RETIRED: US Economy Discussion

[Doctor_Wu]

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WSJ (www.wsj.com)

So This Is a Weak Economy?

By DAVID MALPASS
June 28, 2005; Page A14

The divisions over America's economic outlook are deep, causing indecision at a time when the U.S. should be pushing confidently forward with structural improvements. Whether on competitiveness, the future of the dollar, savings, China, or the meaning of the fiscal and trade deficits, we underestimate ourselves and the strength of our economic system. Abroad, this gives the harmful and undeserved impression of American economic weakness, even as we should be more actively encouraging foreign economic freedom and prosperity.

The U.S. expansion has been strong and steady despite the warnings of fragility, the repeated claims of a slowdown, and the fear of China (as intense as the Japan fears of the 1980s). U.S. growth has averaged a fast 3.9% pace since the initial 7.4% tax-cut-related growth celebration in the third quarter of 2003. Thanks in large part to smaller businesses, U.S. unemployment has fallen to 5.1%, with wage and salary income growing at a 10% annual rate in the revised fourth-quarter data. Beyond housing, household liquid assets have increased more than both total debt and foreign debt, helping build solid resources for the future. Add to that the nation's biggest unrecorded asset -- a robust system of innovation, market-based capital allocation, and decentralized decision-making.

Yet the litany against the U.S. economy is so ingrained and familiar that few disputed this spring's "slowdown." When strong data on income, employment, consumption and profits showed 3.5% first-quarter GDP growth and a continuation into the second quarter, the headlines shifted to other attacks -- adjustable-rate mortgages, a housing "bubble," the distribution of income -- rather than revising the slowdown story.

The recent decline in bond yields is being presented as a likely economic slowdown and a justification for the Fed to stop hiking rates. But similar yield declines gave way to solid growth and higher yields in both 2003 and 2004. Rather than a "conundrum," bond yields in the U.S. and abroad are probably being held down by the extraordinary U.S. monetary accommodation since the 9/11 attacks and an underestimate of its inflationary consequences.

* * *
Why the urge to look for weakness at every turn? Partly, bad news sells; even in business news, if it bleeds, it leads. Second, some of the search for weakness is pure politics -- the party in the opposition has an interest in criticizing the economy and economic management. In its latest variation, the plan seems to be to paint the U.S. as an unfair, dying economy with insufficient resources to care for the elderly even as the rich get richer at the expense of the poor. This may or may not win votes, but it is not an accurate depiction of the younger-than-elsewhere, hard-working, increasingly prosperous U.S. middle class. The data, and even the analysis of it from the sources used in the negative articles, clearly shows a different reality -- an upwardly mobile society at least as dynamic as 30 years ago even before factoring in immigrants, a society in which the median household is reaping large gains from rising income, flexible job skills, low unemployment, low mortgage rates, and assets increasing more than debt.

The overarching reason for the consistent underestimation of the economy is a misunderstanding of its strengths and vulnerabilities. U.S. economic success rests on market-based flexibility and self-reliance unmatched in major foreign economies. Though flaws exist, we enjoy a healthier system of capital allocation than elsewhere, as R. Glenn Hubbard has pointed out on this page. The biggest vulnerability is the risk of future federal government policy mistakes -- protectionism, tax increases, inflationary or deflationary swings in the dollar's value, the inability to restrain government spending growth, inattention to political problems in this hemisphere.

Recessions tend to follow government policy mistakes -- to name three, the strong-dollar, high-tax, deflation policies of the late 1990s, President Nixon's 1971 departure from the gold standard and imposition of wage-price controls, and the timeless lesson from the 1929 stock market crash following Senate progress on Smoot-Hawley tariffs. Otherwise, the economy tends to expand, the result of a generally healthy, decentralized system with a natural bias to grow and create.

This leaves America's economic prospects bright. The 1970s hyper-inflation was finally conquered in the 1990s, meaning neutral interest rates won't have to be as high as they were and future bouts of inflation should be mild by comparison. The value of the dollar, deflationary in 2000, has settled into a more constructive range, and the worst of the commodity and producer price inflation of 2004 is probably behind us. Yes, CPI inflation may bulge in 2005 due to dollar weakness in 2004, finally forcing nominal interest and mortgage rates up toward neutral. But the years of low rates caused a powerful infusion of capital to home owners, new businesses, and entrepreneurs. We're likely to see a perfect storm of innovation, with small businesses in the forefront. People are staying healthy longer and some may want to work more years, undoing the grim forecasts of collapsing output. Tax receipts are surging as people find new productive activities, often unrecorded by any part of the government except the tax collector.

For those worried about global imbalances and the decline of America, batten down the hatches -- the headlines may continue to accentuate the negative view even as the economy keeps thriving. The trade deficit will probably get even bigger as the U.S. outgrows and out-invests the shrinking labor forces in Europe and Japan. Debt of all kinds should push to new records in 2005, logical as real interest rates stay invitingly low by historical standards, assets grow, home ownership expands further, and the tax bias toward debt persists. The money supply may stop growing, driving monetarists into a tizzy, though the related recovery in monetary velocity after the 2001 deflation is actually pro-growth. The severely understated personal savings rate will probably stay low and might go negative as older Americans begin to spend decades of hard-earned gains in their pensions, 401(k)s, equities and homes, cash inflows that the government doesn't count in calculating the savings rate.

These headline fears are a diversion. Rather than responding to the trade deficit with protectionism and attempts to force currency instability on Asia, the goal should be to improve the quality of investment and savings in the U.S. and also rethink and rebuild the weak multilateral efforts to promote prosperity abroad. Growth would be faster with a simpler tax code and federal government spending restraint. The budget process would work better if the growth impact of tax rates were considered, not ignored, when Congress scores proposed tax reforms and if proposals to increase spending had to be offset by spending cuts elsewhere. Rather than addressing the savings rate with tax increases and forced savings, policy makers should encourage an increase in usable savings and at least partial funding of the government's now-unfunded Social Security promises, recognizing that home ownership, mortgages and consumption have more powerful tax advantages than savings and retirement accounts.

One of the most needed steps in finding good policies is to marshal more understanding and confidence in our own economic system's strengths and weaknesses. The first issue facing policy makers (and investors) is whether current growth is a fragile interim between the deflation crisis of 2001 and a new crisis; or, more likely, a durable expansion in which each quarter's strong growth argues that we're on the right path, with an urgent need for more structural improvements.

Mr. Malpass is chief economist at Bear Stearns.

[stephie67]

Great article, Thanks! :hug:

[XXnarg]

The average unemployment rate under Bush has now fallen below the average unemployment rate under eight years of Clinton.

Unemployment rose higher under Clinton than it ever reached under Bush, despite the fact that Clinton inherited an economic boom and left office with the economy in a recession for the rest of us to clean up.

[J. Bourne]

Malpass is no intellectual lightweight, but he truly pays short thrift to the incredible danger that the national debt (accumulated annual deficits) represents to the U.S. Economy. It is now close to 7.2 trillion, and is expected to reached 10.8 trillion by 2008 based on current projectories.

The national debt is a giant albatross hanging around the neck of the U.S. economy, and it is growing larger as neither political party apparently has the discipline to step up to the plate and legislate the changes to U.S. fixed spending (about 90% of our annual budget - mostly entitlement programs - only 10% is discretionary spending in the entire annual budget).

[Duke Atreides]

Current projections of the national debt in 1996 were that it would be halved by 2006, then six months later current projections showed that it could be eliminated by 2008, then in 1998 it was deemed gone!

Projections on the national debt are like a bunch of drunks blindfolded playing darts, if someone actually hits the board it is amazing, and yet we still listen to these supposed "projections".

But I agree, the entitlement programs have to be curbed, both parties seem more intent on blowing our money out of their backsides than the treasury has printed, does anyone remember the House bank scandal with the $100K floating checks? That is indicative of the problem, they are so removed from reality and fiscal responsibility it is appalling.

[Anonymouse]

Without an incredible amount of research to debunk or substantiate the claims, it would be difficult to assess the veracity of the article. However, one can always use the "sniff" test. If I "sniff" what will I smell? I will "smell" a Chief Economist at a firm that makes it's profit convincing people to invest in stocks and bonds. If I missed the mark, I sincerely apologize. I would expect no less than, and almost would expect an even more elated attitude in an article on the joys of Capitalism from such a person.....IF the economy was all THAT great. Perhaps the man used a modicum of reserve to protect and make possible a degree of backpedalling should the thing blow up in his face. But........... I am a natural cynic, so ........... :paperbag:

[XXnarg]

June 29, 2005

(Reuters) — Robust new-home building and stronger exports helped the U.S. economy expand at a faster-than-expected 3.8 percent annual rate in the first quarter, the Commerce Department said on Wednesday as it revised its growth estimate up for a second straight time.

Initially, the department said gross domestic product — the broadest measure of total economic activity within U.S. borders — grew at a 3.1 percent rate but it pushed that up to 3.5 percent a month ago before finally revising it to match the 3.8 percent rate posted in the closing quarter of 2004. The final figure outpaced Wall Street economists' forecasts for a 3.7 percent rate of first-quarter growth and implied the economy had more strength going into the spring than previously thought. Most forecasters say GDP will continue expanding at rates around 3.5 percent in coming quarters, despite some strain from costlier energy prices.

The first estimate of second-quarter performance will not be available for another month. The government revises its GDP data twice each quarter as it gathers updated trade, employment and price information.

The first-quarter GDP report was one of the final pieces of economic data that Federal Reserve policy-makers, who are scheduled to begin a two-day meeting on Wednesday afternoon to consider interest-rate strategy, will have as they move toward a widely predicted ninth straight rate increase on Thursday.

The Fed began raising rates a year ago, pushing its trend-setting federal funds rate up in eight successive quarter-point increments from a 46-year low of 1 percent to a current level of 3 percent and so far it has given no indication that it is considering a halt to the rate-rise cycle.

The revised GDP report showed prices remained well behaved. A gauge favored by Fed Chairman Alan Greenspan — personal consumption expenditures minus food and energy — advanced at a 2 percent annual rate instead of 2.2 percent estimated a month ago. That was moderately ahead of the fourth quarter's 1.7 percent rate.

The sizzling home-building industry contributed importantly to the upward revision in first-quarter growth. Residential spending climbed at an 11.5 percent rate instead of 8.8 percent estimated a month ago. That was more than three times the 3.4 percent growth rate posted in the fourth quarter of last year.

In addition, exports grew at an 8.9 percent rate instead of 7.2 percent calculated a month ago — also nearly three times the 3.2 percent rate of increase in the final quarter of 2004. Despite the stronger economic performance, growth in corporate profits after taxes weakened from the fourth quarter. Commerce said profits grew at a revised 1.2 percent annual rate in the first quarter compared with the 1 percent rise originally reported, and slowing from the 12.5 percent in the final three months of 2004.

http://www.chicagobusiness.com/cgi-bin/news.pl?id=16959

[XXnarg]

By THE ASSOCIATED PRESS
Published: June 29, 2005

Consumers' confidence in the economy gained momentum in June, rising to a higher-than-expected level for the second consecutive month. The advance, in a report from the Conference Board, put consumer confidence at a three-year high.

The board, a business research group, said its consumer confidence index rose to 105.8 this month, up from a revised 103.1 in May and better than the 104 analysts expected. The index rose more than five points in May after declining in April.

June's reading was the highest since 106.3 in June 2002.

"The improvement in consumer's mood suggests that business activity and labor market activity will continue to pick up over the next several months," said Lynn Franco, director of the consumer research center of the Conference Board.

http://www.nytimes.com/2005/06/29/business/29econ.html

More slow and steady growth, none of this bubble economy stuff of the 90s that destroyed fortunes and lives, and was replete with corporate corruption (ignored by the Justice Department).

[adr]

You really have to wonder why the chief economist of an investment firm is writing an editorial for WSJ playing up the economy. I think there lot of fear going. Our currency is being propped by China but what is going to happen when they go to a free market valuation on their currency? Also who is going to replace Greenspan? Lots of questions investors are asking themselves.

Anyway, i heard something about Berkshire Hathaway moving $21 billion overseas today. I guess Warren Buffet is betting against our economy and he's never been wrong just a year early on some of his bets. :lol:

[XXnarg]

You really have to wonder why the chief economist of an investment firm is writing an editorial for WSJ playing up the economy. I think there lot of fear going. Our currency is being propped by China but what is going to happen when they go to a free market valuation on their currency? Also who is going to replace Greenspan? Lots of questions investors are asking themselves.

Anyway, i heard something about Berkshire Hathaway moving $21 billion overseas today. I guess Warren Buffet is betting against our economy and he's never been wrong just a year early on some of his bets. :lol:Buffet speculates in currency, which is not the same as betting against the economy. The article explains the difference, plus this:

"For those worried about global imbalances and the decline of America, batten down the hatches -- the headlines may continue to accentuate the negative view even as the economy keeps thriving. The trade deficit will probably get even bigger as the U.S. outgrows and out-invests the shrinking labor forces in Europe and Japan. Debt of all kinds should push to new records in 2005, logical as real interest rates stay invitingly low by historical standards, assets grow, home ownership expands further, and the tax bias toward debt persists. The money supply may stop growing, driving monetarists into a tizzy, though the related recovery in monetary velocity after the 2001 deflation is actually pro-growth."

[XXnarg]

"10:07am 07/01/05

U.S. ISM index rises to 53.8%, while prices moderate By Rex Nutting

WASHINGTON (MarketWatch) -- The U.S. manufacturing grew at a faster pace in June while price pressures eased, the Institute for Supply Management said Friday.

The ISM index rose to 53.8% in June from 51.4% in May. Prices paid fell to 50.5% from 58.0% in May, the lowest since February 2002. The new orders, production and employment indexes all improved from May levels.

Economists were expecting the main index to rise to 51.5%. Readings over 50% indicate expansion.

The ISM has been above 50% for 25 straight months.

"We may be through the 'soft patch' that many observers touted," said Norbert J. Ore of the ISM."

[stephie67]

"10:07am 07/01/05

U.S. ISM index rises to 53.8%, while prices moderate By Rex Nutting

WASHINGTON (MarketWatch) -- The U.S. manufacturing grew at a faster pace in June while price pressures eased, the Institute for Supply Management said Friday.

The ISM index rose to 53.8% in June from 51.4% in May. Prices paid fell to 50.5% from 58.0% in May, the lowest since February 2002. The new orders, production and employment indexes all improved from May levels.

Economists were expecting the main index to rise to 51.5%. Readings over 50% indicate expansion.

The ISM has been above 50% for 25 straight months.

"We may be through the 'soft patch' that many observers touted," said Norbert J. Ore of the ISM."

Seems to be some good news here, but due to MY RECENT EXPERIENCES, I have a healthy dose of skepticism when it comes to the GOV'T and news... ;)

[XXnarg]

Seems to be some good news here, but due to MY RECENT EXPERIENCES, I have a healthy dose of skepticism when it comes to the GOV'T and news... ;)The ISM is an independent (http://www.ism.ws/) organization based in the Phoenix area and not part of the government.

I have some knowledge of how the ISM works, and believe me, they DO take strong precautions to resist all outside influence. Over the years, they have exhibited an extremely high degree of integrity.

But don't let that stop you... :lmao:

[mrlaugh]

Seems to be some good news here, but due to MY RECENT EXPERIENCES, I have a healthy dose of skepticism when it comes to the GOV'T and news... ;)

sweet, that means you won't ever believe a word I have to say. I'll keep that in mind in future debates with you.

[danlbuckley]

Malpass is no intellectual lightweight, but he truly pays short thrift to the incredible danger that the national debt (accumulated annual deficits) represents to the U.S. Economy. It is now close to 7.2 trillion, and is expected to reached 10.8 trillion by 2008 based on current projectories.

The national debt is a giant albatross hanging around the neck of the U.S. economy, and it is growing larger as neither political party apparently has the discipline to step up to the plate and legislate the changes to U.S. fixed spending (about 90% of our annual budget - mostly entitlement programs - only 10% is discretionary spending in the entire annual budget).

More and more, I'm finding common ground with J. on matters of the economy. It seems that we only want to live in today, with no thought of the long-term. Neither party wants to confront it, but eventually "tomorrow" will arrive.

This will be a HUGE problem in the very near future.

[XXnarg]

More and more, I'm finding common ground with J. on matters of the economy. It seems that we only want to live in today, with no thought of the long-term. Neither party wants to confront it, but eventually "tomorrow" will arrive.

This will be a HUGE problem in the very near future.What does confronting the future actually mean to you?

IMHO, we're addressing long-term issues with greater intensity and accuracy than at anytime in the history of mankind. Yes, we don't have it worked out, but we need to be realistic about the progress being made and having been made already. There are many many people studying the long-term effects of policies and actions and more resources are being pumped into such study and planning than ever. IMHO, it's really easy to complain that "not enough is being done."

True, not enough IS being done, we can always do more. Until we install an omniscient, omnipotent (but benevolent) dictatorship, we're just going to have to deal with doing the best we can.

[XXnarg]

More terrible news for the liberals agenda of doom and gloom (but with their well-known creativity, I'm sure they'll be able to find SOMETHING negative about the economy :D ).

Factory orders surge 2.9% in May (http://www.marketwatch.com/news/print_story.asp?print=1&guid={C66564D5-54C7-43DA-8BE7-30CF3D3FA45E}&siteid=mktw)
Excluding aircraft, monthly U.S. orders off 0.3%
By Rex Nutting, MarketWatch
Last Update: 12:05 PM ET July 5, 2005


WASHINGTON (MarketWatch) -- Driven by a surge in orders for airplanes, orders for U.S.-made factory goods increased 2.9% in May, the Commerce Department estimated Tuesday.

The 2.9% growth marked the biggest gain in factory orders in 14 months. Economists had been looking for a gain of about 2.8% in factory orders, according to a survey conducted by MarketWatch. See Economic Calendar.

Factory orders had increased 0.7% in March and April after small declines in January and February. Orders are up 7.1% in the past 12 months. Read the full release.

Excluding the 165% surge in civilian airplane orders and the 17% rise in defense aircraft orders, however, orders for factory goods fell 0.3% in May.

Economists say the slump in orders is likely temporary, taking heart from last week's Institute for Supply Management report, which showed a big rebound in factory orders during June based on surveys of company purchasing managers. See full story.

Shipments of factory goods were flat in May after a 0.7% gain in April, the Commerce Department's data showed. Shipments are up 7.5% in the past year. Inventories were flat in May, while unfilled orders rose 1.9%.

"The sector may be pulling out of the inventory-related slowdown," said John Ryding, chief U.S. economist at Bear Stearns.

The data expand on a preliminary report on durable goods released on June 24. As in the preliminary report, orders for durable goods, such as airplanes, computers, and washing machines, increased 5.5% in May. Read the story on durable goods orders.

Demand was weak outside the transportation sector, with orders for machinery falling 2.6% and orders for electronics excluding semiconductors sinking 1%.

Orders for core capital goods, adjusted to exclude aircraft and defense goods, fell 2.5% in May after a 1.7% gain in April. Core capital goods are up 10.5% in the past year, indicating robust order demand for investment goods.

"New capital goods orders appear to have peaked on a year-over-year basis," said John Silvia, chief economist for Wachovia, who looks for "solid enough" capital spending to keep the economy growing.

On the shipments side, durable goods fell 0.2% in May, while shipments of core capital goods increased 0.5%.

Meanwhile, orders and shipments of nondurable goods increased 0.1% in May. Shipments of petroleum products fell 2.2%, likely because prices fell. Shipments of chemicals slipped 0.9%, while shipments of food and tobacco increased.

Rex Nutting is Washington bureau chief of MarketWatch.

[Anonymouse]

BUSH PLAN WOULD DISTORT WAGE FIGURES
Union Labor News Vol 68 No. 7 July 2005
Despite strong opposition from the public and the union movement, the Bush administration is moving ahead with plans that economists say would seriously distort the Bureau of labor Statistics' monthly payroll report, which has consistantly shown that most workers' wages are stagnant. The BLS plans to include the salaries of managers, executives, and even CEOs in it's monthly payroll survey. Including the high salaries in the average would make it look like workers are making more money than they really are.

But, them CEOs are werkers too! :eek:
Why not include their weekly pay? It "PROVES the economy is getting better. Those damn Liberals just want to keep everyone believing life is a bowl of cherries and all they get are the pits.

(Whatcha think Xnarg? Does this one fall into our little catagory?) :P

[XXnarg]

http://www.chicagobusiness.com/cgi-bin/news.pl?id=17048

Jobless rate falls to lowest level since Sept. 2001

Employment gain of 146,000 in June failed to meet Wall Street estimates

July 08, 2005
(Reuters) — U.S. employers added 146,000 jobs in June, below Wall Street forecasts, but the unemployment rate fell to its lowest point since September 2001 as few joined the labor force, a government report showed on Friday.

June's tepid employment growth fell short of analyst expectations for 188,500 new jobs in the month.

But the decline in the unemployment rate to 5.0 percent was a nice surprise, since Wall Street had expected it to hold at 5.1 percent. The drop was mostly due to a paltry 1,000 increase in the work force, which includes those looking for work as well as those who have jobs.

The dollar climbed to session highs against major currencies after the report was released, while U.S. Treasury bond prices traded flat after an initial bounce.

"Jobs created were weaker than expected but the unemployment rate dropped. It's enough to keep the wolves at the bay but not enough to get excited about," said Michael Jansen, currency strategist at National Australia Bank in New York.

The Labor Department revised up job growth in April and May to 292,000 and 104,000, respectively, boosting the two-month count by 44,000 payroll jobs.

Economists said the rise in hiring suggested an economy growing at a rate of about 3 percent — strong enough to reassure the Federal Reserve that a spring "soft patch" had evaporated but not enough to spark inflation worries.

"It's very consistent with an economy that is growing at or just below trend. It does not change anything for the Fed — they're going to raise rates again next month," said Steve Ricchiuto, chief U.S. economist at ABN AMRO in New York.

The Fed has raised short-term interest rates nine times since last June in a bid to head off inflation, and experts expect a tenth rate hike in August.

Factory payrolls shrank for the fourth straight month as auto assembly and parts plants cut back on production. Bloated inventories have prompted many automakers to slow production lines until demand can catch up. Some 96,000 manufacturing jobs have been lost since August 2004.

While 18,000 new workers were hired in the construction industry last month, most of June's employment growth came in the service sector. Professional and business services jobs rose 56,000, education and health services were up 38,000 and leisure and hospitality payrolls grew 19,000.

In a potentially troubling sign, the length of the average workweek was 33.7 hours, unchanged from May's downwardly revised length. The factory workweek was also unchanged at 40.4 hours, while overtime held at 4.4 hours.

Employers typically increase the length of the workweek before taking on new workers, so a lack of growth in that area can mean scant hiring ahead.

Average hourly earnings rose 3 cents to $16.06 and have risen 2.7 percent over the year.

[XXnarg]

Net exports seen as positive for second-quarter GDP (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={4FABA847-28B1-4A8E-8A28-69B1B9EC3897}&dist=bnb)
By Greg Robb, MarketWatch
Last Update: 10:02 AM ET July 13, 2005

WASHINGTON (MarketWatch) -- Stronger demand for U.S. products overseas and lower energy costs at home helped to reduce the trade deficit in May, the Commerce Department said Wednesday.

The trade deficit narrowed 2.8% in May to $55.3 billion, and was below the consensus forecast of Wall Street economists of $57.0 billion. See Economic Calendar.

The deficit has stabilized after setting a record of $60.1 billion in February.

As a result, economists expect net exports to start contributing positively to gross domestic product in the second quarter. The trade gap subtracted 0.6 of a percentage point from first-quarter GDP growth.

Jay Feldman, economist at Credit Suisse First Boston, said the trade report caused him to raise his second-quarter growth estimate to 3.8% from his earlier estimate of 3.2%.

The Commerce Department also revised the trade deficit for April slightly lower, to $56.9 billion from an initial estimate of $57 billion.

May's exports reached a new record, while imports slipped. In particular, exports rose 0.2% to $106.9 billion, with imports falling 0.9% to $162.2 billion.

Exports of agricultural products, consumer goods and industrial supplies increased in May.

The increase in exports is impressive in part because it came despite a drop in exports of civilian aircraft. Exports in this volatile sector fell 28.4% to $2.3 billion.

Imports of goods alone fell 1.2% to $135.3 billion. The decline in imports was led by industrial supplies, primarily crude oil, and by capital goods.

Imports of consumer goods remained strong in May, rising 0.7% to $34.0 billion.

Robert Brusca, chief economist at FAO Economics, said the sluggish trend in imports could be a bad sign, implying weak domestic demand.

Ian Shepherdson, chief U.S. economist at High Frequency Economics, said imports ex-oil and aircraft have stalled since January.

"Only part of this can be blamed on softer domestic demand; the rest is a bit of a mystery," Shepherdson said.

Mixed energy picture

The nation's petroleum deficit narrowed 8.7% to $15.8 billion, the lowest level since January. Some of this may be due to lower prices for imported oil last month: The average price per barrel of oil fell to $43.08 in May from a record $44.76 in April.

The U.S. imported 318.6 million barrels of crude oil in May, equating to 10.3 million barrels per day, up from 313.8 million in April.

The U.S. trade deficit with China widened to $15.8 billion in May compared with $14.7 billion in April and $12.2 billion in May 2004.

Some analysts weren't impressed by the narrowing deficit. They noted that much of the improvement in May was due to the lower cost of oil, which would only be a temporary cure.

Indeed, in a separate report, the Labor Department said import prices rose in June on a rebound in crude-oil prices.

[rybal]

And:

http://www.sun-sentinel.com/news/nationworld/sfl-adeficit13jul13,0,3937097.story?coll=sfla-news-nationworld

WASHINGTON · For the first time since President Bush took office, an unpredicted leap in tax revenues is about to shrink the federal budget deficit this year by nearly $100 billion.

White House officials plan to announce today that the deficit for fiscal year 2005, which ends in September, will come in far lower than the $427 billion they estimated in February.

President Bush plans to hail the improvement at a Cabinet meeting today and to cite it as a validation for his argument that tax cuts have stimulated the economy and ultimately will help pay for themselves.

Based on revenue and spending data through June, the budget deficit was $76 billion lower, or a total of $251 billion, for the first nine months of fiscal 2005 than the $327 billion gap recorded at the same point one year earlier.

The Congressional Budget Office estimated last week that the deficit for the entire fiscal year, which hit $412 billion in 2004, could be "significantly less than $350 billion, perhaps below $325 billion."

The big surprise this year has been tax revenues, which are running nearly 15 percent higher than in 2004. Corporate tax revenues have soared about 40 percent, after languishing for four years, and individual tax revenues have climbed as well.

Most of the increase in individual tax receipts appears to have come from higher stock market profits and business income of relatively wealthy taxpayers. The biggest jump came not from taxes withheld from wages and salaries but from quarterly payments on investment profits and business earnings, which were up 20 percent this year.

That was similar, though much smaller, than the sharp increase in tax revenues during the stock market boom of the late 1990s, which was followed by plunges in revenue when the stock market bubble burst.

But many independent analysts cautioned that the improvement, though dramatic, could prove ephemeral and did little to eliminate much bigger fiscal problems just over the horizon. "Lawmakers who allow themselves to be lulled into thinking that the economy is growing its way out of the deficit, are unlikely to support the painful measures needed to reach a more lasting solution," wrote Edward McKelvey, an economist at Goldman Sachs in New York.

For one thing, analysts note, federal spending has continued to climb rapidly, about 7 percent this year.

[XXnarg]

8:30am 07/14/05

U.S. June CPI flat as energy prices fall (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={16E834E2-D53D-422F-97B1-D93336B6AEDF}&dist=bnb)
By Rex Nutting

WASHINGTON (MarketWatch) - U.S. consumer prices in June were unchanged as energy prices actually fell, the Labor Department said Thursday.

Excluding food and energy prices, core inflation at the consumer level increased 0.1%.

The figures were well below expectations of an 0.2% increase. In the past year, the CPI is up 2.5%, the lowest year-over-year gain since September.

The core CPI is up 2% in the past 12 months, in the middle of the Federal Reserve's comfort zone.

Energy prices fell 0.5%. Food prices rose 0.1%. Housing prices increased 0.1%.

[Danman114]

8:30am 07/14/05

U.S. June CPI flat as energy prices fall (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={16E834E2-D53D-422F-97B1-D93336B6AEDF}&dist=bnb)
By Rex Nutting

WASHINGTON (MarketWatch) - U.S. consumer prices in June were unchanged as energy prices actually fell, the Labor Department said Thursday.

Excluding food and energy prices, core inflation at the consumer level increased 0.1%.

The figures were well below expectations of an 0.2% increase. In the past year, the CPI is up 2.5%, the lowest year-over-year gain since September.

The core CPI is up 2% in the past 12 months, in the middle of the Federal Reserve's comfort zone.

Energy prices fell 0.5%. Food prices rose 0.1%. Housing prices increased 0.1%.Serious question: Are gas - pump prices considered 'energy'? Because my gas station raised it a quarter last week

[Hurricane]

But but but Bush is still evil right? I mean, didn't his tax cuts only benefit the wealthiest Americans? Didn't he LIE to us while every major Democratic senator and Clinton were only misinforming us?

Wait, I think I have it. Bush gave so many economic benefits to BIG BUSINESS so what do those bastards do? They start hiring people and opening up the cookie jar to invest more into R&D. What is the evil Bush going to do next, force us to invest a small percentage of our money into a tax-free, interest bearing account for our retirement before social security runs dry. Stay out of our lives already and let our senators decide what is best for us !!!

[XXnarg]

Serious question: Are gas - pump prices considered 'energy'? Because my gas station raised it a quarter last weekYes, gasoline prices at the pump are part of the energy segment of the bundle of goods used to calculate the CPI.

Last week was in July. The report was for June.

Gas prices may dip again before the end of July plus prices variations are regional so don't be disappointed or surprised if the CPI does not match your own experience 100%.

[XXnarg]

More bad news for Democrats!

June U.S. producer prices flat (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={2221401D-0966-4D43-8AE7-0D9CD6601E39}&dist=bnb)
Inflation moderates throughout production pipeline
By Rex Nutting, MarketWatch
Last Update: 8:30 AM ET July 15, 2005

WASHINGTON (MarketWatch) - U.S. producer prices were unchanged in June despite higher energy prices, the Labor Department reported Friday.

The core rate of inflation at the wholesale level fell 0.2%, the agency said.

Economists had expected the producer price index to rise 0.4% in June, according to the MarketWatch survey. Core inflation was expected to rise 0.2%.

The PPI had dropped 0.6% in May while core prices increased 0.1%.

Despite the mild reading in June, inflation accelerated on a year-over-year basis to 3.6% from 3.5% a month earlier. Yearly inflation peaked at 5% in November. The core PPI is up 2.2% year-over-year.

The PPI report, combined with a similarly mild consumer price index for June, should add to the chorus of voices calling for the Federal Reserve to end its tightening cycle sooner rather than later.

The Federal Open Market Committee will get one more major inflation report before its next meeting on Aug. 9: the key personal consumption expenditure price index, to be released July 30.

Fed officials have said they believe inflation is contained for now, but are boosting short term rates to keep the economy from overheating and fueling inflation.

The PPI report showed moderate inflation throughout the production pipeline.

Prices of intermediate goods destined for further processing increased 0.1%, with core intermediate prices falling 0.8%.

The core intermediate PPI is up 4.9% in the past year, having peaked at 8.5% in January.

The Fed typically wraps up its tightening cycle about the time the year-over-year gain in the core intermediate PPI peaks, although this cycle has been anything but typical.

Prices of crude goods fell 3.3%. Prices of iron and steel scrap fell 19.9%, the biggest drop in 31 years, Crude energy prices fell 3.1% despite a 5.5% rise in crude petroleum prices.

At the finished goods level, energy prices rose 2%, including an 8.7% rise in wholesale gasoline prices, the most since October.

Finished foods prices fell 1.1%, with large declines in beef, pork and seafood offsetting a large increase in vegetable prices.

Prices of finished consumer goods other than food and energy fell 0.1%. Auto prices fell 1% while light truck prices dropped 1.7%.

Prices of finished capital goods fell 0.2% in June.

[Silver_Oaks9]

The average unemployment rate under Bush has now fallen below the average unemployment rate under eight years of Clinton.

Unemployment rose higher under Clinton than it ever reached under Bush, despite the fact that Clinton inherited an economic boom and left office with the economy in a recession for the rest of us to clean up.


i would like to know the quality of these jobs that are being created. You know creating 100k strawberry picking jobs doesnt really do much for our economy even though unemployment will go down.

[XXnarg]

i would like to know the quality of these jobs that are being created. You know creating 100k strawberry picking jobs doesnt really do much for our economy even though unemployment will go down. http://www.bls.gov/news.release/jec.nr0.htm

Statement of

Kathleen P. Utgoff
Commissioner
Bureau of Labor Statistics

Friday, July 8, 2005


Nonfarm payroll employment rose by 146,000 in June, and
the unemployment rate, at 5.0 percent, continued its recent
downward trend. Payroll employment has increased by 2.1
million over the year. In June, job growth continued in
several industries, with notable gains in professional and
business services and in health care. Manufacturing
employment declined over the month.

Professional and business services added 56,000 jobs in
June and nearly half a million over the year. Employment
continued to trend upward in several component industries,
including architectural and engineering services and
computer systems design and related services. Temporary
help services employment was little changed over the month;
job growth in the industry has slowed since last fall.

Employment in health care continued to expand in June
with a gain of 25,000. The industry has added 249,000 jobs
over the year. Over the month, employment rose in hospitals
and in ambulatory health care services, such as doctors'
offices.

Employment growth continued in construction in June,
with a sizable gain (13,000) in heavy construction.
Construction employment has increased by 282,000 over the
year. In June, employment in financial activities remained
on an upward trend and has increased by 151,000 over the
year. More than half of the over-the-year gain occurred in
credit intermediation, which rose by 9,000 in June. Real
estate also has accounted for a substantial portion of the
job growth in financial activities over the year.

Manufacturing employment declined by 24,000 in June.
The number of factory jobs has decreased by 96,000 since
August 2004, offsetting gains posted earlier in 2004. The
June employment decline was concentrated in motor vehicles
and parts manufacturing, where production cutbacks occurred
in assembly and parts plants. Job losses also occurred in
electrical equipment and in paper and paper products. In
contrast, employment in computer and electronic products
increased in June. Both the factory workweek, at 40.4
hours, and factory overtime, at 4.4 hours, were unchanged
over the month.

Average hourly earnings of private production or
nonsupervisory workers rose by 3 cents in June to $16.06,
following a 3-cent increase in May. Over the year, average
hourly earnings have grown by 2.7 percent.

Turning now to our survey of households, the unemploy-
ment rate has trended down in recent months. At 5.0 percent
in June, the rate was 0.4 percentage point lower than in
February. During the February-through-June period, the em-
ployment-population ratio increased from 62.3 to 62.7 percent.

The number of long-term unemployed--that is, persons
unemployed for 27 weeks or more--declined to 1.3 million in
June. They constituted 17.8 percent of all unemployed
persons, down from 20.l percent in May.

In summary, nonfarm payroll employment increased by
146,000 in June, and the unemployment rate was 5.0 percent."

[Anonymouse]

I wanna know how many people were employed in this survey? It'd take a HELLAVALOTTA people to go around counting heads at all those places.

http://inflationdata.com/inflation/images/charts/air20050714.gif.
Inflation rates chart, sorta looks bad for the middle class IMHO wage growth of 2.77% on an average 3.49% inflation rate means people are making .72% LESS in "real dollars"
That's why I HATE statistics, the damn things lie in pictures
Source linky (http://inflationdata.com/inflation/Inflation_Rate/AnnualInflation.asp)

[XXnarg]

Wow, that chart really highlights how devastating the Clinton Recession was on the US!

BTW, historically, inflation often drops at the beginning of a recession and rises near the end. Fortunately, the current low, stable inflation rate is really helping a lot of people - but don't let that fact affect your negative take on the economy.

[Anonymouse]

Wow, that chart really highlights how devastating the Clinton Recession was on the US!

BTW, historically, inflation often drops at the beginning of a recession and rises near the end. Fortunately, the current low, stable inflation rate is really helping a lot of people - but don't let that fact affect your negative take on the economy.
Huh!
:rolleyes: Are you reading that chart while doing a head stand?
It SAYS, the inflation rate was very high around 2000-2001 and after 9/11 dropped very sharply....for a while..like 6 months. Ever since it's been climbing and has been holding ABOVE the rate of wage increases for at least the past year. Judging from the trend line, I would estimate that we are in for some higher rates at the bank soon to attempt to slow inflation. If that doesn't work, the middle class are going to REALLY start losing ground, (once again, the middle class takes it without lube)
Bear in mind, this is not a percent of the earnings, it is a percent of INCREASE, meaning it COMPOUNDS the damage to wages earned, the longer and higher it climbs.
In real terms, if you EARNED $60,000.00 last year, and lost 3.49% due to inflation, but GAINED 2.77% as a raise in wages, then the net difference on YOUR wages, (purchasing power in REAL DOLLARS), was a loss of $432 of purchasing power. That has to do WONDERS for the economy and the consumer spending keeping it afloat. (4.32 x 10 to the 10th power [43.2 BILLION] for 100 million wage earners nationaly) YMMV :lol:

That means the porn industry, raking in $60 BILLION per year is going to lose 2/3 of it's sales. Have you NO consideration for all those out-of-work actors and actresses?

[XXnarg]

"8:30am 07/21/05

U.S. initial jobless claims fall by 34,000 to 303,000 (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={E5ABC878-39D6-4D8B-B271-94282B363766}&dist=bnb)
By Rex Nutting

WASHINGTON (MarketWatch) - First-time filings for U.S. state unemployment benefits dropped by 34,000 to a seasonally adjusted 303,000 last week, the lowest level in three months, the Labor Department said Thursday. It's the largest decline since December 2002. Economists were expecting claims to fall to about 325,000. The four-week average of new claims - which smoothes out one-time events that can distort the weekly figures - dropped by 3,250 to a four-month low of 318,000. The number of people receiving unemployment checks fell by 41,000 to 2.577 million in the week ending July 9."

[XXnarg]

More bad news for anti-American liberals.

Existing-home sales at record pace (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={85B90E8F-37DE-4F38-BBA3-77433C0B6724}&dist=bnb)
June sales up 2.7% to 7.33 million annual rate
By Rex Nutting, MarketWatch
Last Update: 10:10 AM ET July 25, 2005

WASHINGTON (MarketWatch) -- Sales of previously owned homes rose 2.7% in June to a record seasonally adjusted annual rate of 7.33 million, the National Association of Realtors reported Monday.

Sales were up 4.4% on a year-over-year basis.

Economists had been expecting steady sales of about 7.13 million, according to the MarketWatch survey.

May's sales were revised higher to 7.14 million from 7.13 million reported earlier.

The inventory of unsold homes rose 3.8% to 2.653 million, a 4.3-month supply at the current sales rate.

The median sales price rose 14.7% year-over-year to a record $219,000. It's the fastest price appreciation since November 1980.

"Low mortgage rates are keeping the housing markets very very strong," said David Lereah, chief economist for the real estate trade group.

Interest rates have risen slightly since June, Lereah said. "The air should come out of these balloons," Lereah said, "But I don't expect the balloons to pop."

"I do worry going forward about interest-only loans and the option ARMs," Lereah said, referring to exotic loans that allow some buyers to buy more expensive homes while keeping monthly payments low, hoping that price appreciation will build some equity.

[XXnarg]

8:44am 07/27/05

CRRCT: U.S. June durable-goods orders up 1.4% (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={8CD72670-336A-45D3-9093-74BD383FA3A6}&dist=bnb) By Greg Robb

(Correcting non-defense capital goods to 3.8% rise in June after 0.6% fall in May) WASHINGTON (MarketWatch) - Led by demand for computers, orders for new U.S.-made durable goods increased 1.4% in June, the third straight strong monthly increase.

Economists were expecting orders to fall 0.9%. Adding to the strength, durable orders in May were revised to a 6.4% increase from 5.5% previously estimated.

This is the strongest monthly increase since July 2002. Shipments of durable goods slipped 0.1% in June after three straight monthly increases. Inventories fell 0.3% in June.

Orders for core capital goods equipment rose 3.8% in June after falling 0.6% in May.

[XXnarg]

CDC: Child vaccination rate hits record high (http://www.cnn.com/2005/HEALTH/07/27/child.vaccinations.ap/index.html)

Thursday, July 28, 2005; Posted: 4:02 a.m. EDT (08:02 GMT)

WASHINGTON (AP) -- Almost 81 percent of the nation's toddlers are getting vaccinated on time, a record level that comes five years ahead of government expectations, federal health officials reported Tuesday.

"That's a tribute to the fact that parents recognize the benefits and values of these vaccines and ... are protecting their children," said Dr. Stephen Cochi, acting vaccine chief at the Centers for Disease Control and Prevention.

But, "we can't be complacent, " he cautioned. "There is much more work to be done."

Inoculations still lag in pockets of the country. Worst in the nation was Nevada, where 68.4 percent of youngsters got their main series of vaccinations on time last year. And fewer black and Hispanic children are up-to-date on their shots than white children.

But overall, Tuesday's news was good, albeit expected. In 2003, 79.4 percent of the nation's 19- to 35-month-olds had received a full series of inoculations against nine diseases: diphtheria, tetanus, pertusiss, polio, meningitis-causing Haemophilus influenza or HIB, measles, mumps, rubella and hepatitis B.

Last year, inoculations inched up again -- to 80.9 percent of toddlers. That exceeds the government's goal that 80 percent of toddlers get those shots on time by 2010.

In addition to that main series of shots, toddlers also are supposed to get two additional ones. Last year, 87.5 percent of toddlers had received the chickenpox vaccine and 73.2 percent had on-time doses of the pneumococcal vaccine Prevnar that protects against meningitis and ear infections.

With more toddlers than ever being protected, the CDC reminded parents that adolescents need their shots, too. Among them, a new whooping cough booster shot for teen-agers and pre-teens was approved earlier this year, to combat a return of that disease as childhood vaccine protection wanes.

That booster dose is crucial, Cochi noted, because while whooping cough seldom kills older children, it can be fatal to newborns who haven't yet started their immunizations. Already this year, 15 infants have died from whooping cough, he said.

[XXnarg]

Midwest business activity up in July (http://www.chicagobusiness.com/cgi-bin/news.pl?id=17295)

U.S. manufacturing sector recovering after recent weakness

July 29, 2005
(Reuters) — Business activity in the U.S. Midwest expanded in July at a much faster rate than expected, with employment bouncing back strongly as new orders jumped, according to a survey published on Friday.

The National Association of Purchasing Management-Chicago business barometer jumped to 63.5 from 53.6 in June. Economists had forecast the index at 55.5. A reading above 50 indicates expansion in the sector.

The index's employment component rose to 56.1 from 48.9 in June, which had been the weakest reading in almost a year.

Prices paid edged up to 61.3 from 59.7 but were not as high as some analysts had feared, while new orders jumped to 69.6, the highest level since March, from 56.5.

Economists said the report was another sign that the U.S. manufacturing economy was looking solid after a brief period of weakness in the spring. The Chicago index had been lower for three straight months coming into July.

"The slowdown for the Chicago business activity during the last couple of months was apparently quite transitory," said David Resler, chief economist, Nomura Securities International in New York.

Many view the NAPM-Chicago as an industrial indicator, even though service sector companies are all polled, because the Midwest region is relatively industrialized, especially in the auto sector.

"This is very welcome but could be a local story; the Chicago PMI is often influenced by the strength of the auto market, which has been very robust in the past two months as a result of GM-led price cuts," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.

U.S. Treasury bond yields rose slightly on the data, with the 10-year Treasury note up to 4.26 percent from 4.23 percent earlier. Equities prices remained slightly lower.

[Angel of Death]

Midwest business activity up in July (http://www.chicagobusiness.com/cgi-bin/news.pl?id=17295)

U.S. manufacturing sector recovering after recent weakness

July 29, 2005
(Reuters) — Business activity in the U.S. Midwest expanded in July at a much faster rate than expected, with employment bouncing back strongly as new orders jumped, according to a survey published on Friday.

The National Association of Purchasing Management-Chicago business barometer jumped to 63.5 from 53.6 in June. Economists had forecast the index at 55.5. A reading above 50 indicates expansion in the sector.

The index's employment component rose to 56.1 from 48.9 in June, which had been the weakest reading in almost a year.

Prices paid edged up to 61.3 from 59.7 but were not as high as some analysts had feared, while new orders jumped to 69.6, the highest level since March, from 56.5.

Economists said the report was another sign that the U.S. manufacturing economy was looking solid after a brief period of weakness in the spring. The Chicago index had been lower for three straight months coming into July.

"The slowdown for the Chicago business activity during the last couple of months was apparently quite transitory," said David Resler, chief economist, Nomura Securities International in New York.

Many view the NAPM-Chicago as an industrial indicator, even though service sector companies are all polled, because the Midwest region is relatively industrialized, especially in the auto sector.

"This is very welcome but could be a local story; the Chicago PMI is often influenced by the strength of the auto market, which has been very robust in the past two months as a result of GM-led price cuts," said Ian Shepherdson, chief U.S. economist at High Frequency Economics.

U.S. Treasury bond yields rose slightly on the data, with the 10-year Treasury note up to 4.26 percent from 4.23 percent earlier. Equities prices remained slightly lower.

Yes, I still call the midwest a weak economy.

http://www.bls.gov/xg_shells/ro5xg02.htm#lf

Graphs also attached.

Jan '99 33,580,589 Size of Labor force
32,387,839 Employed
1,192,750 Unemployed
3.6% Unemployment Rate

Jun '05 34,493,224 Size of work Force
32,606,154 Employed
1,887,070 Unemployed
5.5% Unemployment

What part of this makes the economy look good ? Less employed, more unemployed, and the work force grew. When you fall so far, sometimes you forget how good it was under other leadership.

[gt95stang]

Jan '99 32,387,839 Employed

Jun '05 32,606,154 Employed

What part of this makes the economy look good ? Less employed.....
:confused: :confused: :confused:
Must be the new math.
:confused: :confused: :confused:

[Angel of Death]

:confused: :confused: :confused:
Must be the new math.
:confused: :confused: :confused:

Your correct - I did not qualify my statement about the number of employed being down.

This is what I mean - I was comparing it to the total workforce. Meaning in '98 96.4% of the work force was employed, where as in '05 94.5% of availble workforce was employed.

So do you fell the economy is better in '05 for the midwest compared to '98 ?

[gt95stang]

Your correct - I did not qualify my statement about the number of employed being down.

This is what I mean - I was comparing it to the total workforce. Meaning in '98 96.4% of the work force was employed, where as in '05 94.5% of availble workforce was employed.

So do you fell the economy is better in '05 for the midwest compared to '98 ?
I havent' been in the midwest for awhile and those statistics are insufficient to answer the question (and I don't care enough to find more statistics).

I do know, however, that the overall U.S. economy in 1998 was artificially propped up by phantom corporate profits (Enron, WorldCom & Tyco were the big 3, but there were plenty of others) and that the Bush administration has cracked down on the fraudulent practices that occurred during the previous administration. This could wreak havoc with the comparative statistics.

There was also a little incident on 09/11/01 that crippled the economy and resulted in much higher unemployment than would have otherwise occurred.

And, IMHO, the recession that the Bush administration inheirited from the Clinton administration was minimized by prudent fiscal policy - including deficit spending and tax cuts.

[XXnarg]

ISM reaches highest level in 2005 (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={EC30FE2F-0F97-4F27-B603-4009B9A84154}&dist=bnb)
By Rex Nutting, MarketWatch
Last Update: 10:16 AM ET Aug. 1, 2005

"WASHINGTON (MarketWatch) - A key gauge of the strength of the U.S. factory sector rose to its highest level of the year in July, the Institute for Supply Management reported Monday.

The ISM index rose to 56.6% in July from 53.8% in June. It's the 26th straight month of growth in the sector.

Economists were expecting an increase to 54.5%, according to the survey conducted by MarketWatch.

Readings over 50% indicate growth in the manufacturing sector.

"It appears that the sector hit a low point in May, and has rebounded nicely in June and July," said Norbert Ore, chairman of the ISM's survey committee. An index reading of 56.6% (over time) would be consistent with economic growth of about 5%, Ore said.

The new orders index rose from 57.2% in June to 60.6% in July, the highest since December.

The production index rose to 61.2% in July from 55.6%, the highest since September.

The employment index rose to 53.2% in July from 49.9% in June, indicating hiring could increase.

The prices paid index fell to 48.5% from 50.5% in June, indicating buyers had more pricing power than sellers.

Twelve of 18 industries were growing in July, led by instruments, food and wood products. Five industries were contracting, led by publishing, glass and primary metals. The petroleum industry was unchanged."Your correct - I did not qualify my statement about the number of employed being down.

This is what I mean - I was comparing it to the total workforce. Meaning in '98 96.4% of the work force was employed, where as in '05 94.5% of availble workforce was employed.

So do you fell the economy is better in '05 for the midwest compared to '98 ?First, are you SURE you want to use the bubble economy of the late 90s as a benchmark for anything?

Second, what level of unemployment is sustainable and realistic?

Third, that graph you show misrepresents the facts. The baseline should be zero. As it it, the graph makes it look like there was no unemployment in 98/99 and that unemployment skyrocketed during the Clinton Recession. That's not factual. A graph like that lacks statistical integrity.

[Angel of Death]

Third, that graph you show misrepresents the facts. The baseline should be zero. As it it, the graph makes it look like there was no unemployment in 98/99 and that unemployment skyrocketed during the Clinton Recession. That's not factual. A graph like that lacks statistical integrity.

It comes from the Department of Labor, so dispute the accuracy of the chart with them. Also, I was simply looking at the numbers over the last 6 years. Go ahead and follow the link provided and produce any other set of charts or compare any other year you want.

[XXnarg]

08.08.2005, 06:26 AM

Four Chinese airline companies have agreed to buy 42 Boeing 787 jets for a total US$5.04 billion (euro4 billion), the official Xinhua News Agency reported Monday.

China's flag carrier Air China Ltd. and China Eastern Airlines Corp. will each buy 15 planes, Shanghai Airlines Co. will buy nine planes, and Xiamen Airline Co. will buy three planes, the report said.

The purchase comes ahead of an expected visit by Chinese President Hu Jintao to the United States in September and is a coup for Chicago-based Boeing over European archrival Airbus SAS.

In January, six Chinese airlines signed an agreement with Boeing to order 60 of its new fuel-efficient 787 Dreamliners for US$7.2 billion. It was not clear why the latest purchase contract did not include Hainan Airlines Co. and China Southern Airlines Co., who were part of the earlier agreement.

Xiamen Air is 60 percent owned by China Southern Airlines, which along with Xiamen Air also signed a contract in April to buy 45 Boeing 737s.

Chicago-based Boeing has said the 787s will be priced at between US$125 million (euro101 million) and US$135 million (euro109 million) each, though airlines usually negotiate discounts for large orders. The 787 Dreamliner, which is to go into service in 2008, competes with the A350 being developed by Airbus.

To date, Boeing has received 143 firm orders and 109 additional commitments for the long-range 787, including the 60 orders the Chinese airlines placed in January.

Both Boeing and Toulouse, France-based Airbus have boosted sales efforts in China, where airlines have made a series of major aircraft purchases in recent years as they build up fleets to meet soaring demand.

Boeing says it expects China's airlines to spend US$183 billion (euro148 billion) on aircraft over the next two decades as its 1.3 billion increasingly prosperous citizens take to air travel.

On Monday, pending the announcement of the planned purchase, shares in Air China, Shanghai-based China Eastern, and China Southern were suspended from trading in Hong Kong.

http://www.forbes.com/associatedpress/feeds/ap/2005/08/08/ap2175062.htmlIt comes from the Department of Labor, so dispute the accuracy of the chart with them....You chose to utilize a chart that does not accurately represent the facts. Whenever a graph shows only the tops of the columns the tops look wildly different. However, when you compare the entire range of data, the columns look much more similar. I'm not disputing the accuracy of the data, just the usage of that particular type of graph, which does misrepresent the facts.

[Angel of Death]

August 8, 2005 Monday 8:39 AM

NEWS & COMMENTARY; AUTOMOBILES

Delphi, Visteon swing to quarterly losses (http://www6.lexisnexis.com/publisher/EndUser?Action=UserDisplayFullDocument&orgId=574&topicId=100007979&docId=l:301282402&start=18)

August Cole

SAN FRANCISCO (MarketWatch) -- Delphi Corp. and Visteon Corp. on Monday reported quarterly losses as the auto-components companies struggled with accounting issues and waning vehicle production at their biggest American customers.

Delphi (DPH) said its second-quarter loss came to $338 million, or 60 cents a share, down from a year-ago profit of $143 million, or 25 cents a share. The latest results include $49 million worth of restructuring charges.

Delphi shook up the markets Friday with its drawdown on a credit facility and announcement of a restructuring of ties to former parent General Motors (GM).

Revenue fell in the three months ended June 30 to $7 billion from $7.5 billion in the same period a year earlier.

First Call pegged Delphi's second-quarter per-share loss at 51 cents, while revenue was forecast at $7.14 billion.

On Friday, Delphi shares fell more than 10% as one of the session's most active stocks after the company announced talks with GM and unions on a restructuring and tapped nearly all it could from its credit line. Debt ratings agencies followed with downgrades.

The Troy, Mich., automotive-parts maker said Monday that if these talks don't lead to a satisfactory plan, it will consider other strategic options, including reorganization of its U.S. businesses under Chapter 11.

Delphi said it expects continued lower production levels in North America for the third quarter and forecast revenue of $6.1 billion to 6.3 billion, with margins lower than in the first half of the year due to high fixed costs in its U.S. legacy business. Delphi also forecast negative cash flow from operations in the third quarter.

Visteon Corp. (VC) on Monday said it expects a loss of $1.2 billion, or $9.49 a share, in the second quarter on sales of $5 billion. The Van Buren Township, Mich., auto-parts maker said this outlook reflects previously disclosed asset impairment charges of $1.1 billion, or $9.01 a share.

Visteon had been expected to lose 78 cents a share with revenue of $5.01 billion, according to Thomson First Call.

The company noted that its sales to customers other than Ford Motor rose by 29% in the quarter to $1.8 billion.

Visteon added that it ended the quarter with net debt of $1.1 billion, a reduction of $128 million from its March 30 total. The company also said it continues to work along with Ford (F) toward the completion of a previously disclosed deal to transfer 24 Visteon facilities to a Ford-managed entity by the end of the third quarter.

Visteon, which spun off from Ford in 2000, last year posted earnings of $31 million, or 24 cents a share.

1997-2002 MarketWatch.com, Inc. All rights reserved. See details at http://custom.marketwatch.com/custom/docs/useragreement.asp.

[XXnarg]

One understands the need of some liberals to focus on the negative.

It looks like heavily-unionized US automakers are indeed having a hard time competing.

[Angel of Death]

One understands the need of some liberals to focus on the negative.

It looks like heavily-unionized US automakers are indeed having a hard time competing.

Let's see you post an article supporting the title of the thread, and I post one that show that the economy isn't great for everyone.

So you decide to post the above comments, because I do not think the economy is roses. I would appreciate talking about the issue instead of labeling me or telling me I focus on the negative. Believe it or not even YOU talk about the positive and negative sides of issues.


It is not just the unions that are hurting these companies.

[Anonymouse]

Delphi said it expects continued lower production levels in North America for the third quarter and forecast revenue of $6.1 billion to 6.3 billion, with margins lower than in the first half of the year due to high fixed costs in its U.S. legacy business.One understands the need of some liberals to focus on the negative.

It looks like heavily-unionized US automakers are indeed having a hard time competing.This would include INEFFICIENT machinery. shipping avenues & location of infrastructure, and supply services providing inefficient materials. Labor is a variable cost. INVESTING in MORE EFFICIENT MACHINERY might help. Relocating near a major traffic artery might help. SMART MANAGEMENT "investments". Unfortunately, it would cost CAPITAL INVESTMENT, thereby lowering short term returns to investors demanding quick "INFLATIONARY" gains, even though it sacrifices the long term HEALTH of the company.

[XXnarg]

This would include INEFFICIENT machinery. shipping avenues & location of infrastructure, and supply services providing inefficient materials. Labor is a variable cost. INVESTING in MORE EFFICIENT MACHINERY might help. Relocating near a major traffic artery might help. SMART MANAGEMENT "investments". Unfortunately, it would cost CAPITAL INVESTMENT, thereby lowering short term returns to investors demanding quick "INFLATIONARY" gains, even though it sacrifices the long term HEALTH of the company.If somewhere in there you are saying that executives in the US auto industry have screwed up royally, I agree.

Note that whenever companies invest in new technology (which you suggest they should), they meet resistance from the unions.

Also, I suspect that the better executives avoid heavily unionized companies, however. Who would want to subject himself and his family to union threats, character assasination, and dangers?

[adr]

If somewhere in there you are saying that executives in the US auto industry have screwed up royally, I agree.

Note that whenever companies invest in new technology (which you suggest they should), they meet resistance from the unions.

I suspect that the better executives avoid heavily unionized companies, however.

Japanese use unions for their labor. Problem with domestic car manufactors is with their executives. They can't build a car that people want which shows they have no concept of the market.

Quite funny when you blame unions when Europeans and Japanese use organize labor to build their cars.

[Anonymouse]

Japanese use unions for their labor. Problem with domestic car manufactors is with their executives. They can't build a car that people want which shows they have no concept of the market.

Quite funny when you blame unions when Europeans and Japanese use organize labor to build their cars.AND provide BETTER benefits to boot. The truth is, AMERICAN CEOs travel from BOD to BOD, interlocking those boards with the same old fashioned ideas about prodution because they are giving the "good ol' boys" the same jobs, just on different BODs, then "whine" about UNIONS killing their industries.

This post clearly shows WHY investment is THE key ingrediant in competition, LABOR is NOT the problem, it's short sighted MANGEMENT. (http://forums.slickdeals.net/showpost.php?p=1457767&postcount=75)

If quick profits are the name of the game, then UNION LABOR is your target. IF GOOD HEALTH for the COMPANY is the target, then LABOR is clearly NOT the target.
No matter HOW MANY FACTS are demonstated over and over, the "quick profit" crowd will continue to spew the ANTI_UNION rhetoric in their own self interest. LABOR's failing is in NOT taking a stand against the PROPAGANDA & trying to compete in the legislative arenas with corrupt lobbyists bribing BOTH sides of the political spectrum. It is the SAME "BIG LIE" tactic used by the current administration to push a war nobody wanted. All the UNIONS do is come off looking as corrupt as the Corporate lobbyists.

I have challenged the connies to put up or shut up on "The UNION Thread" They can't, (ONE PERSON at LEAST made a stab at showing CEOs are "suffering" right along with the workers, totally DEBUNKED), so they continue to whine, piss, & moan the same old fairy tails about UNION worlers being lazy, (not true, UNION is MORE productive), UNION workers demanding excessive wages and benefits, (not true, MANAGEMENT is striping investment capital for fast profits leaving companies old, inefficient and DISPOSABLE), and UNIONS being the driving force behind jobs leaving America, (TRUE, because "fast buck" artist KNOW they can steal even MORE MONEY FROM AMERICA if they steal WAGES from foreign workers at the SAME TIME they drain the coffers of the old inefficient American companies).

Nowhere do Corporations EVER show any PATRIOTISM, except when they hang a big ol' American flag outside the offices of the corporation they are looting. Then they use a snapshot on TV to show what "GOOD AMERICANS" they are. (and whine about UNIONS killing "PATRIOTIC" American companies) They HAVE NO ALLEGIENCE, except to profit, not to workers, not to communities, not to America. The GREAT GOD "PROFIT" is worshiped to the exclusion of all else. Is it a coincidence the words PROFIT and PROPHET sound so similar?

[XXnarg]

Posts about our blessed unions are OT in this thread.

http://www.chicagobusiness.com/cgi-bin/news.pl?id=17383

"Caterpillar, Boeing among best performers

(Reuters) — Earnings growth in the industrial sector will be above average versus the market at least through 2006, according to Lehman Brothers' analysts.

"Two of the sources of earnings growth (in the industrials sector) should be an improvement in pricing power and continued unit growth," Henry "Chip" Dickson, Lehman's chief U.S strategist, wrote in a report to clients. That's "a combination that points to a better environment for high-quality organic- growth prospects for the sector."

Lehman remains overweight with companies in the industrial sector in its U.S. strategy core model portfolio, according to the report, despite the sector's lackluster performance among other stocks this year.

An index of industrials components of the Standard & Poor's 500 Index is down 4.3 percent year-to-date, compared with a 29.1 percent gain for energy companies and a 11.8 percent gain for utilities. Overall, the S&P 500 is up 1 percent this year.

The shares in some of the largest revenue producers in the sector, such as General Electric Co., Tyco International Ltd and United Parcel Service Inc., are also down this year. Tyco shares lost 24.26 percent this year, followed by a 14.47 percent drop in UPS' shares and a 7.26 percent decline in GE. The best performing stocks in the group include Boing Co. with a 27.37 percent gain this year and Caterpillar Inc., up 10 percent.

Within the industrials sector, Lehman has an overweight in capital goods and a market weight in both commercial services and supplies and transportation.

"The drivers of the improved growth (in industrials) are both cyclical and secular," wrote Dickson. "The cyclical component is the first global synchronized industrial recovery since the early 1980s. The secular component is the need to build out global infrastructures because of decades of underinvestment."

The recent emergence of large developing nations, such as China, is also having an impact in the sector, according to the report.

"The increased demand of the developed world has put additional pressure on the existing global infrastructure and should spark further new investment in energy, water, security, transportation and logistics," Dickson wrote."

[XXnarg]

Japanese use unions for their labor. Problem with domestic car manufactors is with their executives. They can't build a car that people want which shows they have no concept of the market.

Quite funny when you blame unions when Europeans and Japanese use organize labor to build their cars."The foreign car makers, principally Honda, Toyota and Nissan from Japan, started producing cars and trucks in non-union, modern factories in the Southern states. Later, they were joined by German car makers BMW and Mercedes Benz in South Carolina and Alabama."
http://www.businessjournalism.org/content/3192.cfm
_______ _______ _______

"'Basically, auto country is moving down south," said Mr. Herring, 29, who met Toyota's president on his first day on the job. He added, "Fate brought me here."

For the most part, the first wave of foreign-owned plants were farther north, in places like Ohio and Kentucky, while the newest factories are concentrated in the Deep South.

The state of Alabama has been particularly generous in wooing auto companies. In 1993, it provided $258 million in incentives and tax breaks to land its first foreign automaker, Mercedes. The state has spent hundreds of millions since to attract the Honda, Hyundai and Toyota plants.

But what may have clinched the deals was the state's laws - similar to those on the books throughout much of the South - that do not require workers to join unions even if their plants are organized.

...In a state where the average wage is $31,000 a year, according to the Commerce Department, Toyota's workers earn $45,000 on average, with overtime, plus a benefits package valued by the company at $10,000. Workers receive medical, dental and life insurance coverage; a traditional pension plan and a 401(k) plan; an allowance for child care; and an annual cash bonus, which was $3,850 a worker last year.

Prospective employees are lining up to apply for jobs at the new factories. About 30,000 people vied for the 2,000 additional jobs at the gleaming white Mercedes plant west of Birmingham, where its workers dress in royal blue shirts that bear the company's three-pointed star logo on the right shoulder and their names on the left. "
http://www.truthout.org/issues_05/062205LC.shtml

_______ _______ _______

Go ahead and bash me some more if you like, but let's move the discussion of unions to a more appropriate thread.

[XXnarg]

Moto to repatriate $4.4B in foreign profits

Company bought back 9.2M shares in second quarter

(AP) — Motorola Inc. on Wednesday said it will bring back $4.4 billion in foreign profits in the second half of this year, thanks to new corporate tax breaks.

The Schaumburg electronics giant said in its quarterly report filed with the Securities and Exchange Commission that it expects to record a third-quarter net income tax benefit of more than $200 million in connection with the repatriation of earnings from its foreign units.

The move will occur in the third and fourth quarters, it said.

The American Jobs Creation Act, signed into law in October, temporarily reduces the tax rate on repatriated income if the money is reinvested permanently in the United States.

Also Wednesday, Motorola also said it bought back 9.2 million shares, worth about $164 million, during the second quarter.

Under the first buyback program in its history, Motorola is repurchasing up to $4 billion of its outstanding common shares through May 31, 2008.

As of July 2, Motorola had about 2.47 billion common shares outstanding.

Shares of Motorola rose 22 cents, or 1 percent, to $21.84 in early trading Wednesday on the New York Stock Exchange.""

http://www.chicagobusiness.com/cgi-bin/news.pl?id=17406

[Dr.Murdoc]

Well yes the ecomony is weak for the middle class and the others. If you are making a living working for someone you are out of luck.

[The Raddish]

Well yes the ecomony is weak for the middle class and the others. If you are making a living working for someone you are out of luck.
It is?? :confused:

Hmmm. I just don't see it. I am solidly "middle class", I own two homes (one is a rental), two cars, and I have a dog. I make a living working for someone else. I pay taxes, I contribute to my 401(k), and I put gas in my cars every week or so. I'm paying off long-accrued debt and becoming more and more solvent.


A good friend of mine at work just bought his first new home. My neighbors just bought a new car and are sending their kids to private schools. My other neighbor just retired, early at age 60. He and his wife just bought a new travel trailer and a new F-250 to tow it around.

Yep. It sure sucks to be middle class in America. The economy is sure weak for us. :rolleyes:

[XXnarg]

Well yes the ecomony is weak for the middle class and the others. If you are making a living working for someone you are out of luck.Not like it was back in the good old days, eh?

BTW, when WERE the good old days?

The middle and lower classes have more resources available to them than at any time in history. The world changes - the boom times of the 1950s are gone. The US does not have a permanent monopoly on high-paying tech jobs. We'll have to become more able to compete in the world market. That's a fact of life.

Liberals have painted themselves into the corner of always appearing negative while ignoring economic reality. I'm not suggesting that everything is great. It's not.

[gt95stang]

It is?? :confused:

Hmmm. I just don't see it. I am solidly "middle class", I own two homes (one is a rental), two cars, and I have a dog. I make a living working for someone else. I pay taxes, I contribute to my 401(k), and I put gas in my cars every week or so. I'm paying off long-accrued debt and becoming more and more solvent.
Although you logically sound middle class, I doubt you really are (what with owning 2 homes & all). Problem is, with very few exception, nobody really considers themselves "rich" or "poor". Everyone is accustomed to what they have and consider it to be "normal". "Normal" is considered to be "middle class".

In reality, if you made more than $29,000, you were amongst the richest 50% of Americans. I doubt that someone making between $50K and $100K would consider $29K to be "middle class".

[XXnarg]

Although you logically sound middle class, I doubt you really are (what with owning 2 homes & all). Problem is, with very few exception, nobody really considers themselves "rich" or "poor". Everyone is accustomed to what they have and consider it to be "normal". "Normal" is considered to be "middle class".

In reality, if you made more than $29,000, you were amongst the richest 50% of Americans. I doubt that someone making between $50K and $100K would consider $29K to be "middle class"."Though an average yearly income in the United States is about $30,000, incomes all the way from $20,000 up to $75,000 a year are generally considered middle class."
http://en.wikipedia.org/wiki/Middle_class

Keep in mind that these are individual incomes and family or household incomes. Two teachers making $60K each for 10 months' work are not doing too badly, are they?

There are of course other measures of "middle class" besides annual income, such as education level, values, lifestyle, and net worth, etc..

[gt95stang]

"Though an average yearly income in the United States is about $30,000, incomes all the way from $20,000 up to $75,000 a year are generally considered middle class."
http://en.wikipedia.org/wiki/Middle_class

Keep in mind that these are individual incomes and family or household incomes. Two teachers making $60K each for 10 months' work are not doing too badly, are they?

There are of course other measures of "middle class" besides annual income, such as education level, values, lifestyle, and net worth, etc..
I have no problem with that definition. $29,000 is "middle"... how far each direction one goes before hitting "poor" and "rich" is subjective.

[XXnarg]

I have no problem with that definition. $29,000 is "middle"... how far each direction one goes before hitting "poor" and "rich" is subjective.The income range for the middle class, per the definition on Wikipedia, is $20,000 to $75,000.

[XXnarg]

2:00pm 08/10/05

U.S. July federal deficit falls to $53 billion (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={DC3D446D-0426-4DE5-8575-C374AAA83084}&dist=bnb)

By Rex Nutting

WASHINGTON (MarketWatch) - The U.S. federal budget deficit shrank to $52.8 billion in July from $69 billion a year ago, the Treasury Department said Wednesday.

The deficit was about $5 billion less than the $58 billion estimated by the Congressional Budget Office a week ago.

Receipts came in $1 billion more than expected, while outlays were $4 billion less than CBO projected.

Through the first 10 months of the fiscal year, the federal deficit has totaled $302.6 billion, $110.2 billion less than at this time in 2004. Receipts are up 13.7% year-to-date at $1.75 trillion.

Outlays are up about 6.1% year-to-date at $2.05 trillion."

[gt95stang]

Receipts are up 13.7% year-to-date at $1.75 trillion.
This can't be correct! AAGLIK that tax cuts (and especially the Bush tax cuts for the rich) reduce federal tax receipts.

[XXnarg]

This can't be correct! AAGLIK that tax cuts (and especially the Bush tax cuts for the rich) reduce federal tax receipts.AAGLIK that Bush is just sending out bogus news releases like this, getting ready for the next election. Millions of people are starving in the streets every day and the soup lines are running out of gray water. I know because I got an email from Howard Dean about it. Also, MoveOn told me that Bush wants to explore Mars to steal Martian oil.

[gt95stang]

bogus news releases
Well duh! AAGLIK that Bush lies.

[XXnarg]

Well duh! AAGLIK that Bush lies."Clinton lays, Bush lies." :sly:

[XXnarg]

U.S. inventories tightest ever in June (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={7E9B9AC6-115D-49FB-99D0-125A63C38AF6}&dist=bnb)
By Rex Nutting, MarketWatch
Last Update: 10:22 AM ET Aug. 11, 2005

WASHINGTON (MarketWatch) - Inventories at U.S. businesses were tighter than they've ever been in June, as sales growth outpaced inventory accumulation, the Commerce Department said Thursday.

Inventories were essentially flat in June after nine months of growth. Meanwhile, sales increased 0.7%.

Economists expected inventories to rise 0.1%, according to a survey conducted by MarketWatch. See Economic Calendar.

The inventory-to-sales ratio thus fell to a record low 1.29 in June. The typical business had 39.3 days of sales on hand.

With inventories tightening and sales strong, economists expect production at U.S. facilities to ramp up in coming months to meet demand. Imports are also likely to increase.

In the first estimate of second-quarter gross domestic product, slower growth in inventory building was said to have subtracted 2.4 percentage points from growth.

Economists now expect U.S. gross domestic product to grow at least 4% in the current quarter, up from 3.4% in the second quarter.

Much of the data in Thursday's report had been released earlier. The one main new piece of news was retail inventories, which fell 0.4% in June, the biggest decline in eight months. Retail auto inventories fell 2.4%, the largest drop in nearly two years.

Retail sales increased 1.7% in June.

The inventory-to-sales ratio in retail fell to 1.46 from 1.49.

Earlier Thursday, the Commerce Department said retail sales increased 1.8% in July, as auto sales surged at the fastest rate in nearly four years. See full story.

In another report, the Labor Department said initial jobless claims dropped by 6,000 to 308,000. See full story.

Sales at manufacturers fell 0.1% in June while inventories were flat. The inventory-to-sales ratio was steady at 1.23.

Sales at wholesalers increased 0.6% while inventories rose 0.7%. The inventory-to-sales ratio stayed at 1.19.

[XXnarg]

U.S. leading indicators up 0.1% in July (http://www.marketwatch.com/news/print_story.asp?print=1&guid={D584BF52-F82E-475C-B0B5-F9BA0ACD3A3D}&siteid=mktw)
By Rex Nutting, MarketWatch
Last Update: 10:14 AM ET Aug. 18, 2005


WASHINGTON (MarketWatch) -- "Leading indicators of U.S. economic activity increased 0.1% in July, suggesting "moderate growth into the fall," the Conference Board said Thursday.

Economists had been expecting a 0.3% increase, according to a survey conducted by MarketWatch. See Economic Calendar.

The leading indicators increased a revised 1.2% in June, up from 0.9% reported last month. The leading indicators were flat in May.

The coincident indicators rose 0.1% in July, while the lagging index rose 0.3%.

The leading indicators are designed to forecast economic activity six to nine months ahead. Read the full release.

Six of the 10 leading indicators increased in July, led by jobless claims, the interest-rate spread and stock prices.

Three indicators declined, led by vendor performance and money supply.

Over the past six months, the leading indicators are up 1.1%, with six of the 10 indicators increasing over that time, "consistent with the economy continuing to expand moderately in the near term," the Conference Board said.

"The spike in energy prices is one factor in this outlook," said Ken Goldstein, chief economist for the private economic research group.

"Of more concern is the level of business executive and consumer confidence. Both investment and hiring intentions reflect a level of caution over both pricing and profit strategies," he said.

In a separate report Thursday, the Labor Department said weekly initial jobless claims rose by 6,000 to 316,000 last week, with the four-week average rising to 2,750 to 312,750."

[XXnarg]

New-home sales surge to record 1.41 mln (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={5838221E-DB28-4F1E-93E9-64DFC8B507BC}&dist=bnb)
Median sales price falls, showing shift to cheaper homes [THUS ADJUSTING TO CHANGING MARKET NEEDS AND BENEFITTING PEOPLE WITH LESS MONEY!!!]
By Rex Nutting, MarketWatch
Last Update: 12:57 PM ET Aug. 24, 2005


WASHINGTON (MarketWatch) -- Sales of new U.S. homes surged 6.5% in July to a record seasonally adjusted annual rate of 1.41 million, the Commerce Department said Wednesday.

The supply of new homes on the market increased 1.8% in July to a record 460,000, which represents a lean four-month supply at July's sales pace. It's the tightest inventory in relation to sales since October.

Economists were expecting sales to dip slightly to a pace of 1.33 million in July, according to a survey conducted by MarketWatch. See Economic Calendar.

The report turned financial markets around. Stocks pared earlier losses, while bonds turned negative after getting a boost from the weak durable-goods report earlier in the session. See Market Snapshot.

New-home sales are up 27.7% since July 2004. June's sales were revised lower to 1.324 million from 1.374 million, but it was still a record. Read the full report.

This really looks like a market in throes of a panic," said Joel Naroff, president of Naroff Economics. "People are getting in before prices hit levels that they cannot afford. But there is also an awful lot of speculation going on."

Reversing a trend toward higher prices, the median sales price fell to $203,800, down 4% in the past year, as builders shifted toward homes costing less than $250,000 and away from more expensive homes.

It's the first month prices have been down year-over-year since December 2003. It's the largest year-over-year decline in median prices since 1991, said Jason Schenker, economist for Wachovia.

On Tuesday, the National Association of Realtors said sales of previously owned homes fell 2.6% to a seasonally adjusted annual rate of 7.16 million in July, the third highest sales pace ever.

Median prices for previously owned homes have risen 14.1% in the past year. See full story.

In the Commerce Department report, sales of new homes in the West rose 36% to a record annual pace of 495,000. Sales increased 10.1% in the Northeast to 98,000. Sales fell 13.5% in the Midwest to 205,000 and fell 3.5% in the South to 612,000.

The hot housing market is fueled by still-low interest rates, rising incomes and a widespread belief that real estate is the best investment.

In August, a national homebuilders group warned that sales and buyer traffic at new developments had fallen from lofty levels, while remaining well above average. The homebuilders remain upbeat about sales over the next six months, however. See Wall Street Journal story on foreign demand for U.S. real estate securities (subscription required).

The government cautions that its housing data are extremely volatile and subject to large sampling and other statistical errors. It can take up to six months for a new trend in sales to emerge.

In the past six months, sales have averaged a record 1.31 million annualized, up from 1.27 million a month ago.

In all of 2004, 1.203 million new homes were sold.

[XXnarg]

Confidence rebounds in August (http://www.marketwatch.com/news/story.asp?siteid=mktw&guid={25D082E7-FA15-4ACD-BF7F-53CD6619CD07}&dist=bnb)

By Rex Nutting, MarketWatch
Last Update: 10:01 AM ET Aug. 30, 2005

WASHINGTON (MarketWatch) - Led by the best assessment of current conditions in nearly four years, U.S. consumer confidence bounced back in August, the Conference Board said Tuesday.

The consumer confidence index rose to 105.6 in August, reversing most of July's decline to 103.6, the private economic research group said.

Economists were expecting the index to decline further to 100.8, according to a survey conducted by MarketWatch. Calendar. Other consumer surveys, including the University of Michigan survey, have shown reduced consumer confidence because of rising energy prices.

In the Conference Board report, feelings about the current situation improved to their highest level since September 2001. The present situation index rose to 123.6 from 119.3.

The assessment of the labor market turned up, with more consumers saying jobs are plentiful than are saying jobs are hard to get, the first time since October 2001 that "plentiful" has "outnumbered hard to get."

The number of consumers saying conditions are "good" outnumbered those saying conditions are "bad" by nearly two-to-one, at 29.8% to 15.1%.

The expectations index, meanwhile, increased to 93.7 from 93.2.

Rex Nutting is Washington bureau chief of MarketWatch.

[steaksauce]

http://www.bls.gov/news.release/jec.nr0.htm


Nonfarm payroll employment rose by 146,000 in June, and
the unemployment rate, at 5.0 percent, continued its recent
downward trend. Payroll employment has increased by 2.1
million over the year. In June, job growth continued in
several industries, with notable gains in professional and
business services and in health care. Manufacturing
employment declined over the month.

Professional and business services added 56,000 jobs in
June and nearly half a million over the year. Employment
continued to trend upward in several component industries,
including architectural and engineering services and
computer systems design and related services. Temporary
help services employment was little changed over the month;
job growth in the industry has slowed since last fall.



All that matters is that Manufacturing is still going overseas and the Administration is doing nothing to combat it.

Most of those Professional and Business Services jobs were in Retail and Restaurant industries. I heard this report on CNN a while ago. Just like a typical Conservative, thanks for underinforming us.

[Doctor_Wu]

All that matters is that Manufacturing is still going overseas and the Administration is doing nothing to combat it.


Ah... outsourcing...

Combat it how? Should the government outlaw outsourcing?

One wonders why Japan and Germany didn't protect themselves against outsourcing when their automakers were building plants in the United States.

We insource a lot of jobs too.

[The Raddish]

All that matters is that Manufacturing is still going overseas and the Administration is doing nothing to combat it.
That's all that matters? That's a very narrow minded focus you have there.

Nothing else matters except that some "manufacturing jobs" are "going overseas". Gotcha. :thumbup:

Most of those Professional and Business Services jobs were in Retail and Restaurant industries. I heard this report on CNN a while ago. Just like a typical Conservative, thanks for underinforming us.
Would you care to support your claims with a link for proof? We have supplied quite a few links to the contrary, but the lefties around here keep repeating the same old tired party line:"The only new jobs are low paying restaurant and retail jobs."
Here is a novel idea. Why not do a little research before making such uninformed, ignorant, baseless claims??

Golly gee whiz, it has got to suck to be a Democrat in today's climate, where the economy is booming but all they see is negativity. This furthers my premise that the only good news for Democrats these days is bad news for America.

[adr]

Ah... outsourcing...

Combat it how? Should the government outlaw outsourcing?



Easiest way to control outsourcing is ban federal funds from going to companies that will outsource over a certain percentage of work say 25%. That would cause Oracle and other companies to lose government contracts and my guess they would probably bring development back since government contracts are big money.

[steaksauce]

That's all that matters? That's a very narrow minded focus you have there.

Nothing else matters except that some "manufacturing jobs" are "going overseas". Gotcha. :thumbup:


Would you care to support your claims with a link for proof? We have supplied quite a few links to the contrary, but the lefties around here keep repeating the same old tired party line:"The only new jobs are low paying restaurant and retail jobs."
Here is a novel idea. Why not do a little research before making such uninformed, ignorant, baseless claims??

Golly gee whiz, it has got to suck to be a Democrat in today's climate, where the economy is booming but all they see is negativity. This furthers my premise that the only good news for Democrats these days is bad news for America.

Why don't you read the article that Xnarg provided for us in the post that we are talking about? The answers are all there.

Thanks for nitpicking every single little word that I type up... and how is the economy "booming" right now? You having 5 meals a day doesn't count.

[The Raddish]

Why don't you read the article that Xnarg provided for us in the post that we are talking about? The answers are all there.
I read it. Did you?

Notable Gains: health care
Professional and business services
architectural and engineering services
computer systems design and related services
Status Quo (which means little or no change):temporary help services
Declines:Manufacturing employment
Well there, I see nothing about "low paying restaurant and retail jobs". Do you?

I guess if you are a Democrat, architectural and engineering services, computer systems design and related services and health care are all "low paying restaurant and retail jobs."

Maybe conversations in the World of the Democrats goes something like this?"Excuse me sir, we have you scheduled for a prostate exam on next Thursday at 8:00am. Would you like fries with that?"
:rofl2:

[steaksauce]

Go to the link and it shows July statistics. For some reason the article Xnarg posted mentions nothing about retail and restaurant industries.

Total jobs gained in July: 207K
Retail: 50K
Food Services and Drinking places: 30K
Health Care: 29K (This stat will always be in the positive since we are always lacking health care professionals)
Professional and Tech: 23K
Financials Activities: 21K
Construction: 21K per month average but about in line with 2004 statistics
Manufacturing: Flat with vehicle and parts manuf. -11K

So, Retail and Food services account for the bulk of the job gains.

[XXnarg]

Manufacturing jobs have been going overseas since the 50s!

What really bugs youthful techies is that finally THEY are being affected.

[steaksauce]

Yeah, most people don't give a shit about things until they themselves are affected.

Do we just let manufacturing slide or do we want to keep them here? I am not an expert but don't we want to produce our own? What if in the future the rest of the world catches up to the level of U.S.'s economy, we'll be stuck with a bunch of people that cannot produce our own goods and will have to import everything... not so good for our trade deficit.

[The Raddish]

So, Retail and Food services account for the bulk of the job gains.
...as is almost always the case, historically. So what? They don't account for even half of the jobs gained, so saying that "most" of the jobs gained were in restaurant and retail services is, of course, incorrect. And who did you accuse of underinforming??

From the same article:Retail trade employment grew by 50,000 in July, with gains widespread among the component industries. Employment in retail trade has increased by 352,000 since its recent low in June 2003. In July, employment rose in clothing and clothing accessories stores and in building material and garden supply stores. Automobile dealers also added jobs, as special incentives to buyers raised sales volume. Employment in food services and drinking places increased by 30,000 over the month and has expanded by 262,000 since July 2004. This industry accounted for the vast majority of the job growth in leisure and hospitality, both over the month and over the year.
There are a lot more than Mallrat and McJobs in the "Retail and Restaurant" sectors, steaksauce. This report is very encouraging, on nearly all fronts. The R&R sector appears to have rebounded nicely since 2003. This means that people are spending money. People are buying things. When people spend money and buy things, consumer confidence increases. This is good for the economy.

But you see, it's not just the R&R sector that is increasing, as the liberal party line would have you believe. Over half of the jobs that have been created are for other, high-paying sectors.

Not everyone is qualified for all those high-paying jobs, however. But liberals would have us believe that everyone is entitled to a high-paying job, regardless of education level or background. Hogwash.

Those that want to work, that get themselves educated, and that want high-paying jobs in this country can get them, if they give up on their entitlement attitudes and excuses. Sometimes you have to move to where the jobs are instead of waiting for someone to "give" you a job. You want it, go get it, because in America, it is possible to do so.

Or, if you are a liberal, you can just go around whining that the R&R sector is increasing. No matter what, to a liberal, the economy is bad when a Republican is in office. Good news for America is bad news for Democrats, and your response to this good news article is a perfect reflection of that attitude.

Would you like fries with that?

[Doctor_Wu]

Yeah, most people don't give a shit about things until they themselves are affected.

Do we just let manufacturing slide or do we want to keep them here? I am not an expert but don't we want to produce our own? What if in the future the rest of the world catches up to the level of U.S.'s economy, we'll be stuck with a bunch of people that cannot produce our own goods and will have to import everything... not so good for our trade deficit.


What does a trade deficit mean? What does having more imports indicate about our economy? Is it better to have more exports than imports?

[steaksauce]

Since Bush has taken office, the only way that I see the unemployment rate going is up. The problem is, it has been a slow climb with increases from here and there. The focus of the Admin was and has been to go take out a dictator that has no significant ties to Al-Quaida, go on some bad information that they had WMDs, hand thousands of families news that their son and daughter has just been killed so that their little circle of oil buddies can profit from this endeavour in the future. So, the unemployment had to go down, but the rate of improvement could be much better and there isn't much that Bush has done to improve them.

Good point there because when Clinton was in office, Repubs didn't credit him with any of the economic gains during that period.

I don't like fries, dude. You can have them all to yourself, I know you want to keep them.

[The Raddish]

Since Bush has taken office, the only way that I see the unemployment rate going is up.
Then there is no hope for you because facts obviously mean nothing to you. I am sorry you live in such a pessimistic world. :dontknow:

[steaksauce]

Then there is no hope for you because facts obviously mean nothing to you. I am sorry you live in such a pessimistic world. :dontknow:

Oh, I meant, since it was so high back then, the only way unemployment could go is down. So this recent trend of gaining job should be no surprise, it's just the rate of improvement that is under the microscope.

[XXnarg]

10:09am 09/26/05

U.S. Aug. existing homes sales rise 2% to 7.29 mln (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={AA8525E6-B64E-42B1-9B63-0E11547F0A13}&dist=bnb) By Maggie McNeil

WASHINGTON (MarketWatch) -- Sales of previously-owned homes rose 2% in August to a seasonally-adjusted annual rate of 7.29 million units, the National Association of Realtors said Monday. Sales in July were revised down to 7.15 million from 7.16 million reported earlier.

August sales were up 7.8% from August 2004 and were the second highest on record.

The median home sales price rose 15.8% over a year ago to $220,000.
Inventories of homes for sale rose 3.5% in August to 2.86 million, a 4.7 month supply and the most plentiful month's supply since November, 2003. David Lereah, NAR's chief economist, said, "Katrina has disrupted everything for us," and it may be several months before realtors will know the full impact of Katrina on the housing market.

[XXnarg]

8:30am 09/28/05

U.S. Aug. durable-goods orders up 3.3% (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={1BBF35B2-CB01-4125-B6C3-A4D6B5813CEB}&dist=bnb) By Greg Robb

WASHINGTON (MarketWatch) - Led by demand for computers, orders for new U.S.-made durable goods increased 3.3% in August.

Economists were expecting orders to rise 0.9%. Durable orders in July were revised to a 5.3% decrease from 4.9% previously estimated.

Shipments of durable goods increased 1.7% in August after a 0.7% fall in July.

Orders for core capital goods equipment rose 4.3% in August after falling 7.1% in the previous month.

[Final Quest]

What does a trade deficit mean? What does having more imports indicate about our economy? Is it better to have more exports than imports?


I would like a good answer to this question, just for my own understanding. Maybe we could make a thread for your questions.

[XXnarg]

I would like a good answer to this question, just for my own understanding. Maybe we could make a thread for your questions.Start a thread! :D

[XXnarg]

"10:05am 09/30/05

Chicago-area business gauge rebounds in September to 60.5% (http://www.marketwatch.com/news/newsfinder/pulseone.asp?siteid=mktw&guid={FD79D6A2-3410-4F67-9393-4C0332367274}&dist=bnb) By Rachel Koning

CHICAGO (MarketWatch) -- A measure of business activity in and around Chicago rebounded in September. The National Association of Purchasing Management-Chicago's index stood at 60.5%, up from August's 49.2%.

It beat expectations for some recovery from last month's surprising weakness, to 50.6%.

Readings over 50% indicate a majority of companies sees steady or improving business.