►Economy brightens as consumers spend and layoffs slow
Christopher S. Rugaber/Associated Press/Dec 24
Economic reports Thursday suggested that employers are laying off fewer workers, businesses are ordering more computers and appliances, more people are buying new homes, and consumers are spending more confidently. Combined, the latest data confirm that the economy is improving, though the job market remains a problem with unemployment at a stubbornly high 9.8 percent. “The recovery is moving into higher gear,” said Jim O’Sullivan, global chief economist at MF Global Ltd., of New York.
►Consumers Lift Economy
Justin Lahart/Wall Street Journal/Dec 24
“It looks like we’ve transitioned into a period of solid consumer spending,” said Barclays Capital economist Dean Maki. “That makes it hard not to be optimistic about economic growth.”
►New home sales climb – but recovery is sluggish
Laurie Segall/CNNMoney/Dec 23
New home sales edged higher in November, but the recovery remains sluggish. Sales of new homes rose 5.5% to an annual rate of 290,000 in November, the Commerce Department reported Friday. And while that shows improvement, sales are still off 21.2% from a year ago.
Although the numbers indicate a slight improvement, little has changed, according to IHS Global Insight economist Patrick Newport.
“It’s just another bad report. There’s some improvement but it’s fiscally insignificant,” he said. “It means that we’re basically still stuck at the bottom – that the situation for builders is as bad its ever been.” Newport says he expects the numbers to improve in 2011, but at a slow pace.
►US durable orders ex-transportation surge in Nov
Lucia Mutikani/Reuters/Dec 23
New orders for U.S. manufactured goods excluding transportation rose more than expected in November, to record their largest gain in eight months, according to a government report on Thursday that pointed to continued strength in the manufacturing sector.
►Has the recession permanently changed Americans’ holiday shopping habits?
Annie Lowrey/Dec 23/Slate
It is the third recession-era holiday season. And although the economy has picked back up in recent months, Americans are clearly still adjusting to the new normal of high unemployment, sagging wages, increased poverty, and general economic malaise. Tear-jerking Santa stories aside, how have the bad economic times changed the way Americans treat—and shop for—the holidays? And what might be the effect going forward?
For one, Americans are certainly spending less on gifts due to the persistent hangover of the recession. Overall holiday spending looks as if it will tick up this year but will probably remain lower than it was in 2004, 2005, 2006, or 2007. And about half of Americans say they’ll spend less on gifts this year than the last. But they don’t seem to be lamenting the cutbacks, becoming frugal both out of necessity and out of choice. According to a Strayer University poll, 77 percent of Americans say the economy “gives them a chance to focus on what is truly important.”
►Consumer Spending Above Pre-Recession Level
Mark J. Perry/Carpe Diem/Dec 23
Real personal consumption expenditures increased by 2.77% in November from a year earlier, to $9.432 billion, according to today’s BEA report. This was the largest increase in spending since a 2.96% yearly gain in January 2007, and lifted consumption spending above the pre-recession peak of $9.355 billion in December of 2007, when the recession officially started. The U.S. consumer is back.
►Oil Consumers Wary as Some in OPEC Target $100 Crude Before Cairo Meeting
Ola Galal and Lananh Nguyen/Bloomber/Dec 24
Oil importers are growing wary of the impact of prices near two-year highs as some OPEC members foresee a further rally to the $100-a-barrel level and Arab oil ministers gather for a meeting in Cairo…“An issue for OPEC will obviously be prices edging higher,” said Bill Farren-Price, chief executive officer of Winchester, U.K.-based consultants Petroleum Policy Intelligence. “The issue is whether we’re in a new rally and for now the jury’s out on that. And I don’t think anyone in OPEC would disagree with that.”