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From mini cars to monster pickups, sales of new cars and trucks surged in June and eased concerns that Americans would be turned off by slower hiring and other scary headlines.
Automakers sold nearly 1.3 million cars and trucks in June, up 22 percent from the same month last year. Chrysler posted its best June in five years. Sales soared at Volkswagen, which is on track for its best year in the U.S. since 1973.
The results allayed fears that the car market’s momentum had stalled. U.S. sales were on track to reach 14.5 million after the first four months of the year. But the annual pace dropped to 13.8 million in May, as the stock market plunged and hiring slowed. June brought more worrisome news about jobs growth and consumer confidence.
But buyers didn’t go away last month. In fact, June’s sales pace rose to 14.1 million, according to Autodata Corp. And if sales stay at that level for all of 2012, it will be the industry’s best year since 2007.
Falling gas prices, cheaper loans and new models like the Ford Escape and Dodge Dart drew buyers. A revived housing market lifted sales of pickups. And there was still plenty of demand from people who bought cars in the middle of the last decade and needed to replace them. Annual sales hit a high of 17 million in 2005, and those cars and trucks are now seven years old.
(Reuters) - After a month in which his re-election campaign picked up momentum, hard economic realities are about to hit President Barack Obama as he takes to the road on a campaign bus trip through the Rust Belt. Poor manufacturing data earlier this week followed by a likely weak jobless report on Friday are reminding Obama that he has a lot of work to do to convince voters he is bringing the economy back to full health.
... U.S. manufacturing activity contracted in June for the first time in nearly three years, data showed on Monday, stark evidence of a slowing economic recovery and that Europe's debt crisis is weighing on the U.S. economy.
And the monthly jobless figures, the most closely watched economic indicator, are expected to be lackluster. Economists polled by Reuters expect nonfarm payrolls to have risen by only 90,000 jobs in June and the unemployment rate will stay unchanged at 8.2 percent. Employers likely increased hiring, but not enough to dispel concerns that the economy is losing steam.
The fiscal gloom allows Romney to re-energize his charge that the White House is not creating jobs quickly enough, after his nonstop economic criticism was drowned out by last week's Supreme Court ruling that Obama's 2010 healthcare law is constitutional.
"From day one of his administration, the president has pursued policies that have hurt job creators, hurt the manufacturing sector, and left millions of Americans struggling to find work. It's going to be hard for the president to argue Americans should gamble on a second term while on his bus tour," Romney campaign spokeswoman Amanda Henneberg said.
Romney also struggled recently to explain his immigration position after Obama forced the issue on to the agenda by halting possible deportations of young illegal immigrants. The immigration debate helped Obama in polls.
... "Everybody is concerned about the prospects for the economy. There are two huge issues. One is Europe and the second is our own fiscal cliff," said Isabelle Sawhill, a budget expert at the Brookings Institution, referring to programmed cuts in the U.S. budget and rising taxes next year, unless congress acts to avoid them.
"The concerns and the fears... have already begun to undermine confidence in the economy and cause both consumers and businesses to hold back on what they are willing to spend," she said. ...
LOS ANGELES, CA - Dubbed "Government Motors" by some, this would be bad news for those who invest in GM - but it's a much larger issue here. The Treasury still owns 26.5 percent of GM, or 500 million shares. Taxpayers are out $26.4 billion in direct aid. In essence, shares would have to hit $53 for the government to break even. GM stock is worth about $9.8 billion as of the beginning of this week, leaving taxpayers with a loss of $16.6 billion.
U.S. President Barack Obama let GM keep $45 billion in past losses to offset future profits, which are usually wiped out or slashed, along with debts, in bankruptcy. The White House essentially gifted $45 billion in write-offs to GM. So when GM earned a $7.6 billion profit in 2011, no taxes were paid. Including the $18 billion gift, the taxpayers' true loss climbs to nearly $35 billion.
It is highly unlikely that the Obama administration will sell off its GM stake before Election Day, forcing Obama to recognize actual losses, which would remind voters that the bailout was a massive transfer from taxpayers to unions.
... Overall U.S. auto sales were strong to start the year, but that momentum has faded along with slowing economic growth and hiring. Falling gas prices also may reduce the incentive to replace aging cars and trucks with higher-mileage vehicles.
Dubbed "Government Motors" by some, this would be bad news for those who invest in GM - but it's a much larger issue here. The Treasury still owns 26.5 percent of GM, or 500 million shares. Taxpayers are out $26.4 billion in direct aid. In essence, shares would have to hit $53 for the government to break even.
Chancellor Angela Merkel faces growing resistance to her European policy from within her own coalition. Horst Seehofer, the leader of the powerful CSU party, sharply criticized the outcome of last week's EU summit, and threatened to let the coalition government collapse if Berlin makes any more concessions to ailing euro members. ... "The time will come when the Bavarian government and the CSU can no longer say yes. And I wouldn't then be able to support that personally either," Seehofer said in an interview with Stern magazine released on Tuesday. "And the coalition has no majority without the CSU's seats."
The CSU is the Bavarian sister party to Merkel's Christian Democratic Union.
Germany's billions of euros in aid and guarantees were already "borderline," said Seehofer, who is known in Germany for his combative, occasionally populist style. "My biggest fear is that the financial markets will ask: Can Germany cope with all that? That is the point I regard as the most dangerous of all."
Seehofer said several euro countries needed to drop their debt mentality.
"The fact that others want to get at our money without asking too much of themselves is deeply human," he said. "But it won't solve the problem."
Seehofer has repeatedly attacked the German government on a number of issues in recent weeks including a controversial childcare benefit for stay-at-home mothers, a pet project of his party.
He told Stern that the government needed to explain the agreements made at the EU summit, where Merkel backed down and agreed to demands from Italy, Spain and France that troubled banks should receive aid directly from the permanent bailout fund, the European Stability Mechanism (ESM).
'European Monster State'
"We were debating about the stability pact in the Bundestag (Germany's federal parliament). And at exactly that time the government leaders of some euro countries were working to soften precisely those stability criteria. Who is supposed to understand that?"
Seehofer also criticized a suggestion by Finance Minister Wolfgang Schäuble that Germany should hold a referendum on a new constitution that could relinquish national powers to Brussels. "Hands off our constitution! We have this constitution to thank for the most stable state and the most stable democracy there has ever been in German history. We don't want a different constitution," said Seehofer.
He said he wouldn't accept the transfer of major powers to a "European monster state." He said he would turn the next general election and the Bavarian regional election, both scheduled for 2013, into a vote on Europe. "We will put this question to the people."
Merkel on Tuesday denied there were any differences between her and Seehofer on European policy. She said her coalition was united on the issue.
Alarming Data From Greece Expected
The euro crisis could worsen in the coming days. The Greek government said it would present alarming figures on the recession and unemployment to visiting inspectors from the "troika" of European Union, European Central Bank and International Monetary Fund on Wednesday.
The figures show that the current austerity program imposed by the international creditors was counterproductive, said government spokesman Simos Kediglos on Tuesday in a TV interview. The Greek government wants to renegotiate the terms of the €130 billion ($165 billion) bailout package.
The inspectors will have to assess Greece's progress on reforms to determine whether the country qualifies for the next tranche of aid totalling €31 billion.
Meanwhile, there was speculation in financial markets that Slovenia may become the sixth euro-zone member to seek aid after Greece, Ireland, Portugal, Spain and Cyprus. A spokesman for the European Commission declined to comment.
Merkel has given the minimum each step of the way. However there have been too many give-aways to count. Each cave-in, no matter how small, has had a cumulative effect. Each time she makes a concession, she adds risk of an adverse ruling in the constitutional court or risk of increased political fallout.
Her latest pre-planned escapade in Brussels puts her at risk of both.
The constitutional court already had the ESM under review. Additional challenges will be filed. I suspect the court will OK the treaty but with a stern warning. And speaking of stern warnings, CSU party leader Horst Seehofer just issued one in no uncertain terms.
This may be the end of the line of what Merkel can agree to without a referendum. When yields head North again in Spain and Italy (and they will because nothing has been solved), Merkel will be in serious trouble.
OilFinder2 wrote:BTW, your article is really dumb:Dubbed "Government Motors" by some, this would be bad news for those who invest in GM - but it's a much larger issue here. The Treasury still owns 26.5 percent of GM, or 500 million shares. Taxpayers are out $26.4 billion in direct aid. In essence, shares would have to hit $53 for the government to break even.
Then, to break even, all they have to do is to wait until the stock price gets to $53 before they sell the rest of their shares! Taxpayers haven't lost ANYTHING yet, because the government hasn't SOLD the remaining portion yet!! DUH!!!
.Planned firings fell by 9.4 percent from June 2011 to a 13- month low of 37,551, according to figures released today by Chicago-based Challenger, Gray & Christmas Inc. Manufacturers including makers of industrial goods, consumer products and motor vehicles saw job cuts decline, the report showed.
“Employers appear reluctant to shed too many workers,” John A. Challenger, chief executive officer of Challenger, Gray and Christmas, said in a statement. “While it does not take long to shrink payrolls, it can take a significant amount of time to rebuild them, particularly as reports of a growing skills gap become more widespread,” he said
U.S. private employers added 176,000 jobs in June, topping economists' expectations, a report by a payrolls processor showed on Thursday.Economists surveyed by Reuters had forecast the ADP National Employment Report would show a gain of 105,000 jobs. May's figures were revised up slightly to an increase of 136,000 jobs from the previously reported 133,000.
Fewer Americans than forecast filed first-time claims for unemployment insurance payments last week, easing concern that the labor market was deteriorating.
Applications for jobless benefits decreased by 14,000 in the week ended June 30 to 374,000, the fewest since mid May, Labor Department figures showed today. Economists forecast 385,000 claims, according to the median estimate in a Bloomberg News survey. A Labor Department spokesman said there was nothing unusual in the data.
Fewer firings help pave the way for faster job creation when companies grow more confident about the economic outlook. A report tomorrow may show the world’s largest economy added 90,000 jobs in June, capping a second quarter where employment growth slowed to half the pace of the prior three months.
Tomorrow's NFP may or may not beat expectations, following some modestly better than expected employment-related data points (then again last month NFP was again supposed to come in solidly above 100K only to cross below the critical threshold), but keep one thing in mind: with the average June seasonal adjustment being a deduction of over 1 million jobs, several tens of thousands in marginal absolute job numbers + or - will be nothing but statistical noise. Furthermore, with seasonality playing such a huge role tomorrow, it is quite likely that merely the ongoing seasonal giveback will result in June being yet another subpar month. And that does not even take into account the quality assessment of the job number, which if recent trends are any indication, will be another record in part-time jobs at the expense of full-time jobs. Yet no matter where the NFP data ends up, the following chart from David Rosenberg puts a few thousand job into perspective, showing that regardless of how many part-time jobs the US service industry has added, there is a far greater problem currently developing in the world: "We now have 80% of the world posting a contraction in industrial activity." This is the second worst since the great financial crisis and only matched by last fall, when in response Europe launched a $1.3 trillion LTRO and the Fed commenced Operation Twist. Now except the occasional rate drop out of the PBOC or modest QE expansion out of the BOE (not to mention the Bank of Kenya's rate cut earlier), there is no real, unsterilized flow of money coming from central bank CTRL-P macros to stabilize the global economy. Which leaves open the question: just where will the latest spark to rekindle global growth come from? And no, 10 hours a week waitressing jobs in Topeka just won't cut it.
International football transfer numbers and and player buying fees have fallen sharply worldwide in the past six months, says governing body Fifa.
Completed player deals fell by 9% in the first six months of 2012, but their total financial value plunged by more than a third, falling by 34%.
Total income from 4,973 transfers around the globe was $576m (£371m).
International Monetary Fund (IMF) chief Christine Lagarde has said that the organisation's next forecast for global economic growth would be down from the 3.5% predicted in April.
She also hailed EU leaders' efforts to solve the debt crisis.
She said "significant steps" had been taken, but further reforms and strong implementation were needed.
(Reuters) - U.S. employers hired at a dismal pace in June, raising pressure on the Federal Reserve to do more to boost the economy and further imperilling President Barack Obama's chances of re-election in November. The Labour Department said on Friday non-farm payrolls expanded by just 80,000 jobs in June, falling short of forecasts though a tad higher than a revised May reading of 77,000.
Job creation during the month wasn't enough to bring down the country's lofty 8.2 percent unemployment rate.
The report appeared sure to fuel concerns that Europe's debt crisis is shifting the U.S. economy into low gear. "There's just not a lot of momentum in the economy," said Sam Bullard, an economist at Wells Fargo & Co in Charlotte, North Carolina.
Mitt Romney, Obama's Republican challenger, is focusing his campaign on the weak jobs market that has dogged Obama's presidency.
The details of the report were also unsettling. The government said the economy created 1,000 fewer jobs during April and May than previously estimated.
The sombre report might push the Federal Reserve closer to taking new actions to lower borrowing costs to encourage companies to increase hiring. Analysts polled by Reuters expected an increase in payrolls of 90,000 jobs.
Debt woes have bogged down much of Europe, sending some countries into recession. The euro zone crisis in turn has dulled economic growth around the world from China to Brazil. A survey on Monday found U.S. manufacturing contracted for the first time in nearly three years in June.
Europe is not the only worry weighing on the U.S. outlook. Washington plans enough belt-tightening at the start of 2013 to easily send the economy into recession. Cautious observers wonder if lawmakers can avoid this "fiscal cliff."
"Firms are saying, 'Is there really a reason to ramp up hiring right now?'," said Bullard.
Job creation averaged 75,000 per month during the second quarter, compared with an average increase of 226,000 in the first quarter. Part of the slowdown could be because mild weather led companies to boost hiring in the winter at spring's expense.
But recent weakness in everything from retail sales to business sentiment suggests something more fundamental is at play. ....
Here's the key: Once I looked at the charts I generate, I had to look three times to make sure I hadn't picked up wrong numbers in my tables. +80k should be a negative print in terms of month-over-month change as that is fewer than the 189,000 new entrants to the workforce.
But it wasn't -- 475,000 more people were working (unadjusted) this month than last.
The bottom line? It's just plain old not as bad as it appears from the "headline"
Since the seasonal adjustments have been called into question by just about everyone lately, let's take a look at the non-seasonally adjusted numbers from this report. The June Establishment Survey showed job creation (NSA) of 391,000, which means the seasonal adjustment subtracted 311,000 jobs from the NSA number. Also of note is that private sector NSA job creation for June was 815,000, while NSA government jobs posted a loss of 424,000 jobs for the month.
(Reuters) - China, the euro zone and Britain loosened monetary policy in the space of less than an hour on Thursday, signalling a growing level of alarm about the world economy, although suggestions of coordinated action were played down.
Of the three, the surprise move was from Beijing which lowered its lending rate by 31 basis points to 6 percent following an interest rate cut just a month ago that also came out of the blue.
The European Central Bank cut rates to a record low 0.75 percent following a dire run of economic data. But it steered clear of bolder moves such as reviving its government bond-buying programme or flooding banks with more long-term liquidity.
Still, a Reuters poll found the ECB is expected to follow the rate cut with more steps to help the region's economy in coming months.
The Bank of England, whose rates are already at a record low 0.5 percent, said it would restart its printing presses and buy 50 billion pounds ($78 billion) of assets with newly created money to help the economy out of recession. "It is a surprise that they are moving so quickly. It shows that policymakers' concerns about the global economy have only grown," Mark Williams, an economist at Capital Economics in London, said of the People's Bank of China's action.
A raft of Chinese data is due next week, including second-quarter gross domestic product that officials may know to be poor, he said. But they may also be trying to foster suggestions of acting in concert.
"Policymakers may have felt that cutting rates on the day that the ECB (did) the same would deliver a bigger impact, encouraging talk of a coordinated response to the slowdown in the global economy," Williams said. "Again, though, this might simply underline the seriousness of the downside risks."
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