Every presidential candidate has to do it, though Sen. Barack Obama (D-Ill.) less often than most: handle a bad news day. And Obama began that task yesterday by making an offer to the reporters who thronged his immigration press conference — on issues wholly unrelated to immigration.

“I know there may be some presidential questions,” Obama said, perhaps understating the blogosphere and Beltway brushfire set off by a New York Times story on his stock holdings, “and I’d be happy to stick around [to answer them].” But first, Obama asked for time to discuss his new bill blocking planned fee hikes for citizenship applications filed by legal immigrants.

The press obliged him, and Obama responded to the Times’s questions about his 2005 investments in companies that some of his political donors also favored. Obama said he was in the process of setting up a trust to make targeted stock purchases, tapping a broker at UBS who came recommended by George Hayworth, one of the freshman’s financial supporters.

The broker chose to spend some of Obama’s book-advance income on two so-called “small cap” stocks, AVI BioPharma and SkyTerra Communications, according to the senator. While hardly household names, the two companies were considered potential growth stocks thanks to the federal spending boom on homeland security.
“At no point did I know which stocks were held,” Obama said. “At no point did I direct how those stocks were invested.”

The senator, whose avoidance of critical media coverage has fascinated 2008 prognosticators and frustrated allies of his rival, Sen. Hillary Rodham Clinton (D-N.Y.), did direct the stocks to be sold in the fall of 2005. Obama said he made the move to avoid the appearance of a potential conflict of interest after he received a shareholder communication from one of the companies, though he could not recall details.

“At that point I became concerned that I might not be able to insulate myself from knowledge of my holdings,” Obama said. Now, he added, his investments are pointedly confined to cash, mutual funds and money market accounts.

The origin of the shareholder update Obama referred to remains unclear. SkyTerra, like many public companies, sends investors copies of its Securities and Exchange Commission (SEC) proxy forms, also known as 14As, but none were issued during the fall of 2005, according to SEC records.

AVI generally sends mailings to shareholders or institutional investors that proactively request them or sign up for e-mail lists, said Michael Hubbard, AVI’s investor-relations director.

“It doesn’t sound like anything we would have sent out,” Hubbard said.

The fall of 2005 did make the pitfalls of qualified blind trusts abundantly clear, as former Senate Majority Leader Bill Frist (R-Tenn.) began grappling with an SEC investigation into his sale of stock from a quasi-blind trust. Obama said Frist’s troubles, which helped torpedo the Republican’s presidential prospects, helped explain his decision-making.

“The fact that that qualified blind trust didn’t work as intended explains why I didn’t take that route initially,” Obama said.

SkyTerra is controlled by the private-equity firm Apollo Management, where Obama backer and former Senate Democratic leader Tom Daschle (S.D.) briefly served on the board of directors after Obama had divested himself of the company.

Edwards snubs Fox

The burgeoning online campaign to push the Nevada Democratic Party to drop Fox as a sponsor of its pre-primary debate claimed a big victory late Tuesday, as former Sen. John Edwards (D-N.C.) announced he would skip the Fox-backed debate.

MoveOn.Org Civic Action, which is helping turn up the grassroots pressure on Nevada Democrats, issued a statement yesterday praising Edwards for “sending a clear message to the voters, the media and the other candidates” by bowing out.

—  Elana Schor

Rep. Walsh backs Giuliani

Former New York Mayor Rudolph Giuliani announced the endorsement of the senior Republican in the New York delegation as Rep. James Walsh (R-N.Y.) signed on to his New York Leadership Team.

Walsh, who was narrowly reelected in November to his 10th term in the House, joins fellow New York Republican congressmen Pete King and Vito Fossella in backing Giuliani. Former state party chairman Bill Powers and former Rep. Guy Molinari (R-N.Y.) are chairing his state efforts.

“I was proud to work with Rudy while he was mayor and I’ve seen the direct results of his actions and his demands for accountability and high standards,” Walsh said.

—  Aaron Blake

Candidates show off Lone Star support

Texas Rep. Mike Conaway (R) is backing Mitt Romney’s bid to become president.

Conaway’s district includes President Bush’s hometown of Midland, and Romney claimed the endorsement represented the development of a “strong network” of Lone Star support.

Around the same time of Romney’s release, however, his rival, Sen. John McCain (R-Ariz.), announced his own Texas patron.

Former Rep. Thomas Loeffler (R-Texas), now a successful lobbyist at the Loeffler Group, will be “general co-chair” of the McCain campaign. Loeffler was a key money man for Bush’s successful campaigns.

Conaway is a Romney guy, though. He called the former Massachusetts governor a man of “deep character and integrity” and the “only conservative candidate who can bring real change to Washington.”

Romney has the most endorsements from lawmakers. The Hill’s website tracks such endorsements at http://thehill.com/endorsements-2008.html.

—  Jim Snyder