On Wednesday January 19, 2011, 5:59 pm EST
2010 ends as 2nd worst year
for home construction
WASHINGTON (AP) -- U.S.
homebuilders are coming off their two worst years in more than a half-century,
and the outlook for this year is only slightly better.
Economists say it could
take three more years before the industry begins building homes at a healthy
rate. In the mean time, the housing downturn is dragging on the broader
economy, with one-quarter of the jobs lost since the recession began in the
construction field.
Builders normally help lead
the economy out of a recession. Construction projects fuel growth and that
leads to more hiring.
But a year and a half after
the recession officially ended, builders are struggling to compete in markets
flooded with unsold homes -- many of them foreclosures that are depressing
prices.
Homebuilders broke ground
on a total of 587,600 homes in 2010, just slightly better than the 554,000
started in 2009, the Commerce Department reported Wednesday Those are the
lowest annual totals on records dating back to 1959.
Obama: Chinese currency
still undervalued
WASHINGTON (AP) --
President Barack Obama says he has told Chinese President Hu Jintao that
China's currency is still undervalued.
Speaking alongside Hu at a
White House news conference Wednesday, Obama said that while some steps have
been taken to make the yuan market-based, progress has not come fast enough.
The U.S. and other
countries charge that China keeps its currency artificially low in order to
maintain an export advantage.
Obama says a market-based
yuan would not only increase U.S. exports to China, but would also help Hu
reach his goal of increasing domestic demand.
Banks say fewer consumer
loans are going bad
NEW YORK (AP) -- Americans
are starting to get their household finances in order.
In an encouraging round of
earnings reports, major banks say fewer mortgages are going bad, credit card
defaults are down and more people are paying the bills on time.
One of the nation's largest
consumer lenders, Wells Fargo, said Wednesday that 29 percent fewer loans went
bad in the last three months of 2010 than the year before. And late payments on
loans considered likely to default declined for the first time since 2008.
Late payments on credit
cards issued by Bank of America, JPMorgan Chase and Citigroup also improved at
a record pace at the end of last year, according to an analysis by Barclays
Capital.
The reports are a sign that
Americans are feeling more comfortable about their finances. Personal spending
powers about 70 percent of the U.S. economy, and most economists say a fiscally
fit consumer is critical to a strong economic recovery.
Goldman earnings fall 53
percent in fourth quarter
NEW YORK (AP) -- Goldman
Sachs' earnings fell 53 percent in the fourth quarter due to sharp declines in
its bond trading and investment banking businesses.
Goldman Sachs Group Inc.
earned $2.23 billion after paying preferred dividends in the last three months
of the year, down from $4.79 billion in the same period year earlier. On a
per-share basis, the earnings came out to $3.79 per share versus $8.20 per
share.
Goldman reported drops in
all its key businesses. In the fourth quarter, its revenues from financial
advisory services fell 7 percent from last year as mergers and acquisitions
declined. Goldman also led fewer debt and stock underwriting deals, leading to
a 12 percent drop in revenue in that business.
In a troubling sign, the
bank said its backlog of investment banking transactions decreased. That suggests
revenues from advising companies on deals might not pick up in the first
quarter of 2011.
China agrees to purchase
$45B in US exports
WASHINGTON (AP) -- Seeking
to build ties with an economic rival, the White House said Wednesday that China
would purchase $45 billion in U.S. exports, including a highly sought-after $19
billion deal for 200 Boeing airplanes.
The announcement came as
Chinese President Hu Jintao arrived at the White House for a state visit with
President Barack Obama. The deals could soothe some concerns from the U.S.
government and corporate America, both of which contend that China keeps its
currency artificially low in order to make Chinese products cheaper in the U.S.
and U.S. products costlier in China.
Obama and Hu met Wednesday
with U.S. and Chinese business leaders, including some involved in the new
export deals.
Hu told the executives that
he welcomed U.S. companies to do business in China, and said his country is
speeding up its economic restructuring and trying to increase domestic
consumption. Increased Chinese demand for goods is a prime U.S. concern because
it could help reduce a U.S.-China trade gap.
In addition to the Boeing
deal, China will also invest in U.S. exports from agriculture,
telecommunications and technology companies, including General Electric,
Honeywell and Navistar. The White House said the deals will support up to
235,000 jobs in the U.S. Executives from Boeing and General Electric were among
the business leaders who will meet with Obama and Hu at the White House.
British recovery failing to
create jobs
LONDON (AP) -- Britain's
unemployment rate remained at 7.9 percent in November, an official report said
Wednesday, evidence the economic recovery is not yet strong enough to create
jobs.
The number of unemployed
people in fact rose by 49,000 in the three months to November to a total 2.5
million, the Office for National Statistics said.
The number of people
claiming unemployment benefits fell by 4,100 in December to 1.46 million.
Portugal sees high demand,
lower cost in debt sale
LISBON, Portugal (AP) --
Debt-stressed Portugal raised euro750 million ($1 billion) in a Treasury bill
sale on Wednesday, with a lower interest rate and high demand reflecting an
easing in tension about the country's financial woes.
The results boosted market
confidence, even though many analysts expect Portugal to eventually seek a
bailout, like Greece and Ireland, despite the government's insistence it
doesn't need help.
The debt agency said the
yield on the 12-month bills was 4.03 percent, down sharply from 5.28 percent on
the same bills last month. Demand was three times the amount on offer.
The country has experienced
no difficulty raising money so far, despite concern about its debt load and
meager growth. Portugal needs to raise up to euro20 billion from financial
markets this year.
The fall in the cost of
Portugal's funding was more good news for the minority government, which is
scrambling to get the country's finances back on an even keel amid nervousness
about the wider eurozone's fiscal soundness.
EBay 4Q revenue rises,
helped by holiday shoppers
SAN FRANCISCO (AP) -- EBay
Inc. said Wednesday that its fourth-quarter revenue rose, as the healthy
holiday shopping season bolstered growth in its PayPal online payments business
and online marketplace.
The company's profit fell,
since the year-ago quarter included a large gain from the sale of Internet
communications business Skype. Excluding special items such as the Skype gain,
eBay's fourth-quarter profit shot up 24 percent.
For the quarter that ended
Dec. 31, the online marketplace operator's revenue rose 5 percent from the
year-ago quarter to $2.50 billion.
Analysts polled by FactSet
expected $2.48 billion in revenue, on average.
By The Associated Press
The Dow Jones industrial
average lost 12.64 points, or 0.1 percent, to 11,825.29.
The Standard and Poor's 500
fell 13.1, or 1 percent, to 1,281.92. It was the biggest percentage drop in the
benchmark index since Nov. 23.
The Nasdaq composite fell
40.49, or 1.5 percent, to 2,725.36.
Benchmark oil for March
delivery lost 50 cents to settle at $91.81 a barrel on the New York Mercantile
Exchange.
In other Nymex trading in
February contracts, heating oil rose 1.03 cents to settle at $2.6562 a gallon,
and gasoline gained 0.24 cent to settle at $2.4816 a gallon.
In London, Brent crude rose
36 cents to settle at $98.16 a barrel on the ICE Futures exchange.