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Tuesday
Dec142010

November Retail Sales Up More Than Expected

Photo Courtesy - Getty Images(WASHINGTON) -- The Silver Bells of holiday retail rang a bit louder and clearer Tuesday as the Commerce Department released figures that showed retail sales up more than expected in November.

The government said retail sales were up 0.8 percent last month, well above the 0.6 percent increase economists had expected.

“Gains were fairly broad-based across big-box retailers, apparel stores and online vendors,” said Diane Swonk, an economist with Mesirow Financial. “We also saw more spending at the gas pump as energy prices picked up. The weak spots were electronic store sales and restaurant tabs. Middle and lower income households, in particular, tend to make trade-offs and eat out less when prices at the pump rise.”

Consumer confidence polls have suggested spending would be more conservative.

The better than expected results have some retail groups revising their expectations for the holiday season. The National Retail Federation initially thought holiday spending would be up 2.3 percent this year, but revised its outlook Tuesday morning to a 3.3 percent annual growth.

“The start to the holiday season has surpassed all expectations,” said NRF President and CEO Matthew Shay. “While employment data is still a concern, we are starting to see improvement in other economic indicators that support an increase to our forecast.”

Copyright 2010 ABC News Radio

Tuesday
Dec142010

Want to Buy a Foreclosed Home? Try Google Maps or Zillow

Photo Courtesy - ABC News(WASHINGTON) -- With mortgage rates at their highest level in six months, this may be an opportune time for buyers.

Real estate websites are offering better tools to research foreclosed homes for sale, sometimes at a steep discount. Earlier this month, RealtyTrac announced that in the third quarter of this year, the average sales price of properties sold in some stage of foreclosure was over 32 percent below the average sales price of properties not in foreclosure.

Google Maps began offering a search feature last year for foreclosed properties. It is growing in popularity, though it is not very novel, said Justin McHood of MortgageCommentator.com.

McHood, who writes about mortgage topics for Zillow.com, one of the largest real estate websites, said a number of sites are simply rehashing what is known as "multiple listing services," regional listings of properties for sale. Last month Zillow.com had 12.5 million visitors, up 60 percent from last year, according to Bohutinsky. Despite the "biggest real estate downturn of our lifetime," she said Zillow.com is growing, as is the number of other real estate websites.

RealtyTrac.com is a real estate website that specializes in foreclosed properties, with over 2 million listings, according to senior vice president Rick Sharga. Although all foreclosed properties are listed in public records, he estimates that less than 6 percent of public foreclosure databases are online. Sharga said RealtyTrac.com fills that gap by hiring contract employees to hand collect those records in court houses in 2,200 counties nationwide.

Fannie Mae launched a website in June, HomePath.com, which lists the properties it owns. HomePath.com gets 15 to 19 million hits per month and generates about 800 leads a day to listing brokers, according to Janis Smith, a spokeswoman for Fannie Mae. More than 87,000 families purchased HomePath properties in the first half of 2010, according to Terry Edwards, executive vice president, Credit Portfolio Management at Fannie Mae.

Copyright 2010 ABC News Radio

Tuesday
Dec142010

Report: Yahoo! Prepares to Cut 600 Jobs

Photo Courtesy - Getty Images(SUNNYVALE, Calif.) -- Search giant Yahoo! is reportedly set to cut more than 600 jobs beginning as early as Tuesday.

The Wall Street Journal, citing sources, reports that the company will slash nearly five percent of its workforce as it struggles to compete with Google, which just last month promised workers a 10 percent raise.

It’s the latest in a round of cuts that began in late 2008, when Yahoo! Inc. cut approximately 1,400 jobs.

Copyright 2010 ABC News Radio

Tuesday
Dec142010

GM Begins Shipping Chevrolet Volts to US Dealerships

Photo Courtesy - Chevrolet [dot] com(DETROIT) -- The first batch of Chevrolet Volts are on their way to car dealers across the United States, according to General Motors.

The electric vehicles left the Detroit-Hamtramck Assembly Plant on Monday and are being shipped to their initial launch markets in California, Texas, Washington, D.C. and New York.  GM says a total of 160 Volts are expected to be shipped by this week.

“Today is a historic milestone for Chevrolet,” said Tony DiSalle, Volt marketing director.  “We have redefined automotive transportation with the Volt, and soon the first customers will be able to experience gas-free commuting with the freedom to take an extended trip whenever or wherever they want.”

The Volt combines "battery-only electric driving with an efficient, gas-powered engine" that allows the vehicle to go 379 miles before having to recharge its battery or fill up its gas tank.  It is the only electric vehicle that is mass produced in the U.S.

Copyright 2010 ABC News Radio

Monday
Dec132010

IT Employment Sees Modest Growth in November

Photo Courtesy - Getty Images(ALEXANDRIA, Va.) -- The information technology industry added 600 jobs in November, continuing its modest, month-over-month growth, according to a monthly IT employment index developed by TechServe Alliance.

While last month's numbers were significantly weaker (12,000 jobs were added in October) than preceding months, the index still reflected a trend of growth, which has been unbroken for 12 consecutive month.

TechServ Alliance CEO Mark Roberts advises that we keep November's moderate growth in perspective.

"IT employment has now grown every month for the last 12 months.  While we will continue to see month-to-month variances given the dynamic nature of the economy and labor markets, our bullish forecasts for the coming year remain unchanged," he said.

Copyright 2010 ABC News Radio

Monday
Dec132010

Toyota Conducting Recall of 2011 Sienna Model

Courtesy - Toyota(TORRANCE, Calif.) -- Toyota Motor Sales (TMS), U.S.A., Inc. is conducting a voluntary safety recall of some cars in its 2011 Sienna line.  The reason given is that it wants to replace a potentially faulty bracket connected to the break light.

Owners of the affected vehicles will receive official notification of the recall via first-class mail from Toyota by January 2011, along with instructions on what to do should the owner experience break light problems. 

No other Toyota or Lexus vehicles are involved in this recall. 

Toyota will also post this information on its website, toyota.com/recall. 

Copyright 2010 ABC News Radio

Monday
Dec132010

Continental Airlines Introduces New Fee to Hold Airfare

Photo Courtesy - United Continental Airlines(NEW YORK) -- It looks like the airline industry has found a new fee to squeeze some extra cash out of the flying public: the rate lock fee. Continental Airlines on Monday afternoon announced "FareLock," a new service which allows passengers to pay fees starting at $5, and rising to $9 or more, to hold a seat at a given price as a hedge against rising airfare. The price can vary depending on the itinerary and other factors.

Continental, which merged with United Airlines but is still operating as a separate airline, is the first carrier to offer such a service but, as with baggage fees, expect the rest of the industry to soon follow Continental's lead.

Continental, Delta, United and other airlines currently allow customers to get a full refund on any ticket within 24 hours of purchase. Some travelers take advantage of the system by booking, canceling the next day and then rebooking to ensure the best fare. American Airlines currently allows customers to hold a ticket -- and the fare -- for 24 hours for free.

Continental said that, for now, it won't abandon its 24-hour cancellation policy and that its new FareLock just gives travelers more options and more time to decide.

Customers may choose FareLock when booking reservations at continental.com and opt for a 72-hour or a seven-day hold. They may return to complete the transaction at any time between purchasing the lock and its expiration, or they may choose an auto-ticketing feature which tickets at the end of the lock period, the company said. FareLock fees, beginning at $5 for a 72-hour hold and $9 for a seven-day hold, will vary based on a number of factors such as the itinerary, number of days to departure and the length of the hold. While tickets can still be canceled with 24 hours, the FareLock fee is non-refundable.

Fees are big business for the airlines. The Department of Transportation on Monday revealed that Delta Air Lines collected the most fees of any of the U.S. carriers, hauling in $1.26 billion in fees so far this year, Neidl noted. United/Continental was second with $922 million followed by $784 million collected by American. Neidl said that even though Southwest does not charge for the first two checked bags, it still collected $22.5 million in fees for third bags and overweight bags.

Copyright 2010 ABC News Radio

Monday
Dec132010

A&P Files for Chapter 11 Bankruptcy

Photo Courtesy - The Great Atlantic & Pacific Tea Co.(MONTVALE, N.J.) -- The company that operates grocery store chains A&P, Waldbaums and Pathmark has filed for Chapter 11 bankruptcy.

The Great Atlantic & Pacific Tea Company said Sunday it made the move to “restore the Company to long-term financial health,” and assured shoppers that each of its 395 stores would remain open and fully stocked throughout the reorganization.

“It will allow us to restructure our debt, reduce our structural costs, and address our legacy issues,” A&P President and CEO Sam Martin said of the restructuring.

The company announced in October what it called a “turnaround” plan, which included assigning a new management team, reducing costs and enhancing customer experience.

A&P -- which employs more than 40,000 workers -- also operates stores under the Super Fresh, Best Cellars and The Food Emporium labels.

Copyright 2010 ABC News Radio

Monday
Dec132010

Public Pensions in America's Biggest Cities Face Underfunding Crisis

Photo Courtesy - Getty Images(EVANSTON, Ill.) -- Two professors of finance are giving a sharp rap on the knuckles to Philadelphia, Boston, Chicago and other major cities.  Their warning: better fix your pension problems fast.

An analysis by Robert Novy-Marx of the University of Rochester and Joshua Rauh of the Kellogg School of Management finds that public pension plans for America's 50 biggest cities and counties are underfunded by $382 billion -- or $14,000 for every household in those same cities.  Some of the biggest plans may run out of money to pay promised benefits in as little as five to eight years.

Michael Zuccht, general manager of the San Diego Municipal Employees Association, says the problem has been building for decades.  Year after year, municipalities have put off fully funding their pension obligations, just kicking the can down the road.  Now, though, with the Baby Boom retiring, that road is running out.

"For 30 years elected officials have failed to meet these 'boring' obligations," says Zuccht, referring to his city's and others' pension plans.  "They preferred to spend their money on 'exciting' things like parks and libraries and recreation.  Guess what?  It's come due now.  It's hit the fan."

Cities claim their liability is less -- only $190 billion, or $7,000 per household.  But Rauh and Novy-Marx say this lower figure is the result of government accounting that assumes too rosy a return on assets and underestimates the cost of pension promises.  The professors use private sector accounting standards, then calculate how long the assets in each fund (as of June 2009) could keep paying out the benefits promised, as of that same date.

Philly, by their reckoning, has just five years until it can't pay.  Boston, Chicago and New York, have eight.

Of the 50 cities in the study, 20 won't be able to pay their promised benefits after 2025.

Copyright 2010 ABC News Radio

Monday
Dec132010

NYC Considers "Crash Tax" for Accident Response

Photo Courtesy - Getty Images(NEW YORK) -- Strapped for cash, a growing number of municipalities have begun charging for responding to accidents -- services that have long been covered by taxpayers.  Sometimes, the victim's insurer will pick up the tab for these new fees -- but sometimes the insurers will refuse to pay.

This past week, New York City joined the growing debate over what some are calling a "crash tax."  Mayor Michael Bloomberg announced the city wants to begin charging accident victims hundreds of dollars each as one way to help plug the city's multimillion-dollar budget deficit.

Under Bloomberg's "crash tax" plan, car fires with injuries would incur a bill of $490.  A car fire with no injuries would cost $415.  And a crash with no injuries would receive a "discount" -- a bill of only $365.

Although critics say the New York Fire Department could easily find more savings in its budget -- such as by eliminating the paid drivers of fire chiefs -- Bloomberg said he had little choice.

"Would you like them to close fire houses?" Bloomberg said.  "I don't think so.  So they've got to raise the money."

Some municipalities have instituted accident-recovery fees at the prodding of collection companies that have offered their billing services, in return for a percentage of the revenue raised.  The AAA and the insurance industry oppose such fees, saying accident response and public safety are basic government services that should be paid for with general taxes.

"Crash taxes" are just some of the extreme measures states and cities are taking around the country to counter billions of dollars in budget deficits. 

In New York State, Gov. David Paterson has proposed legalizing ultimate fighting, a move that would generate $2.1 million a year.  Arizona slashed its Medicaid program, leaving 98 residents ineligible for life-saving organ transplants.  California Gov. Arnold Schwarzenegger wants to open up the coast off of Santa Barbara to oil drilling to raise hundreds of millions of dollars in new revenues.  And one of New Jersey's more crime-ridden cities, Camden, recently sent pink slips to about half of its 380-member police force.

Copyright 2010 ABC News Radio







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