IN BRIEF

Fannie Mae, the largest source of money for U.S. home loans, cut its dividend 30 percent and said it will sell $7 billion of preferred stock to bolster capital as the housing crisis deepens.

The quarterly payout will drop to 35 cents a share from 50 cents starting in the first quarter, Washington-based Fannie Mae said in a statement Tuesday. The government-chartered company plans to issue the preferred stock later this month.

The worst housing slump in at least two decades will hurt fourth-quarter earnings “in a material way” and continue to weigh on 2008 results, Fannie Mae said. The decision to shore up capital follows a similar move last week by McLean, Va.-based Freddie Mac.

SAN FRANCISCO

Yahoo offers free tools for editing on Flickr

Yahoo is touching up its popular online photo-sharing service, Flickr, with free editing tools aimed at the growing number of shutterbugs who want to doctor digital pictures.

The editing software, expected to be introduced late Tuesday in a partnership with Picnik, represents Yahoo’s latest attempt to broaden Flickr’s appeal as the Sunnyvale-based company closes its older Yahoo Photos service.

Although Flickr offers free accounts with limited photo storage to all comers, the service also sells $24.95 annual subscriptions that accommodate unlimited uploading. Yahoo is betting the editing tools will encourage more people to pay to show a larger number of pictures on the site.

ATLANTA

Delta will freeze hiring in push to reduce costs

A Delta Air Lines executive said Tuesday that the nation’s No. 3 carrier is freezing hiring in certain areas as part of a cost-cutting move aimed at dealing with high fuel prices that will weaken the company’s fourth-quarter results.

President and Chief Financial Officer Ed Bastian said at the Calyon Securities U.S. Airline Conference in New York that high fuel costs will “dampen” Delta’s operating margin — the ratio of operating income to sales revenue, expressed as a percentage — in the quarter ending Dec. 31.

He said Delta’s current projection for operating margin is flat to minus 2 percent. Previously, the company projected an operating margin of 3 percent to 5 percent for the quarter.

MINNEAPOLIS

UnitedHealth admits to missteps in year

In an unusual display of self-flagellation, UnitedHealth Group on Tuesday acknowledged missteps in the past year that alienated doctors and drove away customers, and promised to do better.

The health insurer said the missteps would cost it half a million members in the first quarter of 2008. It predicted a turnaround later in the year as it strives to improve customer service and roll out new types of health plans.

“We are not satisfied at all with 2007,” Chief Executive Stephen Hemsley said in New York.

UnitedHealth has a deal in place to acquire Las Vegas-based insurer Sierra Health Services for $2.6 billion.

Government backs file-sharing penalty

The U.S. government told a judge it supports a $222,000 damages award against a Minnesota mother found liable for online piracy of 24 songs owned by Vivendi SA’s Universal Music Group and five other recording companies.

The jury’s award against Jammie Thomas, 30, is lenient because it’s based on $9,250 per song instead of the maximum $150,000 per song allowed under the Copyright Act, the Justice Department said in papers filed Monday in federal court in Duluth, Minn. The damages must be used to send a message to potential copyright infringers, it said.

NEW YORK

Treasury prices decline amid rate-cut hopes

Treasury prices fell moderately Tuesday, breaking from a recent vigorous rally, but the market still drew support from the rising conviction that the Federal Reserve will cut rates next week.

The benchmark 10-year Treasury note fell 0.25 points to 102.94 with a yield of 3.89 percent, up from 3.85 percent late Monday. Prices and yields move in opposite directions.