Thailand
Spanish stocks dropped sharply early Friday morning after ratings agency Moody’s downgraded its credit score of 16 Spanish banks in the latest blow to the troubled financial sector.
The Ibex 35 index was off more than 2 points shortly after trading began Friday. Banks were among the biggest losers.
Moody’s acted late Thursday, citing banks’ load of non-performing loans amid a recession-plagued economy, their creditworthiness and the government’s sovereign debt problems, among other woes.
Those punished included Banco Santander, SA, the eurozone’s largest bank by market capitalization.
Shares in Bankia SA, a recently nationalized bank, took a roller coaster ride Thursday, ending up sharply lower on reports depositors pulled out a (EURO)1 billion in a week.
On the bond market the interest rate on 10-year bonds was unchanged at 6.25 percent.
The U.S. economy expanded less than forecast in the first quarter as a smaller contribution from inventories overshadowed the biggest gain in consumer spending in more than a year.
Gross domestic product, the value of all goods and services produced in the U.S., rose at a 2.2 percent annual rate after a 3 percent pace, Commerce Department figures showed yesterday in Washington. The median projection of economists surveyed by Bloomberg News called for a 2.5 percent gain. Government spending fell for a sixth straight quarter.
Job creation and income gains propelled sales at car dealerships and retailers like Target Corp. (TGT), helping cushion the U.S. economy from weakness overseas. Further gains in consumer spending will depend on progress in reducing a jobless rate that has hovered above 8 percent since early 2009.
The Times of London is being sued over email hacking, a lawyer said Friday, an indication that the scandal over media misdeeds at Rupert Murdoch’s British newspapers continues to spread.
Lawyer Mark Lewis told The Associated Press that his firm had filed suit against the 227-year-old publication over its hacking of police blogger Richard Horton’s email account.
“We did lodge papers,” Lewis confirmed in an email, adding that the suit was filed on Tuesday.
The Times unmasked Horton as the detective behind the award-winning “NightJack” blog in a controversial 2009 piece which Horton unsuccessfully sued to try to suppress.
According to an account of the lawsuit published in Britain’s New Statesman magazine, Horton’s lawyer raised the possibility that the detective’s Hotmail account had been illegal accessed _ an allegation dismissed as “baseless” in 2009 by Times lawyer Alastair Brett pay day loans.
However, in public statements and in testimony before an official inquiry into media ethics, senior Times managers admitted that one of their reporters had accessed Horton’s account.
“‘Baseless’ was not the best word to use,” Brett told the inquiry last month.
Times publisher News International did not immediately return an email or a call Friday.
South Korean inflation may accelerate above the government
The ruling this week overturning a new state fund for science startups is likely headed to higher court.
Attorney General Chris Koster said Wednesday he plans to file an appeal of a Cole County judge’s ruling that declared the Missouri Science and Innovation Reinvestment Act to be unconstitutional.
Circuit Judge Dan Green tossed out the law in a ruling late Monday, saying it was invalid because lawmakers included a “contingency clause” when they passed it last fall, requiring a broader tax credit reform bill to be passed before MOSIRA could take effect. The tax credit bill never passed, and opponents of MOSIRA sued when Gov. Jay Nixon started implementing the science fund no fax pay day loan.
In a statement, Koster said MOSIRA is too valuable to let die on a technicality.
“(MOSIRA) is an important economic development tool that can bring high-tech jobs to Missouri and preserve jobs that are already here,” he said. “I don’t want to see important job-creating legislation fail. We intend to appeal this matter to its conclusion.”
Supporters of MOSIRA have said they also plan to push for a clean up-or-down vote on the matter in the General Assembly this session.
Police say unknown bombers detonated locally made dynamite near an important bridge in Nigeria’s oil-rich southern delta overnight, though no one was injured.
The blast happened Friday night in Yenagoa, the capital of Bayelsa state, the home of President Goodluck Jonathan. Bayelsa state police spokesman Eguavoen Emokpae said the bomb targeted a bridge, but caused little damage.
The blast occurred as Bayelsa state is under increasing political pressure over an upcoming gubernatorial race in the state no teletrack payday loan. The winner of the race will control a state budget that’s larger than some nations surrounding oil-rich Nigeria. Violence remains common in elections in Nigeria, a nation of more than 160 million people and a top crude oil supplier to the U.S.
Leaving behind a year of bruising legislative battles, President Barack Obama enters his fourth year in office having calculated that he no longer needs Congress to promote his agenda and may even benefit in his re-election campaign if lawmakers accomplish little in 2012.
Absent any major policy pushes, much of the year will focus on winning a second term. The president will keep up a robust domestic travel schedule and aggressive campaign fundraising and use executive action to try to boost the economy.
Partisan, down-to-the-wire fights over allowing the nation to take on more debt and sharply reducing government spending defined 2011. In the new year, there are almost no must-do pieces of legislation facing the president and Congress.
The one exception is the looming debate on a full-year extension of a cut in the Social Security payroll tax rate from 6.2 percent to 4.2 percent. Democrats and Republicans are divided over how to put in place that extension.
The White House believes GOP lawmakers boxed themselves in during the pre-Christmas debate on the tax break and will be hard-pressed to back off their own assertions that it should continue through the end of 2012.
Once that debate is over, the White House says, Obama’s political fate will no longer be tied to Washington.
“Now that he’s sort of free from having to put out these fires, the president will have a larger playing field. If that includes Congress, all the better,” said Josh Earnest, White House deputy press secretary. But, he added, “that’s no longer a requirement.”
Aides say the president will not turn his back on Congress completely in the new year. He is expected to once again push lawmakers to pass elements of his jobs bill that were blocked by Republicans last fall.
If those efforts fail, the White House says, Obama’s re-election year will focus almost exclusively on executive action.
Earnest said Obama will come out with at least two or three directives per week, continuing the “We Can’t Wait” campaign the administration began this fall, and try to define Republicans in Congress as gridlocked and dysfunctional.
Obama’s election year retreat from legislative fights means this term will end without significant progress on two of his 2008 campaign promises, an immigration overhaul and closing the military prison for terrorist suspects at Guantanamo Bay, Cuba.
Presidential directives probably won’t make a big dent in the nation’s 8.6 percent unemployment rate or lead to significant improvements in the economy. That’s the chief concern for many voters and the issue on which Republican candidates are most likely to criticize Obama.
In focusing on executive actions rather than ambitious legislation, the president risks appearing to be putting election-year strategy ahead of economic action at a time when millions of Americans are still out of work.
“Americans expect their elected leaders to work together to boost job creation, even in an election year,” said Brendan Buck, a spokesman for House Speaker John Boehner, R-Ohio.
Still, Obama and his advisers are beginning 2012 with a renewed sense of confidence, buoyed by a series of polls that show the president’s approval rating climbing as Congress becomes increasingly unpopular.
They believe his victory over Republicans in the payroll tax debate has boosted his credentials as a fighter for the middle class, a theme he will look to seize on in his Jan. 24 State of the Union address.
Obama’s campaign-driven, domestic-travel schedule starts in Cleveland on Wednesday, the day after GOP presidential hopefuls square off in the Iowa caucuses. He will also keep up an aggressive re-election fundraising schedule, with events already lined up in Chicago on Jan. 11.
Campaign officials say Obama will fully engage in the re-election campaign once the Republicans pick their nominee. He will focus almost exclusively on campaigning after the late summer Democratic National Convention, barring unexpected developments at home or abroad.
Among the issues that could disrupt Obama’s re-election plans: further economic turmoil in Europe, instability in North Korea following its leadership transition and threats from Iran.
The president’s signature legislative accomplishment will also come under greater scrutiny in the new year, when a critical part of his health care overhaul is debated before the Supreme Court.
Obama’s foreign travel next year will be limited mainly to the summits and international gatherings every U.S. president traditionally attends. He’s expected to travel to South Korea in March for a nuclear security summit and to Colombia in April for the Summit of the Americas. He’s also likely to visit Mexico in June for the G-20 economic summit.
Two other major international gatherings _ the NATO summit and the G-8 economic meeting _ will be held in Chicago, on home turf.
Four new types of American shoppers have emerged this holiday season.
There’s the bargain hunter who times deals. The midnight buyer who stays up late for discounts. The returner who gets buyer’s remorse. And the “me” shopper who self-gifts.
It’s the latest shift by consumers in the fourth year of a weak U.S. economy. Shoppers are expected to spend $469.1 billion during the holiday shopping season that runs from November through December. While it won’t be known just how much Americans spent until the season ends on Saturday, it’s already clear they are shopping differently than they have in years past.
“We’re seeing different types of buying behavior in a new economic reality,” says C. Britt Beemer, chairman of America’s Research Group.
THE BARGAIN TIMER
Cost-conscious shoppers haven’t just been looking for bargains this season. They’ve also been more deliberate about when to find those deals. Many believe the biggest bargains come at the beginning and end of the season, which has created a kind of “dumbbell effect” in sales.
For the week ended on Nov. 26, which included the traditional start of the holiday shopping season on the day after Thanksgiving, stores had the biggest sales surge compared with the prior week since 1993, according to the International Council of Shopping Centers-Goldman Sachs Weekly Chain Stores Sales Index. The cumulative two-week-sales drop-off that followed marked the biggest percentage decline since 2000. Then, stores had another surge in the final days, as retailers stepped up their promotions again.
“Shoppers are budgeting their money and time,” says Paco Underhill, whose company, Envirosell, studies how consumers behave in stores. “They’re focused on being opportunistic bargain shopping vultures.”
Kalilah Middleton, 30, of Queens, is one of them. Starting late on Thanksgiving night, she spent five hours and $400 at Wal-Mart and Target. She bought a TV and clothing at 50 percent off. Then, she waited until Christmas Eve to shop again because she believed she’d get better deals later in the season.
“This is when you get the best deals,” says Middleton, an office manager, about her holiday shopping.
Going forward, shoppers are expecting even bigger discounts. According to America’s Research Group research firm, 34 percent of shoppers say they want to see post-Christmas discounts of about 70 to 80 percent, up from 20 percent last year.
THE MIDNIGHT BUYER
Used to be, bargain shoppers would wake up at the crack of dawn to take advantage of big discounts on Black Friday, the day after Thanksgiving. This year, some shoppers instead stayed up late on Thanksgiving night to get deals.
This behavior was in large part due to retailers’ efforts to outdo each other during the traditional start to the holiday shopping season. Stores like Macy’s, Best Buy and Target for the first time opened at midnight on Thanksgiving night, offering deals that once were reserved for the next day.
Twenty-four percent of Black Friday shoppers were at stores at midnight, according to a poll by the National Retail Federation, the industry’s biggest trade group. That’s up from 9.5 percent the year before when only a few stores were open during that time.
Of those shopping at midnight on Black Friday, 37 percent were ages 18 to 34. That percentage was higher than among 35- to 54-year-olds, of whom 23.5 percent were in stores by midnight.
Macy’s, for one, drew 10,000 people to its midnight opening. Terry Lundgren, Macy’s CEO, says many of them were young people who turned out for the Justin Bieber $65 gift sets and discounted fashions.
Anika Ruud, 15, of Boca Raton, Fla., went out with her four cousins to Macy’s at midnight and then shopped at Target until 2:30 a.m. She picked up two bras at Macy’s for $10. Then, she and her cousins went home to bed.
“It’s always been inconvenient,” Ruud says of the traditional 4 a.m. Black Friday openings of years past. “No one likes to wake up early.”
THE RETURNER
Shoppers who were lured into stores by bargains gleefully loaded up on everything from discounted tablet computers to clothing early in the holiday season. But soon after, many of them were rushing back to return the items they bought.
For instance, Elizabeth Yamada, 55, of Fort Lee, N.J., says she got caught up with the shopping frenzy over the Thanksgiving weekend and picked up a $350 coat that was marked down more than 50 percent off at Macy’s. She ended up returning the item one week later.
“It was nice, but I didn’t need it,” says Yamada, who works part-time as a waitress and a hospital aide. “It was impulsive shopping. But I am doing more reflecting.”
It’s all about buyer’s remorse.
For every dollar stores take in this holiday season, it’s expected they will have to give back 9.9 cents in returns, up from 9.8 last year, according to the a survey of 110 retailers the NRF. It would be the highest return rate since the recession. In better economic times, it’s about 7 cents.
Stores have themselves to blame for the higher returns. They lured shoppers in with deals of up to 60 percent off as early as October. Because of the deals, shoppers spent more than they normally would. And retailers’ return policies have been more lax since 2008, with some sweetening their policies even more this year.
THE “ME” SHOPPER
One for you; one for me.
After scrimping on themselves during the recession, Americans turned to shopping for themselves. It’s a trend that started last year but became more prevalent this season.
According to the NRF, spending for non-gift items will increase by 16 percent this holiday season to $130.43 per person. That’s the highest number recorded since it started tracking it in 2004.
“This season, the consumer put herself ahead of the giving,” says Marshal Cohen, chief industry analyst with market research firm The NPD Group.
Betty Thomas, a health care coordinator at a hospital in Raleigh, N.C., says she spent $1,700 on a ring and bracelet for herself and a rug for her home during the holiday season. That’s up dramatically from the $200 she spent last year.
“I have been putting other people first,” Thomas says. “I definitely felt I earned it.”
Stores have been encouraging such self-gifting.
AnnTaylor’s campaign “Perfect Presents: One for you. One for her” highlighted merchandise like brightly colored sweaters. Brookstone’s print ads urged shoppers to get accessories for their iPads and other electronics with the words: “gifts for your gadgets.” And Shopittome.com, an online site that alerts consumers to clothing sales they’re interested in, launched “Treat Yourself Tuesday” after Thanksgiving weekend.
_____
Anne D’Innocenzio reported from New York.
Christina Rexrode in Raleigh, N.C. contributed to this report.
Follow AP retail coverage at http://www.twitter.com/AP–Retail.
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