Housing Now a Plus For The Economy
Morning Business Memo:
The housing market is climbing out of the basement, leaving fewer homeowners underwater on their mortgages. This positive trend could provide a new boost to consumer confidence, which has been showing recent signs of improvement. Home prices are rising again in almost all parts of the country after a long and steep fall. The Standard and Poor's/Case-Shiller index reports an average 6 percent price gain since the beginning of this year. Construction is showing signs of life. Homebuilders' share prices have soared this year. This week Lennar's (NYSE: LEN) fiscal third-quarter earnings quadrupled from a year earlier.
USA Today reports home improvement sales are going through the roof. "It's a trend that's also driving sales in brick-and-mortar home improvement stores from mom-and-pop hardware shops to Home Depot (NYSE: HD), which hammered out its highest quarterly earnings report last month in five years at $1.5 billion," says the newspaper.
The latest round of the tablet wars… Barnes and Noble rolls out two new versions of the Nook in an increasingly crowded market. They're said to feature a sharper high definition screen. The new Nooks come in two sizes, one with a 7-inch screen ($199) and the other with a 9-inch diagonal screen is called the Nook HD+ ($269). The lightweight slim tablets are low price competitors to Apple's much more expensive iPad. ABC News Technology Editor Joanna Stern has the lowdown on the launch.
Less turbulence ahead for American Airlines? There could be progress in breaking the standoff between American and its pilots, blamed for a spike in canceled and delayed flights. The airline formally asked the pilots' union to resume negotiations on a new labor contract. A spokesman says the union board will meet today to decide on the next step. Pilots and management at American have been at odds for years, but the conflict came to a head this month when a federal bankruptcy judge allowed the airline to break its contract with pilots. American set new pay and work rules that could lead to outsourcing more flying to other airlines. Almost immediately, delays and cancelations rose sharply. American canceled more than 300 flights last week, and there were many more problems for passengers yesterday.
Controversial comments by the president of the Philadelphia branch of the Federal Reserve may have sparked Wall Street's biggest stock sell-off in three months. Charles Plosser said the latest Fed effort to boost the economy will fall short of its goals and may hurt the central bank's credibility. Plosser - unlike most fed officials - is a critic of quantitative easing. The Dow Jones index is down about 1 percent since hitting a five-year high last week.
Anger in the streets of Europe… A general strike is on in Greece today to protest austerity measures demanded by European and international creditors. It's the first general strike since Greece's coalition government was formed in June. In Spain police say 38 people were arrested and 64 people injured when officers clashed with protesters demonstrating against austerity cutbacks and tax hikes.
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc
