Payrolls dropped by 63,000;
recession fears intensify
Bloomberg Mar 7, 08 7:58 AM CST
(Newser)
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The US lost 63,000 jobs in February, the second straight month payrolls contracted and the worst drop since 2003, catching economists off guard and fanning fears of recession anew, Bloomberg reports. Economists hoped the economy would add 23,000 jobs after declining a modest 17,000 in January, when the unemployment rate rose to 4.9%.
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US credit crisis has investors in Asian markets hedging their bets
Associated Press Mar 7, 08 6:07 AM CST
(Newser)
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Japan’s Nikkei fell 3.3% and Australia’s S&P/ASX2000 dropped 3.2% as woeful US economic news—including rising foreclosures, worsening homeowner debt and impending credit defaults—sent Asian markets reeling, the Associated Press reports. Investors also worried that a key jobs report to be released this morning would show a rise in US unemployment, which would further hurt already depressed Asian exports.
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Ceiling on loans backed by Fannie Mae, Freddie Mac goes to $729K in 70 counties
Wall Street Journal Mar 6, 08 6:10 PM CST
(Newser)
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Government-backed mortgage guarantors Fannie Mae and Freddie Mac can now back loans up to $729,750, the Wall Street Journal reports, after the Federal Housing Administration put into effect that provision of the federal economic stimulus package today. More than 70 counties in the US are subject to the new limit, and ceilings will rise from the previous cap of $417,000 in many others.
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MARKETS
Talk of Ambac bailout leads to late rally
MarketWatch Mar 4, 08 3:49 PM CST
(Newser)
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News of an impending bailout for bond insurer Ambac helped the markets recover from steep losses and end today's session down only slightly, MarketWatch reports. Down by 200 points at 2:30, the Dow closed only 45.10 down, ending at 12,213.80. The Nasdaq rose 1.68 to 2,260.28, and the S&P 500 lost 4.59 to close at 1,326.75.
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Critics say accounting rules exaggerate losses, hinder market
Wall Street Journal Mar 1, 08 12:09 PM CST
(Newser)
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After months of staggering writedowns battering Wall Street, some investors and executives are charging that accounting rules are exaggerating losses and triggering slumps like yesterday’s 315-point plunge in the Dow, reports the Wall Street Journal . Rules requiring companies to value holdings at current market rates, no matter how volatile, have a domino effect, they say: "The market falls, forcing banks to take write-offs, pushing the market lower, causing more write-offs," the Journal writes.
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Confidence is falling as inflation rises
Bloomberg Feb 29, 08 12:03 PM CST
(Newser)
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Consumer spending rose more than expected in January—but only because prices did so as well, Bloomberg reports. Adjusted for inflation, spending remained flat for the second straight month. With fuel costs rising, banks restricting loans, and property values falling, “consumers are clearly hard-pressed to maintain their standard of living and are cutting back,” says an analyst.
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MARKETS
Dow drops 112 points on sluggish growth, rising jobless claims
Bloomberg Feb 28, 08 3:56 PM CST
(Newser)
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Stocks fell more than they had in a week today amid reports of sluggish economic growth, rising jobless claims, and fears of failing banks, Bloomberg reports. The Dow fell 112.10 points to 12,582.18, the Nasdaq fell 22.21 points to 2,331.57, and the S&P 500 12.34 points to 1,367.68. The government said GDP grew by 0.6% last quarter, below analysts' estimates.
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Many tech workers not seeing US slump
ABC News Feb 27, 08 5:31 PM CST
(Newser)
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Ben Bernanke’s report to Congress on monetary policy offered a grim outlook on the economy, but ABC News sees some signs that good news may be around the corner: workers in Silicon Valley, a national economic bellwether, feel good about their prospects. Rising exports, the recently-passed stimulus package and the future rate cuts Bernanke will probably make at the Fed’s March 18 meeting are additional reasons for optimism.
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Says central bank 'will act as needed'
to further minimize economic risks
Wall Street Journal Feb 27, 08 9:15 AM CST
(Newser)
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Federal Reserve Chairman Ben Bernanke today said that the board stands ready to cut interest rates again to give the economy "adequate insurance against downside risks," reports the Wall Street Journal. The move, which follows 2.25% in cuts to the key rate since September, is widely expected at the Fed's March 18 meeting.
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Almost half on US panel predict
recession, up from 25% last year
Associated Press Feb 25, 08 7:09 PM CST
(Newser)
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An panel of US economists leaned closer to predicting recession today after grappling with a slew of scary data, the AP reports. More than half of analysts at the National Association for Business Economics maintained that a downturn is still unlikely, but 45% expected recession in 2008; only a quarter saw a 35% chance of recession in a report last September.
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Reserve officials sharply reduce economic forecast
New York Times Feb 20, 08 6:58 PM CST
(Newser)
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The Federal Reserve issued a bleak assessment of the economy today, predicting weak growth and rising unemployment this year. Fed officials expect the economy to grow between 1.3% and 2% in 2008, the slowest in five years, the New York Times reports. A separate report today showed consumer prices rising, putting the Fed in a tricky spot as it weighs another rate cut against fears of inflation.
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