The Senate finally nailed down a deal on a housing bill, something The Wall Street Journal deems worthy of page one, but which The Washington Post briefs on D2. The New York Times splits the difference, and puts it on C1.

The bill, similar to one that already passed in the House, would let the government back as much as $300 billion in refinanced mortgages, which the papers say could help 500,000 borrowers. Lenders would have to cut borrowers’ principal, write off the losses, and pay a monthly fee to insure taxpayers against losses. That helped the Bush administration change its position from veto threat to “willing to consider,” the NYT reports.

But the whole thing is an exercise in futility if banks don’t cut borrowers some slack, which the WSJ writes is a real possibility:

One practical issue: Lenders thus far appear reluctant to voluntarily write down the value of loans, even though this may be a cheaper option than foreclosure. Nonetheless, congressional staffers said the expanded FHA program is expected to help between 500,000 and one million people refinance into more affordable loans.

Thomas Lawler, a housing economist in Leesburg, Va., says he doubts the package will “put a floor” under the market, as Sen. Dodd predicted. Writing down the principal owed by distressed borrowers will be only the “last resort” of lenders, which are more inclined to reduce interest payments or give borrowers more time to repay their loans, Mr. Lawler said.

The bill would also create a new agency to regulate Fannie Mae and Freddie Mac, the government-sponsored enterprises that underpin the housing market by buying mortgages from lenders. The legislation must still be passed by the full Senate and reconciled with the House’s version.

How the cookie crumbles

The NYT reports on C1 that NexCen Brands, a buyout firm that owns Bill Blass and Athlete’s Foot among other brands, is about to go bust and said it had launched investigation of its accounting practices. The company is getting hit by the consumer slowdown and credit crisis, the paper says, and is likely to be taken under by cookies. Great American Cookies, that is, which it bought in October and has to make a big payment on soon. It had failed to disclose to investors that it had to make that payment, something that sparked the investigation. (The WSJ puts the story on C6 and doesn’t mention the investigation for some reason.)

But we think the Times is being kind to this company by blaming its woes primarily on the economy’s problems. Check out this business plan:

NexCen was created in 2006 with an unusual business plan. Unlike most buyout firms, which hope to sell off acquisitions quickly for a profit, it intended to create a conglomerate whose disparate divisions in food, fashion, furniture and sports would play off one another.

The idea was for Bill Blass designers to make athletic clothing to be sold at The Athlete’s Foot, or for Athlete’s Foot store operators to branch out and open a MaggieMoo’s or a Pretzel Time.

We’ve long known that when corporate executives start blathering about “synergy” that it’s time to raise the skeptical eyebrow. But come on! Shoes and pretzels? Bill Blass and the Athlete’s Foot?

Have we got a beauty for you!

The Journal on page one writes that car sales may have been another bubble of the last decade. It reports that sales peaked in 2000 and leveled off until two years ago when they started falling so significantly that the market won’t beat its previous record until 2012.

The paper says automakers pushed sales to “artificial highs” with aggressive pricing, no-interest loans, and low-margin sales to rental companies.

The industry’s miscalculations hold broader consequences for the U.S. economy. The auto industry is the nation’s largest manufacturing sector, accounting for almost 4% of U.S. gross domestic product. It employs about 2.5 million people directly or indirectly, and spends tens of billions of dollars a year in research and development.

Oh, what a tangled web…

The papers report that the Securities and Exchange Commission filed civil fraud charges against eight former AOL and Time Warner executives, including a chief financial officer, who it says were instrumental in illegitimately inflating advertising revenues by more than $1 billion beginning with the run-up to its merger with Time Warner. Four of the former execs settled, agreeing to pay a combined $8.1 million.

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.