US President Barack Obama warned today, that restoring economic growth will require fiscal discipline and"hard choices."
"We need to be honest with ourselves about what costs are being racked up because that's how we'll come to grips with the hard choices that lie ahead," Obama said shortly before his administration released its budget for fiscal 2010."And there are some hard choices that lie ahead."
The deficit is expected to reach a record $1.75 trillion in the current fiscal year, which ends in September 2009. That would more than triple the previous record and lift the budget deficit gap to 12% of the Gross Domestic Product (GDP.)
US jobless claims surged to 667,000 in the past week, the highest in more than 26 years.
The US Department of Labor reported today, new US jobless claims surged to 667,000 in the past week, the highest in more than 26 years.
Official figures show that new US jobless claims surged to 667,000 in the past week, the highest in more than 26 years.
The number of initial claims for unemployment benefits in the week to February 21st rose from a revised 631,000 in the previous week, which was the highest level since 1982.
The four-week moving average was 639,500, an increase of 19,000 from the previous week's revised average.
The US labour market, one of the best indicators of economic health has been on a downward spiral, in particular from last September.
The report signals that the monthly report on unemployment for February, will show another large rise. The US economy lost 598,000 jobs in January, pushing the unemployment rate to a 16-year high of 7.6%.
Sales of new one-family houses in January 2009 were at a seasonally adjusted annual rate of 309,000, according to estimates released jointly today by the US Census Bureau and the Department of Housing and Urban Development.
This is 10.2% below the revised December rate of 344,000 and is 48.2% below the January 2008 estimate of 597,000.
The median sales price of new houses sold in January 2009 was $201,100; the average sales price was $234,600. The seasonally adjusted estimate of new houses for sale at the end of January was 342,000. This represents a supply of 13.3 months at the current sales rate.
Manufacturers' orders for goods designed to last at least 3 years, decreased by 5.2% last month to a seasonally adjusted $163.80 billion, the Commerce Department said Thursday.
Durables fell 4.6% in December, revised down from a previously estimated 3.0% decrease.
Year over year, durables were 26.4% lower, in unadjusted terms.
General Motors today posted a $9.6 billion net loss, or $15.71 a share, in the fourth quarter, and burned through $6.2 billion in cash as it implored the Federal government for public assistance to avoid running out of cash. Excluding special items, the car maker's loss was $9.65 per share for the quarter. The company recorded a net loss of $30.9 billion for fiscal 2008 amid a global sales plunge and recession.
In addition to seeking up to $30 billion in Federal funding, the biggest US car maker is seeking about $6 billion from governments outside the US
GM Chief Rick Wagoner said in a statement that he expects"challenging conditions will continue through 2009, and so we are accelerating our restructuring actions."
GM's stock is trading up 1%.
In the markets, the Dow Jones Industrial Average has risen 70 points. The S&P 500 is up 1.1% and the Nasdaq Composite Index has gained 0.4%.
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European stocks rose for the first time this week and the Dow Jones Stoxx 600 Index rebounding from a six-year low.
Swiss bank UBS rose 13% after ousting its CEO.
The Stoxx 600 has risen more than 2% and national benchmarks have risen in all 18 Western European markets, except Ireland.
In Dublin, the ISEQ has fallen 1.4%.
Glanbia has fallen 8% and CRH is down 3.5%.
Bloomberg reports, that former Bundesbank President Karl Otto Poehl said smaller members of the euro region are more likely to default on their debt obligations and would probably be rescued by Germany or the International Monetary Fund.
“The first will certainly be a small country, so that can be managed by the bigger countries or the IMF,”he said in an interview with Sky News. “I think there are countries in Europe which are considering the possibility to leave the eurozone. But this is practically not possible. It would be very expensive.”
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Oil
On the New York Mercantile Exchange, oil for April delivery is trading at $44.31 up $1.81 from Wednesday's close. In London, Brent crude for April delivery is trading at $45.62 a barrel up $1.33.
Currencies
The euro is trading at $1.2734 and at £0.8893.
For live currency updates, check the right-hand column of the Finfacts home page.
The dollar traded at a record low $1.6038 per euro on July 15th.
