By Michelle Jamrisko - Dec 3, 2013
Americans have been holding on to their wobbly washing machines and sagging sofas even longer than their grandparents did 50 years ago, setting the stage for a rebound in consumer spending as old household goods wear out.
The average age of consumer durable goods -- long-lasting items such as furniture, appliances and computers -- is the highest since 1962, according to data from the Bureau of Economic Analysis dating to 1925. Among things Americans are keeping for the longest time: jewelry and wristwatches and home and garden tools like lawnmowers.
Replacement purchases, overdue after the worst recession since the Great Depression, would boost the consumer spending that accounts for 70 percent of the economy. Automobile sales are headed for their best year since 2007, showing Americans have the financial security to buy more expensive items, and economists say that means household-goods sales will pick up.
Such purchases are postpone-able for only so long, said John Silvia, chief economist for Wells Fargo Securities LLC in Charlotte, North Carolina, the biggest U.S. mortgage lender. Increases in home values, along with gains in consumer confidence, incomes and employment from recessionary lows, make people sense its worth putting money back into that house with purchases such as appliances, he said.
Cars and luggage were the only two of 17 categories the BEA tracks that saw a decrease in average age in 2012, according to the data released Nov. 14. The average age of jewelry was 5.3 years, the oldest since 1942, while that of home and garden tools was 5.1 years, the highest since 1961. The categories include products that typically last at least three years.
The city of Detroit today officially became the largest municipality in U.S. history to enter Chapter 9 bankruptcy after U.S. Bankruptcy Judge Steven Rhodes declared it met the specific legal criteria required to receive protection from its creditors.
The landmark ruling ends more than four months of uncertainty over the fate of the case and sets the stage for a fierce clash over how to slash an estimated $18 billion in debt and long-term liabilities that have hampered Detroit from attacking pervasive blight and violent crime.
It is indeed a momentous day, Rhodes said at the end of a 90-minute summary of his ruling. We have here a judicial finding that this once proud city cannot pay its debts. At the same time, it has an opportunity for a fresh start. I hope that everybody associated with the city will recognize that opportunity.
Rhodes in a surprise decision this morning also said hell allow pension cuts in Detroit's bankruptcy. Rhodes emphasized that he wont necessarily agree to pension cuts in the citys final reorganization plan unless the entire plan is fair and equitable.
The plan is expected to include controversial cuts to unsecured creditors and asset sales, including a potential spinoff of the water and sewer department and the possible sale of Detroit Institute of Arts property.
TOKYO (AP) -- U.S. Vice President Joe Biden has opened a weeklong trip to Asia aimed at showing the U.S. is still committed to increasing its engagement and influence in the region.
Biden arrived in Tokyo on Monday evening and was being met by Caroline Kennedy, the new U.S. ambassador to Japan. While in Japan, Biden will meet with Prime Minister Shinzo Abe (shin-zoh ah-bay). He'll also tour a technology company and highlight women's role in Japan's economy.
Later in the week, Biden will meet in China with President Xi Jinping (shee jihn-peeng) amid an international spat over China's new air defense zone.
Biden will wrap up the trip in Seoul, where he'll meet with South Korea's president and prime minister. He'll deliver a speech about U.S.-Korean relations and be briefed on the North Korean nuclear situation.
People have noticed the silence of former Secretary of State and widely presumed 2016 Democratic presidential nominee Hillary Clinton on the Iran nuclear deal negotiated by President Obama and Secretary of State Kerry. Where does she stand? How long can she dodge? And how long can former President Bill Clinton dodge?
It's not like the Clintons have gone into seclusion on public affairs in general or U.S. foreign policy in particular.
The Hill reports that Hillary is urging Congress not to cut U.S. aid to the Afghan government as U.S. forces withdraw from Afghanistan. In early September, Hillary issued a statement supporting President Obama's effort to seek authorization from Congress for bombing Syria. Then she welcomed Russia's proposal that Syria place its chemical weapons under international control.
Neither has Bill been shy about sharing his opinions on public affairs. Just a few weeks ago, Bill told an interviewer that President Obama should "honor the commitment the federal government made" and let people keep insurance policies they have, even if those policies don't meet the coverage standards of the Affordable Care Act. And, notoriously, when the Bush administration was campaigning for the war in Iraq, Bill Clinton backed the Bush administration to the hilt.
Hillary surrogates have tried to defend Hillary's silence on the Iran deal, but if you back the deal and the underlying shift in U.S. foreign policy from war to diplomacy, their arguments are more cause for concern than for reassurance.
Ukraine's PM says he sees "all the signs of a coup" as protests intensify.
2 December 2013 Last updated at 13:34 ET
Mykola Azarov said the government was aware of plans to seize the parliament building in the capital Kiev.
Demonstrators are blockading the main government building, continuing protests against a decision not to sign a deal for closer ties with the EU.
President Viktor Yanukovych has called for only peaceful rallies after violence during a weekend of protests which saw many injured.
President Vladimir Putin of neighbouring Russia said events in Ukraine seemed "more like a pogrom than a revolution."
Read more: http://www.bbc.co.uk/news/world-europe-25192792
By Henry Meyer - Dec 2, 2013
Gay rights activists plan to defy President Vladimir Putin and pressure Olympic sponsors including Coca-Cola Co. (KO) by getting athletes to protest a Russian ban on homosexual propaganda during the Sochi Games.
Athlete Ally, based in New York, said its in talks with Australian snowboarder Belle Brockhoff and Canadian alpine skier Mike Janyk as well as two others about wearing logos referring to the Olympic charter, which bans all forms of discrimination in its sixth principle.
There is a tremendous opportunity because the world is going to be watching, Hudson Taylor, Athlete Allys founder and executive director, said by phone on Nov. 27. The sponsors will have no choice but to respond, Taylor said.
Coca-Cola, the worlds largest beverage company, and McDonalds Corp. (MCD), the biggest global restaurant chain by sales, have already endured protests in the U.S. over their sponsorship of the Sochi Games, as has Procter & Gamble, the worlds largest consumer-products maker.
All Out, a New York-based gay rights group with 1.9 million members around the world, hired trucks in October to circle Coca-Colas headquarters in Atlanta with billboards urging the drink maker to call on Russia to repeal the law signed by Putin in June.
Not long ago, before the financial crisis and the global recession it triggered, economists referred to Americans as the consumers of last resort. When the U.S. grew at a healthy pace, its citizens were buyers, fueling demand for the goods China (CNFREXPY) and other nations produced. They kept the world economy humming.
It may not work that way anymore, Bloomberg Markets magazine will report in its January issue. A rebounding U.S. is giving less support to global growth than in the past. Homegrown demand and production are more important drivers of the worlds biggest economy than they were a decade ago.
The smallest U.S. current-account deficit since 1999 shows the trend, and the discovery of new domestic sources of oil and gas reinforces it. Exploration and production are adding to growth, and the country is spending less on imported energy. Cheaper fuel and raw materials are boosting manufacturing as well, making the U.S. more of a competitor to emerging-markets nations and less a reliable consumer of their goods.
Global growth is slowly becoming more of a zero-sum game, says Manoj Pradhan, emerging-markets economist at Morgan Stanley in London and a former International Monetary Fund official. U.S. growth is not reverting to the pre-crisis model, which created lift for everyone else.
By Alex Barinka - Dec 2, 2013
Cognizant Technology Solutions Corp. (CTSH), one of the largest providers of outsourcing services, plans to hire about 10,000 U.S. workers, potentially soothing concerns that the industry is harming the domestic job market.
The move, which President Gordon Coburn is scheduled to announce at a speech in Texas today, will increase the companys 29,000-employee domestic workforce by about a third over the next three years. The new positions will be full-time jobs in science, technology, engineering and math -- or STEM -- fields.
A legislative battle over immigration reform has put a spotlight on outsourcing providers and their effect on U.S. technology jobs. Companies such as Cognizant and Infosys Ltd. (INFO) often rely on work visas to bring in consultants from overseas, rather than hiring local workers to do the job. In October, Infosys agreed to pay a record fine to the federal government after a probe into its use of visas.
For Cognizant, an improved U.S. economy is making it more feasible to hire full-time workers in the country, Coburn said in an interview. The company has raised its forecast for profit and sales twice this year.
The stabilization of the economy in the U.S. has given our clients more comfort in innovation and investing in growing their own top line, Coburn said. There is clearly long-term demand for skilled technology professionals here in the U.S. We are working hard to identify the talent to meet our clients needs.
By Matt Townsend - Dec 2, 2013
The first spending decline on a Black Friday weekend since 2009 reinforced projections for a lackluster holiday, increasing chances retailers will extend the deep discounts already hurting their profit margins.
Purchases at stores and websites fell 2.9 percent to $57.4 billion during the four days beginning with the Nov. 28 Thanksgiving holiday, according to a survey commissioned by the National Retail Federation. While 141 million people shopped, about 2 million more than last year, the average consumers spending dropped 3.9 percent to $407.02, the survey showed.
The survey results, if borne out at cash registers in American malls and on website checkout screens, herald retailers likely return to Black Friday-type discounts this week and suggest added stress for several chains. Wal-Mart Stores Inc. and Target Corp. already cut profit forecasts after tepid sales gains in back-to-school shopping.
Retailers didnt get what they wanted from Black Friday and they will need to make it up in the next three weeks, Poonam Goyal, an analyst for Bloomberg Industries, said in an interview. There will be some panic sales.
Target fell 0.6 percent to the equivalent of $63.56 in German trading today. Best-Buy Co. slipped 0.6 percent to the equivalent of $40.39, while Wal-Mart was unchanged at $81.01.
By Craig Trudell - Dec 2, 2013
Automakers entered their year-end sales push last month with the most cars and trucks on U.S. dealer lots in eight years, a buildup thats poised to test the industrys newfound pricing discipline.
Inventory climbed to almost 3.4 million cars and light trucks entering November, according to industry data provider WardsAuto. At 76 days supply, that was the highest for the month since 2005.
Carmakers have boosted production to meet demand that has left the industry on pace for the best sales year since 2007. Swelling supply raises the stakes for sales in November after deliveries missed estimates in October and slipped in September for the first time in 27 months. If buyers dont absorb enough inventory, more automakers, including Toyota Motor Corp. and Honda Motor Co., may need to follow Ford Motor Co.s lead by trimming production to avoid margin-slicing discounts.
Ford has chosen the route preferred by analysts such as RBC Capital Markets Joe Spak by scheduling two weeks of downtime for its plant that builds the Focus compact and C-Max hybrid, as well as about one week off for a Fusion sedan factory late this year to trim inventory. Toyota and Honda may need to follow suit with their Camry and Accord sedans and RAV4 and CR-V utility vehicles, Spak wrote in a Nov. 7 report.
Read more: http://www.bloomberg.com/news/2013-12-02/most-autos-on-u-s-lots-since-05-has-ford-leading-cuts.html
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