Nation digest 07/09/02

U.S. consumers boost borrowing in May

WASHINGTON -- Americans, shrugging off worries about the strength of the recovery, increased their borrowing in May at the fastest pace in six months.

The Federal Reserve said Monday that consumer credit rose at an annual growth rate of 6.8 percent in May, the strongest rate of growth since a 15 percent growth rate last November.

The May increase left consumer borrowing at $1.706 trillion. The gain of $9.5 billion in May followed a revised $8.6 billion increase in April. That represented a 6.1 percent annual growth rate.

The May advance was about $2 billion higher than private analysts had been expecting.

EBay buying online payment provider PayPal

SAN JOSE, Calif. -- Internet auction giant eBay Inc. said Monday it is buying online payment facilitator PayPal Inc. for $1.5 billion in stock.

The long-rumored deal would mark the end of eBay's own, rival electronic payment program, called eBay Payments by Billpoint. It also would cut off the use of PayPal for gambling, eBay's chief said Monday.

Separately, eBay released second-quarter earnings early, posting results that beat Wall Street expectations. EBay's net profit more than doubled to $54.3 million, or 19 cents per share, on revenue of $266 million, in the quarter ended June 30. Wall Street analysts had been expecting profits of 17 cents a share, according to Thomson Financial/First Call.

Haze from Canadian fires lingers over Northeast

ALBANY, N.Y. -- Northeastern states advised people with heart trouble or breathing problems to avoid the outdoors Monday because of a smoky haze hanging over the region from forest fires burning hundreds of miles away in Canada.

Winds pushed the smoke as far south as Washington, D.C., and from Michigan to Massachusetts over the weekend.

"It smelled like someone's house was burning down," said John Agee, a graduate student at the University at Albany in New York.

More than 80 fires were burning Monday southeast of James Bay in Quebec, 200 to 400 miles north of the U.S. border. Most were started by lightning since July 2.

Nebraska rushing to fix highway cut by flood

OGALLALA, Neb. -- Gov. Mike Johanns promised on Monday that state crews would work around the clock to reopen a major transcontinental highway that was cut by weekend flooding.

Interstate 80 was severed when flooding caused by 10 inches of rain on Saturday washed out the approaches to two bridges spanning a ravine. State officials hope to have the highway reopened by the end of this week.

A truck driver was killed when the approaches gave way.

Man arrested in deaths of girlfriend, two others

HOUSTON -- A man was charged Monday with murder in the deaths of his 15-year-old girlfriend and two of her relatives.

Police have not determined a motive. The girlfriend and her mother were strangled and the girlfriend's 77-year-old grandfather was beaten to death, police said.

Derrick Dewayne Charles, 19, was arrested Sunday near the Houston airport. Police found a car nearby that was stolen from the family's home, where the bodies were found Saturday.

The three had been dead for several days and their bodies were decomposing, authorities said.

Defense secretary has surgery on left hand

WASHINGTON -- Defense Secretary Donald H. Rumsfeld had three hours of surgery on his left hand Monday.

Doctors at Walter Reed Army Medical Center performed the surgery to correct a problem caused by arthritis at the base of Rumsfeld's thumb, the Pentagon said. The surgery did not require general anesthesia.

Rumsfeld will wear a cast on his left forearm for the next four to six weeks, the statement said.

Rumsfeld, who turns 70 Tuesday, is right-handed.

-- From wire reports