Warren Buffett sees US already in recession; says will last long
Asked by Germany's Der Spiegel weekly whether he thinks the U.S. could still avoid a recession, he said that as far as the average person is concerned, it's already here.
"I believe that we are already in a recession," Buffet was quoted by Spiegel as saying. "Perhaps not in the sense as defined by economists. ... But people are already feeling the effects of a recession."
"It will be deeper and longer than what many think," he added.
Read Complete Story
Sunday, May 25, 2008
Friday, May 9, 2008
Trade gap narrows in March
Deficit shrinks more than expected as demand for imports falls by the sharpest rate in over 6 years.
The nation's trade gap narrowed in March, as a weakened U.S. economy led to the sharpest decline in Americans' demand for foreign imports in more than six years, according to a government report released Friday.
The Commerce Department said the March trade deficit came in at $58.2 billion, versus a revised $61.7 billion in February. A consensus of economists forecast the gap would shrink to $61.3 billion, according to Briefing.com.
U.S. exports for the month fell 1.7% to $148.5 billion from February's $151.1 billion.
The decline in exported goods and services was the first since April 2007, but was dragged down by a momentary lull in volatile airplane exports. Plane manufacturer Boeing (BA, Fortune 500) is the nation's largest exporter.
Read Complete Story
The nation's trade gap narrowed in March, as a weakened U.S. economy led to the sharpest decline in Americans' demand for foreign imports in more than six years, according to a government report released Friday.
The Commerce Department said the March trade deficit came in at $58.2 billion, versus a revised $61.7 billion in February. A consensus of economists forecast the gap would shrink to $61.3 billion, according to Briefing.com.
U.S. exports for the month fell 1.7% to $148.5 billion from February's $151.1 billion.
The decline in exported goods and services was the first since April 2007, but was dragged down by a momentary lull in volatile airplane exports. Plane manufacturer Boeing (BA, Fortune 500) is the nation's largest exporter.
Read Complete Story
EXL eyes mid-sized companies in US, India
Delhi-based EXL Services Holding is planning to acquire mid-sized companies with revenues ranging between $50 million and $100 million (around Rs 200-400 crore) as a part of its inorganic growth plan.
The company is looking at acquisition of firms in both the US and India. It plans to close at least one deal by the end of this financial year.
EXL has set the revenue for target firms in India in the range of $50-100 million, while it is eyeing multiple acquisitions of small firms offering business process outsourcing services in the US.
"Acquisitions are a core part of our growth strategy and these targets, here and abroad, will happen if we get the right kind of opportunity," said Rohit Kapoor, president and CEO, EXL Services.
Read Complete Story
The company is looking at acquisition of firms in both the US and India. It plans to close at least one deal by the end of this financial year.
EXL has set the revenue for target firms in India in the range of $50-100 million, while it is eyeing multiple acquisitions of small firms offering business process outsourcing services in the US.
"Acquisitions are a core part of our growth strategy and these targets, here and abroad, will happen if we get the right kind of opportunity," said Rohit Kapoor, president and CEO, EXL Services.
Read Complete Story
Oil: After hitting $126, is $150 far behind
Crude futures continue to explore the upper price reaches, but getting too much further might not happen so easily.
Oil leaped into uncharted territory Friday, soaring past the $126-a-barrel mark for the first time, and leaving analysts and investors wondering how high the price will go.
U.S. light crude futures for June delivery hit an intraday record $126.20 in electronic trading, backing off to $125.31 by around 1 p.m. ET. That was still $1.62 above Thursday's record closing settlement of $123.69 a barrel.
The price of a barrel of crude oil has more than doubled in the past year. On May 9, 2007, the active contract settled at $61.55 a barrel.
And if oil has doubled in the past year, what has to happen for oil to hit $150 a barrel?
Foreign central banks net sellers of US debt
Foreign central banks were net sellers of U.S. Treasury debt and U.S. federal agency debt in the latest week, U.S. Federal Reserve data showed on Thursday.
The Fed said its holdings of Treasury and agency debt kept for overseas central banks fell by $8.47 billion in the week ended May 7, to a total of $2.273 trillion.
The breakdown showed overseas central banks sold $4.51 billion in Treasury debt, leaving the total of their Treasury holdings at $1.342 trillion.
Read Complete Story
The Fed said its holdings of Treasury and agency debt kept for overseas central banks fell by $8.47 billion in the week ended May 7, to a total of $2.273 trillion.
The breakdown showed overseas central banks sold $4.51 billion in Treasury debt, leaving the total of their Treasury holdings at $1.342 trillion.
Read Complete Story
Barely surviving on credit cards
No longer able to turn their homes for cash, Americans are increasingly using plastic to meet their basic living expenses. But many can't afford to pay the bills.
These days, more and more people are saying "Charge it."
Finding themselves strapped for cash and unable to use their home as an ATM, Americans are increasingly turning to credit cards to cover gas, groceries and other living expenses.
But many find themselves struggling to pay the burgeoning bills at a time when even the basic needs are growing costlier.
"Other sources of money for a lot of Americans are drying up," said Dick Reed, regional counseling manager of Consumer Credit Counseling Service of Greater Atlanta, who sees more clients with mounting credit card debts these days. "Consumers just don't have a place to go to get money. They are digging themselves into a deeper hole not only to pay for normal living expenses, but to make minimum payments on outstanding debt."
Read Complete story
These days, more and more people are saying "Charge it."
Finding themselves strapped for cash and unable to use their home as an ATM, Americans are increasingly turning to credit cards to cover gas, groceries and other living expenses.
But many find themselves struggling to pay the burgeoning bills at a time when even the basic needs are growing costlier.
"Other sources of money for a lot of Americans are drying up," said Dick Reed, regional counseling manager of Consumer Credit Counseling Service of Greater Atlanta, who sees more clients with mounting credit card debts these days. "Consumers just don't have a place to go to get money. They are digging themselves into a deeper hole not only to pay for normal living expenses, but to make minimum payments on outstanding debt."
Read Complete story
Thursday, May 8, 2008
India's Tulip IT Eyeing buyouts in US, Europe
Trade & Gain from the Indian Stock market with Axis Bank. Apply Now !
Hardeep Singh Bedi, MD of Tulip IT Services that they are looking at acquiring the inorganic growth in the US and Europe.“We have identified some countries and we have given mandates and we are trying to see if any of these companies meet our requirements and going forward, we will be looking at acquisitions in the Europe countries and we will also be looking at tying up with some companies in the developing countries where we can roll out similar networks in partnerships with local partners,” he said.
Excerpts from CNBC-TV18’s exclusive interview with Hardeep Singh Bedi:
Q: Could you outline the growth triggers for your company going forward - the network integration is one of your key plays. But going forward, you have been looking at ramping up the data connectivity and your sworn projects, what’s the update there?
Read Complete Story
Hardeep Singh Bedi, MD of Tulip IT Services that they are looking at acquiring the inorganic growth in the US and Europe.“We have identified some countries and we have given mandates and we are trying to see if any of these companies meet our requirements and going forward, we will be looking at acquisitions in the Europe countries and we will also be looking at tying up with some companies in the developing countries where we can roll out similar networks in partnerships with local partners,” he said.
Excerpts from CNBC-TV18’s exclusive interview with Hardeep Singh Bedi:
Q: Could you outline the growth triggers for your company going forward - the network integration is one of your key plays. But going forward, you have been looking at ramping up the data connectivity and your sworn projects, what’s the update there?
Read Complete Story
'False hope' seen in April store sales gains
Analysts, citing numerous headwinds, aren't buying that last month's gains indicate a rebound in consumer spending.
Although many retailers reported improved April sales, following a disastrous March, analysts cautioned Thursday that it's premature to declare a resurgence in consumer spending.
"It's false hope to think that these numbers show that a rebound is about to take place in consumer spending," said Ken Perkins, president of sales tracking firm Retail Metrics, adding that there are still too many "headwinds" constraining consumers' discretionary budgets.
Specifically, Perkins pointed to four months of job losses, record-high gas prices, higher food prices, tighter credit availability and declining home values as the primary culprits.
Read Complete Story
Although many retailers reported improved April sales, following a disastrous March, analysts cautioned Thursday that it's premature to declare a resurgence in consumer spending.
"It's false hope to think that these numbers show that a rebound is about to take place in consumer spending," said Ken Perkins, president of sales tracking firm Retail Metrics, adding that there are still too many "headwinds" constraining consumers' discretionary budgets.
Specifically, Perkins pointed to four months of job losses, record-high gas prices, higher food prices, tighter credit availability and declining home values as the primary culprits.
Read Complete Story
Retail gas prices soar to fresh record
With nationwide prices at an all-time high of $3.645 a gallon, drivers now pay 20% more than they did last year.
Retail gasoline prices have jumped to new record high, auto group AAA's Web site showed Thursday.
The national average price for a gallon of regular unleaded gasoline rose to $3.645, surpassing the previous record set May 1.
Gas prices have been marching steadily higher since the start of the year.
Read Complete Story
Retail gasoline prices have jumped to new record high, auto group AAA's Web site showed Thursday.
The national average price for a gallon of regular unleaded gasoline rose to $3.645, surpassing the previous record set May 1.
Gas prices have been marching steadily higher since the start of the year.
Read Complete Story
The draining national prosperity
The first quarter Gross Domestic Product rise of 0.6% was greeted with considerable relief by most Wall Street commentators; they had expected the chaos in the housing market and the banking system to have pushed the US economy into recession. This was unreasonable; the huge monetary stimulus currently being hurled at the economy was always likely to prevent immediate recession, while the fiscal stimulus of the $110bn rebate package is likely to prop it up through July or so. Beyond that, the future becomes less clear: at some stage the monetary and fiscal stimulus must run out.
As I have frequently written, monetary conditions have been pretty lax since 1995. It had been becoming difficult to determine how lax since March 2006, when the Federal Reserve stopped reporting M3 money supply, the measure used in by the European Central Bank and other monetarist organizations. However the St. Louis Fed, which for the decade until April was run by the monetarist William Poole, has constructed its own measure of broad money, Money of Zero Maturity, which is a reasonable proxy for M3; it consists of M2 plus institutional money market funds minus small time deposits. Like M3, MZM began to expand excessively in early 1995; in the 13 years to March 2008 it grew at an average annual rate of 8.88%, compared with growth in nominal GDP during that period of 5.25%.
Read Complete Story
As I have frequently written, monetary conditions have been pretty lax since 1995. It had been becoming difficult to determine how lax since March 2006, when the Federal Reserve stopped reporting M3 money supply, the measure used in by the European Central Bank and other monetarist organizations. However the St. Louis Fed, which for the decade until April was run by the monetarist William Poole, has constructed its own measure of broad money, Money of Zero Maturity, which is a reasonable proxy for M3; it consists of M2 plus institutional money market funds minus small time deposits. Like M3, MZM began to expand excessively in early 1995; in the 13 years to March 2008 it grew at an average annual rate of 8.88%, compared with growth in nominal GDP during that period of 5.25%.
Read Complete Story
Wednesday, May 7, 2008
France Telecom posts revenue growth, eyes acquisitions
PARIS—France Telecom SA on Wednesday reported growth in first-quarter revenue and profit margins and said it is ready to seek acquisitions to enhance its presence in both emerging markets and Western Europe.
"All the necessary conditions are in place for the group to take part in the consolidation of the European sector," Chief Executive Didier Lombard said in a statement.
France's dominant telecommunications operator said last month it was considering possible Nordic acquisitions including Swedish company TeliaSonera and Norway's Telenor.
France Telecom Chief Financial Officer Gervais Pellissier, speaking in a conference call, said France Telecom is still interested, but has not opened talks with TeliaSonera.
France Telecom said when it looks at possible acquisitions, it is seeking synergies, stronger positions in new products and services, increased activity in emerging countries, and compatibility with business models and strategic priorities.
Wachovia nearly doubles its 1Q loss to $708 million
Wachovia Corp. is nearly doubling previously reported losses for the first quarter to $708 million after reviewing its portfolio of bank-owned life insurance.
In April, the nation's fourth-largest bank reported a $393 million first-quarter loss, cut its dividend and said it would raise $7 billion in new capital.
Read Complete Story
In April, the nation's fourth-largest bank reported a $393 million first-quarter loss, cut its dividend and said it would raise $7 billion in new capital.
Read Complete Story
US Manufacturers Claim Presidential Candidates Are Ignoring Their Issues
The presidential campaigns are ignoring issues around U.S. industrial competitiveness, much to the dismay of manufacturers, according to a new poll from Thomas Publishing Company, LLC.
The just released survey of more than 2,000 manufacturing professionals shows 70 percent are concerned about the state of US manufacturing today and industry’s ability to compete effectively on the global stage. Yet they feel even worse about the lack of attention the Republican and Democratic candidates are paying to the sector.
Eighty percent of manufacturers want the next administration to take a more active role in strengthening the industry. More than 80 percent said the government can do more to “level the playing field” with such competing nations as China, India, and Korea.
These messages came through loud and clear in this new poll by Managing Automation and its sister publications in parent company Thomas Publishing, including Industrial Equipment News, Thomas Global, ThomasNet, and InBound Logistics.
Yet while poll-takers are united in their concerns about the future of America’s industrial base, they hold differing opinions in how they would approach fixing some of the problems. For example, when asked whether international trade agreements such as NAFTA have helped or hurt US competitiveness, nearly half of respondents said such agreements have had a mixed effect.
Read Complete Story
The just released survey of more than 2,000 manufacturing professionals shows 70 percent are concerned about the state of US manufacturing today and industry’s ability to compete effectively on the global stage. Yet they feel even worse about the lack of attention the Republican and Democratic candidates are paying to the sector.
Eighty percent of manufacturers want the next administration to take a more active role in strengthening the industry. More than 80 percent said the government can do more to “level the playing field” with such competing nations as China, India, and Korea.
These messages came through loud and clear in this new poll by Managing Automation and its sister publications in parent company Thomas Publishing, including Industrial Equipment News, Thomas Global, ThomasNet, and InBound Logistics.
Yet while poll-takers are united in their concerns about the future of America’s industrial base, they hold differing opinions in how they would approach fixing some of the problems. For example, when asked whether international trade agreements such as NAFTA have helped or hurt US competitiveness, nearly half of respondents said such agreements have had a mixed effect.
Read Complete Story
Pandering at pump: Gas-tax holiday is politics at its worst
Why would a politician promulgate policy that would boost gasoline consumption, enrich Big Oil, increase dependence on foreign crude, hasten global warming, rob the federal highway trust fund and threaten thousands of jobs?
Actually, there are two short and simple answers to that long-winded question: 1) It's an election year. 2) John McCain and Hillary Clinton are trying to buy your vote.
The proposal for a federal gas tax holiday this summer, contrary to the candidates' claims, is not an honest, earnest attempt to alleviate the plight of the poor.
It's pure political pandering, as Barack Obama points out. At best, it would put a few pennies in your pocket if Congress approves this foolish proposal.
Economists say the idea flies in the face of the law of supply and demand. In times of constricted supply, like now, the price rises to a level necessary to reduce the demand to meet the available supply. If you lower the price by suspending the tax, the demand increases, a shortage is created, and the price goes back up. Only the oil industry gains.
Read Complete Story
Actually, there are two short and simple answers to that long-winded question: 1) It's an election year. 2) John McCain and Hillary Clinton are trying to buy your vote.
The proposal for a federal gas tax holiday this summer, contrary to the candidates' claims, is not an honest, earnest attempt to alleviate the plight of the poor.
It's pure political pandering, as Barack Obama points out. At best, it would put a few pennies in your pocket if Congress approves this foolish proposal.
Economists say the idea flies in the face of the law of supply and demand. In times of constricted supply, like now, the price rises to a level necessary to reduce the demand to meet the available supply. If you lower the price by suspending the tax, the demand increases, a shortage is created, and the price goes back up. Only the oil industry gains.
Read Complete Story
What Uncle Sam Gives in Rebates, OPEC Takes, Stalling Economy
Wal-Mart and OPEC are battling for the tax rebates the U.S. government began handing out last week. The result may be a draw for the economy.
While consumers might spend enough of the $117 billion stimulus at retailers to keep the U.S. economy afloat in the months ahead, the boost from their purchases will be diluted by gasoline prices at $3.62 a gallon and rising.
The upshot: The U.S. might avoid an outright contraction in the second quarter and still be saddled with sluggish growth typical of Europe, which expanded at a 0.9 percent annual pace in the six quarters following a 2001 recession.
``It feels like the U.S. is taking a European holiday,'' says Bruce Kasman, chief economist at JPMorgan Chase & Co. in New York. ``We're in for a long period of growth hugging 1 percent.''
Read Complete Story
While consumers might spend enough of the $117 billion stimulus at retailers to keep the U.S. economy afloat in the months ahead, the boost from their purchases will be diluted by gasoline prices at $3.62 a gallon and rising.
The upshot: The U.S. might avoid an outright contraction in the second quarter and still be saddled with sluggish growth typical of Europe, which expanded at a 0.9 percent annual pace in the six quarters following a 2001 recession.
``It feels like the U.S. is taking a European holiday,'' says Bruce Kasman, chief economist at JPMorgan Chase & Co. in New York. ``We're in for a long period of growth hugging 1 percent.''
Read Complete Story
The WSJ Is Wrong on the Housing Crisis
The Wall Street Journal editorial page had a piece yesterday titled 'The Housing Crisis is Over'. In my view, this assessment is premature by many years.
The article's main flaws, based on my own research, are its emphasis on pricing as the key driver of housing demand, and its sole focus on the inventory of new homes, ignoring existing homes. The author puts his faith in a rebound based on the issue of affordability: house prices have come down enough that people can afford them again. Fair enough but he treats the inventory of homes with a nonchalance that ignores underlying demographic trends, writing:
Even if home sales pick up, how can home prices stop falling with so many houses vacant and unsold? The flip but true answer: because they always do.
Flip, yes. True, no. This time it will be different because of two demographic factors:
First, the supply of homes is made up not only of new home construction but also of existing homes coming back to market. And we are facing a wall of existing homes coming to market in the next 15 to 20 years. How so? Quite simple: older people will leave their homes as they age or pass away. Some of these homes will be demolished, but most will come back to the market.
Read Complete Story
The article's main flaws, based on my own research, are its emphasis on pricing as the key driver of housing demand, and its sole focus on the inventory of new homes, ignoring existing homes. The author puts his faith in a rebound based on the issue of affordability: house prices have come down enough that people can afford them again. Fair enough but he treats the inventory of homes with a nonchalance that ignores underlying demographic trends, writing:
Even if home sales pick up, how can home prices stop falling with so many houses vacant and unsold? The flip but true answer: because they always do.
Flip, yes. True, no. This time it will be different because of two demographic factors:
First, the supply of homes is made up not only of new home construction but also of existing homes coming back to market. And we are facing a wall of existing homes coming to market in the next 15 to 20 years. How so? Quite simple: older people will leave their homes as they age or pass away. Some of these homes will be demolished, but most will come back to the market.
Read Complete Story
Tuesday, May 6, 2008
Oil passes $122 a barrel
Crude hits a new record high Tuesday on supply worries, optimism about U.S. economy.
Oil futures blasted to a new record over $122 a barrel Tuesday, gaining momentum as investors bought on a forecast of much higher prices and on any news hinting at supply shortages. Retail gas prices edged lower, but appear poised to rise to new records of their own in coming weeks.
A new Goldman Sachs prediction that oil prices could rise to $150 to $200 within two years seemed to motivate much of Tuesday's buying, although a falling dollar and increasing concerns about declining crude production in Mexico and Russia contributed, analysts say.
The Energy Department raised its oil and gasoline price forecasts, but also predicted that high prices will cut demand more than previously thought.
Read Complete Story
Oil futures blasted to a new record over $122 a barrel Tuesday, gaining momentum as investors bought on a forecast of much higher prices and on any news hinting at supply shortages. Retail gas prices edged lower, but appear poised to rise to new records of their own in coming weeks.
A new Goldman Sachs prediction that oil prices could rise to $150 to $200 within two years seemed to motivate much of Tuesday's buying, although a falling dollar and increasing concerns about declining crude production in Mexico and Russia contributed, analysts say.
The Energy Department raised its oil and gasoline price forecasts, but also predicted that high prices will cut demand more than previously thought.
Read Complete Story
Columbia free trade bad for America
Debate over the Colombia Free Trade Agreement came to the forefront last month when the pact emerged as President Bush’s top legislative priority. A wide range of Democrats, from Hillary Clinton and Barack Obama to Earl Blumenauer and David Wu, quickly announced their opposition.
They rightfully argue that consideration of a trade agreement with Colombia is inappropriate until that nation improves its atrocious human rights record. Why, then, does Congresswoman Darlene Hooley remain undecided?
My union, the Association of Western Pulp and Paper Workers, typically opposes free trade agreements because of their harmful legacy of offshoring American jobs.
Read Complete Story
They rightfully argue that consideration of a trade agreement with Colombia is inappropriate until that nation improves its atrocious human rights record. Why, then, does Congresswoman Darlene Hooley remain undecided?
My union, the Association of Western Pulp and Paper Workers, typically opposes free trade agreements because of their harmful legacy of offshoring American jobs.
Read Complete Story
Fed task force eyes lenders and Wall Street in subprime mess
Federal authorities, responding to the subprime-mortgage crisis, have formed a task force to determine if lenders or Wall Street firms participated in fraud.
The task force will be headed by prosecutors in the Eastern District of New York, where one of the nation's top mortgage lenders went bankrupt last year.
Robert Nardoza, spokesman for the U.S. Attorney's office in Brooklyn, confirmed a report on Monday that a task force, comprised of federal, state and local agencies, would focus on the activities of mortgage lenders and Wall Street firms. He declined to give further details.
U.S. Attorney Benton Campbell told The Wall Street Journal that it was too early to say if actions that led to the subprime crisis rise to the level of a crime.
Read Complete StoryFannie Mae Has Loss, Cuts Dividend, to Raise Capital
Fannie Mae, the largest U.S. mortgage- finance company, reported a wider loss than analysts estimated, cut the dividend for the second time in six months and said it will raise $6 billion in capital as the worst housing slump since the Great Depression deepens.
The first-quarter net loss was $2.19 billion, or $2.57 a share, Washington-based Fannie Mae said in a statement. Analysts were expecting a loss of 64 cents a share, the average of 12 estimates from a Bloomberg survey.
The shares rose after the company's regulator said it will loosen restrictions on Fannie Mae's capital once the company has raised the $6 billion. Fannie Mae, which owns or guarantees one of every five U.S. home loans, needs new capital to weather credit and derivative losses that rose fivefold to $8.9 billion. Moody's Investors Service affirmed the company's Aaa credit rating. The money raised will enable the company to ``emerge from this crisis'' in a stronger position, Chief Executive Officer Daniel Mudd said.
Read Complete Story
The first-quarter net loss was $2.19 billion, or $2.57 a share, Washington-based Fannie Mae said in a statement. Analysts were expecting a loss of 64 cents a share, the average of 12 estimates from a Bloomberg survey.
The shares rose after the company's regulator said it will loosen restrictions on Fannie Mae's capital once the company has raised the $6 billion. Fannie Mae, which owns or guarantees one of every five U.S. home loans, needs new capital to weather credit and derivative losses that rose fivefold to $8.9 billion. Moody's Investors Service affirmed the company's Aaa credit rating. The money raised will enable the company to ``emerge from this crisis'' in a stronger position, Chief Executive Officer Daniel Mudd said.
Read Complete Story
Greenspan Says `Pale Recession' May Last Through Year
Former Federal Reserve Chairman Alan Greenspan said the U.S. has slipped into an ``awfully pale recession'' and may continue to languish for the rest of the year.
``We are clearly receding,'' with economic growth now at about zero percent, he said in an interview with Bloomberg News. Greenspan, who now consults for clients including Deutsche Bank AG, also said it was too soon to declare the end to the credit crisis stemming from the collapse in the subprime mortgage market.
The former Fed chief's assessment echoes figures in the past month that show declines in manufacturing and housing industries, though fewer job losses than economists forecast. Greenspan's successor, Ben S. Bernanke, and his colleagues indicated last week they are ready for a pause in interest-rate cuts after seven reductions since September.
Read Complete Story
``We are clearly receding,'' with economic growth now at about zero percent, he said in an interview with Bloomberg News. Greenspan, who now consults for clients including Deutsche Bank AG, also said it was too soon to declare the end to the credit crisis stemming from the collapse in the subprime mortgage market.
The former Fed chief's assessment echoes figures in the past month that show declines in manufacturing and housing industries, though fewer job losses than economists forecast. Greenspan's successor, Ben S. Bernanke, and his colleagues indicated last week they are ready for a pause in interest-rate cuts after seven reductions since September.
Read Complete Story
Is America still great?
I have criticized Thomas Friedman for supporting every trade agreement he has ever seen, despite not reading one of them. His past (and continued?) lemming-like support for trade agreements has pushed America into these troubles.
"We got this free market, and I admit, I was speaking out in Minnesota--my hometown, in fact, and guy stood up in the audience, said, `Mr. Friedman, is there any free trade agreement you'd oppose?' I said, `No, absolutely not.' I said, `You know what, sir? I wrote a column supporting the CAFTA, the Caribbean Free Trade initiative. I didn't even know what was in it. I just knew two words: free trade."
But he makes some good points today, in an op-ed on whether America is still strong.
Traveling the country these past five months while writing a book, I’ve had my own opportunity to take the pulse, far from the campaign crowds. My own totally unscientific polling has left me feeling that if there is one overwhelming hunger in our country today it’s this: People want to do nation-building. They really do. But they want to do nation-building in America.
Nation building in the U.S. is a good idea. But we are following the U.K. trajectory of decline. Giving away the riches of the realm for foreign policy reasons on trade, pursuing expensive military action in pipsqueak countries, allowing our production to be shipped overseas, and financing it all on credit cards and subprime mortgages.
Read Complete Story
"We got this free market, and I admit, I was speaking out in Minnesota--my hometown, in fact, and guy stood up in the audience, said, `Mr. Friedman, is there any free trade agreement you'd oppose?' I said, `No, absolutely not.' I said, `You know what, sir? I wrote a column supporting the CAFTA, the Caribbean Free Trade initiative. I didn't even know what was in it. I just knew two words: free trade."
But he makes some good points today, in an op-ed on whether America is still strong.
Traveling the country these past five months while writing a book, I’ve had my own opportunity to take the pulse, far from the campaign crowds. My own totally unscientific polling has left me feeling that if there is one overwhelming hunger in our country today it’s this: People want to do nation-building. They really do. But they want to do nation-building in America.
Nation building in the U.S. is a good idea. But we are following the U.K. trajectory of decline. Giving away the riches of the realm for foreign policy reasons on trade, pursuing expensive military action in pipsqueak countries, allowing our production to be shipped overseas, and financing it all on credit cards and subprime mortgages.
Read Complete Story
Monday, May 5, 2008
Survey finds gas prices up about 15 cents over past 2 weeks
The national average price for regular gasoline rose about 15 cents in the last two weeks, according to a survey.
The average price of self-serve regular gasoline on Friday was $3.62 a gallon, up 15 cents from two weeks ago. Mid-grade was at $3.74 and premium was $3.85. That's all according to the Lundberg Survey of 7,000 stations nationwide released Sunday.
Regular gasoline is up 55 cents since 2008 began.
Read Complete Story
The average price of self-serve regular gasoline on Friday was $3.62 a gallon, up 15 cents from two weeks ago. Mid-grade was at $3.74 and premium was $3.85. That's all according to the Lundberg Survey of 7,000 stations nationwide released Sunday.
Regular gasoline is up 55 cents since 2008 began.
Read Complete Story
JPMorgan says no near end to financial crisis: report
JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) does not expect the U.S. financial crisis to end soon and will remain very cautious, its top executive said in comments published by a German weekly on Saturday.
"We can only speculate how deep and how long the recession in the United States will really be and how that in turn will impact banks," James Dimon told "Welt am Sonntag".
"But we are not done with the crisis for a long time," Dimon said, adding that it was not the company's job to make bets on the future.
"Imagine we would need to walk up to our shareholders one day and say, sorry but the recession in the USA is so bad, we're broke. We need to be able to rule out at all times that it will not come to that," Dimon said.
Read Complete Story
"We can only speculate how deep and how long the recession in the United States will really be and how that in turn will impact banks," James Dimon told "Welt am Sonntag".
"But we are not done with the crisis for a long time," Dimon said, adding that it was not the company's job to make bets on the future.
"Imagine we would need to walk up to our shareholders one day and say, sorry but the recession in the USA is so bad, we're broke. We need to be able to rule out at all times that it will not come to that," Dimon said.
Read Complete Story
Oil prices surpass $120 a barrel
Crude soars to new heights after attack on Nigerian oil installation, raids in Iraq; pump prices dip a cent.
Oil futures have surpassed the once unthinkable price of $120 a barrel Monday as supply threats emerged overseas and the dollar weakened against the euro.
At the pump, however, the average national price of a gallon of regular gas slipped to $3.611 a gallon on Monday, down 1.1 cents from Friday, according to AAA and the Oil Price Information Service. Prices peaked at a record $3.623 a gallon on Thursday.
Diesel prices also fell, slipping to a national average of $4.239 from a record $4.251 on Thursday. The runup in prices of diesel, used to power most trucks, trains and ships, is one reason why food prices are so high.
The slight relief motorists are seeing at the pump could end quickly if oil's rise continues. Analysts say gas prices could still go up another 10 cents or so. Indeed, Andy Lebow, senior vice president at MF Global Inc., thinks the gas price declines of the last four days are almost entirely due to crude oil's sharp drop last week; prices fell from a trading record $119.93 on Monday as low as $110.30 on Thursday before rebounding. Gas prices tend to follow prices in the futures market, but with some lag.
Read Complete Story
Oil futures have surpassed the once unthinkable price of $120 a barrel Monday as supply threats emerged overseas and the dollar weakened against the euro.
At the pump, however, the average national price of a gallon of regular gas slipped to $3.611 a gallon on Monday, down 1.1 cents from Friday, according to AAA and the Oil Price Information Service. Prices peaked at a record $3.623 a gallon on Thursday.
Diesel prices also fell, slipping to a national average of $4.239 from a record $4.251 on Thursday. The runup in prices of diesel, used to power most trucks, trains and ships, is one reason why food prices are so high.
The slight relief motorists are seeing at the pump could end quickly if oil's rise continues. Analysts say gas prices could still go up another 10 cents or so. Indeed, Andy Lebow, senior vice president at MF Global Inc., thinks the gas price declines of the last four days are almost entirely due to crude oil's sharp drop last week; prices fell from a trading record $119.93 on Monday as low as $110.30 on Thursday before rebounding. Gas prices tend to follow prices in the futures market, but with some lag.
Read Complete Story
Friday, May 2, 2008
Hampson to pay up to $314 mln for two U.S. purchases
British aero engineer Hampson Industries Plc (HAMP.L: Quote, Profile, Research) said on Friday it was to pay up to $314 million to make two U.S. acquisitions, to expand its presence in the carbon composite materials market in the United States.
Hampson also said it was raising 65 million pounds ($129 million) via a placing and open offer to help fund the deals, which are inter-conditional, to buy Odyssey Industries Inc and Global Tooling Systems Inc.
Hamspon will pay an initial $253 million made up of $213 million in cash and 14.87 million new shares, with further payment dependent on performance.
Both Odyssey and GTS are suppliers to next-generation commercial and military aircraft, including Boeing's (BA.N: Quote, Profile, Research) 787 and the F-35 Joint Strike Fighter and "are under substantially common ownership, and are both headed by President Randal D. Bellestri," Hampson said.
Read Complete Story
Hampson also said it was raising 65 million pounds ($129 million) via a placing and open offer to help fund the deals, which are inter-conditional, to buy Odyssey Industries Inc and Global Tooling Systems Inc.
Hamspon will pay an initial $253 million made up of $213 million in cash and 14.87 million new shares, with further payment dependent on performance.
Both Odyssey and GTS are suppliers to next-generation commercial and military aircraft, including Boeing's (BA.N: Quote, Profile, Research) 787 and the F-35 Joint Strike Fighter and "are under substantially common ownership, and are both headed by President Randal D. Bellestri," Hampson said.
Read Complete Story
U.S. Loses 20,000 Jobs in April; Unemployment at 5%
The U.S. lost fewer jobs than forecast in April, and the unemployment rate dropped, signaling that the economic slowdown may be milder than the 2001 recession.
Payrolls shrank by 20,000 workers, following a revised 81,000 drop in March that was larger than previously estimated, the Labor Department said today in Washington. The jobless rate fell to 5 percent, from 5.1 percent in March.
``We are in a recession, this report doesn't change that,'' said Ellen Zentner, economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, who had forecast a payrolls cut of 25,000. ``What it does is support the idea that the downturn will be mild. Consumer spending isn't going to tank.''
Read Complete Story
Payrolls shrank by 20,000 workers, following a revised 81,000 drop in March that was larger than previously estimated, the Labor Department said today in Washington. The jobless rate fell to 5 percent, from 5.1 percent in March.
``We are in a recession, this report doesn't change that,'' said Ellen Zentner, economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, who had forecast a payrolls cut of 25,000. ``What it does is support the idea that the downturn will be mild. Consumer spending isn't going to tank.''
Read Complete Story
Surging food, fuel prices push some Americans to brink: experts
US consumers are being hammered by record fuel costs and the steepest food price spikes in 17 years, sparking a "recession diet" and pushing more Americans to seek help at food banks, a Congressional committee heard Thursday.
Experts headed to Capitol Hill to respond to lawmakers' concerns over how the United States will cope with a mounting global food crisis that has reached the country's shores and threatens to upend millions of US households.
"While we have been cringing at gas stations as gas prices have more than doubled since 2001, now it's a double whammy," said Senator Charles Schumer, chairman of the Joint Economic Committee.
"We pay more to drive to the supermarket, and then get hit with higher prices when we get there," he said as he opened a hearing on food prices impacting US families.
Read Complete Story
Experts headed to Capitol Hill to respond to lawmakers' concerns over how the United States will cope with a mounting global food crisis that has reached the country's shores and threatens to upend millions of US households.
"While we have been cringing at gas stations as gas prices have more than doubled since 2001, now it's a double whammy," said Senator Charles Schumer, chairman of the Joint Economic Committee.
"We pay more to drive to the supermarket, and then get hit with higher prices when we get there," he said as he opened a hearing on food prices impacting US families.
Read Complete Story
Credit crisis far from over: expert
A DERIVATIVES expert who two years ago warned of a potential meltdown in global credit markets has cautioned that the crisis is far from over, and has endorsed recent calls to relax controls on inflation and allow higher prices to help markets trade their way out of their problems.
Longtime critic of derivatives markets, Satyajit Das, says those who believe the US sub-prime loans crisis, and the drought in credit markets it triggered, are nearly over are wrong.
"I think the cycle has some way to run yet," he told a Financial Services Institute of Australasia function in Sydney yesterday. "It's a matter of years, not a matter of months."
In particular, investors in the US stock market, which has climbed off its lows amid a growing mood that the worst of the crunch was over, were being too optimistic, he said.
Read Complete Story
Longtime critic of derivatives markets, Satyajit Das, says those who believe the US sub-prime loans crisis, and the drought in credit markets it triggered, are nearly over are wrong.
"I think the cycle has some way to run yet," he told a Financial Services Institute of Australasia function in Sydney yesterday. "It's a matter of years, not a matter of months."
In particular, investors in the US stock market, which has climbed off its lows amid a growing mood that the worst of the crunch was over, were being too optimistic, he said.
Read Complete Story
Consumer spending up mainly because of sharp price increases
Don't be fooled by a larger-than-expected increase in consumer spending. People aren't buying more — they're just paying more for their purchases, raising doubts about whether the 130 million stimulus payments the government began sending out this week will be enough to lift consumers' sagging spirits.
The Commerce Department reported Thursday that consumer spending was up 0.4 percent, double the increase that economists had forecast. However, once inflation was removed, spending edged up a much slower 0.1 percent.
The March reading was the fourth straight lackluster performance and did nothing to alleviate worries that consumer spending, which accounts for two-thirds of total economic activity, remains under severe strains, reflecting an economy beset by multiple problems.
Rising food costs, soaring energy prices and rising unemployment have pushed consumer confidence to the lowest levels in five years. Incomes in March rose a weak 0.3 but after removing inflation, after-tax incomes were flat.
Read Complete Story
The Commerce Department reported Thursday that consumer spending was up 0.4 percent, double the increase that economists had forecast. However, once inflation was removed, spending edged up a much slower 0.1 percent.
The March reading was the fourth straight lackluster performance and did nothing to alleviate worries that consumer spending, which accounts for two-thirds of total economic activity, remains under severe strains, reflecting an economy beset by multiple problems.
Rising food costs, soaring energy prices and rising unemployment have pushed consumer confidence to the lowest levels in five years. Incomes in March rose a weak 0.3 but after removing inflation, after-tax incomes were flat.
Read Complete Story
Iran No Longer Accepts U.S. Dollar In Oil Trade
Tehran, Iran (AHN) - Iran is no longer accepting U.S. dollars for purchases of its oil and is selling the commodity in the world market only in euro and yen.
Cbsnews.com quoted Iranian Oil Ministry official Hojjatollah Ghanimifard as saying on Wednesday, "The dollar has totally been removed from Iran's oil transactions. We have agreed with all of our crude oil customers to do our transactions in non-dollar currencies."
The official said that Iran is selling oil to Europe in euro and to Asia in yen.
Iran decided to abandon using the dollar because the depreciation of the U.S. currency is eating away the country's foreign currency reserves.
Read Complete Story
Cbsnews.com quoted Iranian Oil Ministry official Hojjatollah Ghanimifard as saying on Wednesday, "The dollar has totally been removed from Iran's oil transactions. We have agreed with all of our crude oil customers to do our transactions in non-dollar currencies."
The official said that Iran is selling oil to Europe in euro and to Asia in yen.
Iran decided to abandon using the dollar because the depreciation of the U.S. currency is eating away the country's foreign currency reserves.
Read Complete Story
Thursday, May 1, 2008
Airbus Deal Must Be Stopped
Let’s take a hard look at what is happening to America, our country.
We are losing control of our industries to overseas powers. Congress and the president no longer represent their constituents or the will of the majority of Americans.
Our very economic system is dependent on foreign financed debts, imports and greed, which has driven us into the destructive throws of a recession.
But the Air Force-Airbus deal is the latest slap in the face in the long line of recent slaps to the face to our country. Awarding of a $40 billion defense contract to European Airbus is extremely dangerous: it puts elements of our nation’s defense under the control of foreign politicians. This must be stopped.
Read Complete Story
We are losing control of our industries to overseas powers. Congress and the president no longer represent their constituents or the will of the majority of Americans.
Our very economic system is dependent on foreign financed debts, imports and greed, which has driven us into the destructive throws of a recession.
But the Air Force-Airbus deal is the latest slap in the face in the long line of recent slaps to the face to our country. Awarding of a $40 billion defense contract to European Airbus is extremely dangerous: it puts elements of our nation’s defense under the control of foreign politicians. This must be stopped.
Read Complete Story
Construction spending falls, led by housing
Spending on construction of private residences drops 4.6% in March, the largest decline on record.
Construction spending dropped sharply in March, with housing activity plunging by the largest amount on record.
The Commerce Department reported Thursday that construction spending fell by 1.1% to a seasonally adjusted annual rate of $1.12 trillion. It marked the fifth decline in the past six months. Building activity has fallen sharply in the face of a steep slump in housing and economic slowdown in other areas.
Read Complete Story
Construction spending dropped sharply in March, with housing activity plunging by the largest amount on record.
The Commerce Department reported Thursday that construction spending fell by 1.1% to a seasonally adjusted annual rate of $1.12 trillion. It marked the fifth decline in the past six months. Building activity has fallen sharply in the face of a steep slump in housing and economic slowdown in other areas.
Read Complete Story
Essar group to acquire US steel maker for $1 bn
The Ruia-controlled Essar Steel Holdings Thursday disclosed it is acquiring the US-based steel producer Esmark Inc for an estimated $1 billion.
"The proposed tender offer was unanimously accepted by the board of Esmark Inc and is subject to customary approvals, including those of the US government and united steel workers," the group said in a statement.
Esmark is a steel production and distribution company with an annual capacity of 2.4 million tonnes and distribution centres across the US. A definitive pact is to be entered into in 52 days, the group said.
"This is another step in realizing our global steel vision of having world class, low-cost assets, with a global footprint," said Shashi Ruia, chairman of Essar Global, the holding arm of Essar Steel Holdings.Read Complete Story
Manufacturing still weak, employment drops
Index of purchasing managers unchanged in April, beating economists' forecasts, but employment index drops off to lowest level in nearly 5 years.
A key index of manufacturing activity was unchanged at a weak level in April, with employment in the sector falling dramatically to the lowest point in nearly 5 years, according to a survey of purchasing managers released Thursday.
The Institute for Supply Management's (ISM) manufacturing index stayed at the March reading of 48.6. Economists were expecting a reading of 48, according to a consensus estimate compiled by Briefing.com.
The tipping point for the index is 50, with a reading above that reflecting growth in the sector. A reading below 50 represents a decline in manufacturing.
Read Complete Story
A key index of manufacturing activity was unchanged at a weak level in April, with employment in the sector falling dramatically to the lowest point in nearly 5 years, according to a survey of purchasing managers released Thursday.
The Institute for Supply Management's (ISM) manufacturing index stayed at the March reading of 48.6. Economists were expecting a reading of 48, according to a consensus estimate compiled by Briefing.com.
The tipping point for the index is 50, with a reading above that reflecting growth in the sector. A reading below 50 represents a decline in manufacturing.
Read Complete Story
Jobless claims surge
A larger-than-expected spike in Americans seeking unemployment insurance comes a day before the April unemployment rate is released.
The number of newly laid off workers filing claims for unemployment benefits soared last week.
The Labor Department reported Thursday that claims for unemployment benefits rose by 35,000 to 380,000. Private economists had expected claims would rise by a smaller 18,000.
But the four-week moving average of new jobless claims fell 6,500 from last week to 363,750.
Continued unemployment insurance claims from those already receiving benefits rose in the week ending April 19 to 3,019,000, up 74,000 from the previous week. The four-week moving average for continued claims rose by 16,750 to 2,979,000.
Read Complete Story
The number of newly laid off workers filing claims for unemployment benefits soared last week.
The Labor Department reported Thursday that claims for unemployment benefits rose by 35,000 to 380,000. Private economists had expected claims would rise by a smaller 18,000.
But the four-week moving average of new jobless claims fell 6,500 from last week to 363,750.
Continued unemployment insurance claims from those already receiving benefits rose in the week ending April 19 to 3,019,000, up 74,000 from the previous week. The four-week moving average for continued claims rose by 16,750 to 2,979,000.
Read Complete Story
Consumer spending jumps in March
Personal consumption rises more than expected, even as incomes grow at slower pace.
Consumer spending jumped in March, even as income grew at a slower pace, according to a government report released Thursday.
The Commerce Department said personal spending by individuals in current dollars rose 0.4% in March, exceeding the 0.2% increase expected by economists surveyed by Briefing.com. February's gain was 0.1%.
The report showed personal income increased 0.3% in March, less than the 0.4% increase expected by economists. February's gain was 0.5%.
In inflation-adjusted dollars, personal income remained flat from the prior month.
Personal spending, in inflation-adjusted dollars, was up only 0.1%, indicating that the jump in consumer spending was primarily driven by higher costs.
Read Complete Story
Consumer spending jumped in March, even as income grew at a slower pace, according to a government report released Thursday.
The Commerce Department said personal spending by individuals in current dollars rose 0.4% in March, exceeding the 0.2% increase expected by economists surveyed by Briefing.com. February's gain was 0.1%.
The report showed personal income increased 0.3% in March, less than the 0.4% increase expected by economists. February's gain was 0.5%.
In inflation-adjusted dollars, personal income remained flat from the prior month.
Personal spending, in inflation-adjusted dollars, was up only 0.1%, indicating that the jump in consumer spending was primarily driven by higher costs.
Read Complete Story
Food price rise could last another two years
Experts say there won't be a food shortage in the U.S., but more consumers will trade down in their grocery shopping.
You may have to get used to paying more for your groceries for another two years or more.
Experts say an increase in global food consumption combined with increasing use of crops such as corn and soybeans for alternative fuel production are partly to blame.
Agricultural economists who've studied food price fluctuations cite historical trends that show run-ups in farm commodity prices typically happen in five-year cycles.
Prices flare up in the first two to three years of the cycle and then start to moderate by the fourth or fifth year, said Chris Hurt, agricultural economist at Purdue University .
If 2007 was the first year of this latest cycle, Hurt said farm supply could start catching up to demand by 2010, helping to push down milk, bread, cereal and other grocery prices.
Read Complete Story
You may have to get used to paying more for your groceries for another two years or more.
Experts say an increase in global food consumption combined with increasing use of crops such as corn and soybeans for alternative fuel production are partly to blame.
Agricultural economists who've studied food price fluctuations cite historical trends that show run-ups in farm commodity prices typically happen in five-year cycles.
Prices flare up in the first two to three years of the cycle and then start to moderate by the fourth or fifth year, said Chris Hurt, agricultural economist at Purdue University .
If 2007 was the first year of this latest cycle, Hurt said farm supply could start catching up to demand by 2010, helping to push down milk, bread, cereal and other grocery prices.
Read Complete Story
Subscribe to:
Posts (Atom)