South Korea
The Consumer Confidence Index is released each month by the Conference Board, a private research group. It is based on a survey of five questions that haven’t changed since the index started in 1967.
The Conference Board surveys about 500 people during the first two weeks of the month, and then comes up with a preliminary number. That number is revised in the following month’s report to reflect a total of about 3,000 people. The revision isn’t statistically significant, says Lynn Franco, director of The Conference Board Consumer Research Center. For example, September’s preliminary figure, announced last month was revised to 46.4 from 45.4.
Each question counts for 20 percent of the index. The responses are used in figuring out the index’s two main components:
_ PRESENT SITUATION: Assesses how people feel about the economy now fast cash now. It’s made up of two questions, one that asks if the person thinks business conditions are “good,” “bad” or “normal,” and one that asks whether jobs are “plentiful,” “not so plentiful” or “hard to get.”
_ EXPECTATIONS: Assesses respondents’ outlook for the next six months. It asks similar questions to the Present Situation about business conditions and job outlook. It also adds a third question on whether the person thinks his or her income will increase, decrease or stay the same.
The index hit its all-time high of 144.7 in 2000. Its record low was 25.3 in February 2009.
The number of Americans who bought previously occupied homes likely increased in February to the highest level in two years.
Economists forecast that sales increased to a seasonally adjusted annual rate of 4.6 million last month, according to a FactSet survey. The National Association of Realtors will report on February re-sales at 10 a.m. Eastern time Wednesday.
Home sales have risen nearly 13 percent over the past six months. While they are still below the 6 million that economists equate with a healthy economy, the gains have coincided with other good news in the housing market that suggests slow and steady improvement.
Homebuilders have grown more confident in the past six months after seeing more people express interest in buying a home. In February, they requested the most permits to build homes since October 2008.
Mortgage rates are near record lows. And the supply of homes fell in January to its lowest level in seven years.
A lower supply helps push up prices, which lures more sellers onto the market and generally improves the quality of homes for sale. Rising prices also boost sales because buyers want to invest in homes that are appreciating in value.
For the past few years, the market has been saturated for years with foreclosures. That has put downward pressure on prices and driven away buyers.
A key reason for the brighter housing outlook is the job market has strengthened no faxing payday loans. From December through February, employers added an average of 245,000 jobs a month. The unemployment rate has fallen to 8.3 percent, the lowest in three years.
Still, economists caution that the damage from the housing bust is deep and the industry is years away from fully recovering.
Fewer first-time buyers, who are critical to a housing recovery, are in the market for a home. They made up roughly one-third of sales last year. In healthy markets, the percentage is at least 40 percent.
Many can’t qualify for loans or meet higher down-payment requirements. Even those with excellent credit and stable jobs are holding off because they fear that home prices will keep falling.
Sales are measured when buyers close on homes. Some deals have been scuttled before the closing after banks declined mortgage applications, home inspectors found problems, appraisals showed a home was worth less than the bid, or a buyer lost a job.
The high rate of foreclosures has made resold homes cheaper than new ones. The median price of a new home is roughly 30 percent above the price of one that’s been occupied before _ twice the normal markup. Investors are taking advantage of the discounts.
With just five days to go for nations to put forward nominees to lead the World Bank, there are few signs the United States has finalized its choice to lead the global development lender.
The United States has held the presidency of the Bank since its founding after World War Two, while a European has always led its sister institution - the International Monetary Fund.
But Washington has yet to publicly identify a candidate and some observers think the delay could signal that the White House is having a hard time convincing possible candidates to take the job. The White House and Treasury Department have declined to comment.
Sources with knowledge of the administration’s thinking say the hope was to convince a woman to enter the race to replace Robert Zoellick, who has said he will step down when his term expires at the end of June.
Naming a woman could go some way to address calls from emerging-market nations for a change in the status quo. A woman has never led the bank.
Two sources said Susan Rice, the U.S. ambassador to the United Nations, was a leading contender. However, it is not clear she wants the job. Rice’s name often surfaces as a possible candidate to succeed Hillary Clinton as secretary of state.
When asked last week how she would help South Sudan if she was president of the World Bank, Rice replied: “Ridiculously hypothetical.”
Senator John Kerry and PepsiCo’s Indian-born CEO Indra Nooyi had also made an Obama administration short list, according to a source, although Kerry has publicly ruled out the job and another source said Nooyi was no longer in contention.
Another short-list member, Lawrence Summers, a former adviser to President Barack Obama and a one-time Treasury secretary, has declined to comment. He told Reuters he would leave the selection process to the officials in charge of it.
LEAVING THE DOOR OPEN
The delay in identifying a U.S. nominee could leave the door open to a dark-horse candidate from the United States. It has also given other nations time to consider their own nominees.
“It wouldn’t be the first time in history that the White House had to scramble a bit,” said Whitney Debevoise, a former director to the World Bank board.
“I think they have lost the opportunity to put a name out there early and make it uncontested,” he added. “Usually … if the U.S. puts a name out there, then nobody else wants to put their name up because they know they don’t have a chance.”
Emerging and developing countries have been pushing to have more say at both the World Bank and IMF, and have said the decision on Zoellick’s successor should be merit-based.
Developing and emerging market economies are currently in consultations on putting forward names of non-U.S. candidates. The dilemma for developing regions, however, is finding candidates willing to come forward in a race in which the outcome is felt to be pre-ordained.
Indeed, the two most talked about names among developing countries are former World Bank Managing Director Ngozi Okonjo-Iweala, now Nigeria’s finance minister, and Trevor Manuel, the South African national planning minister pay day loans. Former Indonesian finance minister and current World Bank Managing Director Sri Mulyani Indrawati, and Mexico’s central bank governor Agustin Carstens have ruled themselves out.
World Bank board sources said there were also talks under way about possibly appointing a candidate from a developing or emerging economy to head the Bank’s private-sector lender, the International Finance Corp. IFC CEOs have mainly been European.
The World Bank’s 24-member board, which represents all of the institution’s 187 member countries, has set a deadline for Friday for nominations to lead the Bank, and has said it would decide on the next president within a month.
ONE MAN RACE
U.S. economist Jeffrey Sachs, a professor at Columbia University, is the only formal candidate to have emerged so far. He has been formally nominated by Bhutan and a cluster of developing countries including East Timor, Jordan, Kenya, Namibia and Malaysia.
“Jeffrey Sachs is a good economist and a very good candidate, but we expect to see the rest of the names and what follows in the process,” Mexican Finance Minister Jose Antonio Meade said on Sunday.
Last week, 27 lawmakers wrote to President Barack Obama to “strongly” encourage him to nominate Sachs. Sachs, whose self-proclaimed candidacy aims to challenge what he sees as a history of political appointments by the White House, acknowledges he lacks the Obama administration’s support.
“They’re not talking to me,” he told Reuters.
With his early nomination, Sachs has had a head start in lobbying for support among developing countries where he has a proven track record on issues such as education, health, climate change and fighting poverty.
“I have spoken with at least a couple of dozen leaders around the world in the last week and believe I have strong worldwide support in every region of the developing countries, and a lot of support in Europe as well,” Sachs said.
“For the European countries, they are not surprisingly saying that they are overwhelmingly likely to defer to the U.S. nominee and that they are waiting for that,” he added.
Sachs said while the United States was still likely to determine who gets the job, a desire among developing countries to end tradition suggested that was not a sure bet.
“I don’t think it is automatic because of feelings that this is an important institution and an important moment, and I don’t think the U.S. has simply the green light to choose anybody.”
Officials argued that it is important for the United States to retain the presidency of the bank, otherwise political support and funding for the institution could erode, given that Congress is focused on budget cutting.
The United States is the World Bank’s largest donor.
(This version of the story has been corrected to fix the date in the dateline)
U.S. stock futures are up ahead of another round of economic data that should shed further light on whether the recovery in the world’s largest economy is still picking up steam.
Dow Jones industrial futures rose 23 points to 13,195. The broader Standard & Poor’s 500 futures are up 2 points to 1,398. Nasdaq 100 futures are up 4 points to 2,716.
The market has rallied on upbeat U.S. economic data and easing worries about European debt, despite some concern over the rise in oil prices. On Thursday, the Standard & Poor’s 500 index closed above 1,400 for the first time since June 2008.
Later Friday, the focus will be on consumer inflation and industrial production figures as well as the closely watched University of Michigan consumer confidence survey.
Plastics manufacturer Spartech Corp. reported a $2.3 million loss in the first fiscal quarter, driven by increased freight costs, corporate expenses and spending on repairs and maintenance.
Clayton-based Spartech lost $2.3 million, or 7 cents a share, in the quarter ended Feb. 4, compared to a profit of $1.0 million, or 3 cents a share, a year earlier.
The company’s business units include custom sheet and rollstock, packaging technologies and color and specialty compounds.
Net sales increased 20 percent to $281.8 million in the first quarter, driven by sales in the automotive sector, construction, and food packaging.
Spartech executives plan to hold an investors’ conference call Thursday at 10 a.m. to discuss the quarterly results.
TORONTO
Signed contracts for home resales rose to a nearly two-year high in January, an industry group said on Monday, further evidence of a budding recovery in the housing market.
The National Association of Realtors said its Pending Home Sales Index, based on contracts signed in January, increased 2 percent to 97.0 - the highest reading since April 2010.
December’s reading was revised down to 95.1 from a previously reported 96.6.
Economists polled by Reuters had expected signed contracts, which lead existing home sales by a month or two, to rebound 1.0 percent after a previously reported 3.5 percent fall. Contracts signed were up 8.0 percent in the 12 months to January.
A nascent recovery is under way in the housing market, with the supply of both new and previously owned homes on the market being whittled down in recent months.
But with the foreclosure tide yet to recede and continuing to depress prices, recovery will be a long, drawn-out affair.
Hammered by the financial crisis that has led to ever diminishing income, a group of residents in northern Greece have joined forces with potato farmers to slash consumer prices and ensure producers can get their crop to markets by cutting out the middle man.
Hundreds of families turned up Saturday in this northern Greek town to buy potatoes at massively reduced prices, sold directly by producers at cost price. They lined up in cars and with bicycles, on foot and with scooters to collect their bags of spuds from a truck that flung its doors wide open and was doing a roaring trade in the parking lot of a local courthouse.
Farmers say it costs about 20 cents ($0.27) to produce a kilogram (2 pounds) of potatoes, but that wholesalers will only buy them for 10-12 cents to get the crop to supermarkets, where they sell for about 60-70 cents a kilogram. Faced with making a loss, many producers say they have been unable to even get their products to the market.
Greece’s severe financial crisis, now entering its third year, has seen pensions and salaries slashed and led to skyrocketing unemployment of over 20 percent. More and more people have been turning up at soup kitchens run by the church or local aid groups, and homelessness has been increasing.
Faced with an ever deepening recession, some local groups have begun coming up with novel ways to beat the financial crunch.
Ilias Tsolakidis, 54, part of a volunteer group in northern Greece, said he contacted a potato farmer in northern Greece last week and posted an advertisement on the internet offering consumers the chance to order directly from the producer at cost price. He was overwhelmed by the response: by Wednesday, all 24 tons of potatoes on offer had been sold, with 534 families putting in orders.
His motive, Tsolakidis said, was “to cover a financial gap in the family budget. You know, the situation in the financial crisis has become very difficult. We help producers (from the local area) on the one hand, and also the families of consumers.”
Kiki Pantelopoulou couldn’t agree more.
“I didn’t only do this because it’s in my interest,” said the 42-year-old as she loaded a sack of potatoes onto her bicycle. “My main concern is how to stop this situation. This way, we favor Greek products and therefore producers can at least make the cost price.”
Tsolakidis said that with demand so high, his group of volunteers would set up another sale next weekend, buying another 24 tons of potatoes from a different farmer this time.
Konstantinos Karanikos, 67, said his son helped him order sacks of potatoes from Saturday’s sale over the internet, but could only secure half the amount he wanted because the demand was so high. “We will order again next weekend,” he said. “The important thing is for the producer to be satisfied and the consumer to have cheap potatoes.”
With the crop being sold at cost price of 20 cents a kilogram, Lefteris Kostopoulos, the farmer who put his spuds up for sale Saturday, didn’t make any profit on the transaction. But, he said, at least he managed to break even and sell more than half of the produce he had stored up in a warehouse.
“This group’s move was very good. It helped us shift the amounts we had in the warehouses, and we didn’t give them to the wholesalers who are asking for 10-12 cents per kilo,” he said. “We might not make money here, because we’re essentially breaking even, but at least we aren’t making a loss.”
Kalypso Skouba, 44, said she hoped the new movement spread to other products soon, so she could buy more vegetables or fruit directly from producers.
“I bought potatoes today just to show that it can’t only be the middlemen who make money,” she said.
The battle of the bulge has been a big, fat failure for U.S. drugmakers. But that hasn’t stopped them from trying.
For nearly a century, scientists have struggled to make a diet pill that helps people lose weight without side effects that range from embarrassing digestive issues to dangerous heart problems.
But this week, federal health advisers endorsed the weight loss pill Qnexa even though the FDA previously rejected it over concerns that it can cause heart palpitations and birth defects if taken by pregnant women.
The vote of confidence raises hopes that the U.S. could approve its first anti-obesity drug in more than a decade. It also highlights how challenging it is to create a pill that fights fat in a variety of people without negative side effects.
“Having a drug for obesity would be like telling me you had a drug for the fever,” said Dr. Mitchell Roslin, chief of bariatric surgery at Northern Westchester Hospital in New York. “There can be millions of different reasons why someone is obese; it’s really a symptom of various underlying mechanisms.”
An effective and safe diet pill would be an easy sale in the U.S.: With more than 75 million obese adults, the nation’s obesity rate is nearing 35 percent. But the biggest problem in creating a weight-loss drug is that there’s no safe way to turn off one of the human body’s most fundamental directives.
For millions of years, humans have been programmed to consume calories and store them as energy, or fat. It’s this biological mechanism that makes it almost impossible to quickly lose weight by not eating. Cutting down on food instead sends stronger signals to the body to store more calories.
“Throughout most of human history calories were scarce and hard to get, so we have numerous natural defenses against starvation,” said Dr. David Katz of Yale University’s Prevention Research Center. “We have no defenses against overeating because we never needed them before.”
The drug industry has been on a nearly 100-year search for a drug that can help the body shed pounds. They’ve mostly failed to come up with an effective one and many of their experiments have proven fatal to patients:
_ Early attempts focused on speeding up metabolism to burn more calories. In the 1930s, doctors prescribed an industrial chemical called dinitrophenol, which accelerated metabolism, but also caused fever, swelling and deadly toxicity in some patients. The 1938 law establishing the Food and Drug Administration was a response to untested drugs like dinitrophenol.
_ In the `50s and `60s, amphetamines became a popular because they boost metabolism and suppress appetite. But the pills proved to be highly addictive, and doctors discovered they increase blood pressure and heart rate. The amphetamine phentermine remains approved for short-term weight loss, usually less than 12 weeks, though it is seldom prescribed because of the potential for addiction.
_ Perhaps the worst diet pill safety debacle came in the 1990s and involved the combination of phentermine and another weight loss drug marketed by Wyeth called fenfluramine. The combination of the two pills, dubbed fen-phen, was never approved by the FDA but more than 18 million prescriptions were written for it by the mid-90s.
But after studies in 1997 suggested that up to a third of patients taking fen-phen experienced heart valve damage, Wyeth was forced to recall two versions of fenfluramine and eventually paid more than $13 billion to settle tens of thousands of personal injury lawsuits.
_ In the last decade, drugmakers have moved toward other weight loss concoctions. Currently, the only drug approved for long-term weight loss in the U.S. is orlistat, which is sold as the prescription drug Xenical and over the counter as alli. The drug works by blocking the absorption of fat.
When launched in 2007, alli received a high-profile marketing push from drugmaker GlaxoSmithKline, complete with TV ads and a celebrity endorsement by country singer Wynonna Judd. But it never took off due to unpleasant side effects, including loose bowel movements. Educational pamphlets for alli even recommend people start the program when they have a few days off work, or bring an extra pair of pants to the office.
_ Most drugmakers now are focusing on medications that block brain signals associated with food craving and appetite. Vivus’ Qnexa is one of a trio of drugs seeking FDA approval. The diet pill, which was initially rejected due to the risks of heart palpitations and other safety issues, is a combination of two older drugs.
It uses amphetamine phentermine, which suppresses appetite. The other drug is topiramate, an anticonvulsant sold by Johnson & Johnson as Topamax. Topiramate is believed to make patients feel more satiated, though it’s unclear exactly how. J&J initially studied Topamax alone as a weight loss treatment but concluded the psychiatric side effects, such as memory loss and difficulty concentrating, were too significant.
Still, on Wednesday, a panel of FDA doctors and other advisers voted 20-2 in favor of approving Vivus’ Qnexa pill, which the drugmaker has resubmitted to the FDA for a second review.
The group touted the drug’s benefits, which include weight loss of nearly 10 percent for most patients taking the drug over a year _ the highest reduction reported with any recent diet pill. But panelists stressed that the drugmaker must be required to conduct a large, follow-up study of the pill’s effects on the heart.
The FDA is expected to issue its decision on Qnexa by mid-April.
“The potential benefits of this medication seem to trump the side effects,” said FDA panel member Dr. Kenneth Burman of the Washington Hospital Center in Washington DC. “But in truth, only time will tell.”
Tammy Wade of McCalla, Ala., is confident that the diet pill works. She lost nearly 40 pounds, dropping down to 167 while in a two-year Qnexa study.
“I never lost that much weight on any of the programs I’ve tried,” said Wade, who’s done everything from Weight Watchers to work out with a personal trainer.
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