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Posts Tagged ‘Economy’

Singapore expects its economy to grow by 6.4 per cent this year compared to the continued strong revival in the global economy.

Trade and Industry Ministry said Singapore’s manufacturing operations were expanded and sustained rate of growth in advanced economies.

In 2010, the republic’s economy grew 14.5 percent, thanks in large part by the manufacturing sector rose by 29.7 percent, reversing a decline of 0.8 percent in 2009.

In its 2011 economic forecast released today, the ministry said the resilient domestic demand in Asia would continue to drive intra-regional trade flows and benefit Singapore’s wholesale trade sector.

It said the republic’s tourism-related services sectors would see a strong growth this year with the expected increase in visitor arrivals, particularly from the key markets within the region.

It added that domestic factors such as capacity expansion in the electronics and biomedical manufacturing clusters would also bolster growth in the manufacturing sector this year.

However, the ministry cautioned that the downside risks still remained, such as with the persisting sovereign debt concerns in the peripheral European Union economies, monetary tightening due to the inflationary concerns in Asia, and a tighter labor market domestically.

The Ministry has revised its increase forecast for this year, two to three per cent in three or four per cent said it should increase by five percent during the first fifty-five months before that moderation in the second half of ‘year.

Employers will hire more workers in 2011 year and the economy will grow faster than expected three months ago, according to an Associated Press investigation found optimism on the rise among the classical economists.

However, unemployment remains chronically high of nearly 9 percent at year end, the last quarter AP Economics Survey shows. A majority of economists say it will be 2016 or later, before the unemployment rate falling to a historically normal rate of around 5 percent.

Economists have become more confident 19 months after the worst recession since the Great Depression ended. Lower Social Security taxes and higher stock prices will embolden Americans to spend more and help power the economy, they say.

“People will finally recognize that an economic recovery is under way,” said Lynn Reaser, a board member of the National Association for Business Economics. “This won’t be a recovery seen only by economists.”

The gains this year will be enough to withstand the threats still clouding the economy, the AP survey found. A majority of the economists doubt, for example, that falling home prices and higher mortgage rates will pose a major risk to the economy in 2011.

The AP survey collected the views of 42 private, corporate and academic economists on a range of indicators. Among their forecasts: The economy will grow 3.2 percent this year, compared with the 2.7 percent they forecast in October. That would top last year’s estimated growth of less than 3 percent.

Employers will create a net total of 2.2 million jobs. Three months ago, the economists predicted 1.6 million jobs would be added in 2011. Last year, employers added roughly 1.1 million.

Consumers will spend 3.2 percent more this year than last year. That’s stronger than the 2.5 percent growth the economists had forecast in October. And it’s nearly double the spending growth that’s estimated for 2010.

Inflation will be 1.8 percent this year, barely more than the 1.7 percent the economists forecast in the previous survey and up only slightly from 1.5 percent last year. The 1.8 percent forecast falls within the range of inflation the Federal Reserve thinks a healthy economy needs.

Among the reasons for the economists’ growing optimism: an extension of income-tax cuts, a cut in Social Security taxes for workers, easier access to loans, higher stock prices and a government that seems more sympathetic to the priorities of businesses.

The brighter outlook is also evident among people responsible for hiring. Jerry Huddleston, human resources manager of the Ozark Natural Foods grocery store in Fayetteville, Ark., said he plans to hire for busy weekend shifts because sales are improving.

The store is generally slow to add jobs. But Huddleston said business is picking up. Customers seem more willing to pay more for organic milk, vitamin supplements and pre-made vegetarian meals. “I think people are starting to be more confident that the job they have is the job they will have tomorrow,” he said.

As the economy gradually strengthens, the economists expect interest rates will pick up, as they already have begun to do. They think the yield on the 10-year Treasury note, now at 3.4 percent, will reach 3.6 percent by midyear and 3.9 percent by year’s end. Those higher rates would force up mortgage rates, which tend to track the 10-year Treasury yield.

Yet when asked about a range of threats from falling home prices and rising energy prices to state budget woes and Europe’s debt crisis the economists called each a minor risk rather than a major risk to the economy. In the spring and summer, many analysts had feared the economy might slide back into a “double-dip” recession.

“Consumers and businesses are in a better mood,” said Nariman Behravesh, chief economist at IHS Global Insight. “They are spending a little more freely. Not a lot more freely, but a little more freely.”

That helps explain why Behravesh has lifted his forecast for economic growth in 2011 to 3.2 percent, from 2.2 percent in October.

Still, the Fed said Wednesday that the economy isn’t growing fast enough to lower unemployment and still needs help from the Fed’s $600 billion Treasury bond-purchase program. The bond purchases are intended to lower rates on loans and boost stock prices, spurring more spending and invigorating the economy.

President Barack Obama still faces risks from voters skeptical of his economic stewardship, according to a new Associated Press-GfK poll. More than half disapprove of how he’s handled the economy. Just 35 percent say it’s improved on his watch; 40 percent had said so a year ago.

Yet public sentiment may brighten if the economists prove correct in their forecasts. Rajeev Dhawan, director of Georgia State University’s Economic Forecasting Center, has raised his estimate for growth this year to 2.7 percent, from 1.8 percent three months ago.

This 2011 is better than 2010 for terms of hiring, spending and economic growth, “said Dhawan.”However, unemployment is falling slowly. At least we’re not going back.”

Addressing climate change should play a greater role in the world economic recovery, Joseph Stiglitz, Nobel laureate and professor of economics at Columbia University said at a public lecture in Pretoria on Monday.

“Addressing climate change can be a part of the recovery,” he said, adding that once the world economy had achieved a recovery, it would be more difficult to get green technologies to be part of the world economy.

Limiting emissions globally would see countries having to cut their emissions globally by 80 percent, but he said that this figure would vary from country to country.

Stiglitz said a carbon tax of $80 a ton was a realistic tax that would encourage investment in green technologies. He was in favour of carbon taxes and was critical of trading in emissions permits, which he believed would see the worst polluters obtain permits.

Stiglitz had been disappointed in the world’s failure to reach an agreement at the 2009 United Nations Climate Change Conference in Copenhagen.

He said the biggest impediment to reaching an agreement on how to tackle the climate change was on how to share the burden of cutting emissions.

WASHINGTON (AP) — Federal Reserve, Ben Bernanke on Capitol Hill is more confidence in the prospects of the economy and jobs, but not enough to retire from the Fed,s 600 billion U.S. dollars of the bond program to buy Friday.

Bernanke’s testimony before the Senate Budget Committee is his first appearance in Congress since the Fed announced in November it planned to buy 600 billion in Treasury bond purchases in June are designed to stimulate the economy by reducing interest rates and rising stock prices.

The program has been criticized by Republicans in Congress and some Fed officials who contend it will do little to help the economy and could hurt it by unleashing inflation and speculative buying on Wall Street. The move heightened tensions with trading partners including China, Germany and Brazil. They complained it was really a scheme to push down the value of the dollar, giving U.S. exporters a competitive edge.

Bernanke is expected to defend the program and signal the Fed intends to spend the full amount as scheduled, while also delivering a more encouraging message about the economic outlook for 2011.

“The economy seems to be moving in the right direction. But he’ll also caution that now is not the time for the Fed or for Congress to pull up supports,” said Ken Mayland, president of ClearView Economics.

Factories are cranking up production. The service sector is growing at its fastest pace in more than four years. Fewer people applied for unemployment benefits over the past month than in any other four-week period in more than two years. Consumers are spending more freely, and a payroll tax cut is likely to boost their activity further. All that suggests hiring will accelerate in the months ahead.

Bernanke’s testimony is scheduled to start one hour after the government releases its December jobs report. Economists are predicting that employers added 145,000 new positions last month and the unemployment rate dipped to 9.7 percent.

“The Fed chief will talk about improvements in the economy and will sound more optimistic,” said James O’Sullivan, economist at MF Global. “But he’ll caution that unemployment is historically high and has a long way to go to get back to normal.

Bernanke has said it could take four or five years for unemployment to drop to a historically normal, 5.5 percent to 6 percent. That’s why O’Sullivan and other economists predict Bernanke will make the case that bond-buying program is still needed.

Economists and Fed officials think Congress’ tax-reduction plan will help bolster the economy this year and should spur more hiring.

The tax package extends tax cuts enacted by President George W. Bush in 2001 and 2003, gives a pay raise to working Americans by lowering the Social Security payroll tax, provides tax breaks to businesses and extends unemployment benefits. The package has a price tag of $858 billion over two years.

Similarly, economists predict Bernanke will argue for Congress and the White House to come up with a long-term plan to reduce the government’s trillion-plus-dollar budget deficits.

President Barack Obama’s debt commission at the end of last year failed to reach a consensus on what to do about exploding deficits. Over the coming decade government deficits are estimated in the $10 trillion range. If Congress fails to come up with a plan to curb those deficits in the long run, the economy could be hurt, Bernanke is likely to say. Big deficits could force investors to demand more returns to loan out their money to the government. Interest rates could soar, crimping spending and slowing the economy.

Risks still lurk, the Fed said earlier this week. Seizures can lower the prices of houses more and further weaken the housing market. Try to balance their budgets, struggling state and local governments could cut spending more deeply and lay off employees. These forces would weigh on economic growth.

Prime Minister Lee Hsien Loong on Friday, marked increases income inequality that the government is trying to address the issue while the economy grew by a record percentage of 14.7 last year, a dramatic recovery of negative growth in 2009.

He said his New Year message: ‘We are committed to ensuring that the vast majority of the benefit of Singapore on the type of economic growth, as low-income and less educated workers and the middle group who feel sandwiched between.’

He also cautioned that the exceptional growth in 2010 was due to special circumstances and unlikely to be repeated soon.

The official forecast for 2011 is 4 to 6 per cent. Year-on-year, the economy grew 12.5 per cent in the last quarter of 2010.

Mr Lee noted that growth had improved Singaporeans’ lives, but also brought a number of challenges. These included: managing the inflow of foreign workers and immigrants, keeping homes affordable, and helping low-wage workers cope with the cost of living.

“We have the means to address these problems and improve things. But in doing so, we must remember that Mexico should be kept open and welcoming of talent, to preserve the value of HDB flats owners of 800,000, and strengthen the spirit of independence for Singaporeans, “he said.

Major stock indexes rose again to record two years on Wednesday, when a report showed the U.S. economy grew faster than expected in the summer.

Department of Commerce said the country’s GDP rose by an annual rate of 2.6 percent in July-September, a slight increase in its previous estimate was 2.5 percent.

“Some folks will look at 2.6 percent as a disappointment, but the market is taking a look at the bigger picture,” said Phil Orlando, the chief stock market strategist at Federated Investors. Many traders expect the economy to grow by 3 percent or more during the fourth quarter and through 2011, he said.

Separately, the National Association of Realtors said sales of previously occupied homes rose 5.6 percent in November to an annual rate of 4.68 million. That was slightly below analysts’ estimates of 4.75 million, according to data provided by FactSet.

“There is some mixed news out there,” said Jeffrey Kleintop, chief market strategist at LPL Financial, pointing to quarterly results from Nike Inc. – one barometer of consumer spending – as raising a flag that there are some concerns that “companies may miss some estimates, and that earnings growth is slowing.”

“Maybe the markets are getting ahead of themselves even though there are a lot of good reasons why stocks should be going up,” said Kleintop.

The Dow Jones industrial average rose 26.33 points, or 0.2 percent, to close at 11,559.49. The S&P 500 index rose 4.24, or 0.3 percent, to 1,258.84. Both indexes closed at their highest levels since July 2008.

The Nasdaq composite index gained 3.87, or 0.2 percent, to 2,671.48. It was the highest close for the Nasdaq since Dec. 28, 2007.

Trading was light ahead of the Christmas holiday on Friday. Rising stocks outnumbered falling ones by 3 to 2 on the New York Stock Exchange. Consolidated volume was 3.6 billion shares.

Of the 30 stocks that make up the Dow index, 22 rose. Bank of America Corp. led the way, gaining 3.1 percent to $13.38. Palo Alto’s Hewlett-Packard had the largest fall. The stock dropped 1 percent to $41.48.

Before the market opened, Walgreens reported revenue and earnings that beat analyst estimates. The country’s largest drugstore chain said its income rose 18.8 percent. The stock rose 5.5 percent to $38.85.

Late Tuesday, Nike Inc. said it planned to raise some of its prices because of higher costs for cotton and shipping. Revenue and earnings per share were better than analysts had forecast. Nike fell 5.3 percent to $86.95.

December promises to be a good month positions. S&P 500 has risen 6.6 percent this month and the Dow has received a 5 per cent. On Tuesday, the S & P 500 closed above it reached in September 1912, 2008, the last trading day before the collapse of Lehman Brothers, a culmination of the financial crisis

John Key government can take more responsibility for the deteriorating fiscal situation and a great responsibility for the deteriorating economic situation, the Green Party co-leader Dr. Russel Norman said today.

Dr Norman said the release of half of Economic and Fiscal Update, the Ministry of Finance, which showed the economic recovery unstable and New Zealand.

“The worsening outlook for the Government’s budget is a result of some poor decisions on both the revenue and spending side,” said Dr Norman.

“On the revenue side, the Government’s tax cuts directed towards upper-income earners and the lack of a capital gains tax (excluding the family home) has led to a revenue shortfall.”

“On the spending side, the Government’s poor quality spending on uneconomic new motorways and ETS subsidies for polluters has also had a negative impact on the books.

“We are literally now borrowing money to pay for tax cuts for the well-off and motorway projects with negative economic returns.”

Dr Norman also questioned the quality of the Government’s economic stimulus measures that have failed to revive a fragile economy.

“Tax cuts directed towards upper-income earners are one of the poorest ways to stimulate a failing economy. Increasing aid to the unemployed has a stimulus impact two-to-three times greater than nearly any other measure the Government could have chosen,” said Dr Norman.”

“And it would have worked to mitigate the worst impacts of the recession on those most vulnerable to it.

“The Government’s approach to economic management during one of the most turbulent periods of recent history has failed all but the wealthiest of us.”

“A smarter way to manage the improbability would have been to use the crisis as an occasion to change the economy onto a more sustainable and flexible grip. Instead, we have the old economy, dependent on cheap oil to drive, to pay polluters to let the aid of carbon, and to borrow to finance tax cuts, which do not stimulate the economy.”

If all schools have to worry about these days was the establishment of common standards for curriculum and agree on how to measure student progress and teacher effectiveness, our national image education will be completely rosy.

But the growing social problems, which are more demanding of students and the shortage of school social workers – usually the only resource dedicated to helping student’s personal concerns – and you’re looking at another major, but rarely noticed, the issue of education.

The U.S. Department of Education Office for Civil Rights just issued complete guidelines descriptive the liability of educational institutions in the prevention of discrimination based on race, national origin, sex, color, sexual orientation or disability.

That action, itself a result of several high-profile bullying-related suicides, spurred New Jersey to provide suicide prevention courses for students and make school districts codify a comprehensive policy on anti-bullying and harassment.

In Illinois, the governor is considering legislation to reduce child sexual abuse that would establish age-appropriate instruction for public school students in kindergarten through fifth grade and training for school workers on identifying and dealing with abused youngsters.

These topics are being programmed into the classroom because they, along with direct instruction on sexual health, emotional balance and social behavior — lessons that teachers a generation ago would have expected students to learn at home — have landed on the doorstep of public schools.

Teachers who never imagined having to address the multifaceted issues of sexuality, suicide or bullying are ever more leaning on school social workers who are already stretched to their limits.

The latest U.S. Department of Health and Human Service report on the topic found that one in five children and adolescents will experience during their school years a significant mental health problem such as stress, anxiety, bullying, family problems, depression, learning disabilities or alcohol and substance abuse.

Serious mental health problems such as self-injurious behaviors and suicide attempts are on the rise. A Substance Abuse and Mental Health Services Administration report in 2005 found that nearly 60 percent of adolescents ages 12 to 17 who reported a major depressive episode didn’t receive any treatment. And of the kids who did look for help, two-thirds received that help only in school.

Other studies have shown that in many states, school social workers are the major providers of mental health services to children and in some cases, such as rural or inner city areas, schools are the only mental health service provider in the community.

Yet only about 5 percent of the nation’s approximately half-million social workers work in public schools, according to the National Association of Social Workers. That organization recently went before a congressional committee to brief legislators on the need for additional federal and state investments to overcome the challenges of recruiting, educating and keeping social workers.

According to U.S. Bureau of Labor Statistics projections, at least 100,000 more social workers will be needed by 2018 just to keep pace with the volume of social needs in communities.

The evidence so far is only anecdotal, but states all over the country are facing hard decisions to cut programs. College and career guidance counselors, testing and special education-focused school psychologists, and social workers are at high risk because their roles tend not to be widely understood in communities.

Cross your fingers that school social workers across the country will survive reduced budgets and continue to help students and teachers navigate these perilous times we’re all living through.

The public is fuming that the economy still isn’t emergent fast enough to create any substantial number of jobs, in next month’s election; the Republicans are expected to take control of the House (and possibly the Senate)

No matter who is elected in November, the economy is preordained to a slow, agonizing, relatively jobless recovery. Their political victory isn’t likely to translate into any noticeable improvement in the economy any time soon, however.

It’ll take years before the unemployment rate drops to an acceptable level, years before the banking system is fully functioning, and years before the crippled housing market returns to health.

That’s not to say that the right government policies couldn’t make a big difference, it’s just that nothing the Republicans have proposed would help much, even if they could enact their economic platform on their first day in office.

And that’s not going to happen. President Obama still has the power of the veto. The more likely outcome of the election will be further gridlock, with neither party able to change public policy at will. That’ll mean more uncertainty, not less.

Given their built-in advantages this year, Republican candidates have been understandably vague about their plans to change economic policy. Many Republican candidates have endorsed John Boehner’s “Pledge to America,” which is full of lofty principles but short on policy details. Read more about the pledge.

Big government’s fault

Inspired by the tea party, the Republicans are pledging to become fiscal conservatives again, to limit the size of government, and to reduce taxes and red tape. In the Republican view, there’s nothing wrong with the economy that isn’t the fault of big government.

However, many of the Republican proposals would actually hurt — not help — the economy if they could be enacted.

Slashing government spending right now would be crippling to an economy that doesn’t have any other source of demand. Keeping taxes low for the richest Americans wouldn’t create many jobs, and would keep the deficits growing. The Republicans’ pledge to repeal the new health-care law and other government regulations would only add to the uncertainty that businesses say is keeping them on the sidelines.

The Republicans say they want to reduce government spending, but they are vague about exactly what should be cut, except to say that discretionary, non-defense spending should be rolled back to pre-recession levels. That category includes only about 15% of all federal spending, and isn’t the part of the budget that’s the problem.

If the deficit is an ocean-sized problem, the Republicans have proposed a solution that would fit in a thimble.

Being vague is probably good politics. A recent poll by Bloomberg News shows that 55% of likely voters agree that the deficit is out of control, but most voters are against specific measures to reduce it, especially the big changes that would be needed to bring the budget into balance.

It turns out that we like the things government does for us, and we also don’t want to pay the taxes necessary to buy those things.

California Republican Senate candidate Carly Fiorina wouldn’t name a single program, or identify any entitlement program that should be scaled back when asked repeatedly by Chris Wallace of Fox News what she’d like to cut from the government. Instead, Fiorina leaned on that old standby of political hacks: “waste, fraud and inefficiency.”

Web Economy will change its face, as Computers will do a lot of the time-consuming work that people still do today, because  Information in a Web 3.0 world will be much easier to access.

It’s like saying “the economy needs jobs”—100 percent correct, but 99 percent useless as a guide to what we should do next. Our political and business leaders talk a lot about innovation being our economic savior, but what can we do with such platitudes? Where will we find long-term solutions to the problems of the economy?

I’m up to the innovation challenge. I’m just a small entrepreneur, but the technology I work in offers some real and specific opportunities for economic improvement. It’s broadly called Web 3.0, or the Semantic Web, and it’s the next generation of the Internet. Each of the earlier Web generations was pretty transformative, and this next version will be too.

Web 3.0 is a smarter Web, giving computers better ways to share information. This has enormous benefits for people who need to search for information, automate processes and transactions, and make logical connections between similar concepts and things. Information in a Web 3.0 world will be much easier to access, because computers will do a lot of the time-consuming work that people still do today.

Here are specific suggestions for ways that Web 3.0 innovation can have a positive effect on the economy:

1. In health care reform, Web 3.0 is an ideal technology for creating electronic medical records (EMRs), by merging the personal information that exists in disparate databases all over the health care system.

2. Data.gov is a comprehensive database of government information from a vast array of sources, all powered by semantic, Web 3.0 technologies. This transparency provides incentives for reducing government waste and improving the accountability of government agencies, procurement processes and contract awards.

3. In biotechnology, Web 3.0 provides tools that cut years of research down to days. New information is incorporated into the R&D process, drawing connections between related concepts and visualizing the results in graphs of merged information. Seeing these connections enables researchers to make better predictions about the spread of diseases, calculate a patient’s response to treatments and assess the risk of drug side effects.

4. In the financial sector, money will be saved through advanced fraud monitoring systems that are made possible through the real-time linking of financial accounts, transaction data and customer information. This can scale globally, so regulators and analysts can understand the risks of portfolio structures and counterparty transactions, preventing future financial crises.

5. Sustainability decisions need the right information quickly, and that information must be based on science and fact. One Web 3.0 solution links a pesticide database to a database of organisms and one of weather patterns, to fully understand the balance of positive and negative consequences of our environmental choices.

6. Open Energy Information (OpenEI) is a collaboration designed to share energy data, tools, models and knowledge. Web 3.0 technologies are used to share energy- related information and accelerate innovation, development and deployment of clean energy systems.

7. The Open Floor Plan Display/Exchange project is using Web 3.0 to provide interactive real-time data about building plans that will be used by emergency services, law enforcement and risk analysts to improve building safety.

8. Personal data lockers will form an identity ecosystem based on Web 3.0. You will be able to configure who gets access to your locker and in what context, depending on your role, intent and location. Applications will understand the relationships between people, services and objects.

9. Web 3.0 will deliver better customer experience because service providers will understand what the customer needs in real time and will take the optimal action. The results will include massive time savings, better customer retention, more effective up-selling and improvements in satisfaction. In summary, Web 3.0 represents a Web in which information is much better linked and more efficiently utilized, with the economy continuing to benefit on a greater scale.