Consumers spend and earn more, layoffs slow [View All]

[bushisanidiot]

Thank you President Obama and Speaker Pelosi!!

http://news.yahoo.com/s/ap/20101124/ap_on_bi_go_ec_fi/us_economy

"WASHINGTON – Americans earned more and spent more last month, and the number of people applying for unemployment benefits dropped last week to the lowest level in more than two years. At the same time, demand for long-lasting manufactured goods and new homes fell off.

All told, the latest government data released the day before Thanksgiving suggest an improving picture of the economy. Income and spending are rising, and layoffs are slowing. This comes amid a decline in manufacturing activity, which had been a source of strength for months after the recession ended, and a weak housing market.

"The flurry of U.S. data this morning suggests that households have started to pickup the baton of growth from businesses," said Paul Dales, U.S. economist at Capital Economics. "Whether or not households will be able to shoulder the burden of growth on their own is another matter."

Investors appeared to be pleased by the data. The Dow Jones industrial average climbed more than 137 points in the early morning trading.

Consumers boosted their spending 0.4 percent in October, the Commerce Department said Wednesday. That was up from a 0.3 percent increase in September.

People showed a slightly bigger appetite to spend because their incomes rose 0.5 percent, reflecting a slowly healing jobs market that gave a boost to wages and salaries. Incomes didn't grow at all in September. The increases in both income and spending last month were the most since August.

And inflation is running lower at a record low. Prices for goods excluding food and energy rose just 0.9 percent in the 12 months ending in October, the Commerce report noted. That was down from a 1.2 percent annual gain posted in September. Inflation is running at a pace below the Fed's comfort zone of between 1.5 percent and 2 percent.

"We have a good signal," John Silvia, chief economist at Wells Fargo, said of the jobless claims and consumer spending reports.

The pace of layoffs slowed to the lowest level since July 2008. Initial jobless claims dropped by 34,000 to a seasonally adjusted 407,000 in the week ending Nov. 20, the Labor Department said. The report raised hopes that more gains in hiring will be seen."