U.S. Economic News

U.S. Economic News

October 20, 2017

U.S. Economic Indicators

Existing home sales inched up 0.7% to a seasonally adjusted annual rate of 5.39 million in September, but are 1.5% below year-ago levels.  NAR notes that demand remains healthy, but inventory remains scarce, especially at the lower end of the market.  NAR Report

U.S. News

The Financial Times reports that U.S. Senate Republicans passed a budget resolution last night, a key step towards enacting tax reform. The budget resolution allows Republicans to pass tax reform legislation via reconciliation, which only requires a simple majority in the Senate instead of the usual 60-vote supermajority. FT

According to the Wall Street Journal, professionals in the retirement industry are worried that the Republican tax plan may limit the amount of pre-tax contributions individuals can make to retirement savings plans. Republicans have been searching for ways to generate revenue to offset massive tax cuts, and congressional staffers say that committee members have been suggesting a cap of $2,400 for tax-free contributions. WSJ

William Mauldin of the Wall Street Journal writes that Congressional trade lawyers have begun outlining legal strategies for challenging a possible U.S. withdrawal from NAFTA. Lawyers say that the administration is sure to face legal challenges from industry associations whose members depend on North American supply chains, which would be threatened if the U.S. were to withdraw from NAFTA. WSJ

U.S. Economic News

U.S. Economic News

October 19, 2017

U.S. Economic Indicators

Initial jobless claims decreased 22,000 to 222,000 last week.  The four-week moving average fell 9,500 to 248,250. DOL Report

U.S. News

Sarah Chaney of the Wall Street Journal reports that while consumer confidence among older Americans has improved drastically in recent months, their consumer spending has been weak. Data show that Americans over age 55 are currently more confident than any other age group, although their consumer spending has been contracting for nearly three years. WSJ

According to the Wall Street Journal, foreign companies operating in the U.S. could face significant changes to their tax bills under new rules being considered by lawmakers. Congressional Republicans say that they need to establish rules that will “level the playing field” considering foreign companies are currently able to use complex tax strategies to reduce the income that is subject to the U.S. corporate tax rate. WSJ

The Washington Post writes that new data show that income inequality among older Americans is among the highest of developed countries. The data also suggest that income inequality is worsening for older Americans with the aging of every generation, and the effects are especially evident in the lack of retirement savings among those in lower income brackets. WaPo

U.S. Economic News

U.S. Economic News

October 18, 2017

U.S. Economic Indicators

Privately-owned housing starts fell 4.7% in September to a seasonally adjusted annual rate of 1.13 million (up 6.1% year-over-year). Housing permits dropped 4.5% to a 1.22 million annual pace in September and are down 4.3% on the year.  Census Bureau Report

U.S. News

The Financial Times reports that Treasury Secretary Mnuchin warned Congress that a failure to pass tax reform would cause equity markets to lose a significant share of recent gains. Mnuchin also asserted that equities would rise even higher if Congress managed to pass tax reform, which continues to face significant procedural and political hurdles. FT

Ben Eisen of the Wall Street Journal writes that the global economy is still waiting for inflation to return. Even as economies around the world are beginning to enjoy the effects of the recovery from the recent Great Recession, policymakers are still unsure as to why inflation has not picked up. WSJ

According to the Wall Street Journal, more than a quarter of U.S. states are unprepared to handle the next recession if it were to hit this year. Analysis also shows that only 16 states would have adequate backup money on hand to cover reduced tax revenues and increased demand for services such as Medicaid and other social safety nets. WSJ

 

U.S. Economic News

U.S. Economic News

October 17, 2017

U.S. Economic Indicators

Industrial production rose 0.3% in September (up 1.6% Y/Y), after falling 0.7% in August.  Capacity utilization edged up to 76.0 from 75.8 (revised) in August.  Fed Report
 
The NAHB Housing Market Index rose 4.0 points to 68.0 in October.  
The outlook for the next six months improved as builders overcame the shock of recent hurricanes, although they will still face increased shortages of materials and labor as rebuilding efforts begin.  NAHB Report

U.S. News

The Wall Street Journal reports that White House economists say that cutting the corporate tax rate to 20% would boost average household income by at least $4,000 a year. Kevin Hassett, the chairman of the White House Council of Economic Advisers, also said that the study only examined a cut to the corporate tax rate, and that other changes to deductions or loopholes could alter the results. WSJ

In a Wall Street Journal op-ed former chairman of the White House Council of Economic Advisers Edward Lazear argues that the current GOP tax plan could be improved by targeting small- and medium-sized businesses for deeper tax cuts. Lazear contends that these businesses would benefit the most from tax cuts which would in turn help accelerate U.S. economic growth. WSJ

U.S. Economic News

U.S. Economic News

October 16, 2017

U.S. Economic Indicators

The October Empire State Manufacturing Survey indicated that industrial activity in the New York region grew at a robust pace, as the headline index rose 6 points to 30.2, the highest level in three years.  The new orders index fell to 18.0, the shipments index jumped to 27.5, and the index for number of employees improved to 15.6; meanwhile, hours worked remained unchanged.  NY Fed Report

U.S. News

Eric Morath of the Wall Street Journal writes that the Labor Department is organizing a group of corporate executives, labor unions, and governors in order to establish a new apprenticeship task force. The White House says that apprenticeships will help workers learn the skills they need to fill openings in various specialized industries that have reported substantial shortages of skilled labor. WSJ

The Financial Times reports that National Economic Council Director Gary Cohn says post-crisis regulation is leading to the consolidation of financial activity in a few, immense banks. Cohn argues that strict financial regulations are keeping new players from entering the sector, thereby driving new business to existing banks. FT

According to the Wall Street Journal, analysts are beginning to consider the possibility of a full U.S. withdrawal from the North American Free Trade Agreement (“NAFTA”). While the White House aims to renegotiate NAFTA and avoid terminating the pact, analysis shows that a full withdrawal would have a minimal effect on U.S. GDP. WSJ

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