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The global economy saw more signs of distress on Thursday with U.S. stocks plunging for a second consecutive day, oil prices falling, a surprise rate cut in Switzerland, export woes in Japan and rescue loans to Turkey and Iceland.

Wall Street was hostage to the rapidly changing news of a possible rescue for the U.S. auto industry, with the stock market rising on news of a tentative bipartisan deal in Congress for a $25 billion package for Detroit and then falling to new lows when the deal ran into trouble.

Automakers held out hope. After the end of the trading day, the White House announced it could back a compromise plan pushed by Michigan senators to help by using $25 billion in Energy Department loans for greener cars, and urged Congress to act quickly. U.S. automakers said they will meet Democratic demands to offer a plan to return to profitability, and lawmakers said it could be considered the week of December 8.

In more bad news for the battered U.S. economy, the number of U.S. workers on jobless rolls surged to the highest in a quarter century, prompting Congress to extend benefits for the long-term unemployed.

Oil prices plummeted below $50 a barrel for the first time since 2005 as investors anticipate a long global recession will slash demand.

“I think this is going to be not only a deep recession, at least in the next couple of quarters, but also a long recession,” said Conrad DeQuadros, senior economist at RDQ Economics in New York.

All three major U.S. stock indexes made broad swings, ending sharply lower due to deepening economic fears and investors’ flight from risk. The Standard & Poor’s 500 slid 6.71 percent to close at 752.44, its lowest since 1997. The Dow Jones industrial average slid 5.6 percent to close at 7,552.29 and the Nasdaq Composite Index fell 5 percent to end at 1,316.12.

World stocks tumbled to 5-1/2-year lows with volatile emerging market equities down 5.16 percent. An index of European shares fell 3.8 percent and Japanese stocks plunged nearly 7 percent.

Investors sought shelter in safe assets such as U.S. Treasury bonds, and the U.S. dollar slumped versus the yen, but both rose against the euro.

The dramatic slowdown in the world economy prompted Switzerland’s central bank to make a surprising interest-rate cut of 1 full percentage point, its third in six weeks and the largest since it adopted its current system in 2000.

Analysts said the weak U.S. labor market almost guaranteed that the Federal Reserve will cut its benchmark rate from the current 1 percent at its next meeting on December 15-16.

Despite reports that Saudi Prince Alwaleed bin Talal planned to boost his stake in Citigroup back to 5 percent, the U.S. financial services giant’s stock fell 26 percent to 1994 levels due to serious concern about its very survival.

“How many times is one going to take a beating before realizing the market isn’t going to bounce?” said Andrew Kanaly, chairman of Kanaly Trust Company in Houston. “The decline in the oil prices is a barometer of more economic sliding globally.”

In what would normally be a good sign for consumers but now signals weaker global growth, U.S. crude futures plunged 9.5 percent, falling as low as $48.50 a barrel to a 3-1/2 year low on expectations that a stalling economy would mean falling demand.

JOB LOSSES, LONG DOWNTURN

A government report showed the number of workers filing new claims for jobless benefits last week surged to the highest in 16 years. More than 4 million Americans were receiving jobless benefits in the week ended November 8, the highest since December 1982.

To give troubled U.S. mortgage borrowers some relief, Fannie Mae and Freddie Mac, the largest U.S. home loan finance companies, announced a hiatus in foreclosures of occupied homes until January 9 while easier borrowing terms are worked out.

Leading economies will likely be in recession for around a year, a Reuters poll of around 250 economists showed. The survey across the Group of Seven nations showed economies faced recession for as much as five quarters.

“All developed economies will contract in 2009. It’s the worst we have had in a century. But to say it’s going to look like 1929 again for all these economies is a bit excessive, it’s too pessimistic,” said Marco Annunziata, chief economist at UniCredit in London.

The Federal Reserve said on Wednesday the U.S. economy would contract through the first half of 2009.

“No end in sight,” ING economists said in a note on Thursday, a sentiment widely shared by investors.

Analysts said now the fear may be for a deadly economic problem: deflation, marked by steadily falling prices and economic stagnation.

“Once you get into a period of deflation, it’s important to get the economy turned around as soon as possible,” said Lyle Gramley, a former Fed governor who is now an analyst with the Stanford Group in Washington.

The Philadelphia Federal Reserve’s monthly business survey said a key component of inflation, the prices paid index, fell to its lowest level since the survey started in 1968.

IMF TO THE RESCUE?

Trade and foreign ministers of Pacific Rim nations meeting in Lima on Thursday called for new free trade deals as a way out of the worldwide crisis. They will recommend the summit of leaders of the Asia-Pacific Economic Cooperation trade group, which includes the United States and China, avoid raising tariffs and deepen economic cooperation.

Japan’s exports to Asia fell in October for the first time since 2002, suggesting the fallout from the credit crisis has spread to neighbors such as China.

With investors looking increasingly to governments and other authorities to stop the rot, the IMF moved to prop up both Iceland and Turkey. It approved a $2.1 billion loan for Iceland, battered by a severe banking crisis, as part of a $10.2 billion package. Sources in Turkey told Reuters the IMF was ready to approve a precautionary standby agreement of $20 billion to $40 billion.

On the lines of Indian Railways, the Uttar Pradesh State Road Transport Corporation (UPSRTC) will now offer e-ticketing facility for its buses, an official said Thursday.

“For offering the new service, we have already started interlinking our bus stations across the state through internet following the directions of state transport minister Ram Achal Rajbhar,” chief general manager (technical) of UPSRTC A.K. Srivastava told IANS.

He said the e-ticketing facility will be available on the website www.upsrtc.com in a couple of months, adding that the concept of e-ticket is growing fast in today’s busy life as one does not want to stand in long queues to buy a ticket.

About 7,000 buses of UPSRTC ply in UP and various neighbouring states including Punjab, Delhi, Haryana, Chhattisgarh, Madhya Pradesh, Rajasthan and Jharkhand.

The United Arab Emirates (UAE) Sunday announced a series of steps to secure the country from the global financial crisis.

The cabinet, headed by Vice President and Prime Minister of the UAE and Ruler of Dubai Sheikh Mohammed Bin Rashid AI Maktoum, Sunday approved a series of internal preventive steps and measures ‘out of keenness to serve national interest, ensure continuity of economic growth and protect national economy’, the state-run Emirates News agency (WAM) reported.

‘We are determined to protect our financial and banking system out of keenness to preserve the interests of our country and people,’ Sheikh Mohammed stated after the cabinet session.

Among these measures, the federal government will ensure that no UAE national bank will be exposed to credit risks, guarantee deposits and savings, guarantee all inter-bank lending operations between banks operating in the UAE and inject sufficient liquidity in the financial system if and when necessary.

UAE President Sheikh Khalifa Bin Zayed Al Nahyan confirmed that the UAE economy is strong and sound and that its banking system is solid and efficient.

The Pakistan Government’s declared ‘austerity’ programme, particularly initiated by President Asif Ali Zardari amid the prevailing economic crisis, has reportedly received a lot, as a 15-strong delegation of Pakistani parliamentarians gets ready to fly to the US to ’study and witness’ the November 4 US presidential election.

The move assumes significance in the wake of the financial crunch worsening and Pakistan’s foreign exchange reserves dwindling.

Those nominated to the delegation have already been informed, but attempts to obtain their names locally have not been successful, reported the Daily Times.

It is not clear what the lawmakers expect to study or witness since unlike their Pakistani counterpart, US elections are low key, added the paper.

It quoted a local community leader as saying that the Pakistani lawmakers would be able to get a much better idea of how the US presidential election is conducted “were they to stay home and watch it on CNN”.

Gunmen have killed six young men at a family party in the gang-plagued Mexican border city of Ciudad Juarez.

A spokesman for the regional Attorney General’s Office, Alejandro Pariente, says the men between the ages of 20 and 25 were killed during a party in a house. The motive for the attack was not immediately known.

At least 1,000 people have been killed this year in Ciudad Juarez, a city across from El Paso, Texas. Many of the deaths have been attributed to warring drug gangs.

Saturday night’s mass shooting was the second in the border state of Chihuahua in less than a week. Just before midnight Thursday, gunmen opened fire in a bar in the city of Chihuahua, killing 11 people.

A Mexican man who doused himself with gasoline and set himself on fire as a political protest has died.

Hospital director Meliton Toledo says 65-year-old Ramiro Guillen Tapia died Wednesday of heart failure after suffering third-degree burns over 70 percent of his body.

Tapia was the leader of a farmers’ group seeking government mediation in a dispute over 620 acres (250 hectares) of land in the Gulf coast state of Veracruz.

He set himself ablaze Tuesday in the state capital of Jalapa, outside the office of Gov. Fidel Herrera.

Tapia told reporters beforehand that Herrera had refused to meet with his group and canceled more than 100 appointments in the last four years.

The top American military commander in Afghanistan said Wednesday that he needs more troops and other aid “as quickly as possible” in a counter-insurgency battle that could get worse before it gets better.

Gen. David McKiernan said it’s not just a question of troops — but more economic aid and more political aid as well.

Speaking to Pentagon reporters, the head of NATO forces in Afghanistan said there has been a significant increase in foreign fighters coming in from neighboring Pakistan this year — including Chechens, Uzbeks, Saudis and Europeans.

“The additional military capabilities that have been asked for are needed as quickly as possible,” he said.

He said he was encouraged by recent Pakistani military operations against insurgents waging cross-border attacks into Afghanistan, but also said that it is too soon to tell how effective they have been.

Officials have said that violence in Afghanistan is up about 30 percent this year compared with 2007. The Taliban and associated militant groups like the terrorist network al-Qaida have steadily stepped up attacks in the last several years and more U.S. soldiers have died in Afghanistan already this year than in any year since the 2001 U.S.-led invasion.

“We’re in a very tough fight,” McKiernan said. “The idea that it might get worse before it gets better is certainly a possibility.”

Defense Secretary Robert Gates said last week that he may be able to send thousands more combat troops to Afghanistan starting next spring.

McKiernan was scheduled to meet with President Bush at the White House late Wednesday.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

WASHINGTON (AP) — The top American military commander in Afghanistan says more troops and other help in fighting a growing insurgency are needed “as quickly as possible.”

Gen. David McKiernan says it’s not just a question of troops — but more economic aid and more political aid as well.

Speaking to Pentagon reporters, the head of NATO forces in Afghanistan said there has been a significant increase in foreign fighters coming in from from neighboring Pakistan this year. He did say Wednesday he’s encouraged by recent Pakistani military operations against insurgents waging cross-border attacks into Afghanistan.

Pakistan has appointed a new head of its powerful Inter-Services Intelligence (ISI) agency, amid US accusations that the military spy organisation secretly backs Taliban rebels on the Afghan border.

Lieutenant General Ahmed Shujaa Pasha, formerly head of military operations, was named director general of the ISI late Monday, a terse military statement announced. He replaces Lieutenant General Nadeem Taj.

The move is part of a major shake-up of the army’s top brass after US, Afghan and Indian officials alleged in recent months that the shadowy organisation was complicit in the Taliban insurgency wracking the region.

Pasha is considered to be a close aide to the relatively reformist Pakistani military chief Ashfaq Kayani, who ran the ISI until October 2007. Taj, by contrast, was a key lieutenant of former president Pervez Musharraf.

The army insisted the 14 new appointments announced on Monday were routine.

“These were the changes due over a period of time. This is how the system works in the army,” chief military spokesman Major General Athar Abbas told AFP.

But movements in Pakistan’s military and intelligence services are closely watched by the United States and other allies for signs of the nuclear-armed nation’s stability and commitment to the “war on terror“.

“The change comes at a time when there was a lot of talk about ISI in the Western media,” security analyst Talat Masood, a retired Pakistan army general, told AFP.

“With the new ISI chief, General Kayani has completed a team of his choice. He will be able to now lead the army with greater confidence.”

In his previous job, Pasha was responsible for military offensives against Al-Qaeda and Taliban militants in northwest Pakistan and the troubled tribal belt bordering Afghanistan.

The ISI has helped capture or kill hundreds of senior Al-Qaeda militants in Pakistan since Musharraf joined the “war on terror” in 2001, including Khalid Sheikh Mohammed, the self-confessed 9/11 mastermind.

But many Western officials suspect that, having helped to create Afghanistan’s hardline 1996-2001 Taliban regime, the organisation is still playing a double game.

In August, the NATO commander in Afghanistan, US General David D. McKiernan, told AFP there “certainly is a level of ISI complicity” in Taliban militancy along the Pakistan-Afghanistan border.

Whether US forces should strike militant targets in Pakistan if the ISI and other agencies fail to do so has become an issue in the US election race, with Democratic candidate Barack Obama backing such attacks.

Afghanistan, which is supposed to be Pakistan’s ally against extremism, and India, Islamabad’s historic foe, accused the ISI of involvement in the deadly bombing of the Indian embassy in Kabul in July.

Pakistan strongly denies any such links, although Musharraf admitted in 2006 that some retired Pakistani intelligence officers may have been abetting extremists.

The ISI is feared at home as it plays a central, although covert, political role in a country that has spent more than half of its 61-year history under military rule.

The change in the ISI comes after the government led by President Asif Ali Zardari, the widower of slain former premier Benazir Bhutto, tried to put the elite agency under the control of the interior ministry in July.

That move was hastily withdrawn after a protest by Pakistan’s powerful military establishment.

In theory ISI works under the control of the prime minister, but in practice its functions are mainly run by Pakistan’s pervasive security set-up.

Tropical Storm Kyle strengthened into a hurricane off the United States on Saturday as it took aim at New England and Canada’s Maritime provinces, the U.S. National Hurricane Center said.

Kyle, which developed as a tropical storm on Thursday, had top sustained winds near 75 mph and was forecast to make landfall near the Maine-New Brunswick border early on Monday.

Kyle was a minimal Category 1 hurricane on the five-step hurricane intensity scale. In its 11 p.m. advisory, the hurricane center said there might be slight weakening in Kyle before it hits the coast.

Kyle was 355 miles south of the island of Nantucket, Massachusetts, and moving north at 23 mph.

The hurricane — spawned by the 11th named storm of a busy and destructive Atlantic hurricane season — was forecast to dump as much as 6 inches of rain over parts of New England, New Brunswick, Nova Scotia and Prince Edward Island through Monday. It was also likely to cause large and dangerous surf in some areas.

Forecasters have predicted the six-month hurricane season, which runs through November 30, could produce up to 18 cyclones. The warm sea temperatures and other factors that contribute to the formation of hurricanes are still in place.

The disturbed weather system from which Kyle developed drenched Puerto Rico, the Virgin Islands and Caribbean island of Hispaniola before it moved north into the Atlantic.

Authorities in Puerto Rico, a U.S. island territory, said at least four people were killed and scores of homes were flooded.

Kyle was the first tropical storm to form in the Atlantic-Caribbean region since Tropical Storm Josephine on September 2.

The U.N. World Food Program’s director flew to a Haitian city still encased in mud Friday to draw global attention to the ongoing disaster that has enormously complicated the country’s struggle to feed itself.

The WFP said it has asked for US$54 million to help Haiti recover from four killer storms but so far has received only US$1 million. Beginning a two-day survey of the disaster area, Executive Director Josette Sheeran said “concerted global action” will be needed in a country where local officials say famine looms.

Haitian President Rene Preval also pleaded for help, asking for long-term assistance Friday in his speech to the U.N. General Assembly.

Devastation awaited Sheeran in this coastal city, largely cut off from the rest of Haiti because of flooded roads and wrecked bridges. Gray mud is still piled waist-high in homes, coating prized television sets, books and cooking pots. Tens of thousands still live in shelters and roam muddy streets looking for food.

At least 194 people were killed by the tropical storms in less than a month this summer in Gonaives and the surrounding region, the largest share of a nationwide death toll of 425.

Some of the muck is topsoil — precious in this deforested country — flushed from the mountains above when a river broke its banks, churned through the countryside and sliced through town before emptying into the sea.

Clouds of mosquitoes now breed in Gonaives’ wet ground, raising fears that disease will spread. Children play in the muck. In a hospital, brown mud immobilizes an empty wheelchair.

Some families bail the mud from their houses, soldiering on in the stench. Mothers use muddy rags to wipe off kitchen utensils. Most residents have nowhere else to go.

“I’ve been cleaning out my dirt house,” said Yonel Charles, who lost all his possessions in the floods. “I have to stay here.”

The floods from Fay, Gustav, Hanna and Ike destroyed an estimated 60 percent of Haiti’s food harvest. The WFP said it has delivered more than 2,200 metric tons of food during this emergency, enough to feed almost 500,000 people.

“Hunger is no stranger to Haitians who have been struck by more than their fair share of crises,” Sheeran said. “Now is the time for concerted global action to get food to the hungry, and to support President Preval’s goal of longer-term solutions to help the country, and its people, feed themselves.”

Speaking in New York, Preval thanked the world for its help, but said emergency aid alone won’t solve Haiti’s plight and that long-term solutions are needed.

“Once this first wave of humanitarian compassion is exhausted, we will be left as always, truly alone, to face new catastrophes and see restarted, as if in a ritual, the same exercises of mobilization,” Preval said.

Preval said he wants trade liberalization “based on clear rules” that would allow Haitian farmers to compete, and a reconstruction project that empowers Haitians to take care of themselves.

More than 800,000 people in the country of 9 million have been affected by the storms, including more than 300,000 children. Gonaives is on Haiti’s central floodplain, but towns on the southern peninsula also remain cut off and desperate for drinking water, and the country’s northwest is flooded. Bridges and roads lay destroyed all across the country.

The U.N. said it has only received 3.4 percent of its US$108 million appeal for relief after the storms. An additional US$17 million has been given in bilateral aid.

The U.S. Agency for International Development has pledged US$29 million in humanitarian assistance so far.

On Friday, the nonprofit Green Family Foundation also announced a US$900,000 seed grant for a Millennium Global Village in Haiti during the Clinton Global Initiative meeting in New York.

The grant funds a village in the impoverished Central Plateau to help fight malaria, increase food production, provide drinking water and improve schools.