McCain, Obama release statements on largest monthly US job loss report in 5 years

Statements by Republican John McCain and Democrat Barack Obama on Friday’s jobs report from the Labor Department. In a sign that the economy is hurtling toward a deep recession, employers slashed payrolls by 159,000 in September, the most in more than five years.

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McCain’s Statement:

Today’s report of another 159,000 lost jobs confirms what America’s working men and women have understood for months: Our nation’s economy is on the wrong track. It is imperative that Congress act to address the financial crisis while protecting taxpayers and being good stewards of their dollars. But we must do more.

America’s middle class needs help from a government that is truly standing on their side and not in their way. I am committed to getting to the roots of this crisis — reforming Washington and cleaning up the mess created by the greed and crony capitalism of government-backed mortgage giants — Fannie Mae and Freddie Mac. I will reverse out-of-control spending, end the wasteful and corrupting practice of earmarks, and get the government budget back to balance. I will reform health care to control costs and better serve American families, open markets around the globe for our products, cut taxes, and expand domestic production of energy to eliminate the ability of international oil markets to hold our economy hostage. I will create jobs and get the economy on the right track.

Unlike Sen. Obama, I do not believe we will create one single American job by increasing taxes, going on a massive spending binge, and closing off markets. Our nation cannot afford Sen. Obama’s higher taxes. — John McCain

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Obama’s Statement:

Today, Americans woke up to the sad news that 159,000 jobs were lost last month alone, making September the ninth straight month of job loss. With three-quarters of a million jobs lost this year, and millions of families struggling to pay the bills and stay in their homes, this country can’t afford Sen. McCain’s plan to give America four more years of the same policies that have devastated our middle-class and our economy for the last eight.

Instead of Sen. McCain’s plan to give tax breaks to CEOs and companies that ship jobs overseas, I will rebuild the middle-class and create millions of new jobs by investing in infrastructure and renewable energy that will reduce our dependence on oil from the Middle East. I also call on Congress to pass an immediate rescue plan for our middle-class that will provide tax relief, save 1 million jobs, and save our local communities from harmful budget cuts and painful tax increases. — Barack Obama.

On the Net:

• McCain campaign: http://www.johnmccain.com/
• Obama campaign: http://www.barackobama.com/index.php

U.S. Central Bank commits US taxpayers to foot 100% of $85 billion AIG bailout, despite the company’s INTERNATIONAL existance and importance (read-bailed out at behest of foreign central banks with only US tax payer money!!??)

Click here to read a Great Opinion Piece  (‘The fleecing of America’) concerning America’s new, diminished role as a pauper nation amongst the world’s new “wealth centers” in China, India, Brazil and the Persian Gulf States and about the lack of foreign investment support in helping to save the international conglomerate AIG (billions in U.S. taxpayer dollars spent to save international company????) Written by Roger Cohen, Published in the New York Times on Sunday, the following is an excerpt:

“…But toxic mortgage-backed securities were pedaled by plenty of foreign banks. And the decision to pour $85 billion of U.S. taxpayers’ money into the rescue of American International Group (A.I.G.), the insurance giant, followed appeals from foreign finance ministers to Henry Paulson, the Treasury secretary, to save a global company.

Representative Barney Frank, Democrat of Massachusetts and chairman of the House Financial Services Committee, told me: “Paulson said he was getting calls from finance ministers all around the world saying, you have to save A.I.G. Well, they should have been asked to contribute to the pot.”

Frank has a point. (He should coach Barack Obama on how to put economics in plain language.) As Frank said on “The Charlie Rose Show,” “I don’t think the European Central Bank should be free to spend the Federal Reserve’s money and not put any in.”

I know, you reap what you sow. Nobody’s itching to help the Bush administration. World central banks did inject billions in concerted action to help stabilize money markets. But the U.S. has essentially been on its own. Now foreign banks with U.S. affiliates will want a slice of the $700 billion bailout. That doesn’t make sense until the burden of this rescue starts reflecting a globalized world.

I asked Frank why Paulson and Ben Bernanke, the Federal Reserve chairman, did not get more foreign support. “I think it’s a perverse pride thing,” he said. “We don’t ask for help. We’re the big, strong father figure. But let’s be realistic: we’re no longer the dominant world power.”

It’s time for a responsibility shift. Call it the Hirst reality check. If he can sell a formaldehyde-pickled sheep with gold horns for millions while Lehman goes under, perhaps it’s time for everyone to help a little when Americans get fleeced.”  😦

U.S. Wholesale inflation jumped at more than twice the expected rate, meaning prices have risen at the fastest pace in 27 years over the past 12 months

The following is grim news for people who live in the United States,as reported By TIM PARADIS at  Associated Press on August 19, 2008:

“NEW YORK (AP) — U.S. stocks headed for a sharply lower open Tuesday after a steeper-than-expected jump in wholesale inflation raised fresh concerns about the drag rising prices are having on the economy.

The Labor Department’s Producer Price Index showed inflation pressures faced by companies increased in July at more than double the expected rate, rising 1.2 percent. Wall Street forecast a 0.5 percent increase, according to Thomson/IFR.

The increase means prices have risen in the past 12 months at the fastest pace in 27 years and follows figures released last week showing consumers are also facing rising inflation.

A Commerce Department report on July housing starts, meanwhile, showed that construction of homes and apartments fell to the lowest level in more than 17 years. Starts fell to an annual rate of 965,000 units for July; the figure was higher than the rate of 950,000 units analysts had predicted on average but didn’t appear strong enough to quell investors’ worries about the sector.

The weakness in housing has not only imperiled home builders and suppliers but has left financial companies reeling over how to cope with soured mortgage debt.

Following the reports, Dow Jones industrial average futures fell 106, or 0.92 percent, to 11,393. Standard & Poor’s 500 index futures declined 12.50, or 0.97 percent, to 1,269.80, while Nasdaq 100 index futures fell 16.25, or 0.84 percent, to 1,927.25. Futures weakened after the reports.

Bond prices were down after the economic reports. While investors ordinarily seek the shelter of government debt when bad news arrives, inflation is just as bad for bonds as stocks because it can eat into the more modest returns Treasurys usually show. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.83 percent from 3.82 percent late Monday. The dollar was mixed against other major currencies, while gold prices fell.

The latest readings don’t reflect all of the pullback in oil seen since mid-July. Oil is down more than $30 a barrel since its July 11 peak of $147.27. Light, sweet crude fell 51 cents to $112.36 a barrel in premarket electronic trading on the New York Mercantile Exchange.

Retailers reported mixed quarterly results, adding to investors’ uncertainty about the economy.

Home Depot Inc. reported a 24 percent decline in its second-quarter earnings but topped Wall Street’s expectations. The nation’s largest home improvement retailer reiterated its forecast for the year amid a weak housing market.

Target Corp. said its second-quarter earnings fell 7.5 percent but topped Wall Street’s expectations despite continued weak sales amid a challenging economy.

Saks Inc. is reporting a wider-than-expected loss in the second quarter as its affluent shoppers cut back on apparel amid a slowing economy. The luxury goods retailer also issued a downbeat forecast for the year.”

Consumer prices up 5%, to highest level in 17 years

U.S. Economy: Consumer Prices Up 5%, 17-Year High (Update2)

By Shobhana Chandra and Timothy R. Homan

July 16 (Bloomberg) — U.S. consumer prices surged 5 percent in the past year, the biggest jump since 1991, just as households struggled with falling home values and the credit crunch.

Spiraling expenses for food and fuel spurred the increase in June, the Labor Department said today in Washington. The cost of living rose 1.1 percent from May, more than forecast and the second-largest rise since 1982. Separate figures showed industrial production rose more than estimated because of the end of a strike at American Axle & Manufacturing Holdings Inc. and increased electricity output.

Price gains accelerated last month even after stripping out energy and food, underscoring the challenge for Federal Reserve Chairman Ben S. Bernanke as he attempts to steer the economy through the slowdown and credit crisis. Treasuries fell.

“This is a problem for the economy; it’s even worse for the Fed,” said Joel Naroff, president of Naroff Economic Advisors Inc. in Holland, Pennsylvania. “Inflation numbers are high enough that under different circumstances the Fed would be hiking rates.”

Excluding food and energy, so-called core costs climbed 0.3 percent in June from the previous month and 2.4 percent from a year before.

Yields Jump

Benchmark 10-year note yields rose to 3.93 percent at 4:20 p.m. in New York, from 3.82 percent late yesterday. The Standard & Poor’s 500 Stock Index advanced 2.5 percent to close at 1,245.36, after earnings from Wells Fargo & Co. topped analysts’ estimates.

Consumer prices were forecast to rise 0.7 percent, according to the median estimate of 79 economists in a Bloomberg News survey. Projections ranged from gains of 0.2 percent to 1.1 percent. Costs excluding food and energy were forecast to rise 0.2 percent, the survey showed.

Bernanke told lawmakers in semiannual testimony on the economy yesterday and today that inflation risks have “intensified.” At the same time, he dropped his June assessment that risks to the economic expansion had diminished, indicating policy makers aren’t ready to raise interest rates to contain expenses.

“We don’t think they’re going to raise rates now — until June next year now is our forecast — until basically the economy starts to get some footing,” Beth Ann Bovino, senior economist at Standard & Poor’s in New York, said in an interview with Bloomberg Radio. “Right now the beast is what’s going to happen with the economy.”

Exceeding Forecasts

Prices were forecast to climb 4.5 percent in June from a year earlier, according to the survey median.

A separate report today said confidence among U.S. homebuilders dropped to 16 this month, a record low. Readings for current sales, expected sales and buyer traffic in the National Association of Homebuilders/Wells Fargo sentiment index also were at all-time lows.

“The magnitude of the housing bubble was unprecedented, and the corrective process promises to be a long and painful one,” Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York, said in a note to clients.

The Fed said today that production at factories, mines and utilities increased 0.5 percent last month after dropping 0.2 percent in May. Capacity utilization, which measures the proportion of plants in use, rose to 79.9 percent from 79.6 percent.

Strike’s Resolution

The resolution of a three-month strike by General Motors Corp.’s largest axle supplier, American Axle, probably helped lift auto output. Excluding autos, factory output fell 0.1 percent for a second month.

Wholesale costs rose 1.8 percent in June, the most in seven months, the Labor Department reported yesterday. From a year ago, prices climbed 9.2 percent, the biggest surge since 1981.

Companies, unable to fully recover ballooning raw-material costs by raising prices, have cut staff and reduced equipment purchases as profits shrink.

Kimberly-Clark Corp., the maker of Huggies diapers and Scott paper towels, said earnings for this year will trail its previous forecast as expenses rise more than twice as fast as predicted,

“Inflation has outpaced our ability to offset higher costs in the near term through price increases, cost reductions and other measures,” Thomas Falk, the Dallas-based company’s chief executive officer, said this week in a statement.

Price Increase

Procter & Gamble Co., the maker of Tide detergent and Head & Shoulders shampoo, last week said it’ll raise prices as much as 16 percent due to higher costs for plastic, energy and paper. The increases start in September and are the Cincinnati-based company’s steepest in at least 18 months.

Energy expenses jumped 6.6 percent, the biggest gain since November. Gasoline soared 10.1 percent and fuel oil jumped 10.4 percent.

The cost of fuel will continue stoking price pressures. Crude oil futures reached a record $147.27 a barrel on July 11 and have risen almost 90 percent in the past year. Regular gasoline, which topped $4 a gallon for the first time in June, kept rising this month, AAA figures show.

The consumer price index is Labor’s broadest gauge of costs. Almost 60 percent of the CPI covers prices consumers pay for services ranging from medical visits to airline fares and movie tickets.

Food Expenses

Food prices, which account for about a fifth of the CPI, increased 0.8 percent, driven by the biggest gain in the cost of vegetables in almost four years.

The report showed that food and fuel weren’t the only items on the rise. Costs for airline fares jumped 4.5 percent, the most since 2001.

Rents which, make up almost 40 percent of the core CPI, also accelerated. A category designed to track rental prices rose 0.3 percent after a 0.1 percent gain in May.

Today’s figures also showed wages decreased 0.9 percent in June after adjusting for inflation, the biggest drop since September 2005, and were down 2.4 percent over the last 12 months. The decline in buying power is one reason economists forecast consumer spending will slow.

Americans trimmed purchases of automobiles, furniture and restaurant meals last month as the cost of gasoline soared, a Commerce Department report showed yesterday. Retail sales rose 0.1 percent, less than forecast, a sign the boost from the tax rebate checks is already fading.

To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.netTimothy R. Homan in Washington at thoman1@bloomberg.net

Cam Cardow National Debt Cartoon, again.

A Cam Cardow National Debt Cartoon, and U.S. National Debt Clock, here…

Dollar sets record low against the euro after Carlyle Group fund defaults on $16.6 billion of debt; Gold hits record high as investors seek shelter.

Published in original form on March 13 by Bloomberg.com (see entire article by clicking here):

“– The dollar fell below 100 yen earlier today for the first time since 1995 and set a record low against the euro after a Carlyle Group fund defaulted on about $16.6 billion of debt, adding to turmoil in financial markets.

The dollar fell to almost one-for-one with the Swiss franc and slumped against the British pound. The drop came as Carlyle said lenders will seize the assets of its mortgage-bond fund, a day after Drake Management LLC said it may shut its largest hedge fund, spurring concern that losses will widen. The tumble in the world’s reserve currency drove gold to a record above $1,000 an ounce as investors sought shelter in the metal.

“The weakening, in reality, is a reflection on how the world is measuring the U.S.,” said Thomas Sowanick, who helps manage $10 billion as chief investment officer of Clearbrook Financial LLC in Princeton, New Jersey. “Until there is a unified central bank effort to support the dollar, the path of least resistance will be down.”

The dollar fell to 99.77 yen, the lowest since October 1995, before trading at 100.68 at 4:20 p.m. in New York, from 101.79 yesterday. The dollar touched $1.5626 per euro, the weakest since the European currency’s debut in 1999, and was at $1.5622, from $1.5551. It slid to a record 1.0045 Swiss francs. Japan’s currency advanced to 157.27 per euro, from 158.30.

The U.S. currency fell against a basket of six major trading partners to the lowest since the index began in 1973. The Dollar Index traded on ICE Futures in New York declined as low as 71.795. The dollar dropped to $2.0320 per pound from $2.0270, touching the weakest since December.

`So Many Holes’

The dollar pared its losses as stocks reversed a decline, after Standard & Poor’s said the end of subprime-related losses is “in sight” for large financial institutions. The S&P 500 index rose 0.5 percent, after earlier losing as much as 2 percent.

“The dollar is trying to find a floor here,” said Alan Kabbani, a senior currency trader at Wachovia Corp. in Charlotte, North Carolina. “The boat has so many holes that it takes a while to fix it.”

Treasury Secretary Henry Paulson reiterated support today for a “strong dollar” that reflects economic fundamentals, after President George W. Bush yesterday said the U.S. currency’s drop was not “good tidings.”

Person George W. Bush

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Congressman Ron Paul, MD vs. Fed Reserve Chairman Ben Bernanke, 11/08/2007: