Housing rebound is facing obstacle: Too few homes
GRAND RAPIDS, Mich. (AP) — Beth Heinen Bell and her husband, Christian, are sick of renting.
They want more space. They’d like to host friends for dinner. And now, having seen the real estate market start to rebound, they want to turn housing payments into long-term equity.
So after a decade as someone else’s tenant, the Bells, like a rising number of Americans, are finally ready to buy a home. Yet they’re running into an obstacle that’s keeping the national housing recovery in check: There aren’t enough homes for sale.
The housing shortage around Grand Rapids, Mich., a city known for its furniture industry and sleek downtown hospital complex, is fairly typical of what the country as a whole is facing this spring.
Fed keeps stimulus, says taxes and cuts have hurt
WASHINGTON (AP) — The Federal Reserve cautioned America’s political leaders Wednesday that their policies are hurting the economy.
The Fed stood by its aggressive efforts to stimulate the economy and reduce unemployment. But it sent its clearest signal to date that tax increases and spending cuts that kicked in this year are slowing the economy.
The Fed maintained its plan to keep short-term interest rates at record lows at least until unemployment falls to 6.5 per cent. And it said it will continue to buy $85 billion a month in Treasury and mortgage bonds. The bond purchases are intended to keep long-term borrowing costs down and encourage borrowing and spending.
Detroit boosted by truck sales; Honda, Nissan gain
DETROIT (AP) — Ford, GM, Chrysler and Nissan all reported double-digit U.S. sales increases last month, signalling the best April for car and truck sales in six years.
A rebound in pickup truck sales led the way, especially for the Detroit automakers. Small businesses are replacing aging trucks that they’ve kept since the Great Recession.
Ford’s sales increased 18 per cent, with the F-Series pickup gaining 24 per cent. At Chrysler, sales rose 11 per cent, led by the Ram pickup, with a 49 per cent sales increase. GM also saw an 11 per cent sales jump, with Chevrolet Silverado pickup sales rising 28 per cent for the month.
Facebook 1Q earnings, revenue grow, mobile ads up
NEW YORK (AP) — Facebook’s net income and revenue grew in the first quarter of the year, helped by an increase in mobile ad revenue, a figure that some skeptical investors have been watching closely.
Facebook Inc. said Wednesday that its net income was $219 million, or 9 cents per share, in the January-March period. That’s up from $205 million, or 9 cents per share, in the same period a year ago when the company was still private.
Revenue grew 38 per cent to $1.46 billion from $1.06 billion, surpassing analysts’ expectations of $1.44 billion.
PepsiCo pulls Mountain Dew ad after criticism
NEW YORK (AP) — PepsiCo is once again learning the risks of celebrity partnerships after an ad for Mountain Dew was criticized for portraying racial stereotypes and making light of violence toward women.
The soda and snack food company said it immediately pulled the 60-second spot after learning that people found it was offensive. The ad was part of a series developed by African-American rapper Tyler, The Creator, and depicted a battered white woman on crutches being urged to identify a suspect out of a lineup of black men.
A goat character known as Felicia is included in the lineup and makes threatening comments to the woman, such as “Ya better not snitch on a playa” and “Keep ya mouth shut.”
Businesses may get sticker shock on health care
NEW YORK (AP) — Small business owners may be experiencing sticker shock now that insurers are revealing the rates they want to charge under the new health care law.
So far, in Rhode Island, insurers are requesting premium increases of up to 14 per cent for small business coverage when the Affordable Care Act is fully effective Jan. 1. They’re also in double digits in Maryland.
Small businesses, especially those that are required, for the first time, to start providing coverage under the Affordable Care Act have been waiting for some clue about how much it will cost. Many are worried that paying for health care will hurt profits and have held back on hiring, spending or expanding. The information that’s been released to date is providing some insight, but not enough for small businesses to be comfortable about making big financial moves.
US manufacturing grows in April at slower pace
WASHINGTON (AP) — U.S. factory activity expanded at a slower pace in April, held back by weaker hiring and less company stockpiling. The report is the latest sign that economic growth may be slowing this spring.
The Institute for Supply Management said Wednesday that its index of manufacturing activity slipped to 50.7 last month. That’s down from 51.3 in March and the slowest pace this year. A reading above 50 indicates expansion.
A measure of hiring fell sharply to 50.2, the lowest level since November. That suggests factories cut jobs again in April. And manufacturers cut back on stockpiling for the second straight month.
US construction spending down 1.7 per cent in March
WASHINGTON (AP) — Spending on U.S. construction projects fell in March as the biggest drop in government projects in more than a decade overwhelmed strength in home building.
Construction spending fell 1.7 per cent in March, compared with February, the Commerce Department reported Wednesday. It marked the second decline in the past three months. January activity plunged a record 4 per cent, which represented a downward revision from a previous estimate of a 2.1 per cent decline.
Even with the recent weakness, construction activity was 4.8 per cent higher in March than a year ago at a seasonally adjusted $856.7 billion.
Survey: Private employers add just 119,000 jobs in April
WASHINGTON (AP) — A private survey shows U.S. companies added just 119,000 jobs in April, the fewest in seven months.
The report Wednesday from payroll processor ADP suggests that government spending cuts and higher taxes could be starting to weigh on the job market. And new requirements under President Barack Obama’s health care law may be prompting some small and mid-size companies to hold back on hiring.
ADP also said that hiring in March was slower than first thought: the survey shows just 131,000 added, down from an initial estimate of 158,000.
Unemployment rates fall in 90 per cent of US cities
WASHINGTON (AP) — Unemployment rates fell in nearly 90 per cent of large U.S. cities in March, though most of the declines likely occurred because more Americans stopped looking for work, rather than found jobs.
The Labor Department says unemployment rates fell in 333 of the 372 largest metro areas. They rose in 22 and were unchanged in 17.
Nationwide, the unemployment rate dipped to 7.6 per cent in March from 7.7 per cent in February. Fewer people said they were unemployed, but only because they gave up on their job hunts. The government only counts people as unemployed if they are actively looking for work.
By The Associated Press(equals)
The Dow Jones industrial average closed down 138.85 points to 14,700.95 points. The Standard & Poor’s 500 index, a broader market measure, dropped 14.87 to 1,582.70. The Nasdaq composite index dropped 28 points, or 0.8 per cent, to 3,299.13.
Benchmark oil for June delivery fell $2.43, or 2.6 per cent, to finish at $91.03 a barrel on the New York Mercantile Exchange. Brent crude, which is used to set prices of oil from the North Sea used by many U.S. refiners, dropped $2.42, or 2.4 per cent, to end at $99.95 per barrel on the ICE Futures exchange in London.
Wholesale gasoline fell 8 cents to finish at $2.72 a gallon. Heating oil retreated by 5 cents to end at $2.79 a gallon. Natural gas fell 2 cents to finish at $4.33 per 1,000 cubic feet.