GMAC, the auto and mortgage finance company majority owned by Cerberus Capital Management, reported a $2.5 billion loss Thursday as vehicle sales plummeted and the housing slump sent foreclosures higher.

The credit crunch has been a sharp drag the return on equity, a main gauge of profit, at many banks, particularly those in Europe and the United States, since the second half of 2007, and those returns may never recover to precrisis levels.

When Henry Paulson agreed to leave his Wall Street job as chairman of investment bank Goldman Sachs to go to Washington as Treasury secretary in 2006, he demanded extraordinary powers as de facto economic czar. He got them.

July 21 (Bloomberg) -- Freddie Mac , the second-largest U.S. mortgage-finance company, may cut purchases of home loans from banks and bonds backed by housing debt to shore up its capital amid record delinquencies.

By The housing market and rate of foreclosures in Prince William are due to worsen, so supervisors should consider providing a risk-free means for employees to buy some of these homes, said one finance official Tuesday during a presentation to the board.