10 Years for the Euro
Has it really been ten years since the Euro was introduced?
When the euro was introduced just after midnight on Jan. 1, 2002, celebratory fireworks exploded above the European Central Bank headquarters in Frankfurt. The historic bridge the Pont Neuf in Paris was lit up in European Union blue with 12 rays of light to symbolize the 12 nations circulating the euro — as people in those countries lined up at A.T.M.’s to get their hands on new bills that would be daily reminders of the project of European integration and unity.
Ten years later, the word “euro” in a headline is usually paired with the word “crisis.” Instead of hosting celebrations for the 10-year anniversary, policy makers appear to be staying as quiet as possible, as if hoping not to upset the brief calm that has come with the holiday season after European central bankers injected nearly $640 billion into the European banking system in December.
Will Europe get its act together? The recent events in Italy have to be encouraging. Let’s see if the austerity can be sustained.
Posted in: Economy, Finance, General Business
Tags: austerity in Europe, banking, banks, EU crisis, Euro, Euro anniversary, Euro crisis, European banking system, European Central Bank, European integration, Italian bonds, Italy
Housing starts surge
There’s a ton of demand out there for apartments as many Americans turn to renting as opposed to buying homes. With this demand, more apartments will be built and that’s having an effect on housing starts.
U.S. housing starts surged to a 1-1/2 year high in November and permits for future construction were the highest since March 2010 as demand for rental apartments rose, offering hope for the weak housing market.
The Commerce Department said on Tuesday housing starts jumped 9.3 percent to a seasonally adjusted annual rate of 685,000 units, the highest since April last year.
October’s starts were revised down to a 627,000-unit pace from a previously reported 628,000 unit rate.
Building permits, a gauge of future construction, rose by 5.7 percent. The increase was spurred by more apartment permits.
New homes have an outsize impact on the economy. Each home built creates three jobs for a year and $90,000 in taxes, according to the National Association of Home Builders.
Although the overall housing market remains weak, rising demand for rental apartments is boosting the construction of multifamily homes.
Falling house values and stringent lending practises by banks are pushing Americans away from homeownership.
The rate is still below the rate needed for a healthy economy, but the trend is in the right direction.
It will be interesting to see how this trend plays out, and it offer business opportunities for people who can exploit these trends. The buying vs renting debate on real estate is definitely tilted now towards renting with the tight bank lending practices.
Is economic optimism returning?
After years of economic misery, things are starting to turn a little. While the news from Europe keeps throwing cold water on the situation, economic conditions in the United States seem to be improving, and that is fueling economic optimism.
Four years after the recession officially began in December 2007, economists, businesses and consumers alike have expressed a growing optimism about the recovery in recent weeks. The more confident, if still tempered, outlook is taking shape as the nation seems to be navigating past some big stumbling blocks — such as high gasoline prices — that have impeded growth most of this year. Some recent encouraging signs:
Vehicle sales in November rose 14% from a year ago to an annual rate of 13.6 million — their best showing since cash-for-clunker incentives drove purchases in August 2009. Economists cite, in part, the recent easing of auto shipment disruptions that followed the Japanese earthquake early this year, as well as a less diffident consumer.
“We’re getting some pent-up demand kicking in where people who have not replaced for a long, long time, particularly if they’re still working … are deciding it’s time,” says Nigel Gault, chief U.S. economist at IHS Global Insight.
Read the entire article and see the various ways things are getting better.