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quinta-feira, 27 de setembro de 2012

Obama touts 'economic patriotism' in new ad

KEN THOMASWESTERVILLE, Ohio -- President Barack Obama is pitching a broad economic argument to voters ahead of next week's debate with Republican opponent Mitt Romney, buying TV time in seven battleground states to promote what he calls a "new economic patriotism."

In a two-minute ad, Obama looks into the camera as he promotes an economic plan he says will create 1 million manufacturing jobs, cut oil imports and hire thousands of new teachers.

The ad set to air in New Hampshire, Virginia, Florida, Ohio, Iowa, Nevada and Colorado comes as Obama and Republican Mitt Romney shadow each other while looking for votes in a closely contested race. On Thursday, the two candidates are scheduled to campaign in the same state for the third straight day, this time in Virginia, a critical battleground in the Nov. 6 election.

Romney is to appear in suburban Washington for a veterans event, while Obama speaks to a farm bureau in Virginia Beach.

The simultaneous visits follow an all-day duel Wednesday in Ohio, where Romney declared he can do more than Obama to improve the lives of average people. Obama scoffed that a challenger who calls half the nation "victims" was unlikely to be of much help.

Meanwhile, new Republican-leaning independent groups have entered the presidential advertising fray as polling suggests Romney's campaign may be losing ground against Obama in key states such as Ohio and Florida.

The commercials, aimed at voters who supported Obama in 2008 but are now undecided, join those from the campaigns and outside groups swamping a narrow and possibly shrinking map of competitive states in the fast-moving presidential contest. Americans for Job Security launched an $8.7 million ad buy in six battleground states, while the Ending Spending Action Fund, a new conservative group bankrolled by billionaire Joe Ricketts, was set to debut a $10 million, four-state ad campaign on Thursday.

Polls show Obama widening his lead in several key states amid backlash from a leaked video in which Romney disparages the 47 percent of Americans who don't pay federal income tax as government-dependent Obama supporters who see themselves as victims and won't take responsibility for their own lives.

Obama's campaign was reveling in the latest public polling but trying to crush any sense of overconfidence. "If we need to pass out horse blinders to all of our staff, we will do that," campaign spokeswoman Jen Psaki said Wednesday.

Romney went after working-class voters at three stops in Ohio, while Obama rallied college crowds at Bowling Green and Kent State. Early voting in Ohio begins next week.

"If President Obama were to be re-elected, what you'd see is four more years like the last four years, and we can't afford another four more years like the last four years," Romney told a boisterous crowd in Toledo at the day's final stop.

Romney said the country had lost more than half a million manufacturing jobs in the past four years. "This is not the path we want for America," he said.

Romney's campaign has been reeling from his caught-on-video comments at a Florida fundraiser last May. New opinion polls, conducted after the video became public last week, show Obama opening up apparent leads over Romney in battleground states, including Ohio and Virginia.

Romney told ABC News that the race was in a statistical tie in some national polls.

"I'm very pleased with some polls, less so with other polls, but frankly at this early stage, polls go up, polls go down," he said.

Obama was not about to let the video comments fade away. He said Wednesday that "America is not about what can be done for us. It's about what can be done by us together, as one nation, as one people."

He added, "You can't make it happen if you write off half the nation before you take office."

Obama flubbed a line at Kent State while building to his argument for keeping jobs in the United States. He mistakenly said, "I want to see us export more jobs." He quickly corrected himself, saying he meant to say "export more products."

"Excuse me," Obama said. "I was a channeling my opponent there for a second."

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Associated Press writers Kasie Hunt and Steve Peoples in Ohio, Beth Fouhy in New York and Ben Feller and Jim Kuhnhenn in Washington contributed to this report.

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quinta-feira, 21 de junho de 2012

Fed projects lower economic growth for 2012

by MARTIN CRUTSINGERWASHINGTON -- The Federal Reserve has sharply lowered its outlook for U.S. economic growth and doesn't expect the unemployment rate to fall much further this year.

In an updated forecast, the Fed says it expects the economy will grow no faster than 2.4 percent this year. That's much slower than the Fed's April forecast, which projected growth as fast as 2.9 percent. And it is not much better than the 1.9 percent annual pace from the first three months of the year.

The Fed also predicts the unemployment rate will fall no lower than 8 percent by the end of the year. It currently stands at 8.2 percent. In April, the Fed said the rate could be as low as 7.8 percent at year's end.

The central bank is forecasting lower inflation. At its highest, it expects inflation to rise 1.7 percent this year, well below its 2 percent target. The decline is largely because of a steep drop in gas prices.

Most economic reports since the Fed's last meeting have pointed to a sharp slowdown in the economy. Job growth averaged only 73,000 in April and May, after average gains of 226,000 per month in the first three months of the year.

The number of people seeking unemployment benefits has risen about 5 percent in the past six weeks, and employers posted sharply fewer job openings in April compared to the previous month.

With job growth weaker and the unemployment rate still high, consumers have pulled back on spending. Retail sales have fallen for the past two months. Part of that is due to falling gas costs, but even excluding gas stations, spending barely rose in May and fell in April.

Businesses also appear to be less confident about the economy's health. They are placing fewer orders at factories, which has slowed manufacturing output. A measure of companies' investment spending has dropped for two straight months.

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sábado, 28 de abril de 2012

Economic growth slows in the first quarter

by CHRISTOPHER S. RUGABERWASHINGTON -- The U.S. economy grew more slowly in the first three months of this year. Governments spent less, and businesses cut back on investment. But consumers spent at the fastest pace in more than a year.

The result suggests that the economy will continue to expand, slowly but steadily.

The Commerce Department estimated Friday that the economy grew at an annual rate of 2.2 percent in the January-March quarter, compared with a 3 percent rate in the final quarter of 2011. But growth is expected to rebound to around 3 percent for all of 2012 as stronger job growth spurs more consumer spending.

Consumer spending accelerated to an annual rate of 2.9 percent in the first quarter. The strength came from a second robust quarter of growth in auto purchases.

Here's what The Associated Press' reporters are finding:

A GLASS HALF-FULL

Is the weaker first-quarter growth worth worrying about?

Not according to Sung Won Sohn, an economics professor at the Smith School of Business at California State University. He thinks the economy will be boosted this year by a more confident consumer as hiring grows and business investment strengthens.

Sohn expects growth this year of 2.5 percent, better than last year's 1.7 percent.

"The economy is firmly on a growth trajectory," Sohn says. "The first-quarter slowdown will be temporary."

SPENDING WARMS UP...

A warm winter probably pulled some consumer spending into the January-March quarter that would normally have occurred this quarter. Auto sales, for example, accounted for nearly 30 percent of growth last quarter. Many car buyers probably came out earlier than usual.

Without autos, growth would have been about 1.5 percent.

"The second quarter won't have the advantage of unseasonably warm weather that likely goosed auto sales," says Beata Caranci, deputy chief economist at TD Economics.

... ON THE OTHER HAND

The warmer weather also sapped strength from the economy: Americans spent less on utilities from January through March for a second straight quarter.

That reduced growth.

Perhaps a hot summer will add to growth later this year as Americans crank up their air conditioners.

WEAK GROWTH, WEAK HIRING

How weak was the economy's 2.2 percent growth rate from January through March? It depends.

A growth rate of 2.5 percent or higher is good when the economy is healthy. But not at a time of high unemployment.

With 12.7 million people unemployed, today's economy needs much faster growth to boost hiring. Growth would have to be roughly 4 percent for a full year to lower the unemployment rate, now 8.2 percent, by 1 percentage point.

U.S. ECONOMY STILL TOPS

Even when growth is tepid, as it was last quarter, the dollar figure for the U.S. economy exceeds that of any other country's.

Adjusted for inflation and seasonal factors, first-quarter output weighed in at an annual rate of $13.5 trillion.

At its lowest point during the Great Recession, the figure was $12.6 trillion.

The size of the world's second-largest economy, China's, is roughly $11.3 trillion.

A DIFFERENT GAUGE OF GROWTH

The drop from a 3 percent growth rate in the October-December quarter to 2.2 percent last quarter partly reflected a slower pace of restocking by businesses.

Such inventory building had contributed more than half the growth in the final three months of 2011. But last quarter, it contributed less than one-third.

Many economists exclude inventories to better gauge the economy's underlying strength. By that measure, the output of goods and services grew at an annual rate of 1.6 percent last quarter - up from a 1.1 percent increase in the fourth quarter.

PRESSURE ON CONGRESS

There may be a bright side to the weaker-than-expected growth in the January-March quarter: It could push Congress to reach a budget deal before the end of the year.

Otherwise, automatic tax increases and spending cuts scheduled to start Jan. 1 would send the nation over a "fiscal cliff" and drastically weaken economic growth, according to Bank of America.

"Lawmakers need a reminder that they must reduce the fiscal drag," says Ryan Sweet, senior economist at Moody's Analytics.

SAVING LESS OF WHAT WE EARN

The increase in consumer spending comes with a caveat: People spent more in part because they socked away less.

After-tax income grew at an annual rate of 2.8 percent from January through March. That was about the same pace as in the final three months of last year.

But over the same period, the savings rate fell to 3.9 percent of after-tax income, down from 4.5 percent.

Economists worry that people won't keep spending more unless their income grows.

HOUSING PERKING UP

One surprising bright spot in the first quarter's data: housing.

Spending on home construction and renovations rose by the most in nearly two years. Some of that gain was likely fueled by the warm winter. Many construction projects are usually put on hold when building sites are covered with snow and ice. That didn't happen so much this winter.

Housing is expected to contribute to growth this year for the first time since 2005.

FIRST DRAFT OF HISTORY

Friday's GDP report is just the initial estimate for first-quarter economic output. As is customary, the government will update its estimate in May and June.

And then in July, the first-quarter numbers will be tweaked yet again. That's when the government will revise its estimates of growth from 2009 through the first quarter of this year.

Last year, figures on incomes and saving were revised to show that Americans earned and saved more than previously estimated. Some economists think the current numbers on savings and income will also be revised higher later this year.

BETTER THAN OVERSEAS

As disappointing as the first-quarter numbers were, the U.S. economy still looks a lot stronger than most of the rest of the developed world. It's expected to grow at least 2.5 percent for the full year.

By contrast, Britain's economy will only grow 0.8 percent and Japan's about 2 percent, according to forecasts from the International Monetary Fund. Things are even worse in Europe. The 17 countries that use the euro as their currency are expected to see growth shrink 0.3 percent.

"Growth is an increasingly rare commodity in the global economy, but the US has got it," says Jason Conibear of Cambridge Mercantile, which specializes in trading currencies.

NOT FAST ENOUGH

This was the 11th quarter since the Great Recession officially ended in June 2009. The fastest rate of economic growth has been 3.9 percent in the first quarter of 2010. Normally, a much bigger bounce would follow a deep recession like the one the United States sank into in December 2007.

When the economy emerged from the recession of 1981-1982, for instance, growth hit an 8 percent annual pace for four straight quarters in 1983 and 1984.

THE WEIGHT OF GOVERNMENT

Government spending cuts are weighing on the U.S. economy in a way that hasn't been seen in generations. Those cuts have reduced growth for six straight quarters - the longest stretch since 1955.

Reduced government spending subtracted 0.6 percentage point from the first quarter's growth.

That drag may ease the rest of this year. Defense spending fell sharply in the past two quarters, which isn't likely to continue. And state tax revenue is recovering, closing budget gaps.

"It's hard for the economy to accelerate when the government has its foot on the brake," said Joel Naroff, president of Naroff Economic Advisors.

WILL FED INTERVENE?

The Federal Reserve might have to rethink its forecasts and its policies, economists say. One economist thinks the Fed is now more likely to pursue a third round of bond purchases to try to push down long-term interest rates to stimulate the economy.

It's "back on the table," says Bernard Baumohl of the Economic Outlook Group.

WHY IT MATTERS

The U.S. gross domestic product is the bedrock of the economy. It measures the output of all goods and services produced in the United States, from cars to electricity to manicures. GDP growth drives job creation, pay, corporate profits and stock prices.

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AP Economics Writer Martin Crutsinger contributed to this report.

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quarta-feira, 11 de janeiro de 2012

Pope says economic crisis cause for reflection

Eyewitness NewsVATICAN CITY -- Pope Benedict XVI said Monday that solutions to the global financial crisis must allow all to lead dignified lives.

The pontiff noted that the crisis has spread from the developed world, where it started, to developing countries, where it is having a "profound impact" on life.

"We must not lose heart, but instead resolutely rediscover our way through new forms of commitment," Benedict said. "The crisis can and must be an incentive to reflect on human existence and on the importance of its ethical dimension."

Solutions should do more than stem financial losses, and also aim to ensure "all can lead a dignified life," Benedict said, speaking to an annual gathering of the diplomats representing their countries at the Holy See. The Vatican has diplomatic relations with 179 nations.

Benedict said economic disparity had provoked last year's protests seeking reform that have swept North Africa and Middle East, noting that it was difficult at the moment "to understand fully the consequences for the stability of the region."

"Initial optimism has yielded to an acknowledgment of the difficulties of this moment of transition and change," the pontiff said, calling for an end to violence and for putting respect for individuals at the center of institutions and laws.

The pope also expressed concern for people in countries where violence continues. He said he was praying for a rapid end to bloodshed in Syria and a speedy start of political dialogue "encouraged by the presence of independent observers."

The pope also recalled the "numerous victims" of religiously motivated terrorism, especially in Asia and Africa. He cited the assassination last spring of Pakistan's sole Christian government minister and a Christmas Day explosion in a Catholic church during Mass near Nigeria's capital, killing at least 15.

Taking up a theme he espoused last fall at a communal peace meeting in Assisi, Benedict emphasized that such violence was the antithesis of religion. "Religion cannot be employed as a pretext for setting aside the rules of justice and of law for the sake of the intended 'good,' " Benedict said.

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segunda-feira, 5 de dezembro de 2011

Obama to give economic talk in historic Kan. town

Eyewitness NewsOSAWATOMIE, Kan. -- President Barack Obama plans to head to the Republican stronghold of Kansas next week to deliver an economic speech about how he considers this a "make-or-break moment" for the middle class, the White House announced Saturday.

Obama is scheduled to speak Tuesday at the high school in Osawatomie, the city where a century ago, former President Teddy Roosevelt delivered a speech calling for a "New Nationalism."

Roosevelt's speech, given after he left the White House, extolled the government's role in promoting social justice and regulating the economy to help the underprivileged. He criticized some fellow Republicans for refusing to tackle the economic power of the wealthy.

Obama will "lay out the choice we face between a country in which too few do well while too many struggle to get by, and one where we're all in it together - where everyone engages in fair play, everyone does their fair share, and everyone gets a fair shot," the White House said.

In 2010, Republicans won every statewide and congressional office on the ballot in Kansas. Gov. Sam Brownback, who took office in January, is a GOP conservative. Kansas also has voted for every Republican presidential nominee since 1964, including Obama's 2008 opponent, Arizona Sen. John McCain. Obama's 42 percent of the vote, however, was the best showing by any Democratic nominee in 20 years.

Amanda Adkins, chair of the Kansas Republican Party, said in an email that Kansas residents "expect clarity on a path to job creation, competitiveness and effectiveness," and that it's being delivered by Brownback.

Joan Wagnon, chairwoman of the Kansas Democratic Party, said Obama's message would likely resonate in the state and she planned to attend the speech in Osawatomie, a town of about 4,400 residents some 50 miles southwest of Kansas City.

"I think Kansans are very concerned about the deepening divide between the wealthy and those that are not," Wagnon said.

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