Sales of previously occupied homes rose last month after a dismal summer but remain well short of healthy levels. The National Association of Realtors says sales grew ten percent in September to a seasonally adjusted annual rate of 4.53 million. They were still down 19 percent from the same month a year earlier. August's results were revised downward slightly. High unemployment, tight credit and the prospect of future declines in home prices have kept people from buying homes. Plus, the prospect of lawsuits from former homeowners claiming that banks made errors when seizing their homes is making some consumers fearful about buying foreclosed properties. The median sale price was $171,700, down 2.4 percent from the same month year ago.
A top banking regulator says a wave of lawsuits from troubled borrowers who lost their homes to foreclosure could hurt the already-ailing housing market. Sheila Bair, chairman of the Federal Deposit Insurance Corporation, says litigation by the affected homeowners “could ultimately be very damaging to our housing markets” because it could keep people from buying foreclosed homes. Bair says her agency is working closely with other federal regulators to determine whether mortgage companies used flawed documents to seize homes. She says eventually a “global solution” will be needed. It could involve mortgage companies assigning priorities to foreclosures and possibly allowing them to proceed if properties are vacant.
Federal Reserve Chairman Ben Bernanke says federal banking regulators are examining whether mortgage companies cut corners on their own procedures when they moved to foreclose on people's homes. Bernanke says preliminary results of the in-depth review are expected to be released next month. Bernanke announced that the examination is under way in remarks prepared for a housing-finance conference in Arlington, Virginia. The Fed chief's remarks come as attorneys general in all 50 states plus the District of Columbia are jointly investigating whether mortgage companies improperly evicted people from their homes. They are looking into whether paperwork and legal procedures were handled properly.
A new survey finds that forecasters have lowered their expectations about the pace of the economic recovery. The economy is still expected to grow, but the National Association for Business Economics survey being finds that economists have become more cautious in the third quarter. Fifty-four percent expect growth of more than two percent in 2010, down from 67 percent in a similar survey last quarter. Demand and profit margins continued to grow in the quarter. The survey showed better margins for the services, goods-producing, finance, insurance and real estate businesses. Margins stagnated in the transportation, utilities, information and communications industries. Fewer firms expect a drop in employment through attrition or layoffs. The majority of those surveyed said employment would hold at current levels.
A new survey finds the average price of regular gasoline in the United States has jumped 5.23 cents in the last two weeks. The Lundberg survey of fuel prices says the price of a gallon of regular is $2.82. Analyst Trilby Lundberg says the average price for a gallon of mid-grade was $2.96, and premium was at $3.07. St. Louis had the lowest average price among cities surveyed at $2.59 a gallon for regular. San Francisco was highest among surveyed cities at $3.16. Diesel was at $3.12, up nearly three cents. In California, the average price for a gallon of regular was $3.11, up nearly ten cents. With San Francisco the highest, Fresno had the state's least expensive gas at $3.05 a gallon.
A federal panel investigating the Gulf of Mexico oil spill is getting 60 extra days to complete its report partly because more time is needed to do forensic testing. A key piece of evidence--the blowout preventer that failed to stop BP's well from gushing into the sea--was lifted from the ocean floor on September 4th and later taken to a NASA facility in New Orleans. But the testing has been held up because of how long it has taken to develop protocols and get input from interested parties. The deadline for the joint U.S. Coast Guard-Bureau of Ocean Energy Management, Regulation and Enforcement investigative panel's report has been extended from January 27th to March 27th. The panel's final public hearing is set for the week of January 24th.
BP Chief Executive Bob Dudley has reassured British business leaders that the company has the financial strength to shoulder the costs of the Gulf of Mexico oil spill. Giving his first address at an external event since taking the reins at BP earlier this month, Dudley was both apologetic for the Gulf disaster and determined that the company will regain international trust. Dudley says that he has spent “much of the last few weeks” traveling the world to visit BP's partners, receiving “strong support.” He says BP's underlying operational and financial performance “is sound” thanks to its wide geographical reach. He also stresses the company has no intention of walking away from the United States in spite of its current problems there.
BP says it has sold its stake in four mature oil and gas fields in the Gulf of Mexico to Marubeni Oil and Gas for $650 million. The oil company has been selling assets to raise cash to pay for the damage caused by the disastrous Gulf oil spill. BP had acquired the four fields in March when it bought a range of assets in the Gulf, Brazil and Azerbaijan from Devon Energy in a $7 billion deal.
New medium- and heavy-duty trucks will have to cut fuel consumption and emissions by ten to 20 percent under first-ever standards announced by the Obama administration. For the first time, the Environmental Protection Agency and the Transportation Department say that work trucks, school buses, long-haul trucks and more will need to get more miles to the gallon than they do today. Big rig trucks will see the greatest change: they'll be required to decrease fuel consumption and emissions by 20 percent in 2018. Other vehicles will see reductions in fuel consumption and emissions of ten to 15 percent. The new standards were required under provisions of a 2007 energy law and will cover vehicles sold in the 2014 model year and extending to the 2018 model year.
Circulation is still dropping at U.S. newspapers. Figures released by the Audit Bureau of Circulations show average daily circulation fell five percent in the April-September period, compared with the same period a year earlier. The latest decline was not as steep as the 8.7 percent drop seen in the previous reporting period, which ran from October 2009 through March of this year. Sunday circulation fell 4.5 percent in the April-September period. That smaller than the 6.5 percent decline in the six months before that. Several trends factor in the decline. There's the rise of free news on the web. And publishers have been looking to offset losses in advertising revenue by raising newsstand and subscription prices. Some newspapers have reduced delivery to unprofitable areas.