Prices surged on congressional testimony by Fed Chairman Ben Bernanke early in the day that suggested the central bank would not slow its massive economic stimulus program any time soon. [...] minutes of a Fed meeting were released suggesting the stimulus could be scaled back as early as next month if the economy picks up, and stocks began dropping fast. "If you had any doubts about the influence of the Fed, you only have to look at the roller coaster that followed Bernanke's testimony this morning and the release of Fed minutes this afternoon," said David Kelly, chief global strategist at J.P. Morgan Funds. Aside from the Fed's stimulus, other factors have been pushing the stock market higher, including a rebounding housing market, a pickup in hiring and strong earnings at big U.S. companies. Investors don't like when the Fed pulls back from stimulus policies and raises interest rates because it typically has slowed the economy, and even led to recessions. [...] JPMorgan's Kelly notes that when interest rates are very low, as they are now, history suggests interest rate hikes won't hurt the stock market that much because it means the economy is getting stronger.

European officials say tax fraud and evasion costs the 27-nation bloc's governments an estimated 1 trillion euros ($1.3 trillion) a year at a time when much of the region is in recession and governments are forced to tighten their budgets. [...] the two governments gave in Wednesday after making sure the system's introduction would be delayed until the end of the year to grant more time for negotiations on abandoning bank secrecy with non-EU countries such as Switzerland, Monaco and Liechtenstein. The leaders didn't give an exact starting time for the automatic information exchange, but cheered the political agreement. In the meeting's concluding statement, the EU called for rapid progress on the measures against "aggressive tax planning and profit shifting" and vowed to push ahead with closing legal loopholes. On Tuesday, members of a U.S. Senate subcommittee grilled Apple CEO Tim Cook over allegations that the company's Irish subsidiaries help it avoid billions in U.S. taxes.

External factors such as Europe's recession, which is damaging markets for exports from New England businesses, and federal spending cuts, which are reducing sales by the region's defense contractors, are crimping the region's economy, according to the New England Economic Partnership. Economists blamed slower growth in Maine in education and health services, professional and business services, construction and manufacturing. The return of the jobs market has helped boost household income and a rebounding stock market has strengthened household wealth, Clayton-Matthews said. [...] demand would be stronger without automatic federal spending cuts that took effect in March and the end to a temporary payroll tax cut, he said. The recovery in Vermont's economy in the next five years is expected to be fueled by businesses in the state taking advantage of a stronger global economy, a return to "more normally functioning financial markets" and improving residential and second-home markets.

Under Abe's direction, Japan has embarked on an aggressive campaign to lift consumer prices, encourage borrowing and spending and improve Japan's economic competitiveness — a program dubbed "Abenomics." The Abenomics blend of fiscal and monetary stimulus and pledges of reforms helped boost Japan's economic growth to an annual pace of 3.5 percent in the January-March quarter. To some extent, Australia's "billabong bonds" as its government debt is dubbed, have replaced Japan's government bonds as a haven for global investors now that the Bank of Japan is soaking up 70 percent of Tokyo's bond sales. The Philippine central bank is also thought to be intervening in the foreign exchange market by buying dollars to curb the peso's rise. Some worry that Japan's aggressive drive to reduce interest rates, paired with similar programs in the West and China's efforts to spur lending, could inflate dangerous bubbles in assets like stocks or real estate. The 10-nation Association of Southeast Asian Nations recently voiced such concern in a joint statement with the Asian Development Bank that noted potentially "excessive risk taking and leverage, credit expansion and asset bubbles." Frothy property markets from China to Hong Kong to Mumbai to Manila. [...] recently, Asian financial markets had seemed sturdier than those in wealthier Western countries. Double-digit gains in share prices in many regional stock markets, where price-to-earnings ratios used to judge value are veering higher, are another worrisome sign, says Rajiv Biswas, an economist with IHS in Singapore. [...] energy-intensive steel mills and utilities are struggling with surging costs for fuel and other key commodities when valued in yen. Japan's net overseas portfolio investments, including equity securities, bonds and money market instruments rose to nearly 2.5 trillion yen ($24.4 billion) in March from minus 1.87 trillion yen (minus $18.2 billion) in September.

LONDON (AP) — Richard Carrion of Puerto Rico entered the IOC presidential race Wednesday, promising to use his business experience to guide the Olympics through the world's troubled financial times and proposing to deploy IOC staff permanently in host cities to help organize the games. The 60-year-old Carrion, a banking executive who chairs the IOC finance commission and has spearheaded multi-billion dollar television rights deals, became the third member to declare as a candidate for the most powerful job in the Olympic movement. Carrion follows IOC vice presidents Thomas Bach of Germany and Ng Ser Miang of Singapore in formally announcing bids to succeed Jacques Rogge, who steps down in September after 12 years as head of the International Olympic Committee. Carrion sent a letter to all IOC members Wednesday announcing his presidential bid, along with a 14-page document laying out his platform and heralding the arrival of a "Great Olympic Era." Carrion is also chairman and CEO of Popular Inc., the financial services company which operates Banco Popular and other banks in Puerto Rico and the U.S. He is a member of the board of directors of Verizon and a director of the Federal Reserve Bank of New York. While his financial credentials are important, the job requires more than a top money man and needs someone passionate about the Olympic values and ideals, Carrion said. Carrion said the IOC is in a strong overall position but must take action to deal with potential risks and challenges, including the financial downturn, doping, match-fixing, youth obesity and threat of natural disasters. On other issues, Carrion said it was time to review some of the reforms that were enacted in 2000 in the wake of the Salt Lake City bribery scandal, including the imposed age limit of 70 for IOC members. Carrion said it's time to develop a new system for distributing Olympic revenues among the IOC, sports federations, national Olympic committees and other bodies.