The Dow Notches Its Best September in 71 Years

The Dow Notches Its Best September in 71 Years 

  The Dow Jones Industrial Average ($INDU) recorded its best September in more than 70 years, which is historically a tough month for the market. 

Stocks started Thursday's session with gains, helped by a drop in weekly initial jobless claims, as well as better readings on second-quarter gross domestic product and regional manufacturing. 

The economy made some modest progress on the labor front last week, as the number of new jobless claims filed fell 16,000 to 453,000, the U.S. Labor Department said Thursday, while economists on average expected claims to come in at 459,000. A better-than-expected revised reading on second-quarter GDP and  surprise jump in the Chicago Purchasing Managers Index also conspired to give equities and early lift. 

Source: Economy, Investing, Market News, Financial Times, Dan Burrows, 9/30/2010

Experts Report that Great Recession ended June 2009

The National Bureau of Economic Research, the arbiter of when recessions begin and end, has reported that the Great Recession ended June 2009.

In a report released Monday, the NBER's Business Cycle Dating Committee said it "determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months."

NBER also explained why a decision took so long. "The committee waited to make its decision until revisions in the National Income and Product Accounts, released on July 30 and August 27, 2010, clarified the 2009 time path of the two broadest measures of economic activity, real Gross Domestic Product (real GDP) and real Gross Domestic Income (real GDI)." In other words, there was no need to call an end to the downturn until it was clear that a meaningful recovery had begun.

Source: Daily Finance, September 20, 2010

10 Reasons to Buy a Home

10 Reasons to Buy a Home


Time magazine is being overly pessimistic in its recent cover piece that called into question the benefits of homeownership. In fact, now is a great time to buy. And, what's more, tomorrow will be a great time to own, because the fundamental strength of homeownership hasn't changed.

Why is now a great time to buy? Here are 10 reasons:

1. You can get a good deal. Prices are down 30 percent on average. They're at a level that makes sense for people's income.
2. Mortgages are cheap. At 4.3 percent on average for a 30-year fixed-rate mortgage, your costs to own are down by a fifth from two years ago.
3. You can save on taxes. When you add up the deductions for mortgage interest and others, the cost of owning can drop below renting for a comparable place.
4. It'll be yours. The one benefit to owning that never changes is that you can paint your walls orange if you want (generally speaking; there might be some community restrictions). How many landlords will let you do that?
5. You can get a better home.In some markets, it's simply the case that the nicest places are for-sale homes and condos.
6. It offers some inflation protection. Historically, appreciation over time outpaces inflation.
7. It's risk capital. If the economy picks up, you stand to benefit from that, even if you're goal is just to have a nice place to live.
8. It's forced savings. A part of your payment each month goes to equity.
9. There is a lot to choose from.,There are some 4 million homes available today, about a year's supply. Now's the time to find something you like and get it.
10.,Sooner or later the market will clear. The U.S. is expected to grow by another 100 million people in 40 years. They have to live somewhere. Demand will eventually outpace supply.

Source: Wall Street Journal, Brett Arends (9/16/10)

People@Work: More Signs Emerge of a Better Job Market Ahead

People@Work: More Signs Emerge of a Better Job Market Ahead

...The Fewest Layoffs Since June 2000

First, there was last week's Labor Department report that showed initial claims for unemployment benefits unexpectedly fell by 27,000 to 451,000. The four-week moving average, a more-telling barometer, also declined 9,250 to 477,500, while continuing claims dropped 2,000 to 4.48 million.

Then, earlier this month, another indicator showed that employed Americans can feel more secure that they will keep their jobs. The number of announced layoffs fell to the lowest monthly total in more than a decade in August, according to a report by employment-services firm Challenger, Gray & Christmas.

At just under 35,000, August job cuts fell 17% from the 41,676 cuts announced in July, marking the first decline following three consecutive months of increases, Chicago-based Challenger said. August not only replaced April as the lowest job-cut month of the year, it represents the lowest since June 2000, when employers announced only 17,241 planned layoffs.
Hiring Is Up Across All Sectors

The lack of massive culls of workers from nation's largest firms is another positive indicator that the U.S. job market may finally be headed in the right direction. Gone are the epic cuts announced in 2008 and 2009, when Citigroup (C), General Motors, Berkshire Hathaway (BRK.A) and Starbucks (SBUX) each cut tens of thousands of jobs.

Further, as U.S. News & World Report points out, every major employment sector is hiring, according to a sampling by job search engine Indeed.com. In the 12 industries Indeed.com monitors, hiring rose significantly in August compared to a year ago. The biggest surge was in transportation, where job postings jumped 119%, but information technology, manufacturing and media and newspapers also saw strong gains, up at least 61% above year-ago levels.

Then there's one other quirky nugget of information dug up by Challenger: Sales of men's suits are on the rise. Citing better-than-expected quarterly earnings at Men's Wearhouse (MW), Challenger says increased suit sales may mean more people -- men, at least -- are going on interviews. Although, the firm says there was no indication from the Houston-based retailer for the reason behind the sales boost.

After years of a trend toward more casual dress in the workplace, Challenger CEO John Challenger says many job seekers simply don't own a suit that fits or is in fashion. "So, they are heading out to restock their suit collections."

Whether suit sales or any other barometer can predict an uptick in the job market is anyone's guess. But one thing is for sure: with 8 million jobs lost since the start of the recession in December 2007, many more months of promising data are needed before everyone looking for job can finally find one.

Tagged: challenger, Challenger Gray Christmas, employee, employees, employer, employers, employment, employment opportunities, initial claims, job market, job search

By DAVID SCHEPP, Public Finance, 9/13/2010

Buffett Sees No Double-Dip Recession in U.S.

Buffett Sees No Double-Dip Recession in U.S.


Berkshire Hathaway (BRK.A) CEO Warren Buffett said a second, near-term recession in the U.S. is unlikely and said his companies have boosted hiring over the past couple of months, Bloomberg News reported.


Buffett said the U.S. economy "will not have a double-dip recession at all," the wire service reported, citing Buffett's remarks during a keynote speech at the Montana Economic Development Summit earlier Monday.


The billionaire investor, whose company is Wells Fargo & Co.'s (WFC) largest shareholder, cited U.S. banks' growing willingness to lend to small businesses as illustrative of an economy on the mend, Bloomberg reported. Buffett called the lending situation "night and day from a year, year and a half ago," according to Bloomberg.


The Berkshire chief was listed this year by Forbes as the world's third-wealthiest person, whose $47 billion net worth trails only that of Carlos Slim Helu and Bill Gates.

by Danny King, Daily Finance, Wells Fargo & Co., 9/13/2010