Cupcake Shop Crumbs Shuttering All Its Stores

rumbs says it is shuttering all its stores, a week after the struggling cupcake shop operator was delisted from the Nasdaq.

The New York City-based company said all employees were notified of the closures Monday. A representative for Crumbs could not immediately say how many workers were affected or how many stores it had remaining on its last day.

"Regrettably Crumbs has been forced to cease operations and is immediately attending to the dislocation of its employees while it evaluates its limited remaining options," the company said in an emailed statement. That will include filing for Chapter 7 bankruptcy liquidation.

A press release from its website in March listed 65 locations in 12 states and Washington, D.C. The website had not been updated with notification of the closures late Monday.

Crumbs was founded in 2003 and went public in 2011, selling giant cupcakes in flavors including Cookie Dough and Girl Scouts Thin Mints. More recently, however, it had been suffering from a steep decline in sales. For the three months ending March 31, Crumbs Bake Shop Inc. reported a loss of $3.8 million, steeper than the loss of $2 million from the same period a year ago.

The company had warned in a filing with the Securities and Exchange Commission this past May that it "may be forced to curtail or cease its activities" if its operations didn't generate enough cash flow.

As of the end of last year, Crumbs listed about 165 full-time employees and about 655 part-time hourly employees working in its stores.

Source:

abcnews.go.com

Read More

U.S. Trade-Case Win Against China Contributes to Tensions

China’s duties on autos imported from the U.S. violated global trade rules, the World Trade Organization said in a ruling that adds to mounting commercial tensions between the world’s two largest economies.

China improperly imposed tariffs on imported vehicles, including those made by General Motors Co. (GM:US) and Chrysler Group LLC, the WTO, a Geneva-based trade arbiter, ruled in a decision issued today. China added the duties in 2011, after the U.S. government bailed out the automakers during the global financial crisis, and eliminated them in December.

“This is a significant victory,” U.S. Trade Representative Michael Froman said today at a press conference in Washington. “It’s time for China to change the practices that have led the United States and our trading partners to bring these kinds of cases.”

VIDEO: Will the U.S. Intervene in China-Vietnam Tensions?

The U.S. this week dramatically escalated the trade battle with China, accusing five military leaders of stealing corporate secrets. The indictments follow complaints over issues such as tires, chicken parts, clean-energy products and credit-card payment services.

“This is more than a humdrum case,” Representative Sander Levin of Michigan, top Democrat on the House Ways and Means Committee, said today in appearing with Froman and Senator Debbie Stabenow, also a Michigan Democrat. “There’s been a vindication of the importance of having a rule of law in international trade.”

Technical Matters

The Chinese Embassy in Washington in a statement claimed victory on some technical aspects of the case.

STORY: In Japan, Obama Has a Message for China: Back Off

“We noticed that the panel report rejected part of the United States’ argument” that China failed to define the domestic industry, Geng Shuang, the spokesman, said in an e-mail. He said China had a “reservation” with other elements of the ruling.

In response to a 2012 U.S. complaint, the WTO found China failed to show how the goods harmed the Chinese market and didn’t disclose to U.S. companies how the tariffs were calculated, the U.S. trade office said, citing a ruling by the Geneva-based arbiter.

Cars, SUVs

China imposed duties, as high as 21.5 percent, on U.S.-made cars and sport-utility vehicles in December 2011, claiming the goods benefited from government subsidies and were sold in China for market below value, known as being “dumped.” The tariffs followed the forced bankruptcy and government bailout of GM and Chrysler, now a unit of Italy’s Fiat SpA (F) in 2010. The U.S. challenged the duties in 2012.

STORY: Which Companies Benefited From China's Hack Attacks?

“We commend both countries for utilizing the WTO’s process to resolve a trade dispute,” Heather Rosenker, GM’s director of public policy and government relations communications, said in an e-mail.

Ford Motor Co. (F:US), which didn’t receive U.S. assistance in the bailout, didn’t export vehicles to China during the investigation period and wasn’t subject to the tariffs, company spokeswoman Christin Baker said in an e-mail.

The value of the goods at issue -- including Chrysler’s Jeep Grand Cherokee, and GM’s Buick Enclave and Cadillac Escalade -- were worth about $5.1 billion last year, according to the U.S. trade office. China is the second-largest export market for U.S. autos, the agency said in a statement.

STORY: Microsoft's Xbox Will Face Fresh Challenges in China

Second Case

In September 2012 the U.S. filed a separate WTO case against China alleging the Beijing government subsidized its own auto and auto-parts makers in violation of global trade rules. That case is still under review, according to the U.S. trade office.

The decision on the autos is the third recent victory for the U.S. in challenging China’s anti-subsidy and anti-dumping practices, after decisions related to poultry and steel, the trade office said in its statement.

Since 2009, the U.S. has filed 17 cases at the WTO against China and other nations, including Indonesia and India, according to the agency. The U.S. doubled the rate of filings against China during that time.

STORY: Lenovo, the Treasure Hunter of Tech

“This announcement is a major victory for U.S. automakers,” Representative Dave Camp, a Michigan Republican and chairman of the House Ways and Means Committee, said in a statement. “We must continue to enforce our trade rights in the WTO to ensure that countries like China do not unfairly discriminate and retaliate against U.S. products.”

To contact the reporter on this story: Brian Wingfield in Washington at bwingfield3@bloomberg.net

To contact the editors responsible for this story: Jon Morgan at jmorgan97@bloomberg.net Steve Geimann

Source:

www.businessweek.com

Read More

Trade Gap Shrinks as U.S. Exports Show Global Pickup

The biggest gain in U.S. exports in nine months helped narrow the trade deficitin March, pointing to a revival of global demand that will help the world’s largest economy strengthen.

The trade gap shrank by 3.6 percent to $40.4 billion from the prior month’s $41.9 billion, Commerce Department figures showed today in Washington. Sales to foreign customers climbed 2.1 percent to the second-highest level on record as demand grew for aircraft, autos and fuels.

Sales overseas improved from a five-month low reached in February, adding to evidence the U.S. economic expansion began to perk up heading into the second quarter after stalling at the start of the year. At the same time, American households and businesses are gaining confidence as employment improves, indicating imports will also rise.

“Exports rebounded after a few weaker months, and that’s good to see,” said Paul Edelstein, director of financial economics at IHS Global Insight Inc. in Lexington, Massachusetts, who projected the gap would narrow to $40.5 billion. “Imports were also up, and that’s a good sign because it suggests that business and consumer spending are back on track. In general, this is a pretty good report.”

Stocks dropped as lower profit from American International Group Inc. dragged down financial shares. The Standard & Poor’s 500 Index (COMFCOMF) decreased 0.4 percent to 1,877.57 at 11:26 a.m. in New York.

U.K. Economy

News from overseas also pointed to improving demand. U.K. services grew at the fastest pace in four months in April as employment and new business picked up, figures from Markit Economics showed today in London.

The median forecast of 66 economists surveyed by Bloomberg projected the U.S. trade gap would narrow to $40 billion from a previously reported $42.3 billion in February. Estimates ranged from deficits of $43 billion to $38 billion.

Exports increased to $193.9 billion from $190 billion in February paced by record demand from Canada, South Korea and the countries in the CAFTA-DR trade zone, which includes Central America and the Dominican Republic. Shipments to Germany were the strongest since October 2008. Excluding petroleum, exports were at an all-time high in March.

The value of U.S. exports of civilian aircraft climbed to a record over the 12 months ended in March.

“We expect further strengthening in exports,” Yelena Shulyatyeva, a U.S. economist at BNP Paribas in New York, wrote in a research note. She said bad weather typically disrupts exports more than imports “as trucks find it difficult to get to ports while ships keep coming in.”

Trade’s Beneficiaries

United Parcel Service Inc. is among companies that stand to benefit as the pace of trade improves. The company projects that U.S. economic growth will accelerate as 2014 progresses and the nation bounces back from weather-induced weakness, Chief Executive Officer Scott Davis said in an April 24 earnings call.

“In Europe, the economy is showing signs of recovery and faster growth,” Davis said. “Yet, if the situation in the Ukraine deteriorates, that pace may slow. Economic expansion in Asia has remained steady, with mid-single-digit growth. And in Latin America, expectations call for increased merchandise exports.”

Imports climbed 1.1 percent to $234.3 billion from $231.8 billion in the prior month as Americans bought more foreign-made mobile phones, semiconductors and civilian aircraft, which points to a pickup in business investment. Excluding petroleum, imports were also at a record.

Growth Impact

After eliminating the influence of prices, which generates the numbers used to calculate gross domestic product, the trade deficit was little changed at $49.4 billion compared with $49.8 billion in February. The average in the first three months of the year exceeded the average during the fourth quarter, so trade subtracted from growth.

First-quarter gross domestic product, released last week, showed that the economy grew 0.1 percent. Taken together, exports and imports shaved 0.83 percentage point from growth, the initial Commerce Department estimate showed.

The March improvement in trade was less than the Commerce Department estimated, and combined with previous reports on construction and inventories, indicates the economy contracted at about a 0.5 percentage-point clip at an annualized rate in the first quarter, according to estimates by economists at Morgan Stanley in New York. They project a 3.7 percent rate of growth this quarter.

China Comparison

The trade gap with China, the world’s second-biggest economy, narrowed 2.2 percent to $20.4 billion from $20.9 billion, today’s report showed. China is set to overtake the U.S. as the biggest economy in terms of purchasing power as early as this year, figures from the International Comparison Program, which involves the World Bank and United Nations, showed April 29.

Even so, a cooling pace of Chinese growth and cuts to Europe’s forecast could temper the outlook for U.S. exports. China’s gross domestic product is expected to climb 7.3 percent this year, according to a Bloomberg survey, compared with 7.7 percent in 2012 and 2013. The European Commission predicted yesterday that gross domestic product will rise 1.7 percent in the euro area in 2015, compared with a previous forecast of 1.8 percent.

Meanwhile, demand for foreign-made products could hold up as U.S. consumers grow optimistic about the economy. Consumer confidence rose last week to its second-highest level in more than six years, propelled by growing optimism over household finances and the buying climate, theBloomberg Consumer Comfort Index showed. That corroborated the signal from the Conference Board’s sentiment gauge in April, which was also the second-highest reading since 2008.

Geopolitical Unrest

Geopolitical unrest could also disrupt U.S. sales overseas. Violence has intensified between Ukrainian forces and pro-Russian separatists in eastern and southern Ukraine, less than three weeks before a presidential vote in the country. President Barack Obama and GermanChancellor Angela Merkel said the elections, scheduled for May 25, are the next trigger point determining whether the U.S. and its allies slap broader sanctions on Russia.

Because the U.S. does little trade with Russia and Eastern Europe, the sanctions and upheaval don’t pose major threats to trade, Mike Englund, chief economist at Action Economics LLC in Boulder, Colorado, said before the report.

To contact the reporter on this story: Jeanna Smialek in Washington atjsmialek1@bloomberg.net

To contact the editor responsible for this story: Carlos Torres at ctorres2@bloomberg.netVince Golle

Source:

www.bloomberg.com

Read More

Sheryl Sandberg sells half her stake in Facebook

Sheryl Sandberg: has sold about 10 million shares worth some $400 million since Facebook made its stock-market debut in May 2012. Photograph: Erin Lubin/Bloomberg
Sheryl Sandberg, Facebook’s number-two executive, has shed more than half her stake in the social networking company since its initial public offering less than two years ago, according to an analysis of recent regulatory filings.

The series of disposals, some of which were made to satisfy tax bills, are likely to add to persistent questions about whether Ms Sandberg is eyeing an eventual departure from the company for a future in government or as head of another large company.

However, her name has yet to be closely linked to any senior corporate positions and she has denied any plans to compete for political office – most recently in January, when she said that politics was “not for me”.

Also, even after the disposals, Ms Sandberg’s stake, worth about $1 billion (€0.72 billion), still makes her one of the largest individual investors in Facebook with a 0.5 per cent stake.

As chief operating officer, the former Google executive was brought in at a critical time in Facebook’s development, when the company was first looking to ramp up its revenues and a young Mark Zuckerberg was still trying to find his feet.

The Facebook chief executive has since developed a greater management self-assurance and taken on many of the company’s key decisions, for instance in his personal handling of deals such as the acquisitions of WhatsApp and Instagram.

Ms Sandberg has frequently been talked of as a candidate for high office in Washington.

A former chief of staff to Larry Summers when he was treasury secretary under Bill Clinton, she was said to have been considered for that position during the first Obama administration.

Ms Sandberg has sold about 10 million shares worth some $400 million since Facebook made its stock-market debut in May 2012, according to filings with the Securities and Exchange Commission.

The sales were made under the “blind” trading plans that corporate executives use to spread their disposals out over a period of time, reducing the risk of being accused of trading on privileged information.

She also sold nearly 16 million shares in late 2012 to settle a tax bill that fell due when restricted stock she had in the company vested to become ordinary shares.

Along with some other small disposals, that has taken Ms Sandberg’s overall stake down to 17.2 million shares, restricted stock units and options in the social networking company. At the time of the IPO, she held about 41 million shares, most of them in the form of restricted stock units. – (Copyright The Financial Times Limited 2014)

Source:

www.irishtimes.com

Read More

Taxpayers Targeted in Nationwide IRS Phone Scam

WASHINGTON (AP) -

A government watchdog says more than 20,000 taxpayers have been targeted by fake IRS agents in the largest phone scam the agency has ever seen.

The IRS inspector general says thousands of victims have lost a total of more than $1 million. As part of the scam, fake IRS agents call taxpayers, claim they owe taxes, and demand payment using a prepaid debit card or a wire transfer.

In order to convince people that they are real IRS agents, the scammers use several tricks including a program to make the IRS's toll-free number appear on the caller ID, call center background noise, and false agent badge numbers, said officials with the Better Business Bureau.

Those who refuse are threatened with arrest, deportation or loss of a business or driver's license.

J. Russell George is the IRS inspector general. He said Thursday that real IRS agents usually contact people first by mail. He says real agents don't demand payment by debit card, credit card or wire transfer. He says people have been targeted in nearly every state.

The BBB recommends consumers to follow a few tips in order to protect  themselves from this IRS scam and others like it:

*Beware of any caller claiming to be from the IRS and demanding money. The IRS announced that it would never ask for payments by wire transfer or a prepaid card and it will typically alert taxpayers of unpaid taxes via the mail, not a phone call.

*In general, never give anyone money or credit card information over the phone. -Never trust callers who use threats and hostility to bully their targets into doing what they want. This is a tactic many scammers use.

 *Be skeptical of what a caller claims he or she can do if you refuse to meet their demand. An IRS agent will not get the police or an immigration agency involved just because you owe taxes.

News Source: www.wsav.com

Read More

Retail Sales Rise Shows U.S. Recovers From Winter Chill: Economy

March 13 (Bloomberg) -- Sales at U.S. retailers rose in February for the first time in three months, claims for jobless benefits dropped last week and consumer confidence improved, pointing to an economy regaining traction after a harsh winter slowed demand even more than previously estimated.

The 0.3 percent advance in purchases followed a 0.6 percent drop in January that was larger than initially reported, the Commerce Department in Washington said. Unemployment claims unexpectedly fell to a more than three-month low and consumer sentiment rose to the second-highest level since August.

The confidence report showed those at the lowest end of the pay scale were becoming less pessimistic, a sign the improving job market will help broaden gains in spending. The extent of the economic damage inflicted by the weather remains open to debate, which means Federal Reserve policy makers will probably continue to trim monthly bond purchases at a measured pace when they meet next week.

“We’ll see a little bit more traction on the consumer side as the weather improves and people get a little bit more willing to leave the house,” said Russell Price, senior economist at Ameriprise Financial Inc. in Detroit and the best forecaster of retail sales over the past two years, according to data compiled by Bloomberg. Still, the gain in February “has to be considered against the negative revisions to January and December.”

Stocks fell, erasing early gains after the Standard & Poor’s 500 Index came within four points of a record. The S&P 500 declined 0.6 percent to 1,857.5 at 12:25 p.m. in New York.

Economists’ Forecasts

The median forecast of 84 economists surveyed by Bloomberg called for a 0.2 percent advance in retail purchases. Estimates ranged from a 0.2 percent drop to a 0.6 percent gain. The decline in January, revised from an initially reported 0.4 percent decrease, was the biggest since March. December receipts were also weaker -- down 0.3 percent compared with a previously estimated 0.1 percent drop.

Another report from the Labor Department showed first-time claims for unemployment benefits dropped by 9,000 to 315,000 in the week ended March 8. Employers cutting back on dismissals may be encouraged to take on more workers as demand rebounds. Payrolls increased by 175,000 in February after a 129,000 gain that was more than initially estimated, the agency said March 7.

“The labor market continues to improve,” said Brian Jones, senior U.S. economist atSociete Generale in New York who accurately forecast the number of claims. “The economy is not in a soft patch.”

Consumer Comfort

Improving conditions in the job market help explain why households are more upbeat. The Bloomberg Consumer Comfort Index climbed to minus 27.6 in the period that ended March 9 from minus 28.5 the prior week.

The advance was the fifth straight and the reading was second only to the minus 27.4 in the week ended Dec. 22 as the strongest since mid-August. Americans were more optimistic about the economy than at any time in the last seven months.

The Bloomberg gauge of whether it’s a good time to buy also increased. The report showed sentiment improved for those making less than $15,000 a year, reaching the highest level since August.

“Better employment prospects and a reduced pace of firings in the economy has bolstered confidence in the broader economy,” said Joseph Brusuelas, a senior economist atBloomberg LP in New York. “Improved sentiment among lower- income groups is particularly important and will likely support growth later this year.”

The labor market is also showing signs of picking up in Australia. The number of people employed full-time rose by 80,500 in February, the biggest increase since August 1991, after the country’s last recession.

Broad-based Gain

News Source: www.sfgate.com

Read More

Google stock split to favour founders, shake up S&P 500

Google's unusual upcoming stock split is about to upend the popular Standard & Poor's 500 and short-circuit the influence of common shareholders.

The complex financial manoeuvre will create the effect of a two-for-one stock split and dramatically reduce the voice of Google's common shareholders But it will also change how the company is reflected in the value of the popular S&P 500 index. The share price will be cut in half from Wednesday's lofty per-share level of $1,207.30 , but investors will see their ability to have a say in the company greatly reduced.

The changes kick off on April 2, when Google will, using newly created class C stock, pay a dividend to existing holders of the company's class A and class B shares. The new class C shares will carry no voting rights, making them unusual relative to the common shares issued by most companies.

Advertisement

S&P Dow Jones Indices has reversed course on the way it will deal with the situation in the S&P 500. Originally, the index provider was going to replace Google's class A shares in the index with class C. But late Tuesday, S&P Dow Jones Indices said it would include both the class A and the class C shares, meaning the S&P 500 will now have 501 stocks in it, representing 500 companies.

The index's rules are also being changed so that in the future companies that issue a new class of stock will be included in the S&P 500 if certain criteria are met. Those criteria include tests of liquidity and materiality levels.

S&P Dow Jones Indices is reviewing the companies in the S&P 500 that already have several classes of stock that trade and will decide which ones will be added to the index by September 2015.

Currently, there are nearly 50 companies in the S&P 500 that have multiple classes of stock that trade, including Berkshire Hathaway, Brown-Forman and CBS. More companies are considering multiple classes of stock to give management tools to fend off shareholder activists, maintain control and prioritise who gets dividends, says Howard Silverblatt of S&P Dow Jones indices.

Google currently has two classes of stock. The class A shares, which are held by the public, carry one vote per share. The class B shares, controlled by the company's founders, receive 10 votes. After the class C dividend is paid out, Google will have double the number of shares outstanding that it does now.

Google has 279.9 million shares of class A and 56.2 million shares outstanding as of January 30.

Despite Google's investor-unfriendly move, some investors such as Michael Farr of Farr Miller & Washington don't plan to sell their stock and might buy more.

Google's move is so brazen, only companies "experiencing great success" would be able to pull it off, Farr says. "They can kind of do whatever they want because everyone is making money, and they're not under any real fire anywhere."

USA Today / MCT International

News Source: www.smh.com.au

Read More

Mt. Gox safe from U.S. suits in bankruptcy case

Mark Karpeles, chief executive officer of the bitcoin exchange Mt. Gox, gets into a taxi after leaving the Tokyo District Court on Feb. 28. Mt. Gox has filed for protection from creditors in both Japan and the United States. | BLOOMBERG.

WILMINGTON, DELAWARE – Mt. Gox Co., the bitcoin exchange that filed for bankruptcy in Tokyo after millions of dollars’ worth of virtual currency vanished from customer accounts, won a temporary halt to lawsuits it faces in the U.S.

U.S. Bankruptcy Judge Harlin Hale in Dallas agreed Monday to shield the company’s assets from creditors and halt two suits, both of which are in their early stages. The company will return to court April 1 to seek to extend the protection until the Japanese case is resolved.

The Tokyo-based exchange filed for bankruptcy in Japan last month after losing bitcoins worth about $473 million at the time. The company said in its U.S. filing that almost 750,000 customer bitcoins and 100,000 of its own, about 7 percent of all bitcoins in existence worldwide, were missing and probably stolen.

“The facts known to date indicate that it was caused or related to a flaw in the software algorithm that underlies bitcoin, and ‘hacking’ attacks of one or more persons,” Mt. Gox Chief Executive Officer Mark Karpeles said in a sworn statement filed in the Dallas court.

The exchange was founded in 2011, two years after bitcoins first appeared. Shortly after it opened in July of that year, hackers attempted to break into the system or shut it down with so-called denial of service attacks, according to court papers.

Manhattan U.S. Attorney Preet Bharara and the FBI are probing possible criminal violations tied to the shutdown of Mt. Gox, two sources said last month. The Bitcoin Foundation, an advocacy group for the digital currency, said last month that it briefed federal prosecutors about possible theft at Mt. Gox.

A spokeswoman for Bharara, Jennifer Queliz, declined comment on whether a software flaw would effect a federal investigation, citing the office’s policy to neither confirm nor deny the existence of an investigation.

Last month, Mt. Gox was sued in federal court in Chicago by an Illinois resident accusing it of misappropriation and fraud. The company also faces a $75 million breach-of-contract suit filed by CoinLab Inc. in Washington state.

Mt. Gox filed for creditor protection Sunday in federal court in Dallas under Chapter 15 of the U.S. Bankruptcy Code, which can be used to shield assets while the main bankruptcy proceeding is carried out in another country. The petition listed about $37.7 million in assets and $63.9 million in liabilities.

Jed MacCaleb, who built the initial Mt. Gox software, owns 12 percent of the company. Tibanne Co., a Japanese company, owns the rest, court documents show.

News Source: www.japantimes.co.jp

Read More

Weekly jobless claims drop sharply to 323,000 as layoffs ease

Job seekers line up for the Recruit Military veterans job fair in San Diego. (Sam Hodgson / Bloomberg / February 27, 2014)

WASHINGTON -- Initial jobless claims fell sharply last week to their lowest level in three months, the Labor Department said Thursday, as a private report showed layoffs eased in February.

About 323,000 people filed for first-time unemployment benefits in the week ending Saturday, down from 349,000, the previous week, the Labor Department said.

The falloff was steeper than that expected by analysts, who had forecast 338,000 first-time claims. Last week's figure was the lowest since the end of November.

PHOTOS: Federal Reserve chairs through the years

Also on Thursday, outplacement consulting firm Challenger, Gray & Christmas Inc. said the pace of business downsizing decreased last month. U.S. employers announced 41,835 planned layoffs in February, down 7.3% from the previous month, it said.

The two reports offered positive glimmers heading into Friday's government jobs report amid a recent slew of weak economic data triggered by extreme winter weather.

Economists project that the economy added 150,000 net new jobs in February, up from 113,000 the previous month. The unemployment rate is forecast to remain at 6.6%.

However, those estimates were called into question Wednesday after payroll processing firm Automatic Data Processing estimated that the private sector added a disappointing 139,000 net new jobs last month, below analyst expectations.

At the same time, the Institute for Supply Management said growth in the crucial service sector fell to a four-month low last month.

Weekly jobless claims below 350,000 indicate moderate labor market growth. The four-week moving average dropped by 2,000 last week, to 336,500.

Planned layoffs last month were down 24% from a year ago and marked the lowest February total since 2000, Challenger said. Announced job cuts in the first two months of the year were 9.2% less than for the same period in 2013.

Banks and other financial firms had the most announced job cuts in February, with 9,791, about double the amount in January.

Although some cuts resulted from less mortgage lending, a large portion came as banks reduced the number of tellers as customers shift to mobile banking, said John A. Challenger, the outplacement firm's chief executive.

“These are the kinds of cuts we don’t see in a recession," he said. "These are successful companies taking proactive steps to adjust to new realities.”

News Source: www.latimes.com

Read More

Most Economists in Survey Say Fed Bond-Buying Has Helped Recovery

WASHINGTON — Most business economists believe the Federal Reserve’s controversial bond-buying stimulus program has helped boost the recovery, but differ on the effects of the health- care overhaul law and other policies by President Obama and Congress, according to survey results released Monday.

Nearly 70 percent of respondents in the semi-annual survey of the National Association of Business Economics said the Fed’s program, known as quantitative easing, has been a success.

A majority — 57 percent — described the central bank’s monetary policy as “about right,” while 37 percent said it was “too stimulative.”

There was less agreement on policy moves from the White House and Capitol Hill.

About 39 percent of respondents said fiscal policy, which has included tax increases and automatic federal spending cuts, was “too restrictive,” while 21 percent thought it was “too stimulative.” Almost 4 in 10 — 37 percent — described it as “about right.”

There also was disagreement on the effects of the Affordable Care Act, with 42 percent saying they thought it would have no significant effect on economic growth. Three in 10 respondents said it would reduce growth, while 18 percent said it would boost economic activity.

The Congressional Budget Office recently said the health-care overhaul law would cause some people to work less, reducing employment by the equivalent of 2 million full-time jobs in the next decade.

“Respondents … generally agree about monetary policy, but there is no clear consensus about most fiscal issues,” said Jay Bryson, global economist at Wells Fargo Securities and chair of the NABE’s policy survey committee.

The Fed began its third round of bond-buying in September 2012, when the unemployment rate was 8.1 percent. The rate in January was 6.6 percent.With the unemployment rate dropping, Fed policymakers began tapering the $85 billion in monthly purchases, reducing them by $10 billion in December and again in January.

But the economy has shown signs in recent weeks of slowing again, with lackluster job growth the past two months.

News Source: ww.azstarnet.com

Read More