U.S. Consumer Confidence Ticks up in February

WASHINGTON (AP) -- A surprisingly optimistic outlook among younger Americans and a higher stock market pushed up a measure of U.S. consumer sentiment in February.

The increase was small, but the harsh winter weather appears to have had little effect on Americans' confidence so far. That's a sign that spending might pick up in the coming months.

The University of Michigan's consumer sentiment index ticked up to 81.6 in February from 81.2 in January. It's still slightly below December's figure.

"While the weather made trips to the store more difficult, the data suggest that purchases were postponed rather than canceled," the report said. For example, consumers' home-buying plans were largely unchanged.

The survey also found that Americans under age 35 have grown more optimistic that their pay will increase. On average, they expect income gains of 5% over the next 12 months, the survey found. That's the largest expected gain since November 2006.

Richard Curtin, director of the survey, said that is a welcome change for an age group that has been particularly hard hit by the recession and sluggish recovery. Unemployment rates for younger Americans have been much higher than for older workers since the recession ended almost five years ago. And their income gains have been weak. Anecdotes of college graduates living with their parents and working low-wage jobs are widespread.

The Michigan survey's finding provides some hope that such trends might be turning around. In a healthy economy, younger Americans usually anticipate solid income growth as they gain experience and become more productive, Curtin said. Optimism about future income may suggest that more people under 35 are finding jobs and that some who are working are getting promotions, he added.

Still, other surveys haven't found rising optimism among younger people. In an Associated Press-GfK poll in January, just 38% of those under 35 said they expected their financial situation to improve in the coming year, down from around half who said so through most of 2011 and 2012.

Among Americans as a whole, the expectation is that their paychecks will rise just 0.9% in the coming year. While that matches a six-month high reached in January, it's still below the inflation rate and is low by historical standards.

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  • Report this Comment On March 01, 2014, at 9:37 AM, famulla wrote:

    Key lawmakers backed President Obama’s warning to Russia Friday that "there will be costs" for any military intervention in Ukraine, and offered support for sanctions and other measures aimed at deterring Russia from escalating tensions in the region.

    Obama, speaking to reporters at the White House, said that the U.S. government is "deeply concerned" by reports of Russian "military movements" inside Ukraine, warning that any violation of Ukraine's sovereignty would be "deeply destabilizing."

    "There will be costs for any military intervention in Ukraine," he said, without specifying what those costs might be.

    A bipartisan group of 12 members of the Senate Foreign Relations Committee expressed support for U.S. assistance in Ukraine and raised concerns over the Russian government’s “provocative and dangerous tactics” in response to the upheaval in Ukraine.

    “We do not seek confrontation with President (Vladimir) Putin and his government, but simply to ensure that Russia abides by its commitments and adheres to core principles of international law. A peaceful, democratic, stable, and sovereign Ukraine is in our national interest,” the senators wrote.

  • Report this Comment On March 01, 2014, at 9:50 AM, famulla wrote:

    The European Commission has dragged Britain to court for failing to deal with its air pollution.

    The Commission has launched legal proceedings against the UK for its failure to cut excessive levels of nitrogen dioxide, a toxic gas.

    Nitrogen dioxide is the main pre-cursor for ground-level ozone causing major respiratory problems and leading to premature death. City-dwellers are particularly exposed as vehicular pollution is a major source. European legislation had set limits on nitrogen dioxide levels which should have been achieved by January 1, 2010 unless an extension was granted till January 1, 2015.

  • Report this Comment On March 01, 2014, at 10:04 AM, famulla wrote:

    German Chancellor Angela Merkel urged Britain on Thursday to stay in the EU but played down David Cameron's hopes that her visit to London would bring major reforms.

    The British premier rolled out the red carpet in his bid to woo fellow conservative Merkel, who gave a speech to both houses of parliament before taking tea with the queen.

    But Europe's most powerful politician was cool on Cameron's desire to change the EU's treaties ahead of a planned referendum on British membership of the bloc in 2017.

    Merkel said in her speech to parliament that Britain and Germany shared the goal of a "strong and competitive" EU that was a "model for other regions of the world".

    "In order to maintain this goal we need a strong United Kingdom with a strong voice inside the European Union," she said in English, after delivering most of the address in German.

    However she admitted Cameron might be disappointed by her speech to members of the House of Commons and House of the Lords, the first by a German leader since president Richard von Weizsaecker's address in 1986.

  • Report this Comment On March 02, 2014, at 10:05 AM, famulla wrote:

    You need to be uncomfortable and apprehensive: True strategy is about placing bets and making hard choices. The objective is not to eliminate risk but to increase the odds of success.

    —Roger L. Martin, professor and former dean at the University of Toronto’s Rotman School of Management, The Big Lie of Strategic Planning, Harvard Business Review, January-February 2014.

    Every year at Davos, there is one article that gains traction. It is too early to hand out ribbons, but my front-runner is Roger Martin’s jewel in this month’s HBR.

    A corporate sponsor in the Valley of Loro Piana extols Davos Man as Thought Leader. Realists abound after the recent wealth, income, and job destruction. And the realists are in search of a new strategic process for a new-normal recovery. Less GDP; less planning. Davos Man breathes well-tailored success. He also carries an uncomfortable apprehension toward tactical execution of a new and sober set of visions.

    Meanwhile, the political class is in search of riskless outcomes combined with a disregard for success and the recursive good of repeated success. Martin nails the goal of maximizing marginal success while monitoring certain risk.

  • Report this Comment On March 02, 2014, at 10:13 AM, famulla wrote:

    a counter argument sees this as rational behaviour (at last) in a market in which lenders have been anything but imprudent for a decades

    it is behaviour that should be applied to normal 'retail' mortgages too

    a) lending and borrowing in this market are seriously mismatched - long term loans should be backed by matched finance - both in both term and interest type

    b) security valuation is also incorrect - capitalised interest yield should be the norm - as elsewhere - and the result would be a prime mortgage of little more than £50k across most of uk residential property

    if a) and b) don't apply then no institutional investor should deposit a bean with uk banks in this market

  • Report this Comment On March 02, 2014, at 10:15 AM, famulla wrote:

    he new chairman of the Senate Finance Committee, Democrat Ron Wyden of Oregon, has expressed a preference for extending lapsed tax breaks.

    Congressional Republicans, seeking to increase control in the House or possibly win a majority in the Senate, have concluded the budget is a secondary issue.

    House Majority Leader Eric Cantor of Virginia said his party’s election-year focus is on Obamacare, abuse of presidential powers, the middle class squeeze and job creation.

    Maya MacGuineas, president of the Committee for a Responsible Budget, which advocates for smaller deficits, said midterm elections and “the ongoing savagely partisan environment” make progress on the budget unlikely.

    “Politics will trump policy,” MacGuineas said in an e-mail. “This is not a good year to expect hard choices.”

  • Report this Comment On March 02, 2014, at 10:17 AM, famulla wrote:

    Warren Buffett’s investing conglomerate saw record profits in 2013 of $19.5 billion, riding a wave of economic improvement in the United States, the company said in its annual report released Saturday.

    Buffett’s holding company Berkshire Hathaway exceeded analysts’ expectations of $18 billion and saw significant gains over 2012, when it posted net profits of $14.8 billion.

    The company’s stellar performance depends on well-known consumer goods and services that do well in economic boom times, as Buffett chiefly invests in established, large companies like Walmart, General Motors, American Express, and Coca-Cola.

    Buffett’s annual shareholder letter, known for its rustic tone, emphasized his commitment to supporting American companies for the long term.

    “Who has ever benefited during the past 237 years by betting against America? If you compare our country’s present condition to that existing in 1776, you have to rub your eyes in wonder. And the dynamism embedded in our market economy will continue to work its magic,” the so-called “Oracle of Omaha” said in the letter. “America’s best days lie ahead.”

  • Report this Comment On March 02, 2014, at 10:25 AM, famulla wrote:

    Britain has advised all its nationals to leave Crimea immediately by 'all practical means possible'.

    In the light of President Vladimir Putin's request to the Federation Council, Britain summoned the Russian ambassador to the foreign office to register their deep concerns.

    Britain's foreign minister William Hague will visit Ukraine on Sunday to discuss concerns directly with the Ukrainian Government.

    Britain has joined hands with Germany and agreed on the need for international diplomatic action to address the crisis.

    UK supports the proposed emergency meeting of the EU Foreign Affairs Council in Brussels "and we have already called an urgent meeting of the United Nations Security Council for this afternoon in New York", Hague said.

    Hague said, "I will reiterate the UK's support for the territorial integrity of Ukraine. I will also discuss how the UK can support the Ukrainian Government in recovering improperly acquired assets. The EU must agree urgently an asset freezing regime to target those suspected of laundering the proceeds of corruption. On my instructions, the British Embassy in Kiev has told the Ukrainian government that we stand ready to provide Ukraine with technical advice on asset recovery."

  • Report this Comment On March 02, 2014, at 10:27 AM, famulla wrote:

    The London gold fix, the benchmark used by miners, jewellers and central banks to value the metal, may have been manipulated for a decade by the banks setting it, researchers say.

    Unusual trading patterns around 3pm in London, when the so-called afternoon fix is set on a private conference call between five of the biggest gold dealers, are a sign of collusive behaviour and should be investigated, NY University's Stern School of Business professor Rosa Abrantes-Metz and Albert Metz, a managing director at Moody's Investors Service, wrote in a draft research paper.

    "The structure of the benchmark is certainly conducive to collusion and manipulation , and the empirical data are consistent with price artificiality," they say in the report, which hasn't yet been submitted for publication . "It is likely that co-operation between participants may be occurring."

  • Report this Comment On March 02, 2014, at 10:29 AM, famulla wrote:

    The financial industry is perceived to be a monopoly controlled by a few who use their positions to manipulate for personal greed for power and wealth belonging to the country and ordinary citizens. This is world culture.

    This abuse of power exists because of the perceived collusion of the four other parties who include

    [a] Elected politicians who took an oath to serve the people but serve own selves, families, relatives, friends and those to whom they are indebted to.

    [b] The appointed regulators who make laws with that are more in favor of these perceived white collar criminals'

    [c] The enforcers of [weak/biased] laws who are assigned to protect the the citizens but most of the time protect the culprits.

    [d] The Judiciary who are expected to be fair and dispense justice and are the last bastion for protection of the ordinary victims but more often than not fail in their duties and yet demand to be referred to as 'Your Honor' when 'honor' may be suspect.

    Prayers to the Almighty may also not produce justice and fairness as the rich 'donate' more to religious leaders and institutions and thus may have reserved seats in the courts of the Almighty in this mortal world and in the after world.

  • Report this Comment On March 02, 2014, at 10:36 AM, famulla wrote:

    The promise to reduce net migration to the “tens of thousands” was a foolish one for the Conservative Party to make, and so, yesterday, it was proved. David Cameron was warned before the 2010 election that the pledge made no sense, arithmetically, politically or economically. Arithmetically, it made no sense because tens of thousands can be added up to make millions. That problem at least was solved easily, because the Tory leader accepted the implication and stated his intention to bring net migration to below 100,000 a year.

    Politically, the promise made no sense because Mr Cameron was setting a target, despite his insistence in other areas of public policy that “top-down targets” distorted priorities and produced perverse incentives. In this case, he was setting a target that simply could not be delivered. The 100,000-a-year figure is the difference between two large numbers, of immigrants and emigrants – both of them estimates because we do not count people in and out of the country, and neither of them controlled by the Government. He was, therefore, failing the two cardinal rules of politics, the first of which is never to promise what you cannot deliver, and the second of which is always to manage expectations.

    Worse, to the extent that the target figure can be predicted, even if it cannot be controlled, it was always likely to go up by the time of the election. The economy is the main influence on both emigration and immigration. Emigration increased in 2008 and the first half of 2009 as unemployment rose and people sought to improve themselves in other countries. Since then, and as the economy has slowly and fitfully recovered, the number of people leaving has fallen back.

    Interestingly, immigration did not slow down until late 2011. It continued to fall until the middle of last year, since when economic growth has been strong and the number of arrivals started to rise again. Hence yesterday’s figures, for the year to September, which show net annual migration, having fallen to 154,000 the year before, now running at 212,000.

  • Report this Comment On March 02, 2014, at 10:39 AM, famulla wrote:

    CASH IS KING We are on the glide-path to the Budget, now just over two weeks away. This will be the last substantive Budget before the general election next year, for the March 2015 version will really be no more than an election pitch. The opinion polls will tell us whether there is any chance that its proposals will be put into practice. Indeed, given the past form of George Osborne (pictured), expect this one to have a strong political spin to it. But politics don’t change mathematics. The harsh maths that will face the next government, whoever forms it, will be that we are only half way along the path of fiscal consolidation. So, I suggest the best way to see this Budget is less as a statement about the Chancellor’s intentions and more as a template into which the next government will have to fit its plans. We will catch a glimpse of the future. Some figures, rather depressing ones I’m afraid: if you look at the Autumn Statement of 2010, by which time the coalition had taken a decent look at the books, it forecasts that this financial year would see a budget deficit of £60bn. Actually (and allowing for changes in accounting practice) it will be about £111bn. Next financial year, the one that begins next month, the deficit was supposed to be down to £35bn. The most recent Office for Budget Responsibility estimates are that it will be £96bn. The Government inherited a deficit of £148bn. Leave aside the target of a surplus, if you say it had to get the deficit to an acceptable level of say £25bn, it has done less than half the job.

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