Mike: Plenty of reports dot the economic landscape this Tuesday. My guess is that the Housing Starts report will garner the most attention from both the green shoot and yellow weed crowds. The Producer Price Index and Industrial Production are also going to show the direction of the economy.
I had to look around for a housing starts headline that didn’t scream “rocket higher,” “soar,” or “jump,” but eventually I found one that hit it correctly with “starts rise from record lows.” I find it easier to digest facts than hyperbole and the headline was factual. Sure, it’s great news that housing starts improve from the previous record low, but let’s not forget that April housing starts were a record low and this is the season to build homes.
I also had to go to a BBC story to get the following important bit of info that seemed lacking in many of the other reports initial statements: “However, the rate was still down 45.2% from May 2008. via BBC NEWS | Business | May rebound in US housing starts.” Am I focusing on the negative? No, I think I’m focusing on the facts that most news organizations should also be doing. These fantastical headlines of housing starts “soaring” just cloud the real state of the housing market and it can make people believe that all is well and prices will start “jumping” higher if they don’t buy now they’ll be priced out forever. Record low interest rates, more affordable home building materials and government tax incentives do make buying a home seem more appealing at this time, but if all those incentives can increase starts and permits just above record lows, I’ll have to hope that interest rates, building products and tax incentives remain as they are for this to be new trend. As the economy improves interest rates and building material prices will increase and tax incentives will be removed. Is the improvement in starts and permits a good sign? Yes. Is it a good to buy a home? Maybe. Are housing problems behind us? I don’t think so, at least not yet.
WASHINGTON (AFP) — US housing construction starts and building permits rose more than expected in May after falling to record lows in April, government data showed Tuesday.
The Commerce Department reported permits to build privately owned homes, an indicator of future activity, leapt to a seasonally adjusted annual rate of 518,000 in May, an increase of 4.0 percent from the prior month.
Building permits had fallen in April to a revised rate of 498,000, the lowest level since the data began to be tracked in 1960.
Mike: Here’s a little clearer picture of why there was a rise in housing starts. The euphoria of this morning is finally evolving into a pragmatic look at the numbers behind the numbers:
But analyst Ivy Zelman gave me a huge nugget: 50 percent of sales in May were on spec. She says we’re seeing a lot of spec homes now because, “today’s consumer wants to touch and feel the house.” The positives are that cancellations are down, sales are better and there’s less negative pricing, although discounts are still prevalent. “The patient was without a pulse in the fourth quarter,” Zelman notes, “and now the patient’s in ICU.”
So why all the spec now? Because builders are trying to jam all these homes into buyers’ pockets before the expiration of the $8000 first time home buyer tax credit. It turns into a pumpkin November 30th.
- Credit Card Issuers Settle Accounts for Lower Balances
- Industrial Production Declines, Capacity Utilization at Record Low
- Wholesale inflation up less than expected in May
- Lockheed warns of job cuts in San Jose
- End of VH-71 POTUS chopper means loss of 750 Lockheed jobs
- 396 teachers losing jobs in Broward
- Farmers Insurance Group plans $84.4 million, 1,600-job expansion in MI
- Interstate 4 construction project to add 14,000 jobs
Microsoft/Google/IBM and other Rumors/News
General Economic News
Government Layoff News
US and some Canada Layoff News
International Layoff News
Hiring News and News You Can Use
– LOS ANGELES (AP) — MySpace is cutting nearly 30 percent of its work force in a move the News Corp.-owned online hangout says will make it more efficient.
The cuts amount to about 420 people, bringing the total number of MySpace’s U.S. staff to 1,000.
7:45 AM ET
US chain store sales fell 0.6 pct last week-ICSC
8:55 AM ET
New York — The Johnson Redbook Retail Sales Index was down 4.4% in the first week of June.
Month-to-date, the month declined 4.4% compared to June 2008, relative to a revised target of a 4.2% drop. And month-over-month was a 4.3% drop relative to May, compared to a targeted 4.1% drop.
8:30 AM ET
The number of new houses started in the US rebounded in May from April’s record low, the Commerce Department has said.
Housing starts jumped 17.2% to a seasonally adjusted annual rate of 532,000 units in May, up from April’s figure of 454,000.
However, the rate was still down 45.2% from May 2008.
8:30 AM ET
The Labor Department said Tuesday that the Producer Price Index increased by a seasonally adjusted 0.2 percent from April. That’s below analysts’ expectations of a 0.6 percent rise.
Despite the increase, wholesale prices fell 5 percent in the past 12 months. That’s the largest annual drop in almost 60 years.
9:15 AM ET
Industrial production decreased 1.1 percent in May after having fallen a downward-revised 0.7 percent in April. The average decrease in industrial production during the first three months of the year was 1.6 percent. Manufacturing output moved down 1.0 percent in May with broad-based declines across industries.
– At least 396 Broward teachers — most of them newcomers and working in elementary schools — lost their jobs over the weekend, a figure almost double the number of layoffs the school district had predicted last month.
– Nineteen Lansing Community College employees are expected to receive layoff notices today. Three counselors at the college got theirs more than a week ago. They are the likely casualties of a grim economy and a contentious budget process.
– Two Columbia employees lost their jobs Monday, and up to 10 more will be let go today as city officials prepare to present a trim $106 million general fund budget for council members to approve Wednesday.
– Zoo Atlanta, feeling a continued pinch from the economy, has laid off four full-time staffers. The employees held jobs in education, multimedia, human resources and animal staff.
via In Brief | ajc.com.
– Union officials representing two groups of workers at the Indiana State Teachers Association say at least 40 people will lose their jobs after 60 days’ notice. A third union representative would not comment on how many people in her division will be laid off, but the total number of layoffs is likely to be higher than 40 out of a staff of 150 employees.
– A manager in DeKalb County’s development department said he was among a half dozen supervisory employees to be laid off today.
– Sixteen positions total were cut from the general fund. Three-fourths of the positions were eliminated through attrition, either with retirements, resignations or additional federal grant funds, and four workers will lose their jobs.
– The termination of two defense programs could cost several hundred people their jobs at a San Jose branch of Lockheed Martin Information Systems and Geographic Services.
Layoff notices have been sent to all 535 employees working on the two programs and layoffs are scheduled for Aug. 10.
But the exact number losing their jobs won’t be known for a while, as the company tries to find jobs for as many of the employees as possible in other parts of the company.
So far, 60 people have been placed in new positions, said spokesman David Jewell.
– WASHINGTON, June 16 (Reuters) – Lockheed Martin Corp (LMT.N) may cut about 750 workers because of the Defense Department’s decision to end the VH-71 presidential helicopter program, the company said on Tuesday.
– Volunteer Fabricators, located at 1132 Campbell Drive in Sneedville, Tenn., has decided to close all of its facilities putting 145 people out of work.
Vacumet Corp., 5705 Commerce Blvd., Morristown, Tenn., has also decided to close its doors according to the Labor and Workforce Development announcement. The metallized paper and plastic manufacturer will begin layoffs July 3 and end by July 10. The closing will affect 99 employees.
– KINGSPORT – After more than 50 years in operation, the PET Dairy plant on Konnarock Road is shutting its doors, resulting in the loss of 120 jobs.
– The difficult economy and uncertainty about future ownership pushed the Texas Rangers on Monday to lay off “less than 10 percent” of the 275-person front office, club spokesman John Blake confirmed.
– Cayman Chemical, a biochemical products manufacturing and research company based in Ann Arbor, today laid off 15 percent of its 184-person workforce, company officials announced.
– Limited cookie sales and donations have led the Girl Scouts of Texas Oklahoma Plains to lay off two workers at their regional office in Lubbock.
The region issued 11 layoffs at offices in Amarillo, Fort Worth and the Wichita Falls region.
– SYDNEY — Cape Breton Radio issued layoffs to most of its newsroom staff last week.
Two people were given layoffs Friday, leaving only one person to direct the news at three Maritime Broadcasting System stations in Sydney.
– Mass High Tech is eliminating four positions, cutting its weekly print editon to every other week and merging its newsroom with its sister publication, the Boston Business Journal.
– Beneficial Financial Group, one of Utah’s oldest insurance and annuity companies, announced Tuesday that it will cut about 150 jobs from its 214-person Utah work force and discontinue writing new policies.
– Developer John Wessman has put his downtown Palm Springs historic office building up for sale. He’s also laid off four employees because he’s outsourcing his property management.
– FRANKFURT (AFP) — Germany’s biggest power company E.ON plans to slash 9,000 jobs as part of a belt-tightening drive aimed at saving 1.5 billion euros (2.0 billion dollars), a newspaper said.
The cuts included 6,000 European posts along with 3,000 others that would go as some of the group’s activities were relocated, Die Welt said, quoting Sven Berglin, an official with the Verdi union who is a member of E.ON’s supervisory board.
– Michelin (MICP.PA) will cut up to 1,500 jobs in France as part of measures the French tyre group will announce on June 24 to weather a collapse in global demand for tyres, French newspapers reported on Tuesday.
– Up to 200 people – mostly women – look likely to be made redundant or forced to move because of plans to close Child, Youth and Family service centres in provincial towns, such as Whangarei and Tauranga.
– Drinks group Diageo Ireland, which owns Guinness, has announced plans to cut 107 jobs.
– Halma Plc, the world’s second- biggest maker of smoke detectors, has cut about 360 jobs in the past year to maintain profit margins, Chief Executive Officer Andrew Williams said.
– Mr. McClelland’s credit card company was calling yet again, wondering when it could expect the next installment on his delinquent account. He proposed paying half of his $5,486 balance and calling the matter even.
It’s a deal, the account representative immediately said, not even bothering to check with a supervisor.
– The Pittsburg, Kan., City Commission today approved a $140,000 forgivable loan for NPC International, the world largest Pizza Hut franchise, as part of a deal that would initially bring 100 jobs to Pittsburg to operate an incoming call center.
– Arkansas officials say they expect to hire about 400 workers using stimulus money but are warning applicants the jobs won’t be there when the federal funds run out.
– Farmers Insurance Group plans $84.4 million, 1,600-job expansion at Foremost complex in Caledonia
– Tom Van Daele knows: He’s started a website, Cardsofchange.com, where people write new messages on their old business cards. Lila Hanft from Ohio got canned by her local newspaper when the recession hit and now typed on her defunct card is the message, “No more cubicle hell. I’m working at my kitchen counter. Shoes are optional.”
– Americans’ credit scores, the three-digit number that determines whether you’ll get a loan and how much you’ll pay for it, have taken a beating.
Millions of consumers’ scores have dropped, making it more expensive for them to borrow money — or even impossible if the score has sunk low enough.
– A project to link Interstate 4 and and the Selmon Expressway at the eastern edge of Ybor City could create 14,000 jobs, and start three years early. The Tribune reports that this is made possible by an influx of dollars from the Federal stimulus package.
Mike: More news later…………………
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