The Wall Street Journal reports on C1 that Charlotte-based Wachovia is getting a capital infusion of as much as $7 billion this week, showing that the financial crisis is very much not over.

The deal comes just two months after the bank, the nation’s fourth biggest, picked up $3.5 billion in new cash by selling preferred stock (The New York Times says the total raised, including other securities, was $8.3 billion). Washington Mutual last week raised $7 billion in new capital. Bloomberg says banks and securities firms have so far raised $140 billion to replace capital wiped out in the credit crisis.

The NYT, unlike the Financial Times and Bloomberg, doesn’t credit the WSJ with the scoop, and says it’s “unclear” if the money will come from a private group or a public sale, though the Journal is pretty clear that it’s the former, adding that the buyers aren’t expected to be so-called sovereign wealth funds.

Bloomberg and Reuters report that the WSJ said Warburg Pincus is one of the buyers, but something happened to that bit of news between last night and the time the paper went to bed.

Issuing new shares like this dilutes the $55 billion value of the shares held by existing shareholders. This deal would be worse because it sells the new shares at a 15 percent discount to Friday’s closing price.

The papers say Wachovia’s $24 billion purchase of adjustable rate-mortgage lender Golden West Financial, at the height of the madness in 2006, is to blame for much of its current woes. Bloomberg says nearly 60 percent of the bank’s $120 billion in ARMs are in hard-hit California. Wachovia was an overly aggressive commercial real-estate lender during the bubble, too.

Nobody attempts to explain why Wachovia is raising capital at such onerous costs when it is still paying out $5 billion a year in dividends.

Hungry planet

The FT and WSJ front, and the <i>NYT puts on A12, reports on global food inflation, saying World Bank and International Monetary Fund officials tried in meetings this weekend to figure out a plan of action for the crisis, which has sparked riots in several countries and led to the ouster of the Haitian prime minister.

The NYT’s lede reports that leaders said food prices “posed a potentially greater threat to economic and political stability than the turmoil in capital markets.”

Dominique Strauss-Kahn, the managing director of the International Monetary Fund, said the food crisis posed questions about the survivability of democracy and political regimes. “As we know in the past, sometimes those questions lead to war,” he said. “We now need to devote 100 percent of our time to these questions.”

The Journal notes that World Bank figures say food prices are up 83 percent in three years, but says the meetings produced few real results other than a consensus that U.S. subsidies for corn and biofuel are a big part of the problem. The Indian finance minister called it “a crime against humanity.”

As has been reported for weeks, the WSJ notes that countries are banning exports of food to protect their own supplies. But Bloomberg has an interesting take, noting that the problems have toppled import barriers that protect their farmers—something it says the Doha trade negotiations haven’t been able to do for seven years now.

The Journal on page two says high food prices are pretty much “here to stay” because of inflation in farm costs.

Ugly Americans

The NYT fronts a story on popping housing bubbles around the world, something it blames “to some extent” on the struggles of the U.S. market, which has caused credit to tighten everywhere.

In Ireland, Spain, Britain and elsewhere, housing markets that soared over the last decade are falling back to earth. Property analysts predict that some countries, like this one, will face an even more wrenching adjustment than that of the United States, including the possibility that the downturn could become a wholesale collapse…

That reality is spreading. Once-sizzling housing markets in Eastern Europe and the Baltic states are cooling rapidly, as nervous Western Europeans stop buying investment properties in Warsaw, Tallinn, Estonia and other real estate Klondikes.
Further east, in India and southern China, prices are no longer surging. With stock markets down sharply after reaching heady levels, people do not have as much cash to buy property.

The Times says prices have fallen 20 percent in a year in some parts of India, and notes that the housing market accounts for a whopping 12 percent of the Irish economy—three times that of the U.S.

Delta (Northwest) Dawn?

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at Follow him on Twitter at @ryanchittum.