The number of buyers who agreed to purchase previously occupied homes fell sharply in November, an indication that sales will fall this winter, undermining last summer’s recovery. The National Association of Realtors says its seasonally adjusted index of sales agreements fell 16 per cent from October to a November reading of 96. It was the first decline following nine straight months of gains and the lowest reading since June. The drop was far larger than the two per cent expected from economists surveyed by Thomson Reuters. The report shows that consumers are taking their time following the extension of a tax credit deadline. The incentive of up to $8,000 for first-time buyers was set to expire at the end of November. But Congress pushed back the date and expanded the program.
Orders to U.S. factories posted a surprisingly big gain in November, reflecting strong demand in a number of industries from steel and industrial machinery to computers and chemicals. The advance was double what had been expected and provided further evidence that manufacturers are beginning to pull out of their steep slump. The Commerce Department said that orders rose by 1.1 per cent in November, much better than the 0.5 per cent increase economists had forecast. The increases were widespread outside of autos and aircraft, which posted declines.
General Motors says its December sales were down ten per cent and off 33 per cent for 2009, a year that saw the top U.S. automaker go through bankruptcy court and industry sales drop to the worst level in nearly 30 years. The troubled automaker faltered even as Ford reported a 33 per cent sales jump last month and a 15 per cent decline for the year. Chrysler sales slipped four per cent in December but it suffered through its worst sales year since 1962. Nissan sales climbed 18 per cent for the month but fell 19 per cent for the year. GM and Chrysler are trying to recover from summertime stints in Chapter 11 and bad publicity over taking government aid. Ford says car sales were up 25 per cent year-over-year, and sales of the Expedition are at the highest volume in 16 months.
A research group says job satisfaction is the lowest its been since the group began studying it 22 years ago. The Conference Board says only 45 per cent of Americans say they’re satisfied with their work. That’s down from 49 per cent in 2008, and 61 per cent in 1987. The deep recession gets part of the blame, because it’s become harder for some people to find challenging and suitable jobs. Another reason is that fewer people find their jobs interesting. Also, worker incomes have not kept up with inflation, and the soaring cost of health insurance keeps eating into take-home pay. The Conference Board says the report “says something troubling about work in America.” Economists warn that lower job satisfaction could stifle innovation, thus hurting competitiveness and productivity.
A new federal analysis says the recession dramatically slowed U.S. health care spending in 2008. But, it still grew at a faster pace than the economy as a whole, accounting for more than 16.2 per cent of the nation’s economic output, up from 15.9 per cent in 2007. Economists at the government’s Centers for Medicare and Medicaid Services says spending totaled $2.3 trillion in 2008–nearly $7,700 per person. A top official at the center says health care spending as a portion of the overall economy is “rising at an unsustainable rate.” He says the report, which appears in the journal Health Affairs, means the U.S. needs a health care overhaul. Health care experts, however, question whether Democratic overhaul bills will do enough to contain costs. GOP Representative Dave Camp says the legislation would just make the problem worse.
Pilgrim’s Pride is cutting 230 corporate and administrative jobs just over a week after the chicken producer emerged from bankruptcy protection. The Pittsburg, Texas-based company is now owned by the U.S. unit of Brazilian beef giant JBS. Pilgrim’s Pride says 160 jobs are being cut at its headquarters or in nearby Mt. Pleasant, Texas. Others are in a dozen other places, including Atlanta and Dallas. Pilgrim’s Pride says it will offer severance and placement assistance. The company says the cuts won’t affect production or operations. Pilgrim’s Pride is looking to consolidate corporate functions at JBS USA headquarters in Greeley, Colorado. The companies expect to have final consolidation plans in three to six months.
Continental Airlines reports a December load factor of 83 per cent. That’s 3.1 per cent above the same month the previous year. The Houston-based airline recorded an on-time arrival rate of 70.7 per cent.
Noble Energy is expanding its domestic onshore field by buying Rocky Mountain energy assets in a $494 million deal with Suncor Energy, according to Bloomberg. Noble also plans to spend about $1 billion a year on new projects in the Gulf of Mexico and off the coast of Israel and West Africa.
An Iraqi government spokesman says the cabinet has approved a deal with a consortium led by Royal Dutch Shell to develop the Majnoon field in southern Iraq. Shell and its partner, Malaysia’s state-run Petronas, won the rights to develop the 12.5 billion barrel field during Iraq’s second postwar bidding round for 15 oil fields last month. The consortium plans to raise production at Majnoon from the current 45,900 barrels per day to 1.8 million barrels per day over ten years. They will be paid $1.39 per barrel produced. Iraq’s government spokesman, Ali al-Dabbagh, said that the cabinet also approved three smaller deals–two with the Angolan national oil company Sonangol and another including Petronas and Japan’s Japex consortium.
Interest rates are falling on the bond market as investors snap up government debt following a drop in the number of home sales. The drop in existing home sales for November caused concerns that the economy could give up some of the improvements it has been making. A cautious tone in the stock market Tuesday also stoked demand for the safety of treasuries. Bond yields were falling as their prices rose. The yield on the ten-year treasury note, which is linked to interest rates on mortgages and other consumer loans, is down to 3.83 per cent from 3.84 per cent late Thursday. Markets were closed Friday. Its price rose 3/32 to 96 10/32. In other trading, the yield of the 30-year bond is up to 4.65 per cent from 4.63 per cent, while its price fell 6/32 to 96 12/32. The yield on the two-year note is down to 1.08 per cent from 1.15 per cent Friday. Its price rose 4/32 to 99 27/32. The yield on the three-month t-bill rose to 0.09 per cent from 0.05 per cent. Its discount rate was 0.04 per cent.
The Department of Labor is asking for public input about its online job resources Web sites through January 15th. All job search and career sites participating in the “Tools for America’s Job Seekers Challenge” have agreed to allow job seekers free access during this phase, when they enter the sites through this link http://www.dol.gov/challenge.
Microsoft will sell four versions of the forthcoming Office 2010 software for prices ranging from $99 to $499. Microsoft will sell office home and student edition with four core programs–Word, Excel, PowerPoint and OneNote–for $149 as boxed software. A “product key card,” which has a code to unlock one copy of Office 2010 pre-loaded on new PCs, costs $119. Microsoft will sell an education-only version, Office Professional Academic, through campus book stores and some retailers for $99. There are also two versions meant to serve for business needs. The Outlook e-mail program will be part of both packages, which will go for $297 or $499 as boxed software. The software is due out in June.