The Oracle of Omaha is betting that the country’s candy jar is recession-proof.

With financing from Warren Buffett, candy maker Mars Inc. on Monday said it is buying confectioner Wm. Wrigley Jr. Co. for an estimated $23 billion in cash. The deal would marry brands that sweet-toothed Americans have munched on for decades: Mars owns Snickers and M&Ms; Wrigley’s gum brands include Juicy Fruit, Orbit, Extra and Big Red.

If the buyout receives regulatory and shareholder approval, the combined companies would leapfrog over Britain’s Cadbury Schweppes as the world’s largest confection maker — a move that’s already fueling speculation that the buyout could spawn a round of candy industry consolidation.

Gas and oil prices pushed further into record high territory Tuesday, with retail gas reaching a national average of $3.51 for the first time and crude nearing $120 as the dollar fell to a new low against the euro. At the pump, the national average price of a gallon of regular gas rose 0.8 cent.  

Gasoline supplies are also being hurt by low profit margins. Refiners have to buy the crude they turn into fuel, but falling demand for gasoline has hurt their ability to raise gas prices as much as they would like. Gas prices are nearly 66 cents higher than last year, when they peaked at a then-record of $3.23 in late May, and have prompted many analysts to raise their estimates of where gas is going to go.

Major Chinese banks are racing to open branches across the United States, but they are unlikely to make much money from them any time soon. The banks, once in deep financial trouble but now much stronger after a series of Chinese government bailouts, are increasingly interested in opening overseas shops, especially in major U.S. cities like New York. The idea is mainly to raise their image as international banks that are publicly traded rather than as state-owned agencies controlled by Beijing.

So far, only two Chinese banks — Bank of China and Bank of Communications – have branches in the United States. At least a half dozen Chinese banks, including Industrial and Commercial Bank of China and smaller rival Merchants Bank, plan to seek approval from the Fed to launch U.S. branches this year. Almost every time U.S. Treasury Secretary Henry Paulson traveled to Beijing to lobby officials for U.S. banks to have wider access to Chinese financial service sectors, Paulson would receive similar requests from his Chinese contacts.

Rice climbed to a record and corn traded near its highest ever on speculation a 3% annual increase in global demand for cereals will outstrip supply as governments curb exports to prevent protests. Rice, the staple food for about 3 billion people, rose 2.4% in Chicago trading today after doubling in the past year. Soybeans advanced for the third day and wheat gained as investors bought agricultural commodities on concern dry weather in the Great Plains and heavy rain in the eastern Midwest may curtail U.S. production and push down global inventories.

The World Bank estimates “that 33 countries around the world face potential social unrest because of the acute hike in food and energy prices,” Robert Zoellick, the bank’s president, said on the organization’s Web site. For these countries “there is no margin for survival,” he said.

The Securities and Exchange Commission is investigating the events leading up to the collapse of Bear Stearns, specifically a surge in options contracts betting that the investment bank’s share price would fall sharply. Citing people familiar with the matter, the paper reported the SEC probe focuses on a surge last week in “put” options that came days before the firm’s proposed sale to J.P. Morgan Chase & Co. for stock now valued at about $278.5 million, or $2.32 a share.

There is still $300bn of bad debt out there, and Japan could be hiding most of it.

Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. The Tokyo bourse has crumbled, suffering the worst start to the year since the Second World War. The Nikkei index is down 17% since Christmas, and the shares of Japanese banks are leading the slide. Americans and Europeans have so far confessed to $130bn of the estimated $400bn to $500bn of wealth that has vanished into the sub-prime hole.

Could the U.S. be in recession?

61% of the public believes the economy is now suffering through its first recession since 2001. The fallout from a depressed housing market and a credit crunch nearly caused the economy to stall in the final three months of last year. Some experts, like the majority of people questioned in the poll, say the economy actually may be shrinking now. The worry is that consumers and businesses will hunker down further and pull back spending, sending the economy into a tailspin.

For all of 2007, the economy grew by just 2.2%. That was the weakest performance since 2002, when the country was struggling to recover from the last recession. The housing collapse was the biggest culprit in 2007. Thanks alot, housing problem!!

The total of bids received from banks at the latest auction was $58.4-billion for the $30-billion that was being provided in short-term 28-day loans.

The Federal Reserve, seeking to combat the effects of a serious credit crisis, said Tuesday it had auctioned $30-billion (U.S.) in funds to commercial banks at an interest rate of 3.010 per cent.

It marked the fifth in a series of auctions that so far have pumped $130-billion in money into the U.S. banking system in an effort to provide cash-strapped banks with extra reserves. The Fed’s hope is that the increased resources will keep banks lending and prevent a severe credit squeeze from making the current economic slowdown worse.

The latest auction results showed that the Fed’s effort is having success. The 3.010 per cent interest rate is the lowest rate for any of the five auctions held so far. It was slightly below the previous auction, when the interest rate had been 3.123 per cent.

The first two auctions in December had seen rates for the funds provided at 4.65% and 4.67% while the first auction in January had seen a rate of 3.95%.