-fall, that exploding deficits would devastate the dollar and that home prices were heading down as much as 20 percent.

U.S. Economy: Trade Deficit Unexpectedly Shrinks (Update3) The trade deficit in the U.S. unexpectedly narrowed in January as imports fell for the first time in five months, indicating demand is cooling following the fastest pace of growth in six years.

N.Y.’s Cuomo Appoints Former Judge to Oversee Probes (Update1) New York Attorney General Andrew Cuomo said today he appointed Judith Kaye, the state’s former chief judge, as an independent counsel to oversee investigations related to the conduct of Governor David Paterson.

Hologic Shares, Options Surge on Buyout Speculation (Update1) Hologic Inc. rose the most in a year and trading of bullish options was the highest since November 2006 on speculation the medical-imaging equipment maker will be acquired.

Corrections Corp. Guards Condone Prison Violence, Inmates Allege Corrections Corp. of America Inc., the biggest U.S. private prison operator, was sued by six prison inmates claiming the company has allowed the Idaho Correctional Center it built and manages for the state to become so violent that it’s known as “gladiator school.”

Venezuela Bolivar May Sink as Low as 9, Barclays Says (Update2) Venezuela’s bolivar may fall as low as 9 per dollar in the “worst scenario” as the government refrains from selling U.S. currency in the unregulated market to preserve foreign reserves, Barclays Plc said.

Health-Care Bill Path Complicated by Parliamentarian (Update2) Republicans said the Senate parliamentarian threw up a hurdle to congressional Democrats’ plans to pass changes to U.S. health-care legislation through a process called reconciliation.

Toyota Seeks 2010 Recovery for Most of Lost U.S. Market Share Toyota Motor Corp. set a 2010 goal of regaining most of the U.S. market share lost in the past two months after global recalls of 8 million vehicles damped demand, the No. 2 U.S. sales executive said.

U.S. Stocks Gain as S&P 500 Rallies to Highest Level Since 2008 U.S. stocks rose, sending the Standard & Poor’s 500 Index to the highest level since October 2008, as Citigroup Inc. led a bank rally and investors speculated that health-care reform will be harder to pass.

Fannie Mae Sells Largest Benchmark Issue in 11 Months (Update2) Fannie Mae sold $6 billion of debt, its biggest offering of benchmark notes in 11 months, as the company boosts borrowing and cuts holdings to fund about $130 billion of planned purchases of delinquent loans from the mortgage securities it guarantees.

Flooding Rains Will Soak New York, New Jersey and Long Island A slow-moving storm will drop as much as 4 inches (10 centimeters) of rain on New York City starting tonight and lasting until next week, according to the National Weather Service.

Obama Designates 10 Charities to Share in Nobel Money (Update1) President Barack Obama has designated 10 charities, including those that serve students and veterans, to get portions of his $1.4 million Nobel Peace Prize award, the White House announced.

GMAC’s Chief Said to Get $9 Million Stock Compensation, No Cash Michael Carpenter, GMAC Inc.’s chief executive officer, will get a 2010 pay package of about $9 million entirely in stock, and some or all won’t vest until later years, according to a person with direct knowledge of the matter.

Elliott Said to Consider Sale of Unit If Bid Succeeds (Update1) Elliott Associates LP, the fund manager that made an unsolicited $2 billion offer for Novell Inc., may consider selling the NetWare networking-software unit if its bid succeeds, a person familiar with the matter said.

Retail LBOs are Back as Credit Freeze Abates, Buyout Firms Say Private-equity firms looking to buy retail and consumer companies said they’re now able to finance deals and pay reasonable prices after the credit crisis and global recession triggered a buyout slump.

Quake Shakes Pinera’s Plan to Spur Chilean Economy (Update3) Sebastian Pinera was inaugurated as Chile’s president today minutes after powerful earthquakes shook buildings in Santiago and Valparaiso, stirring memories of last month’s devastating 8.8-magnitude temblor.

GameStop Gains Most in Year on Takeover Speculation (Update2) GameStop Corp., the world’s largest video-game retailer, gained the most in almost a year in New York and trading of its bullish options jumped to a record on speculation that the company will be acquired.

California Democrats Want to End ‘Supermajority’ Budget Rule California’s two top Democratic lawmakers said they’ll propose constitutional amendments aimed at easing the budget process in the most populous U.S. state.

House Seeks 18-Month Extension of Build America Bonds (Update1) House Democrats will seek to extend interest-subsidized Build America Bonds in negotiations with the Senate over a jobs bill, acting House Ways and Means Committee Chairman Sander Levin said.

JPMorgan, Citigroup Helped Cause Lehman Illiquidity, Report Says JPMorgan Chase & Co. and Citigroup Inc. helped cause the illiquidity that led to the collapse of Lehman Brothers Holding Inc., the bankrupt bank’s examiner said today in a report filed in Manhattan federal court.

Blagojevich Asks U.S. Court to Postpone Corruption Trial Former Illinois Governor Rod Blagojevich asked a U.S. court to postpone the start of his scheduled June 3 trial on corruption charges, saying he needs more time to prepare a defense.

New Jersey Governor Christie May Privatize State Jobs (Update1) New Jersey Governor Chris Christie said he may privatize some state jobs in 2011, as he struggles to close an $11 billion budget deficit amid rising costs for employee salaries and benefits.

KKR Leads $235 Million Debt Refinancing for Harden Healthcare KKR & Co., the private-equity firm run by Henry Kravis and George Roberts that’s expanding its investments outside traditional buyouts, led a $235 million refinancing for Harden Healthcare LLC.

Natural Gas Drops Near 16-Week Low Ample Supply, Mild Weather Natural gas futures fell to the lowest price in almost 16 weeks after a government report showed supplies of the fuel will be ample during milder-than-normal weather at the end of the heating season.

Bond Spreads at Narrowest This Year Lure GMAC: Credit Markets Corporate bond yields fell to the lowest this year relative to benchmark government securities, luring GMAC Inc. to sell its longest-maturity notes since 2004.

U.S. Stocks Advance After Senate Ruling on Health-Care Reform U.S. stocks rose, reversing earlier losses, after a Senate parliamentarian made it harder for Democrats to use a process known as reconciliation to bypass Republican opposition to health-care reform.

Virgin Money Chairman Brian Pitman Dies After Heart Attack Virgin Money Holdings U.K. Ltd. Chairman Brian Pitman died this morning after a heart attack.

Calpers May Challenge Apple, BlackRock on Election of Directors The California Public Employees’ Retirement System, the biggest state-run U.S. public pension, may use its financial clout to force Apple Inc., BlackRock Inc. and other companies where it has large holdings to change the way they elect directors.

House, Senate Leaders Agree on Most of Health Bill (Update2) House and Senate leaders have agreed on most elements of legislation needed to push forward President Barack Obama’s proposed overhaul of the U.S. health- care system, top House Democrats said.

Ecuador Tax Reform May Generate $600 Million in 2010, Cely Says Ecuador’s proposed corporate tax reform may generate $600 million in new investments this year as companies take advantage of incentives to reinvest profits, said Nathalie Cely, the nation’s production minister.

Home Equity Lending That Fueled Spending to Recover (Update1) John Hale’s four-bedroom house near Seattle is worth about $2 million and is 90 percent paid for. It still took him nine months to find a bank that would give him a $250,000 home equity line of credit.

India’s Stalled Arms Buying Leaves Its Army Outgunned by China India, which has tripled its defense spending in a race against China’s military buildup, is having trouble converting the funding into weapons and equipment its military says are urgently needed.

Pelosi Staff Said to Be Told of Massa in October (Update2) House Speaker Nancy Pelosi’s staff first learned of concerns about the behavior of former New York Representative Eric Massa in October, four months earlier than the speaker previously disclosed, said a Democratic aide who spoke on condition of anonymity.

Pledge of Allegiance in Schools Ruled Constitutional (Update1) Reciting the Pledge of Allegiance with its reference to God in public schools doesn’t violate the U.S. Constitution’s separation of church and state, a federal appeals court ruled.

GMAC Executive Pay Packages Questioned by TARP Panel (Update2) GMAC Inc., the auto and home lender rescued by the U.S. government, may have overpaid its top executives after receiving taxpayer funds, according to a report by the panel overseeing the Troubled Asset Relief Program.

Treasury Yield Curve Near Record Adds to Demand at Bond Auction Treasury 30-year bonds gained as one of the biggest yield premiums over 2-year government securities on record bolstered demand at today’s U.S. auction of $13 billion in bonds.

EIM USA Chief Said to Leave Busson’s Fund of Hedge Funds Antonio Munoz, chief executive officer of EIM USA Inc., left the U.S. arm of Arpad Busson’s $9 billion fund-of-hedge-funds firm, according to two people with knowledge of the move.