PRESS DIGEST - New York Times business news - Oct 7

Oct 7 (Reuters) - The following were the top stories in the New York Times business pages on Tuesday. Reuters has not verified these stories and does not vouch for their accuracy.

* As pressure built in the credit markets and stocks spiraled lower around the world on Monday, the Federal Reserve was considering a radical new plan to jump-start the engine of the financial system.

* Emerging markets took one of their biggest collective tumbles in a decade Monday as stock markets from Mexico to Indonesia to Russia were gripped by fears of a collapse of Europe's banking system and concern that a global recession could drag down the price of commodities, forcing a steep slowdown in emerging-market growth.

* As Lehman Brothers (LEHMQ.PK) pleaded for a bailout, it approved millions for its executives, a Congressional committee was told.

* European governments pledged Monday to safeguard bank deposits in a bid to stem financial panic, but they stopped short of a coordinated strategy to break the grip of a credit crisis that now threatens to set off a protracted recession across the Continent, sending markets tumbling on both sides of the Atlantic.

* Markets in Asia extended their drops Tuesday, with shares in Tokyo falling more than 5 percent before bouncing back but other indexes resisting the selloff trend.

* The Treasury Department put its $700 billion bailout on a fast track on Monday, asking companies to submit bids for running the system by Wednesday and announcing its plan to select winners on Friday.

* Prodded by the Federal Reserve, Citigroup Inc (C.N) and Wells Fargo and Co (WFC.N) agreed to a cease-fire until Wednesday in the legal warfare over their competing bids for the Wachovia Corp WB.N.

* Oil prices fell below $90 a barrel for the first time since February, and weak global demand has prompted predictions of further drops.

* The travel industry has been hit hard by the economic slowdown, particularly in the last few weeks. Airlines reported sharp declines in passenger traffic for September.

* The Internal Revenue Service has taken steps to help ease the credit crisis by allowing corporations to ramp up their use of tax-free loans from overseas subsidiaries.

* In a dramatic effort to maintain its position as the only real rival to Intel Corp (INTC.O), Advanced Micro Devices (AMD.N) plans to announce that it will become two companies.

* Eli Lilly and Co (LLY.N) has agreed to pay $62 million to 33 states to settle claims that it improperly marketed Zyprexa to patients who did not have schizophrenia or bipolar disorder.

* MasterCard SpendingPulse said a drop-off in consumer spending had sent its specialty retail sales index plunging 7.7 percent in September compared with last year.

* eBay Inc (EBAY.O) said it would lay off 10 percent of its workers and pay $1.35 billion for the Web payment firm Bill Me Later and two Danish classified advertising companies.

* Eli Lilly and Co (LLY.N) agreed to pay $6.5 billion for ImClone Systems IMCL.O, the biotechnology company that is controlled by Carl C. Icahn.