Nomura Holdings, Japan's largest brokerage, said it would pull out of the U.S. residential mortgage-backed securities market and cut a quarter of its U.S. workforce, pushing it to a big quarterly loss.

Nomura is the latest global investment bank forced to swallow bigger losses on products tied to to U.S. mortgage market, which was thrown into turmoil this year by rising defaults on subprime home loans.

It now expects to post a group pretax loss of 40-60 billion yen ($340-$511 million) for the July-September second quarter due to losses on residential mortgage-backed securities (RMBS) and charges to cut its U.S. workforce to 900 from 1,217 as of June.

Nomura, which has been buying residential mortgages and bundling them for resale as securities, said it would focus its efforts in the U.S. on expanding its asset management business and electronic brokerage unit Instinet.

"This should all but clear up our problems in the United States, and we believe we can build a structure that will allow us to achieve a speedy recovery from the second half," Nomura Chief Financial Officer Masafumi Nakada told a news conference.

Nomura had said earlier this year it may pull out of the RMBS business as part of a reorganisation of its U.S unit, which lost 74 billion yen on a pretax basis in the two quarters to June as it wrote down the value of its mortgage loan portfolio.

The lawsuit is one more symptom of a softening housing market. The median price of an existing condo in Lee County has fallen 38 percent from February 2006, at $353,900, the highest on record, to $218,800 in August 2007, the last month available, according to the Florida Association of Realtors. For single-family homes, the price has fallen 22 percent from the all-time high of $322,300 in December 2005 to $250,800 in August 2007.

Builders in Southwest Florida are seeing such challenges more and more, said Christopher Shields, a real estate attorney with the Pavese law firm in Fort Myers.

"Potential purchasers are trying to get out of their contracts," he said. "Typically in a rising market, it doesn't matter whether or not a developer has committed violations at all, the buyer goes ahead and closes because he thinks the property is going to be worth more next year."

Now that prices are soft, however, "They look for reasons where perhaps the developer is in violation of federal and state disclosure requirements."

Some recent examples of similar suits by both buyers and builders trying to make the best of contracts signed in better times:

• A federal class action lawsuit brought by people who bought houses from First Home Builders alleges that they were defrauded by the developer and real estate brokerage D'Alessandro & Woodyard in a program to sell homes as an investment with a guaranteed rate of return.

• Advantage Builders of America in March sued 13 people for more than $15,000 in damages and attorneys' fees because they entered into contracts to buy houses in Lehigh Acres and Cape Coral but didn't make payments.

• The builders of Sail Harbour in February asked the court to force 29 people to close on their deals in the south Fort Myers development.

The suit against WCI was filed in federal court by David Berry and John Schrenkel, who signed up to buy Unit 1202 in the Florencia building at The Colony Golf & Bay Club in Estero.

They say WCI ran afoul of the Interstate Land Sale Act, which regulates the sale or lease of land from developers.

In this case, WCI violated the act by neglecting to include a provision in the contract giving a buyer 20 days to make things right after being notified that he's in default of the contract, said Miami-based attorney Robert Cooper, who filed the suit.

That means, he said, that "if some purchaser accidentally fails to do x, y or z, the builder can't just take the deposit."

In this case, Schrenkel and Berry want out of the contract and their $115,000 deposit returned.

But WCI attorney Thomas Roehn told Cooper in a July 2 letter that it's all just a misunderstanding. "Inadvertently, the 20 days notice of default and opportunity to cure was provided to the seller rather than the purchaser."

That means the buyers aren't entitled to their money back, the letter says. "WCI looks forward to Mr. Schrenkel and Mr. Berry closing upon their purchase of Unit 1202 at Florencia."

Cooper filed the case anyway, seeking damages for his clients and any other Florencia buyer in the same situation.

He said this is the first case he's seen in which the 20-day default protection for the buyer was left out. "I have not seen other developers screw this provision up."

If successful, the suit would be the latest bad news for WCI, which reported a $33 million loss for the quarter ending June 30 as condo tower sales all but dried up and traditional home sales were sluggish.

On Aug. 30, billionaire investor Carl Icahn gained influence on the company's board as he, two close associates, three incumbents and three jointly nominated members were elected to the board.

Its shares fell more than 2 percent in morning trading.

The El Segundo, Calif.-based company said net income for the quarter ended Sept. 30 slipped to $236.8 million, or 61 cents per share, from $239 million, or 62 cents per share, in the year-ago period. Latest-quarter results included charges of about $40 million related to the company's product recalls covering merchandise that contained lead magnets or bore lead paint.

Sales rose 3 percent to $1.84 billion from $1.79 billion a year ago, mainly helped by the weaker dollar.

Analysts surveyed by Thomson Financial had expected profit of 70 cents per share on revenue of $1.91 billion.

Its shares fell 48 cents, or 2.1 percent, to $21.97 in morning trading Monday.

Since August, Mattel has announced three separate recalls of some 21 million toys because of dangers to children from lead paint or from tiny magnets that can be harmful if swallowed.

The majority of the toys were recalled because they featured the small magnets.

Last month, the company apologized to the Chinese government, acknowledging that the problem was a design flaw and not the fault of Chinese manufacturers.

"Despite the challenges the company faced during the third quarter, the business has performed fairly well, even with some supply chain disruptions that impacted our sales during the quarter," said Robert A. Eckert, chairman and chief executive. "U.S. Barbie performance was soft and remains an area of focus, although a good portion of the decline in the quarter was directly related to the supply chain disruptions."

Eckert said international sales have continued to drive growth, while the U.S. was down slightly in the quarter. Mattel did say, however, that it saw continued strong performance from its core Fisher-Price and Disney/Pixar "Cars" properties.

The "Cars" line of toys and the addition of Radica games and puzzles helped drive a 29 percent increase in sales in the toy maker's Entertainment toys business unit.

Global Barbie sales fell 4 percent, with increases in international sales partially offsetting declines in domestic sales of the fashion doll.

In all, sales for Mattel's Girls and Boys Brands business unit were $1.14 billion, up 6 percent from the year-ago quarter, the company said.

Worldwide sales for the Other Girls Brands unit tumbled 10 percent from the year-ago quarter, with a drop in sales of toys from the Polly Pocket! brand driving the decline.

The company's Wheels unit posted a 9 percent increase in global sales during the quarter, driven by sales of its Hot Wheels and Matchbox brands.

Rupert Murdoch has entered a dark horse in high-stakes races before, and won. On Monday, the News Corp. media titan trots out the Fox Business Network.
Two years in the making, the channel will challenge General Electric Co.'s highly profitable CNBC network as it seeks to redefine business news for average Americans faced with increasingly complex decisions about their financial futures.

Murdoch already has knocked CNN off the cable news throne with Fox News Channel. Can he do the same to NBC Universal's profit machine, whose audience of affluent professionals is one of the most sought-after advertising targets?

"CNBC has a monopoly on an in-demand demographic, but never underestimate Murdoch," said Porter

Bibb, a managing partner at Mediatech Capital Partners, a financier of media businesses. "Success might take a while, but this is the right thing for them to do."

Fox defines success—aside from ratings—as expanding the business news audience by "demystifying" the subject, according to Kevin Magee, the Fox News executive vice president in charge of the new business channel. There are plenty of people not watching business news because it's presented in an "off-putting" way, he said.

Magee would not disclose the programming schedule, citing competitive concerns. But FBN's flashy Web site promises the network will cut through jargon to speak to the average investor, echoing comments by Murdoch last month that his channel

Americans Leonid Hurwicz, Eric S. Maskin and Roger B. Myerson won the Nobel prize in economics on Monday for developing a theory that helps explain how incentives and private information affect the functioning of markets.

Hurwicz, 90, is the oldest Nobel winner ever, according to the academy. "I really didn't expect it," said the Moscow-born researcher, an emeritus economics professor at the University of Minnesota in Minneapolis.

The three winners "laid the foundations of mechanism design theory," which plays a central role in contemporary economics and political science, the Royal Swedish Academy of Sciences said.

Essentially, the three men, starting in 1960 with Hurwicz, studied how game theory can help determine the best, most efficient method for allocating resources, the academy said.

Their research has helped explain decision-making procedures involved in economic transactions including, for example, what insurance polices will provide the best coverage without inviting misuse.

It has been used in everything from negotiations over labor issues to the auctioning of government bonds and has helped countries and companies better understand how markets function even when conditions are rocky.

Hurwicz told reporters he was surprised to have won the award.

"There were times when other people said I was on the short list, but as time passed and nothing happened I didn't expect the recognition would come because people who were familiar with my work were slowly dying off," he said.

Maskin, 56, is professor at the Institute for Advanced Study at Princeton, New Jersey; and Myerson, 56, is a professor at the University of Chicago in Illinois.

The 30 men, mostly Algerians, have been charged with membership of a terrorist organization, conspiracy to commit a terrorist attack and forgery.

The alleged mastermind Abderrahmane Tahiri, alias Mohamed Achraf, was extradited from Switzerland in April 2005.

Spanish authorities suspect Tahiri planned to ram a truck loaded with 1,100 pounds of explosives into the National Court in downtown Madrid.

"This was an organized and structured terrorist group, uncovered in November 2003, with radical Salafist tendencies, which defended the jihad (holy war) and intended carrying it out in Spain through violent actions such as that planned against the National Court and the persons within," according to the indictment.

"With that explosion, they hoped to kill the persons within (judges, clerks and public in general) and destroy the files held against the 'mujahedeen brotherhood' inside," the indictment said.

Investigating magistrate Fernando Grande-Marlaska said such an attack could have killed up to 1,000 people.

The prosecution is demanding sentences of between two and 46 years for the accused.

The trial is expected to last several months.

Police uncovered the alleged plot with the help of an unnamed informant who had lived with some of the accused.

In an initial investigation, Spanish Judge Baltasar Garzon claimed Tahiri set up a cell known as the "Martyrs for Morocco" while he served time in a Spanish prison for credit card fraud between 1999 and 2002.

Garzon said the cell had links with other Islamic terrorists, including the group believed to be behind the March 11 train bombings in Madrid that killed 191 people.

The Food and Drug Administration said Friday it would look into claims from an advocacy group that certain lipsticks contain potentially dangerous levels of lead. Similar claims in the past have not been confirmed, the agency said.
The Campaign for Safe Cosmetics said that a third of the 33 red lipsticks examined by an independent lab contained a level of lead exceeding 0.1 parts per million—which is the FDA's limit for lead in candy. The FDA does not set a limit for lead in lipstick.

The organization commissioning the lipstick study says its goal is to pressure companies to remove toxic chemicals from their products and replace them with safer alternatives. The lead tests were conducted by an independent laboratory last month on red lipsticks bought in Boston, San Francisco, Minneapolis and Hartford, Conn., the organization said.

The FDA said concerns about lead in lipstick have been raised occasionally in the print media and on the Internet.

"These concerns have not generally been supported by FDA's own analysis of products on the market. In the present case, we are looking into the specific details of the issues raised," said Stephanie Kwisnek, a spokeswoman at the FDA. "We will need to confirm the factual basis of these reports independently in order to determine what action, if any, may be needed to protect public health."

The trade association representing the cosmetic industry acknowledged "negligible" levels of lead in some lipsticks, but said it is not intentionally added.

"Consumers are exposed daily to lead when they eat, drink water and breathe the air," said John Bailey, an executive vice president at the Cosmetic, Toiletry and Fragrance Association. "The average amount of lead a woman would be exposed to when using cosmetics is 1,000 times less than the amount she would get from eating, breathing, and drinking water that meets Environmental Protection Agency drinking water standards."