Employers in U.S. Announce Most Job Cuts in Eight Months
– Employers in the U.S. announced plans in November to cut 48,711 jobs, the most in eight months, as government agencies trimmed payrolls. “Job cuts that have been concentrated at the state and local level could expand to include federal workers in the new year,” John A. Challenger, chief executive officer of Challenger, Gray & Christmas, said in a statement. “Other sectors have seen significant declines in job cuts this year and, at the moment, there is little evidence of a possible resurgence in 2011.” Today’s report also showed that employers announced plans in November to hire 26,012 workers, down from 124,766 the prior month. Retail businesses led the gains, planning to add 15,900 workers. Government and non-profit agencies have announced plans to let go of 138,979 workers this year, which is 177 percent more than the 50,168 firings by the pharmaceutical industry, the next biggest job cutter, according to Challenger.
As The Euro Goes The Way Of The Dodo, Where Does That Leave The Dollar?
– The Eurozone is heading for a crash—anyone saying otherwise is either stoned, works in Brussels, or hasn’t checked the European bond market action lately: All hell is breaking loose there. And if, as I have argued here
, the Irish Parliament decides not
to pass the austerity budget next December 7—that is, decides not
to take the European Central Bank bailout—then hell is going to break out in Europe just in time for Christmas: Satan and Santa Claus just might be squaring off on the Rue Belliard before year’s end. Therefore, the smart money starts thinking about what’s going to happen after
the euro-crisis-climax happens. In other words, what’s going to happen to the dollar, once the euro goes the way of the dodo. First, we have to understand how we got here, in order to figure out what’s going to happen next.
U.S. Senate Approves Biggest Food-Safety Overhaul in 70 Years – The biggest U.S. food-safety overhaul in more than 70 years won Senate passage as lawmakers sought to curb food-borne illnesses that cost the nation an estimated $152 billion a year. The U.S. Food and Drug Administration would gain more power to police food companies under the bill that passed today in a 73-25 vote. The measure, backed by the food industry, public- health groups and consumer advocates, adds inspections and lets the FDA force recalls, rather than relying on companies to voluntarily remove contaminated foods from store shelves.
Wayne Co. imposes 20% wage cuts on workers
– Wayne County Executive Robert Ficano today imposed what amounts to a nearly 20% wage reduction on 1,400 employees in the county’s largest union after two years of failed negotiations. Employees’ checks will be reduced 10% for not accepting wage cuts for the last budget year and an additional 10% for the 2010-11 budget. “Our efforts have been tireless, and unfortunately, it’s painfully clear this action must be taken due to the fiscal reality we’re all living in,” Ficano said. “These decisions are neither easy, nor taken lightly. We’ve continued to act in good faith throughout this process, which included rescinding layoffs, hoping proposed concessions would be accepted by the membership. Unfortunately, time and time again, they were not, and we’re left with a disappointing and devastating situation.”
Retailers Nov Sales Show Strong Start To The Holidays
– According to 27 retailers tracked by Thomson Reuters, sales at stores opened more than a year rose 6% in November, above the estimated growth of 3.6% and the year-ago gain of 0.6%. Many retailers started the holiday season early in November, blitzing shoppers with promotions because of concerns that the still-uncertain economy would hold them back. "Retailers’ game plan was aggressive promotions throughout the month," said John Long, retail strategist at Kurt Salmon Associates. "The results we are seeing are not solely the contribution of Black Friday sales." Black Friday is the retail nickname for the day after Thanksgiving. The strong early start has prompted some to wonder if the consumer will continue to spend throughout the holiday season. The National Retail Federation projects holiday sales will rise 2.3% this year after a 0.4% gain in 2009 and a 3.9% drop in 2008.
Pending Home Sales Rebound 10.4% in October – An index that measures the number of contracts to buy previously owned homes in the U.S. rose 10.4% in October month-over-month to a reading of 80.9. The index remains 20.5% lower than year-earlier levels. October 2009 saw the highest level of pending home sales since May 2006 when it hit a reading of 112.6. Economists had expected the data to be flat after a 1.8% downtick in September. September’s rate of pending home sales came in worse than expected and was 24.9% lower than in the year-earlier month. Pending home sales are viewed as an indicator of future home sales. "It is welcoming to see a solid double-digit percentage gain, but activity needs to improve further to reach healthy, sustainable levels."
German bond issue undersubscribed: Bundesbank — A German five-year bond issue on Wednesday was undersubscribed, figures released by the central bank showed, the second time in two weeks that a German debt issue has gone uncovered. Last week, an issue of 10-year German bonds, the eurozone benchmark, also met with offers for less than was available, amid heightened market tensions stemming from the Irish debt crisis. This time, the agency which manages Germany’s sovereign debt received offers for just 4.55 billion euros (5.96 billion dollars) after tendering bonds worth a total five billion euros, the central bank data showed
Fed could launch third round of printing money, warns economist – The US Federal Reserve may have to embark on a third round of printing money next year, a leading Wall Street economist has warned. Alan Levenson, chief economist at T Rowe Price, the investment management firm, said he did not expect the second round of quantitative easing to have a significant impact on the American economy. As a result, and with unemployment and the rate of inflation wide of the Fed’s targets, he said it was possible that a third round of monetary easing — QE3 — would be launched. "The unemployment rate is unacceptably high for the Fed, and inflation is way too low," Mr Levenson said. "If unemployment remains at 9pc next year and inflation stays at 1pc, when QE2 runs out in the middle of next year, then, judging by the Fed’s thought processes, we’ll get QE3. I wouldn’t rule it out."
IMF Expects to Double Its Lending Capacity – The International Monetary Fund expects to double its lending capacity to $450 billion over the next few months, giving it additional firepower to deal with the sovereign-debt crisis engulfing Europe, according to IMF officials and documents. Whether that will be sufficient depends on how deeply the problem spreads. The IMF currently has $202 billion in basic resources and an additional $41 billion it can tap in times of acute international financial distress, for a total of $243 billion, according to IMF financial documents. But that is less than the amount that the euro zone is now counting on the IMF to provide for troubled European countries.
Rising Medicaid costs mean service cuts likely –
Indiana lawmakers likely will cut some Medicaid
-provided services in the upcoming legislative session after learning Wednesday that the state’s share of government health insurance program costs will balloon by $1.1 billion over the next two years unless checked. The federal government pays about two-thirds of Indiana’s Medicaid costs, but human services chief Michael Gargano told the State Budget Committee that the state’s share has been growing by more than 10 percent each year. He said that’s because the recession has made more people eligible for Medicaid, which serves those who are needy and disabled. Gargano, secretary of the Indiana Family and Social Services Administration, asked for an additional $900 million in state Medicaid funds over the two-year period starting next July 1. He recommended the General Assembly rein in the costs by cutting some optional services the state currently provides.
Federal Reserve Data Disclose Big Loans To Financial Organizations
– Federal Reserve data provide listed details of more than 12,000 transactions made between December 2007 and July 2010. The data include short-term liquidity measures for financial institutions, liquidity injections directly to borrowers and investors in key credit markets and big financial help to many organizations. The Federal Reserve data disclose the enormous financial help provided to various banks and companies. . Let’s see the list of emergency programs reported by the Fed run during the financial Crisis.
- Term Auction Facility (TAF): Run in December 2007 to provide relief to strained bank funding markets.
- Primary Dealer Credit Facility (PDCF): Created in March 2008, offering funds to primary dealers aimed to support overall financial markets.
- Term Securities Lending Facility (TSLF): The TSLF issued Treasury securities to certain investment firms for one month on account of pledged collateral.
- Central bank liquidity swaps: The Fed signed agreements with 14 central banks across the world to maintain liquidity in U.S. dollars in foreign markets.
- Commercial Paper Funding Facility (CPFF): Meant for commercial paper market.
- The Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility (AMLF): Aimed to boost asset-backed commercial paper market.
- Money Market Investor Funding Facility (MMIFF): Created to restore liquidity in the money markets.
- Term Asset-Backed Securities Loan Facility (TALF): Designed to revive the asset-backed securities market.