New iraq advs econ adv debt 1ac contention Economy

The US economy is slow and not recovering

Download 1.25 Mb.
Size1.25 Mb.
1   ...   28   29   30   31   32   33   34   35   ...   97

The US economy is slow and not recovering.

Regan and Gammeltoft 7/16 (Michael P. Regan, Associate Attorney in Commercial Litigation, and Nikolaj Gammeltoft, Reporter at Bloomberg News and Columbia University - Graduate School of Journalism, London School of Economics and Political Science, July 16, 2010, “Stocks Tumble, Yen, Treasuries Advance on Recovery Concern”,, LS)

July 16 (Bloomberg) -- Stocks sank, the yen rose to a 2010 high versus the dollar and two-year Treasury yields hit a record low as lower-than-estimated revenue at companies from Bank of America Corp. to General Electric Co. and a slump in consumer confidence fanned concern the economic rebound is slowing. The Standard & Poor’s 500 Index plunged 2.9 percent to 1,064.88 at the 4 p.m. close in New York, wiping out its weekly advance. The two-year yield slid as low as 0.5765 percent and the yen appreciated more than 1 percent to 86.27 per dollar, the strongest level since Dec. 1. Crude oil dropped for a third day, while copper and nickel led a retreat in industrial metals. Spain’s 10-year bonds rallied for a second day after yesterday’s 3 billion-euro ($3.9 billion) debt sale. The S&P 500 erased gains from a late-day rebound yesterday that came as the government settled its fraud lawsuit against Goldman Sachs Group Inc. and BP Plc stopped the flow of oil from its leaky Gulf of Mexico well. Ten-year Treasury yields held below 3 percent for a second day after reports showed consumer prices declined in June and confidence slumped in July to the lowest level in a year. The macro news isn’t too good and the consumer confidence number is piling onto that,” said Scott Armiger, who helps manage about $5.6 billion at Christiana Bank & Trust in Greenville, Delaware. “People were hanging their hats on earnings consistently meeting expectations, but instead we’re getting a mix of hits and misses.” Financials Sink Financial shares sank 4.4 percent collectively, the most in two months, to lead declines among all 10 industry groups in the S&P 500. The Dow Jones Industrial Average lost 261.41 points, or 2.5 percent, to 10,097.9 for its biggest drop of the month as all 30 companies in the gauge fell. GE tumbled 4.6 percent. The S&P 500 lost 1.2 percent this week and the Dow decreased 1 percent. Bank of America plunged 9.2 percent, the most in more than a year, and Citigroup Inc. lost 6.3 percent after revenue trailed analyst estimates and their loan books shrank, a sign volatile markets and a slowdown in the economic rebound may be keeping borrowers away. Banks and credit-card lenders also slumped on concern new financial regulations will crimp earnings, with Visa Inc. and MasterCard Inc. losing at least 5.1 percent. Under the overhaul Congress sent to President Barack Obama yesterday, the Federal Reserve will get authority to limit interchange, or “swipe” fees, that merchants pay for debit-card transactions. The bill will let retailers refuse credit cards for purchases under $10 and offer discounts based on the form of payment. Google Inc. slumped 7 percent, the most in three months, after profit trailed estimates following a surge in spending on acquisitions and staff to grow in new markets such as mobile marketing and display advertising. S&P 500 technology shares slumped 2.6 percent as a group. Rebound Stalls The S&P 500 climbed 7.2 percent from a 10-month low on July 2 through yesterday amid optimism that corporate earnings will signal the economic recovery will be sustained. Today’s slide trimmed the rebound to 4.1 percent. S&P 500 companies are projected to increase profits by 34 percent in 2010 and 18 percent in 2011, the fastest two-year gain since 1995, according to analysts’ estimates compiled by Bloomberg. Of the 23 companies in the S&P 500 that have reported profits since July 12, all but three have topped forecasts for earnings-per-share, Bloomberg data show. Revenue for the group has increased 2.6 percent. The yen strengthened against all 16 major counterparts, climbing 3.4 percent versus the New Zealand dollar and more than 2.4 percent versus the Australian, Canadian and Norwegian currencies. Confidence, Prices Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., boosted holdings of government-related debt to the highest level in eight months as the U.S. recovery showed signs of waning.

The economy is slowing. Risk of protracted recession is rising.

Van de Pol 7/19 (Jurjen van de Pol, Reporter at Bloomberg News, 7/19/10, “Roach Says U.S. at Start of ‘Protracted Sluggishness’”,, LS)

July 19 (Bloomberg) -- The U.S. economy faces a period of “protracted sluggishness” as consumers are wary to spend, said Stephen Roach, Morgan Stanley’s chairman for Asia. “The U.S. is, I think, in the early stages of what is a very protracted sluggishness of domestic internal demand,” Roach, who is also a professor at Yale University, said in a radio interview with Tom Keene and Ken Prewitt on “Bloomberg Surveillance.” The U.S. economy grew at a 2.7 percent annual rate in the first quarter, less than previously calculated, reflecting a smaller gain in consumer spending and a bigger trade gap, data showed last month. Consumer confidence slumped in July to the lowest level in a year, signaling that the biggest part of the economy is losing momentum, according to the Thomson Reuters/University of Michigan preliminary index of consumer sentiment published on July 16. “The dynamism that we’ve gotten hooked and accustomed to, is just not going to be” there, Roach said. The U.S. housing market took another step back in June as construction and purchases dropped, and a gauge of the outlook for growth signaled the expansion will lose steam, economists said before data due to be published later this week. Housing’s inability to maintain a rebound is one reason the economic recovery is not gaining speed. Stimulus Debate President Barack Obama said on July 15 that his economic- stimulus program is gradually pulling the U.S. out of its deepest recession in decades. Republicans have said the stimulus is wasteful, hasn’t reduced unemployment and has added to the record budget deficit.

Share with your friends:
1   ...   28   29   30   31   32   33   34   35   ...   97

The database is protected by copyright © 2020
send message

    Main page