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Cleanup of Oil-Tainted Gulf Coast Nears End
Dig 2 feet into the sand on this wind-swept beach and up comes the foul smell of oil. The unmistakable whiff of crude eight months after the BP spill is one of the last in-your-face reminders of the long, tainted summer on the Gulf Coast. For months, in what BP calls...

Anadarko Shares Recover Spill Losses on Bid Talk

Shares of U.S. oil and gas company Anadarko Petroleum Corp. jumped above highs reached days before BP's Gulf of Mexico Oil spill, rising more than 8 percent Thursday on market talk that a bid from BHP Billiton Ltd. was in the works. Rumors resurfaced that BHP Billiton is...

Russian Tycoon Khodorkovsky Gets Six More Years
Jailed Russian oil tycoon Mikhail Khodorkovsky was sentenced to six more years in prison Thursday following a trial seen as payback for his defiance of Vladimir Putin's power.Judge Viktor Danilkin sentenced Khodorkovsky to 14 years after convicting him of stealing oil from...

December US Auto Sales May Bode Well for 2011
December is expected to be the third straight month that U.S. auto sales hold above 12 million vehicles on an annualized basis, capping a year of gradual recovery for the auto sector, analysts said. While December alone cannot predict 2011 performance, a full calendar...

Moody's: Home Foreclosures Will Soar to 2.1 Million
The number of foreclosed homes rose over the summer after fewer people at risk received assistance lowering their monthly mortgage payments, a new report shows.About 470,000 homeowners received help either directly from banks or through government programs in the...

Publicly Modest Wall St. Bankers Covet Fancy Toys

Wall Street executives may face smaller bonuses and a public that still eyes them with suspicion, but that isn't stopping them from rediscovering their love of luxury cars, oceanfront homes and private jets. A soaring stock market, a surge in merger deals and an uptick in...

China's Rare-Earths Export Cut Stirs Trade Fears
China has raised fresh international trade concerns after slashing export quotas on rare earths minerals, risking action from the United States at the World Trade Organization. China, which produces about 97 percent of the global supply of rare earth minerals, cut its...

Banking Merger Market Looks Brighter in 2011

The new year is offering hope to deal advisers, as U.S. bank M As promises to return at a healthy clip after three years of gloom. For a change, healthy banks are once again stepping up to snap up rivals as they search for revenue growth in a lukewarm economy, investment...

China's Property 'Bubble' May Deflate a Bit Next Year

Chinese housing prices are on track to dip early next year, with tighter monetary policy and rising inventories combining to take some air out of a market that some fear could yet swell into a bubble. The government launched a campaign late last year to brake soaring...

Nonprofits Getting First Shot at Bank Foreclosures
Francisco and Pam Cruz maneuvered around boxes of new flooring and open cans of paint as they surveyed the foreclosed Phoenix house they would soon call their own. This house wasn't typical of the thousands in foreclosure-battered Arizona that banks have auctioned for...

California Woman Arrested in Insider Trade Scheme
A California woman is under arrest as part of a federal crackdown on people working at financial research firms who illegally feed inside information to investors.Winifred Jiau is scheduled to appear Wednesday in federal court in San Francisco.Manhattan prosecutors say the...

Rare-Earths Shares Jump After China's Quota Cut
Shares of rare-earths prospectors soared on Wednesday after China cut export quotas, threatening to reduce already tight global supplies and risking action from the United States at the World Trade Organization. Shares of Lynas Corp., which owns the world's richest known...

OPEC Not Likely to Stand in the Way of $100 Oil

Oil has burst above top exporter Saudi Arabia's preferred $70-$80 range and yet OPEC is unlikely to stop the rally, helping to prepare the way for the market to bound above $100 a barrel. At meetings this month a full conference of the Organization of the Petroleum...

Despite Holiday Spree, Economic Doubts Linger
Holiday spending surged this year, but Americans still have their doubts about the economy.With unemployment high and home prices falling in the nation's largest cities, consumer confidence took an unexpected turn for the worse in December.The decline followed two months of...

Future May Not Be So Golden for Retiring Boomers
Through a combination of procrastination and bad timing, many baby boomers are facing a personal finance disaster just as they're hoping to retire. Starting in January, more than 10,000 baby boomers a day will turn 65, a pattern that will continue for the next 19 years.The...

US Firms Send Jobs Overseas, Where Sales Soar
Corporate profits are up. Stock prices are up. So why isn't anyone hiring?Actually, many American companies are just maybe not in your town. They're hiring overseas, where sales are surging and the pipeline of orders is fat.More than half of the 15,000 people that...

Netflix, Redbox Gain as DVD Sales Slide
After a calamitous 2009, which saw home entertainment spending drop 5 percent as Americans struggled with tough economic times, 2010 wasn't all that bad. Sure, total consumer spending is likely to be down again, as dramatic Blu-ray Disc and digital delivery growth still...

Molycorp Jumps on China's Rare Earth Cutback

Shares of Molycorp Inc. rose as much as 11.6 percent Tuesday after China said it would cut its rare earth mineral export quotas. The surge, which extends the nearly 10 percent jump that Molycorp posted Monday, came after China cut its first batch of rare earth export...

Netflix Falls as Barron's Warns: 'Buyer Beware'

Shares of Netflix slid Monday as the list of those questioning the future profitability of the video rental company grows. Barron's assigned a stock rating of IB, for Netflix, short for investors, beware, saying the company will have a difficult time maintaining profit...

GE Leads $3.19 Trillion in Corporate Bond Sales Read more: Moneynews - America's Money News Page - Investing & Analysis

Corporate bond sales worldwide topped $3 trillion for a second straight year, led by the highest-ever issuance of junk-rated debt, as borrowers locked in the lowest yields on record.Rabobank Nederland, the world s largest agricultural lender, and Fairfield,...

Doctors Get Rich With Surgery Debunked by Studies Read more: Moneynews - America's Money News Page - Investing & Analysis

Suffering from an aching back, truck driver Mikel Hehn went to see surgeon Jeffrey Gerdes in 2008. The St. Cloud, Minnesota, doctor diagnosed spinal disc degeneration, commonly treated with physical therapy, and said surgery wasn t called for.Unhappy with the answer, Hehn...

Fewer Join Jobless Rolls in Good Sign for 2011 Read more: Moneynews - America's Money News Page - Investing & Analysis

Far fewer Americans are applying for unemployment benefits as the year ends, raising hopes for a healthier job market in 2011.Applications are at their lowest level since July 2008, the Labor Department says. They fell to 388,000 in the week ending Dec. 25, bringing the...

Investors See Anadarko as Good Fit for BHP Read more: Moneynews - America's Money News Page - Investing & Analysis

Miner BHP Billiton's acquisition strategy was back in the spotlight on Friday as market talk resurfaced it was looking at a $40 billion-plus bid for Anadarko Petroleum although banking sources said they were unaware of any imminent offer. BHP, under pressure to land a big...

Survey: US Initial Offerings Losing Global Appeal

The United States is losing its appeal as leading global center for stock market flotations, hit by restrictive regulations and competition from other financial centers, a survey of American lawyers showed on Thursday. Just over 70 percent of a 50-strong sample of...

Economics Professors Consider Ethics Code

A professional association of U.S. economists is considering establishment of an ethics code, a move that could require members to disclose their ties to financial firms and potential conflicts of interest.The American Economic Association, the world s largest organization...

Frazier: Fed Likely to Stop Easing Early, Housing and Jobs to Stay Dismal Read more: Frazier: Fed Likely to Stop Easing Early, Housing and Jobs to St

A strengthening recovery is likely to lead the Federal Reserve to abandon its vaunted second round of quantitative easing earlier than most expect, says David Frazier, editor of The ETF Strategist newsletter, published by Newsmax Media.

In an interview with Moneynews.com, Frazier explained that he believes that the Fed will do exactly what it promised in its initial pledge to spend hundreds of billions buying Treasurys through the middle of 2011 — which was to base continued purchases on developments in the economy.

The Fed began the second round of debt purchases in November after telegraphing the move in August. It said then that the buying would last until June 2011 if conditions warranted and would consist of up to $600 billion in new purchases and $300 billion in extra purchases as previous debt rolled over.

The Fed never said — never said — that it is definitively going to purchase $600 billion, $900 billion, whatever number you want to use, they never said that," he said. "What the Fed did say is that they would continue to monitor economic data, and that they might purchase up to that amount of Treasury securities based on the economic situation,” he said.

Frazier says that data just a month after the purchases began suggest that the U.S. economy will grow at a faster rate in 2011 compared to 2010, and that the employment rate subsequently will improve.

By March, Frazier estimates, the Fed is likely to review the latest data and, soon after, conclude that it doesn't need to keep buying Treasurys.

Once the central bank sees the data, “the Fed’s going to stop purchasing,” Frazier says.

Don’t expect the jobless rate to drop immediately, though, he says.

Historically, by the time the job market improves enough for most people to notice the recovery is already well under way, Frazier says.

“We’ve never had, ever, a ‘jobs-driven’ recovery . . . Going back to at least 1920, economic data shows that economies begin to recover three to six months before you see meaningful improvements in the employment market,” Frazier said.

Instead, as the recovery takes hold, employers likely will increase hours on underemployed current staff, add overtime as needed, and look for productivity gains. Expect the jobs number to improve only after it is evident that hiring is absolutely necessary, Frazier says.

Frazier doesn't expect the housing market to improve during the coming months, yet he says investors have already factored in a weak housing market.

“I think the housing market will have a minimal effect on stocks,” Frazier says.

Meanwhile, corporate earnings in the aggregate should continue to rise in 2011.

Unemployment will remain relatively high, Frazier predicts. That means, however, that the currently employed will probably work harder and wages will remain flat.

Since labor is a large part of corporate expenses, stagnant wages should boost corporate profitability, he predicts.

Meanwhile, economies around the world will improve, he says, and the extension of the Bush-era tax cuts will support a recovery already on the way.

Many Americans have spent much of the last few years paying down household debt, now at the lowest level since March 1998, Frazier points out.

People who have a job will get a “raise” this year of $1,500 to $2,500 on the tax break, he says.

“Given that you’ve already paid down a lot of that debt, you’re probably going to go out and spend some of that money,” Frazier says.

“I’m quite sure Americans overall will go out and spend some of this money they are getting through the tax cut. That’s a big positive” for the economy, he says.

Frazier: Fed May Halt Easing Early, Housing and Jobs to Stay Dismal Read more: Moneynews - America's Money News Page - Home

A strengthening recovery is likely to lead the Federal Reserve to abandon its vaunted second round of quantitative easing earlier than most expect, says David Frazier, editor Newsmax Media's The ETF Strategist newsletter. He believes the Fed will do exactly what it promised in its initial pledge to spend hundreds of billions buying Treasurys through the middle of 2011: base continued purchases on developments in the economy.
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