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Purveyor's Journal
Purveyor's Journal
December 5, 2013

Bitcoin Boom Spreads to IPhones With Mobile-Payment Apps

Matt Tuzzolo, who used to split restaurant bills by sending money via PayPal, now wields his iPhone to pay his fellow diners -- in Bitcoins.

“It’s more convenient than PayPal,” said Tuzzolo, a software developer in Portland, Oregon, who uses the Gliph mobile application to transfer digital money on the go. “It’s as easy as sending a text.”

Gliph Inc., which has more than 25,000 users, has raised more than $350,000 from venture capitalists including Tim Draper, who has backed such companies as Skype and Tesla Motors Inc. It’s one of hundreds of Bitcoin-related programs available from Google Inc. (GOOG) and Apple Inc. (AAPL) app stores.

The mini-boom in Bitcoin software for smartphones is making it easier for consumers to use the virtual currency in place of cash for quick transactions, such as paying for food or splitting a bill. The widening appeal of the digital money is also fueling a rally that has lifted Bitcoins to record levels, surpassing $1,000 apiece last week.

“Bitcoin’s success hinges on how well it’s adopted and configured for mobile,” said Richard Crone, chief executive officer of payment-researcher Crone Consulting LLC. “They are very dependent on mobile actually scaling.”



December 5, 2013

The Economy Grew 3.6 Percent Last Quarter. Put Way The Champagne.

The U.S. economy grew at a 3.6 percent annual rate in the third quarter, the government now says, much better than the 2.8 percent previously estimated.

That's the kind of number that, if it reflected the true, underlying growth rate of the economy, would be fantastic news. A couple of years of 3 percent to 4 percent growth would go a long way toward ending the long, post-crisis economic malaise that has afflicted the United States. Too bad that's not at all what the details of the new GDP report suggest is going on.

A run-up in private inventories added a whopping 1.68 percentage points to the overall GDP number, the most since 2010, meaning that "final demand" - -the actual purchases and investments in the second quarter -- rose at a sub-2 percent rate, about where it has been for four years and counting. Inventories can grow for good reasons (businesses are more optimistic about the future and want to stock up), or bad reasons (expected demand for goods doesn't materialize, so more stuff is sitting in warehouses and on store shelves), and it's hard to know in real time which is happening.

But what is consistently true is that inventory shifts are onetime affairs. If anything, a run-up in inventories in one quarter predicts an inventory drawdown in the following quarter (since 1947, the correlation between inventories' contribution to GDP with that same number for the subsequent quarter is negative 20 percent). The steep upward revision is already prompting analysts to downgrade their forecasts for growth in the final months of 2013 and the start of 2014.

But there's a bigger story here than the weird blips to GDP being driven by inventories. It's that we keep getting mixed signals on how robust the U.S. economy really is as 2014 approaches. Some recent data have been good. The Institute for Supply Management survey of manufacturers for November indicated the strongest growth in output since the spring of 2011. The number of people filing new claims for jobless benefits has been hitting rock-bottom levels (including only 298,000 last week, the Labor Department said Thursday, though that was dragged downward by seasonal adjustment quirks tied to the late Thanksgiving).



December 5, 2013

US Jobless Claims Plunge To 298k, As Layoffs Slow

Source: Associated Press

WASHINGTON (AP) — The number of Americans applying for unemployment benefits tumbled 23,000 last week to 298,000, nearly a six-year low that shows companies are laying off fewer workers.

The Labor Department said the less volatile four-week moving average declined 10,750 to 322,250.

Last week’s unemployment benefit applications nearly matched a September figure that was distorted by late reporting from California. When excluding the September report, last week’s figures were the lowest since May 2007.

Applications have now fallen in seven of the past eight weeks, a hopeful sign for job growth at the end of the year.

Read more: http://www.boston.com/business/news/2013/12/05/jobless-claims-plunge-layoffs-slow/Kp6oBZsbt7kd5k6b3IaGfO/story.html

December 5, 2013

Angry Self-Insured Voters Dim Democratic Takeover Plans

By John McCormick - Dec 5, 2013

To appreciate why U.S. Representative Scott Peters has twice broken with his Democratic colleagues and voted to roll back parts of Obamacare, it’s helpful to know that his San Diego-area district is teeming with voters who have reasons to be angry about the law.

The district has one of the nation’s highest proportions of residents who get health insurance through individual policies, instead of from an employer, and many have learned their policies are being canceled because they don’t comply with the Patient Protection and Affordable Care Act.

Walter Niles is one of them. The self-employed biotechnology consultant with a doctorate in neuroscience was notified in September that his policy was being canceled. The coverage offered through Covered California, his state’s new insurance exchange, has left him unsatisfied.

“I’m paying more and getting less,” said Niles, 59, who leans Republican yet also says he voted twice for President Barack Obama. “It is fundamentally a worse plan.”

The political predicament for Peters, who was elected in 2012 with 51 percent of the vote, illustrates the complicated path ahead for Democrats as they approach the 2014 midterms amid a debilitating Obamacare rollout. Democrats need to gain a net of 17 seats to retake House control, and holding such swing seats as California’s 52nd District are vital to their mission.



December 4, 2013

Obama Cites Pope Francis To Attack Income Inequality And Call For Minimum Wage Increase

Conservatives angered by Pope Francis’ recent attacks on capitalism and wealth inequality aren’t going to like hearing President Barack Obama’s approval of them.

The president said Wednesday that growing income inequality had “frayed” the basic bargain at the heart of the U.S. economy during an event sponsored by the Center for American Progress, a liberal think tank with close ties to the White House.

“Some of you may have seen just last week the pope himself spoke about this at eloquent length,” Obama said. “’How can it be,’ he wrote, ‘that it’s not a news item when an elderly homeless person dies of exposure, but it is news when the stock market loses two points.’ But this increasing inequality is most pronounced in our country. And it challenges the very essence of who we are as a people.”

The president noted that the American economy had doubled in size since 1979, but most of that growth has been restricted to a “fortunate few.”

“The 10 percent no longer takes in one-third of our income, it now takes half,” Obama said. “Whereas in the past the average CEO made about 20 to 30 times the income of the average worker, today’s CEO now makes 273 times more, and meanwhile a family in the top 1 percent has a net worth of 288 times higher than the typical family, which is a record for this country.”



December 4, 2013

Putin Backs Amnesty Proposal That Could Free Pussy Riot Members From Russian Labor Camps

By Agence France-Presse
Wednesday, December 4, 2013 12:51 EST

Russian President Vladimir Putin on Wednesday said he backed proposals for an amnesty for thousands of prisoners who, according to his rights advisor, could include ex-tycoon Mikhail Khodorkovsky and the Pussy Riot punks.

“I agree… that such actions must be pacifying, must emphasise the humanity of our state,” Putin said in televised comments.

The amnesty could free up to 100,000 prisoners, said Mikhail Fedotov, the head of the presidential rights council, an independent advisory body, cited by RIA Novosti news agency.

Fedotov told journalists the amnesty could apply to former oligarch Mikhail Khodorkovsky and the two jailed members of punk band Pussy Riot, who held a protest against Putin in a Moscow cathedral.

“I think that yes of course,” Fedotov said, when asked if it could apply to Pussy Riot. “After all that was not a violent crime.”



December 4, 2013

Companies Boost U.S. Payrolls by Most in a Year

By Jeanna Smialek - Dec 4, 2013

Companies boosted payrolls in November by the most in a year, a sign that U.S. employers were optimistic about demand after the end of a government shutdown a month earlier, a private report based on payrolls showed today.

The 215,000 increase in employment exceeded the most optimistic forecast in a Bloomberg survey and followed a revised 184,000 gain in October that was larger than initially estimated, according to the ADP Research Institute in Roseland, New Jersey. The median forecast of economists called for a 170,000 advance.

Stronger job growth helps provide working Americans with the income gains needed to boost consumer spending at the same time retailers seek to spur holiday sales with discounted merchandise. Federal Reserve policy makers are watching labor-market progress as they debate when to scale back record monetary stimulus.

“Not only is the job market healthy, but it’s improving going into year-end,” said Brian Jones, senior U.S. economist at Societe Generale in New York, whose forecast for a 210,000 gain was the highest in the Bloomberg survey. “We’re optimistic on growth next year, continued improvement, further reductions in the jobless rate.”



December 4, 2013

Services Slowdown Highlights Uneven U.S. Expansion: Economy

By Michelle Jamrisko and Victoria Stilwell - Dec 4, 2013

Services from banking to transportation grew more slowly in November, pointing to a U.S. economy that is making progress in fits and starts heading into the new year.

The Institute for Supply Management’s non-manufacturing index dropped to 53.9 from 55.4 in October, the Tempe, Arizona-based group said today. A gauge above 50 shows expansion among companies that account for almost 90 percent of the economy. Other reports showed company hiring picked up more than projected last month and sales of new houses surged in October.

Gains in employment will probably boost growth next year, helping the U.S. overcome government budget cuts and tax increases that have held back the expansion in 2013. Another report showing exports climbed to a record in October indicates American manufacturers will benefit from a global pickup in demand that will further buttress the expansion.

“This is still a moderate recovery, but the data suggest that the recovery is perhaps a bit stronger than what we saw around the turn of the year,” said Dean Maki, chief U.S. economist in New York for Barclays Plc, who projected the services index would drop. “We do think that 2014 is a better year for U.S. growth.”

The median estimate in a Bloomberg survey of 67 economists projected the ISM index would fall to 55. Forecasts ranged from 53.5 to 57. From July 2009, a month after the last recession ended, through last month, the index has averaged 53.9.

Orders Firm

The November decline was paced by a slowdown in hiring and business activity. The ISM’s new orders gauge for the service industries was little changed, capping its strongest four months since mid-2011.



December 4, 2013

Obama Says Income Disparity a Defining Challenge of Era

By Roger Runningen - Dec 4, 2013

President Barack Obama, setting out a theme that he’ll pursue in the final years of his presidency, said growing income disparity in the U.S. is the “defining challenge or our time” and Washington must confront it.

Upward mobility for middle-income Americans has been stymied by economic changes and government policy, Obama said.

“The basic bargain at the heart of our economy has frayed,” he said in an address in Washington today that echoed a speech he gave two years ago in Osawatomie, Kansas, that set the stage for his 2012 re-election race. Increasing inequality “challenges the very essence of who we are as a people.”

After being bogged down for the past two months by the botched rollout of the Patient Protection and Affordable Care Act, the president offered arguments to press his stalled economic agenda and set a foundation for Democratic Party candidates in the 2014 congressional elections.

Illustrating the political agenda within the speech, Obama challenged Republicans in Congress to offer their own ideas for reducing inequality and providing opportunities for middle-income Americans. He said relying on free markets to solve the nation’s problems isn’t enough.



December 4, 2013

Congress Members Urge McDonald’s CEO to Increase Wages

By Leslie Patton - Dec 4, 2013

Democratic members of the U.S. Congress are urging McDonald’s Corp. (MCD) and other fast-food chains to raise wages for store workers.

“Too many hard-working families are being forced to depend on poverty-level wages,” 53 members of Congress wrote in a letter being mailed today to restaurant executives including McDonald’s Chief Executive Officer Don Thompson. “Paying fair wages and putting more spending money in the hands of consumers will strengthen our economy.”

The letter, signed by representatives including Linda Sanchez, a California Democrat, and Raul Grijalva, an Arizona Democrat, is also being sent to CEOs at Burger King Worldwide Inc., Wendy’s Co., Yum! Brands Inc. (YUM) and Domino’s Pizza Inc.

Tomorrow, fast-food workers plan to strike for $15-an-hour pay in more than 100 cities across the U.S. While the protests for higher wages, which started in New York City last year, have spread across the country, they’ve done little to change an industry that employs millions of low-wage workers.

The strikes and letter coincide with President Barack Obama’s support for a bill pending in Congress that would raise the federal minimum wage to $10.10 an hour from $7.25 an hour and index it to inflation. Some states have higher minimum wages than the federal level.



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