US Payrolls Probably Shrank, Economic Growth Was Slowest in Five Years

[marmar]

from Bloomberg:



Payrolls Probably Shrank, Growth Slowed: U.S. Economy Preview

By Courtney Schlisserman

April 27 (Bloomberg) -- The U.S. probably lost jobs for a fourth month as the collapse in construction and a slowdown in consumer spending almost stalled growth, economists said before reports this week.

Payrolls fell by 78,000 in April, based on the median forecast in a Bloomberg News survey before the Labor Department's May 2 report. Figures two days earlier may show the economy expanded at a 0.4 percent annual pace from January through March, the smallest gain in five years.

``Despite our forecast for positive growth in the first quarter, we believe the economy has formally slipped into a recession,'' said Ethan Harris, chief U.S. economist at Lehman Brothers Holdings Inc. in New York. ``Given the headwinds from the housing and credit markets, we expect spending to remain weak through the end of 2009.'' Harris projects a 0.7 percent growth rate for the first three months of the year.

Economists forecast spending rose last quarter at the slowest pace in 13 years as the loss of jobs, increase in food and energy costs, and drop in property values hurt confidence. The Federal Reserve may lower the benchmark interest rate by a quarter-point to try to stem further erosion in the growth.

The Labor Department's employment report may also show the jobless rate rose to 5.2 percent this month, the highest level in three years.

Factory payrolls fell by 35,000, according to the survey median. Construction firms, retailers and financial-service businesses may also have cut jobs.

Job Losses

Wall Street banks and securities firms, hit by $309 billion in mortgage losses and writedowns, have slashed 48,000 jobs in the past 10 months, led by cuts at Citigroup Inc., Merrill Lynch & Co., Lehman Brothers and Bank of America Corp, according to the Securities Industry and Financial Markets Association.

Merrill Lynch, the third-biggest U.S. securities firm, said April 17 it would cut about 3,000 more jobs after the credit- market crisis forced it to write down about $6.5 billion in debt. .....(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=al3S2Y0Yjo9c&refer=home

[Fovea]

1. America has reached peak consumerism.

The new rules.

If you want to buy something, buy American if possible.

If you want to go into business, make something Americans need
and make it as close to 100 domestic content as you can.

If you want to become an instant millionaire, rolling bad mortgages into gold try China.