KeNo's Housing and Economic Portal: Sunday September 12 Housing and Economic stories

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TOP STORIES:

White House: No second stimulus being considered - (www.reuters.com) The White House stressed on Thursday that no second economic stimulus package is being considered as part of new measures under review by President Barack Obama's team. Obama said on Monday he and his advisers are discussing further tax cuts for businesses to help create jobs, as well as an extension of tax cuts for the middle class, rebuilding U.S. infrastructure and increasing investments in clean energy and research and development. The Washington Post reported on Thursday that the business tax cuts could be potentially worth hundreds of billions of dollars. "There have been a lot of reports and rumors on different options being considered -- many of which are incorrect," said White House spokeswoman Amy Brundage. "The options under consideration build on measures the president has previously proposed, and we are not considering a second stimulus package. The president and his team are discussing several options, as they have been for months, and no final decisions have been made," she said.

U.S. Car Sales Plunged in August - (online.wsj.com) U.S. auto sales fell 21% in August compared to a very strong month a year ago, when the federal government's "cash for clunkers" program sparked a surge in new-car buying. General Motors Co., Toyota Motor Corp. and Honda Motor Co. all reported declines of 25% or more while Ford Motor Co. saw its sales drop 11%. The few gainers included Chrysler Group LLC, which reported a 7% rise, mainly because of higher sales to corporate fleets such as rental-car companies. Chrysler also is one of the few makers that didn't see much of a lift from the clunkers program a year ago because its lineup includes few small cars, which were big sellers under the rebates. Auto makers sold 997,968 light vehicles in August, down from 1,262,197 a year earlier, according to Autodata Corp. The annualized selling pace for the month was 11.47 million vehicles, in line with the pace of the last five months but down from the 14.17 million level hit in August 2009, Autodata said. Earlier this decade the industry sold about 16 million cars a year.

Drop in Self-Employment Shows U.S. Recovery Has Yet to Spur New Businesses - (www.bloomberg.com) The number of Americans who were self-employed dropped in August to the lowest level in eight years, showing the economic recovery is not strong enough to nurture new businesses. There were 8.68 million people working for themselves last month, the fewest since January 2002, according to Labor Department data released today. That’s down 13 percent from a record 9.98 million reached in December 2006, 12 months before the latest recession began. Self-employment tends to increase during and immediately following economic slumps as tight labor markets prompt recently fired workers to venture out on their own, said Scott Shane, a professor of economics at Case Western Reserve University in Cleveland. The data this time is testament to the lack of credit and a slump in demand that is choking small businesses, he said. “The failure rate of self-employment picked up a lot during the recession,” Shane, who studies entrepreneurship, said. “I think the indications are not good at all.”

Democrats face midterm meltdown - (www.ft.com) Barack Obama’s Democratic party faces a series of dramatic defeats at every level of government in Washington and beyond in the November midterm elections, according to leading analysts and opinion polls. The University of Virginia’s widely monitored Crystal Ball will on Wednesday forecast sweeping setbacks on Capitol Hill and the loss of a clutch of state governorships on November 2. It follows a Gallup poll that showed the Republicans with a 10 percentage point lead over the Democrats – the widest margin in 68 years. Separately, a University of Buffalo paper has predicted a 51-seat gain for Republicans in November. The Democrats have a 39-seat majority in the House of Representatives. Many believe Democratic control of the Senate is also at risk. “Voters are going to deliver a big fat message to President Obama, which he will not want to hear,” said Larry Sabato, who runs Crystal Ball. “The Republican base is at least 50 degrees further to the right than where it was when Newt Gingrich took control of the House in 1994, so we would be looking at two years of absolutely nothing getting done on Capitol Hill.”

Firing Public Union Workers Creates Real Jobs - (Mish at globaleconomicanalysis.blogspot.com) Public unions in New Haven, Connecticut have not yet gotten the message that business-as-usual no longer flies. I am quite happy with that because the city responded by dumping public workers and privatizing services, and that is exactly what needs to happen. Firing public union workers actually creates jobs. How so? Let's start with a look at the union position as described in War Is On In Custodian Negotiations: Three hours after school custodians blasted the city for threatening to privatize their jobs, the city released a counterattack: It revealed results of a surprise inspection that found custodians watching TV while they were supposed to be at work. Negotiations were already “on the verge of disaster” before Thursday, said Local 287 President Robert Montuori. He accused the city of trying to intimidate workers and punish the union for opposing privatization. As negotiations stall, the city is moving forward toward privatization: It sent out a request for proposals in December, seeking bids on a custodial services contract for the schools. Eight bids came in; the district has identified GCA Services Group, Inc. out of Pennsburg, Penn. as its preferred bidder.