The government says the number of newly laid-off workers filing initial claims for jobless benefits fell sharply last week, largely due to changes in the timing of auto industry layoffs. The Labor Department says the number of first-time jobless claims plummeted by 52,000 to a seasonally adjusted 565,000, the lowest level since early January. That's significantly below analysts' expectations of 605,000. But a department analyst says the drop is mostly due to technical factors. Auto layoffs that normally take place in early July, as factories are retooled to build the next year's models, happened in the spring as General Motors and Chrysler implemented sweeping restructuring plans. Continuing jobless claims, meanwhile, jumped to 6.88 million, a new record high.
Wholesale inventories fell for a ninth consecutive month in May as businesses struggle to trim stockpiles amid the longest recession since World War II. The Commerce Department says inventories dipped 0.8 per cent in May, slightly smaller than the one per cent decline economists had expected. Sales at the wholesale level posted a 0.2 per cent rise in May, better than the expected flat reading. It was the best showing for sales since a similar rise in February.
Many retailers are reporting sharp sales declines for June, as rainy weather and escalating job worries kept consumers from buying summer staples like shorts and dresses. As merchants report their monthly figures, the sales weakness appears to cut across all sectors, particularly apparel merchants. Among the biggest early disappointments are results from teen merchant Wet Seal, the Children's Place and Stage Stores. Even low-priced club operator Costco Wholesale is reporting a same-store sales decline from a year ago, when business was helped by stimulus rebate checks.
Discount retailer Target says its same-store sales fell 6.2 percent in June as customers continued to shop sparingly and spend mainly on necessities such as healthcare products and food. Still, the Minneapolis-based company says it expects to meet or exceed analyst expectations for second-quarter profit. Total sales for the month fell three per cent to $5.69 billion. Year-to-date, Target's same-store sales fell 4.7 per cent and total sales edged down less than one per cent to $24.51 billion. Same-Store sales, or sales at stores open at least a year, are considered a key gauge of retailer performance because they measure growth from existing stores rather than newly opened ones.
J. C. Penney today announced its June same-store sales fell 8.2 per cent, but the numbers beat the expectations of analysts. The Plano-based department store chain also narrowed its loss estimate for the second quarter. Analysts polled by Thomson Reuters had expected same-store sales to fall 9.3 per cent. Sales results were better in the southwest and worse in the southeast.
Leaders from the five fastest developing market economies joined the G8 for meetings. Brazil, China, India, Mexico and South Africa--the so-called Group of Five--discussed climate change, development aid, the economy and international trade with their G8 counterparts. The G5, along with special invitee Egypt, issued a statement saying they're concerned about the state of the global economy, which they say "submits the developing countries to an inordinate burden resulting from a crisis they did not initiate."' They're calling for greater inclusion in international decision-making, noting members' positive contributions to tackling global challenges. Germany and France have been particularly vocal that the G8 needs to be expanded to better represent the world's population and economies.
Abu Dhabi's national oil company says it has signed a deal with ConocoPhillips to extract natural gas in the Persian Gulf emirate. The two companies will split development costs on the project, which was first announced as an interim agreement last year. ADNOC says it will have a 60 per cent stake in the project, while Houston-based ConocoPhillips will retain the rest. The onshore Shah field contains sour gas, which costs more to produce because it contains high levels of the toxic compound hydrogen sulfide. ADNOC says the facility will produce 540 million cubic feet of gas per day. The project includes construction of a natural gas processing plant, natural gas and liquid pipelines and sulfur-exporting facilities.
The Shriners wrapped up their annual meeting in San Antonio. For 87 years, the group has provided free care to children without billing insurance providers. But the recession has hammered the Shriners' endowment, and they considered closing six of their 22 hospitals to slow the financial bleed. In preliminary votes, the Shriners refused to close the hospitals but agreed to begin seeking payment from insurance providers. The board of trustees had proposed the closure of the hospitals in Shreveport, Louisiana; Greenville, South Carolina; Erie, Pennsylvania; Spokane, Washington; Springfield, Massachusetts; and Galveston, eliminating a total of 225 beds.
The Harris County Toll Road Authority says construction of the final segment of the Sam Houston Tollway begins this week. The 13-mile stretch in the northeast quadrant will connect U.S. Highway 59 North with U.S. 90 East—completing the 75-mile loop with three lanes in each direction.
Fort Worth-based Bell Helicopter and United Auto Workers Local 218 resumed negotiations for the second time since nearly 2,500 manufacturing workers went on strike nearly a month ago. Their meeting last week was the first since union members voted to go on strike June 14th. That was after they rejected a three-year contract because of proposed increases in medical costs and plans to outsource janitors' work. Since then Bell Helicopter Textron has brought in about 1,000 temporary workers. But another union approved its three-year contract with Bell last month. The UAW's Local 317 represents 340 office and clerical workers at Bell plants in the Dallas and Fort Worth area.
Health care activists planned rallies in Dallas, San Antonio and Austin as the national health care debate heats up in Congress. Activists had rallies scheduled outside the offices of both U.S. Senators from Texas, Kay Bailey Hutchison and John Cornyn. Representatives of Moveon.org are presenting petitions to the lawmakers asking them to support President Barack Obama's health care plan. The activists want what they call a strong public health insurance option.
Texas' hot summer weather is leading to record electricity use. The Electric Reliability Council of Texas said it set a new record Wednesday afternoon as consumers used an hourly average of 62,786 megawatts of power between 4 and 5 p.m. that broke the record of 62,339 megawatts set on August 17th, 2006. A megawatt is enough electricity to power about 200 average homes during hot summer weather. ERCOT is the electric grid operator for much of the state. Austin set a record Wednesday with a high of 106 at Camp Mabry, breaking the record of 105 set in 1939. The high of 105 at Austin Bergstrom International Airport broke the record of 102 set in 1956.
Projects in some of the nation's poorest areas don't appear to be getting a fair shake in the spending of $787 billion in stimulus funds. The Obama administration intended for the stimulus to jump-start the economy, build new schools and usher in an era of education reform. But government auditors said many states are setting aside grand plans in order to stay afloat. The government accountability office says the stimulus is keeping teachers off the unemployment lines, helping states make greater Medicaid payments and providing a desperately needed cushion to state budgets. But investigators found repeated examples in which states favored short-term spending over long-term efforts such as education reform.
The Department of Housing and Urban Development says the number of homeless remained steady between October 2007 and September 2008. But, more families and more people from the suburbs and rural communities found themselves among their ranks. HUD says the number of families within the about 1.6 million homeless grew by nine per cent. And officials say demand for transitional housing in the suburbs and rural areas grew from about a quarter to a third of those in need. A scaled down count to try and capture the effects of the economic meltdown on homelessness showed a slight uptick in people entering homeless shelters from January to March.
The lead Democrat steering an immigration overhaul through the U.S. Senate says he expects to have a bill ready by Labor Day. Senator Chuck Schumer of New York tells the Associated Press that the bill is more generous to highly skilled immigrant workers than those who are lower skilled. He says it's also tough on future waves of illegal immigration. Schumer says an immigration bill can be done by the end of the year or early next year that works out disagreements between labor and business interests on the flow of legal foreign workers. Earlier today, Homeland Security Secretary Janet Napolitano said beginning September 8th, businesses wanting federal contracts would have to use e-verify. That's a Web-based system used to check whether employees are legally working in the United States. The Bush and Obama administrations had delayed implementing the rule.
A Federal Reserve official says the central bank is paying extra attention to banks' books as losses from sour commercial real estate loans keep mounting. Jon D. Greenlee, associate director of the Fed's Division of Banking Supervision, says in remarks prepared for a Congressional hearing that the central bank has stepped up training of its bank examiners so they are ready to deal with rising losses from the commercial real estate industry. "We have devoted significantly more resources to assessing the quality of regulated institutions' (commercial real estate) portfolios," Greenlee said.
North Texas Tollway Authority officials may raise the speed limits on the Dallas North Tollway and Bush Turnpike to match the speed most people are already driving. Rick Herrington, NTTA deputy executive director, said the maximum on most sections of the two roads would go to 70 miles per hour. The limit on the Dallas North Tollway from Trinity Mills Road toward downtown would go from 55 miles per hour to 65 miles per hour. Herrington tells the Dallas Morning News that a speed study that is nearing completion shows 85 per cent of motorists already drive the higher speeds. And he says it is safer if everyone is going the same speed. The NTTA board is expected to consider the higher limits next month. The higher speed limits would go into effect September 1st.
Federal prosecutors say two of 12 people accused of defrauding the government of thousands of dollars in unemployment benefits have pleaded guilty to mail fraud charges. The U.S. Attorney's Office says 29-year-old Annie Jean Rogers of Pittsburg and 24-year-old Shaneka Lasha Baker-Adams of Longview entered their pleas in East Texas. Both women face up to 20 years in prison. The women admitted using fake last employers and employment information to claim unemployment benefits. Prosecutors said the scheme operated in the camp county area and involved ten others who were charged. In all, authorities say the 12 defendants obtained tens of thousand of dollars.
An investigation is under way into a fire that killed one person at a waste management company in Houston. The Harris County Medical Examiner's Office said the victim died Wednesday. Officials said the man was burned Tuesday when he was inspecting a tanker and a lantern ignited residual ethanol in the tanker at CES Environmental Services.
OPEC says demand for its crude has fallen so sharply because of the world recession that it will take another four years to recover to 2008 levels. The forecast is one of several in OPEC's annual report on oil supply and demand outlook to 2030 that reflects how the global recession has crimped the world's appetite for energy. The report says the world will need 87.9 million barrels of crude a day by 2013--down nearly six million barrels from previous forecasts. The cartel would need to produce 31 million barrels a day for its share compared with a daily 31.2 million barrels last year.
Although these tough economic times have Americans cutting back their spending, consumers are not giving up their summer favorites. In a poll conducted for Chase Card Services, many people said they plan to trim spending in some areas. But they also said they'll spend significantly on things like new barbecue grills, pool memberships, golf clubs and regular vacations. The cuts will come in areas such as lawn care and doing repair jobs around the house themselves rather than hiring a handyman. The survey by Braun Research also found: 15 per cent said they were planning to cut back on summer activities such as summer camp or little league, while four times as many said they would not; 29 per cent said they were skipping a typical summer vacation or lengthy outing and 49 per cent said they were not; 28 percent said they were planning a vacation closer to home to cut costs.
Ticketmaster and Priceline.com say they will team up in order to give the ticket seller's online customers access to various travel services. Terms were not disclosed. The partnership allows Ticketmaster, a unit of Ticketmaster Entertainment, to provide customers various hotel, airline and rental car offers from Priceline.com. The collaboration essentially gives the approximately 20 per cent to 30 per cent of Ticketmaster's online customers that travel to events out of town a one-stop shopping experience as they can buy tickets to an event and plan their travel arrangements on one Web site.