Entries in Economic Downturn (6)


Poll: More Americans Identify Themselves As Fiscally Conservative

Comstock/Thinkstock(NEW YORK) -- According to a new Gallup poll, more Americans identify themselves as conservative. In fact, on economic issues, Americans are more than twice as likely to identify themselves as fiscally conservative instead of fiscally liberal.

Gallup’s annual Values and Belief Poll asked Americans if they identified themselves as very conservative, conservative, moderate, liberal, or very liberal for both social and economic issues.

On economic issues, 46% of those polled identified themselves as conservative, while only 20% identified themselves as liberal.  

When those same people were asked about their social beliefs, only 38% said they considered themselves conservative, while 28% identified themselves as liberal.

In recent years, there has been a slight increase in the number of Americans who identify themselves as conservative on economic issues. There has been a rise in both fiscal conservatives, and fiscal liberals, which coincides with the decline of the number of people who identify themselves as moderate on economic issues.

The poll noted that the rise of fiscal conservatives seems to coincide with the economic downturn.

Copyright 2012 ABC News Radio


Overseas Markets React to Signs of Renewed U.S. Recession

Getty Images(LONDON) -- Stocks across Europe were down Friday morning amid continuing fears over the widening Euro Zone debt crisis and signs of renewed recession in the U.S., after Wall Street's 513-point-plus nosedive Thursday.

The FTSE fell 3% in the first few minutes of trading but has since stabilised slightly. The UK’s main banks’ share prices have been hard hit due to Greece's financial problems.

The primary cause of Europe’s jitters appears to be the sovereign debt problem, its spread to Spain and Italy, and growing scepticism that Europe’s political leaders aren't doing enough to solve the spreading problem.

The confidence following the 31st July announcement of funds to support the latest Greek bailout has all but evaporated. None of the 17 Euro Zone parliaments have ratified the move, and people now doubt the amount pledged is enough.

There is widespread criticism in the European press Friday that German Chancellor Merkel, France's President Sarkozy, British Prime Minister Cameron et al, are still on vacation despite the deepening crisis. Sarkozy and Merkel will hold a telephone conference call Friday and there are hopes that the European Central Bank might start buying stressed Spanish and Italian bonds at some point in the future.

The U.S. jobs figures release Friday will certainly be closely watched in Europe in the last hours of trading. Applications for unemployment in the States have remained at or above the 400,000 mark for 17 straight weeks.

Copyright 2011 ABC News Radio


White House Admits Wall Street Drop Is Uncontrollable

Mario Tama/Getty Images(WASHINGTON) -- As the bottom was dropping out on Wall Street Thursday, reporters pressed White House spokesman Jay Carney on how President Obama is going to deal with this latest economic crisis that could send the nation into another recession.

Carney said the president was going to focus on factors he can control, rather than those he can't, meaning Obama cannot magically reverse the selling frenzy.

The administration is still a bit shell-shocked after weeks of tough debate on raising the debt ceiling and reducing the deficit.

Some economists said the spending cuts might do more harm than good to the tepid economic recovery.

As for the president's determination to send Americans back to work on the heels of what's expected to be another bad unemployment report Friday, Carney said Obama "is working very closely with his senior economic advisers to come up with new proposals to help advance growth and job creation."

Carney was also pressed on reports that Treasury Secretary Tim Geithner is looking to leave the administration, which would represent the biggest defection yet from the president's economic team. The press secretary said they'll trust Geithner's word that "he will be here for the foreseeable future."

Copyright 2011 ABC News Radio


5 Signs of a Double-Dip Recession

ABC News Radio(NEW YORK) -- Though Congress forestalled a default on the country's debt obligations, the faltering stock market and several recent economic indicators are causing economists to worry about a "double dip" recession.

Ethan Harris, Bank of America Merrill Lynch economist for North America, said he sees a 20 to 30 percent probability that the country will enter a recession sometime in the next year.

"The odds of a double dip are rising," Harris told ABC News. "The sad thing is that with more effective policy in Washington the risk of recession would be much lower."

Critics of this week's debt deal say the spending cuts will do harm to an already fragile economy.

Here are five signs that together show a double dip recession could be closer than you think:

1. Unemployment:  The labor market has been one of the most significant sore spots on the economic recovery, says Ed Kashmarek, economist with Wells Fargo. Some 25 million Americans are out of work and unemployment rates remains stubbornly high. Payroll company ADP reported that the private sector added 114,000 jobs in July, far short of what's needed to get the job market moving again.

2. Pullback in stock market:  Kashmarek says the drop in the stock markets in the past two weeks is another indicator of a double-dip recession. "It's a leading indicator historically because stocks are looking at future expected profits for companies," he said.

3. Real wage growth
:  With relatively higher gas, commodity and food prices, real wage growth has declined. June's jobs report showed a 0.1 percent drop in wages. Add inflation and that stalls real wage growth. That's problematic for a country in which consumption comprises 70 percent of GDP.
4. Factory orders:  Kashmarek says factory orders demonstrate how much businesses are willing to invest their capital, which has a ripple effect on workers they hire and spending across the economy. "Many businesses have capital now," he said. "If they're not willing to invest in an era with low interest rates, a lot of cash on balance sheet and tax incentives, then that's a problem."

5. Consumer confidence:  The Conference Board's Consumer Confidence Index, which had declined in June, improved slightly in July, but that was after an eight-month low. Harris said a number of combined global affects are increasing the risk of a recession. "The economy was already suffering the after-effects of the Japan crisis and the rise in gasoline price at the start of the summer," Harris said. "Now the debt crises in Europe are adding additional shocks to confidence."

Copyright 2011 ABC News Radio


Economist Forecasts 20 Percent Further Drop in Housing Prices 

Brand X Pictures/Thinkstock(WASHINGTON) -- When will we reach bottom in the housing market? With lenders filing foreclosures more slowly and an excess inventory of homes, housing prices could fall another 20 percent next year, says one economist. Gary Shilling, one of the economists who predicted the subprime mortgage crisis, says the "depressing effect" of two to 2.5 million homes in excess inventory will push prices down.

Foreclosure filings, in which lenders take back homes with delinquent mortgage payments, decreased 30 percent in the first half of 2011 compared to the same period last year. Banks seized 421,212 homes in the first six months of the year, down from 529,633 in the first half of last year, foreclosure listing company, RealtyTrac Inc. said Thursday.

But questions that began last fall about hastily-signed foreclosure filings, in part, have led to slower approvals. RealtyTrac estimates that 1 million foreclosure-related notices that should have been filed by banks this year will be pushed to next year.

With only 18,000 jobs added in June, the country also has a high unemployment rate at 9.2 percent. Also contributing to a decrease in housing demand is an overleveraged consumer base and home prices that have already seen a double-dip decline, according to the Case-Shiller Index, Shilling said.

"In the past, almost everyone was sure that house prices would never fall, and on a national level, they hadn't since the 1930s," Shilling wrote. "Now everyone knows prices can fall, have collapsed and continue to drop. Who wants to buy an asset that is highly likely to continue dropping in price?"

Shilling said a place to live and a great investment "are no longer contained in the same package," an owner-occupied home. He added the "zeal" to buy the biggest house one can afford is gone and households are seeking smaller abodes.

Steven Leslie, lead analyst with Economist Intelligence Unit's Financial Services Briefing, said he agrees that housing is in a long-term slump.

Leslie said he has "a lot of respect" for Shilling, who is a "big bear on the housing market," but he points out that rent prices have increased. Leslie said rental prices typically have more influence on housing prices than housing inventory.

Copyright 2011 ABC News Radio


Race and Recession: Poll Finds Those Hardest Hit Most Optimistic

Photo Courtesy - Getty Images(WASHINGTON) -- A new poll suggests that Hispanics and African Americans hardest hit by the recession are the most optimistic about their futures.

The new Washington Post/Kaiser Family Foundation/Harvard University poll found that African Americans are especially confident about their future finances compared to whites. Hispanics, although at a lesser level, are also more optimistic than whites following the economic downturn.

The survey found that although whites, on average, felt more secure with their finances than African Americans or Hispanics, their view of the nation's economic prospects was worse.

Twenty-three percent of whites said they were pessimistic about their futures, compared to 10 percent of African Americans.

Two-thirds of Hispanics said they believed they could get ahead with hard work, while just over half believed their financial situation would improve in the next year. A majority of African Americans, 62 percent, also believed their prospects would improve in the near future, compared to just 36 percent of whites.

Copyright 2011 ABC News Radio

ABC News Radio