May, 2008

The following is intended as general information and does not represent legal or tax advice. Individual circumstances vary - please consult your legal and tax advisors about your specific situation. As a monthly news source, some information may remain on this page for several weeks. To return to the general planned giving pages, please close this browser window. This News and Information section has been compiled by Future Focus.

News Stories

Leave Less to the IRS (and the Lawyers)
Why do you need an estate plan? It lets you accomplish these crucial objectives:

• Ensure that your assets go to the people you choose, not those the state chooses.
• Specify who will care for your minor children.
• Defuse potential family conflicts over your assets.
• Minimize estate taxes and other transfer taxes.
• Avoid the costs, publicity and delays of probate.
• Help ensure that you and your affairs will be taken care of as you wish if you become incapacitated.

Even if your estate is modest, take care of the basics:

• Tell loved ones where to find your documents and a list of your accounts, assets and insurance policies.
• Draft a will and final letter of instructions.
• Establish durable powers of attorney and health care in case you're incapacitated.
• Update your account titling and beneficiaries.
• Consider funding a revocable living trust with your titled assets along with a "pour-over" will to ensure other assets avoid a costly probate process.
  4/30/08 gather.com

How to 'restart' Social Security benefits
Can you really start over with Social Security? People who took Social Security payments early -- before their full retirement age -- can later opt to pay back their benefits and qualify for a higher payment based on their current age. You might want to consider "restarting" your Social Security if:

• You started payments before age 65
• You're now in your late 60s or early 70s
• You have the cash or investments on hand to pay back the benefits.

When you apply for Social Security before full retirement age, your benefit amount is reduced. If you delay your application for Social Security beyond full retirement age, though, your future benefit increases year by year until age 70.

If you do want to restart your benefits, begin by filling out SSA Form 521, "Request for Withdrawal of Application." You'll need to write the Social Security Administration a check for the full amount of the benefits you've already received. (Fortunately, Social Security doesn't charge interest, but you still could be coughing up quite a sum. Someone who's received an $1,800 monthly check for five years would owe $108,000.). However, there are estimates that "restarting" your Social Security benefits could increase your checks by as much as 76% if you applied at 62 and are now 70. Such a boost could represent a very good return on the money you'd have to "invest" or pay back to the Social Security Administration. But whether this makes sense for you depends on your individual circumstances, so speak with your financial advisor before deciding to go ahead.
5/2/08 LA Times

Immediate And Deferred Gift Annuity Rates Are Lowered
Having conducted its annual review, the ACGA Rates Committee recommended a new, lower schedule of gift annuity rates for immediate gift annuities, effective on July 1, 2008. In addition, the deferred gift annuity rates which became effective on July 1, 2006 will also be lower. At its April 2, 2008, meeting the ACGA board approved these recommendations.

One of the primary activities of the ACGA (American Council on Gift Annuities) is the publication of suggested charitable gift annuity rates for use by charities and their donors. The Council retains the services of an actuarial firm to advise and consult on matters pertaining to life expectancies and related matters. The Council has a long and distinguished record in this area, and its suggested rates have long been recognized, not only by charities and donors, but also by state insurance departments and the IRS as being actuarially sound and in the best interests of all parties involved.

Editor's note - The new rates will take effect 7/1/2008. Until then, the existing (higher) rates are still in effect. Most charitable organizations that issue gift annuity contracts will continue to use the existing rates through the end of June. If so, a gift annuity contract made prior to the end of June would have a higher rate for the life of the contract. If you are considering a charitable gift annuity, a decision prior to the change in rates would mean a greater annual return for the annuitant. The difference can be illustrated with the following examples of a single life rate:

Phishing Scams, Frivolous Arguments Top the 2008 "Dirty Dozen" Tax Scams
Topping this year's list of scams is phishing, which encompasses numerous Internet-based ploys to steal financial information from taxpayers. New to the "Dirty Dozen" this year is a scheme, which IRS auditors discovered, that relates to unreasonable and/or excessive fuel tax credit claims. Tax schemes can lead to problems for both scam artists and taxpayers. Tax return preparers and promoters also risk significant penalties, interest and possible criminal prosecution. The IRS urges taxpayers to avoid these common schemes:

1. Phishing Phishing is a tactic used by Internet-based thieves to trick unsuspecting victims into revealing personal information they can then use to access the victims' financial accounts.
2. Scams Related to the Economic Stimulus Payment Some scam artists are trying to trick individuals into revealing personal financial information that can be used to access their financial accounts by making promises relating to the economic stimulus payment, often called a "rebate."
3. Frivolous Arguments Promoters of frivolous schemes encourage people to make unreasonable and unfounded claims to avoid paying the taxes they owe.
4. Fuel Tax Credit Scams The IRS is receiving claims for the fuel tax credit that are unreasonable.
5. Hiding Income Offshore Individuals continue to try to avoid paying U.S.taxes by illegally hiding income in offshore bank and brokerage accounts or using offshore debit cards, credit cards, wire transfers, foreign trusts, employee leasing schemes, private annuities or life insurance plans.
6. Abusive Retirement Plans The IRS continues to uncover abuses in retirement plan arrangements, including Roth Individual Retirement Arrangements (IRAs).
7. Zero Wages Filing a phony wage- or income-related information return to replace a legitimate information return has been used as an illegal method to lower the amount of taxes owed.
8. False Claims for Refund and Requests for Abatement This scam involves a request for abatement of previously assessed tax using Form 843, "Claim for Refund and Request for Abatement."
9. Return Preparer Fraud Dishonest tax return preparers can cause many problems for taxpayers who fall victim to their schemes.
10. Disguised Corporate Ownership Some people are going as far as forming domestic shell corporations in certain states for the purpose of disguising the ownership of a business or financial activity.
11. Misuse of Trusts For years, unscrupulous promoters have urged taxpayers to transfer assets into trusts.
12. Abuse of Charitable Organizations and Deductions The IRS continues to observe the misuse of tax-exempt organizations.

IRS Watches Scams That Fall Off the List While the IRS has seen a decline in the occurrence of some of these scams, other problems, such as abuse of the American Indian Employment Credit and misuse of structured entity credits, continue to be areas of concern. The absence of a particular scheme from the Dirty Dozen should not be taken as an indication that the IRS is unaware of it or not taking steps to counter it.
3/13/08 IR 2008-41

TOP OF PAGE | CLOSE WINDOW

THE ECONOMY: SEVEN INDICATORS - From CNN Money (as of 5/29/08)

The Indicator	What It's Telling Us	Next Update
Consumer Confidence	Consumer confidence: Worst since '92	June 24
Retail sales	Sales excluding autos top forecasts in April report	June 12
Leading Economic Indicators	Up slightly but remain sluggish	June 16
Manufacturing Activity (ISM)	Unchanged in April	June 2
Industrial Production	Biggest drop since Hurricane Katrina in 2005	June 17
Job Growth	Minus 20,000 in April	June 6
Inflation (CPI)	Overall consumer prices up 3.9%, less than expected	June 13

Recent Economic News

Consumer sentiment sinks as inflation worries mount - 5/30/08 MarketWatch
U.S. consumer sentiment dropped in May to the lowest level in 28 years as worries about inflation grew, according to the University of Michigan/Reuters consumer sentiment index released Friday. The UMich index fell to 59.8 in May from 62.6 in April, the lowest since June 1980. The preliminary May index was reported at 59.5 two weeks ago. Inflation expectations rose to their highest level in more than two decades, following steady increases in gasoline prices. The consumer expectation index fell to 51.1 in May from 53.3 in April, the lowest since October 1990.

Consumer Spending and Personal Income Slow - 5/30/08 AP in the NY Times
Consumer spending barely budged in April and growth in personal income slowed sharply, even though the government started sending out billions of dollars in economic stimulus payments. The Commerce Department reported Friday that consumer spending rose 0.2 percent, and income growth was just as weak, also increasing 0.2 percent. The growth in incomes, held back by four straight months of jobs losses, would have been just 0.1 percent had it not been for the first wave of economic stimulus payments that the government started sending out April 28.

GDP Gets Revised Up - 5/29/08 Forbes.com
First quarter GDP estimates improved the second time around, showing more trade and less of an inventory stockpile. On Thursday, the Commerce Department posted a rosier version of its first quarter GDP report with an expansion rate of 0.9% up from 0.6%. The upward revision was in line with Wall Street expectations. The first version posted last month was preliminary and there will be a final estimate published next month. GDP is the value of all goods and services produced within the United States. Two quarters of decline in this metric is generally regarded as an indicator of recession. The National Bureau of Economic Research has a more comprehensive, if still somewhat vaguely worded, measure of recession, defining it as a significant decline in economic activity spread across the economy, lasting "more than a few months" normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. From MarketWatch - The GDP revision matched expectations of economists. The revision to GDP showed a better mix of growth. Personal incomes were also growing significantly faster than first believed.

Unexpected Strength in Durable Goods - 5/28/08 NY Times
A crucial measure of business spending declined less than expected in April, a sign that businesses may be breathing easier about the economy, although orders of cars and computer equipment still dipped, the government said on Wednesday. Over all, manufacturing orders fell 0.5 percent last month, to a seasonally adjusted $214.4 billion, after slipping 0.3 percent in March, the agency said. Although it was the third decline this year, the dip was less severe than economists had forecast. The Commerce Department report measures orders of durable goods, those intended to last three years or more, which provide a sense of willingness among businesses to make long-term investments in capital equipment.

U.S. April durable goods orders down 0.5% - 5/28/08 MarketWatch
Orders for U.S.-made durable goods sank in April, falling 0.5% on weaker demand for airplanes, vehicles, and computers the Commerce Department reported Wednesday. Excluding the 8.0% decrease in transportation goods, orders rose 2.5%, the biggesst gain since July 2007. The decrease in overall orders was much smaller than the expected 2.8% drop forecast by economists surveyed by MarketWatch. A sharp gain in electronics orders partially offset the weakness in other areas. So-called core durable goods orders rose 4.2% in April. Shipments rose 1.2% in April. Inventories rose 0.5% while unfilled orders rose 1.0%.

Consumer confidence: Worst since '92 - 5/27/08 CNNMoney.com
A key measure of consumer confidence dropped in May to the lowest level in 16 years, as Americans grew more concerned about their jobs and more pessimistic about business conditions. The New York-based Conference Board said Tuesday that its Consumer Confidence Index dropped to 57.2, the lowest level since October 1992, from a revised 62.8 in April. Economists had expected the index to decline to 61, according to a consensus compiled by Briefing.com. The index has now declined for five months in a row.

New-Home Sales Rose, but Prices Fell - 5/27/08 Reuters in the NY Times
A government report released Tuesday showed that sales of new single-family homes rose 3.3 percent in April but were down 42 percent from a year ago. According to MarketWatch, April's increase was in line with expectations. Economists said the sales gain was a rebound from the sharp 11% drop in sales in March to 509,000 units, which was the lowest level in sales since April 1991.
Prices of single-family homes declined a record 14.1 percent in the first quarter from a year earlier, marking a pace five times faster than the last housing recession, according to the Standard & Poor's/Case Shiller national home price index reported on Tuesday. The S.&P./Case Shiller composite index of 20 metropolitan areas fell 2.2 percent in March from February and fell 14.4 percent from March 2007. Economists expected prices for the 20-city index to fall 2.0 percent on month and 14 percent from a year earlier, according to a median in a Reuters survey.

U.S. Homes: It Could Be Worse - 5/23/08 Forbes.com
While the sales of existing homes are still declining due to the poor market conditions, they are declining at a smaller rate than last month. According to data from the National Association of Realtors, April sales of existing homes were not as disappointing as expected and some markets are starting to see some turnaround. Sales of existing homes were down 1.0%, to 4.89 million units, and they remain 17.5% below the rate of April 2007. Economists surveyed by Thomson expected the rate of sales for new homes to drop 1.6%, to 4.85 million units, down from the 4.93 million units that were sold in March. The national median existing-home price for all housing types was $ 202,300 in April, down 8.0% from $219,900 a year ago. From the NY Times - The biggest decline came in sales of apartments and condominiums, which plunged 5.2 percent after two months of rising sales. Demand for single-family homes dropped 0.5 percent in April, the Realtors said.

U.S. weekly initial jobless claims fall 9,000 to 365,000 - 5/22/08 MarketWatch
First-time claims for state unemployment dropped by 9,000 to 365,000 on a seasonally adjusted basis in the week ending May 17, the Labor Department reported Thursday. Initial claims were the lowest since the week ended April 5. The four-week average of initial claims rose by 5,000 to 372,250. The number of continuing jobless claims was unchanged for the week ending May 10, at 3.07 million. The four-week average of those claims rose by 31,750, to 3.05 million.

U.S. Q1 OFHEO home prices down 1.7% - 5/22/08 MarketWatch
In the first quarter U.S. home prices fell a seasonally adjusted 1.7% -- the largest quarterly price decline on record, the Office of Federal Housing Enterprise Oversight reported Thursday. Prices fell 3.1% in the past year. In the prior quarter, prices declined 1.4%. For March, prices fell 0.4%. The OFHEO index is based on repeat sales of homes mortgaged through Fannie Mae and Freddie Mac.

Producer Inflation Stays Strong--Or Maybe Not - 5/20/08 Forbes.com
Wholesale inflation continues to pressure the economy. The Labor Department said its Producer Price Index rose 0.2% in April. That's down from a 1.1% rise in March and below economists' forecasts of a 0.4% jump. However, its core index--excluding food and energy items--climbed 0.4% last month. Analysts had expected 0.2%. The PPI is a leading indicator of where consumer prices will go. The full brunt of rising oil prices has not been felt by either the electric or natural gas utilities. Utilities will be asking regulatory commissions for large rate increases, and those will be reflected in producer and then consumer price data through the fall. From Yahoo Finance - Over the past 12 months, core inflation has risen by 3 percent, the highest reading in more than 16 years.

Leading indicators show economy remains sluggish - 5/19/08 AP in the NY Times
The New York-based Conference Board said its forecast of future economic activity (leading economic indicators) rose 0.1 percent in April, matching a 0.1 percent increase in March. Economists had expected a 0.1 decrease in April. The index is designed to forecast economic activity in the next three to six months based on 10 economic components, including stock prices, building permits and initial claims for unemployment benefits. Six of ten leading indicators rose in April, including stock prices, interest rate spreads and housing permits. Those increases more than offset the sharp declines in average weekly hours worked and consumer spending. From MarketWatch - The leading index is down at a 2.3% annual pace in the past six months, better than the 4.7% annualized decline in the six months ending in January. Four of the 10 leading indicators are stronger over the past six months, the broadest strength since November.

Housing Starts Rise Unexpectedly - 5/16/08 NY Times
New-home construction increased 8.2 percent in April, offering signs of life in a deeply troubled sector, the Commerce Department reported on Friday. But most of the gain came in multifamily housing, masking further bad news on single-family homes, whose groundbreakings dropped to a 17-year low. Housing starts rose to a seasonally adjusted annual rate of 1.032 million. (MarketWatch estimated 939,000) Construction of multifamily units surged 36 percent, compared with a 35 percent drop in March, a huge swing - and an average one in recent months, the agency said in a report. While building permits were up 4 percent in both areas, ground was broken on 1.7 percent fewer single-family homes in April, from a seasonally-adjusted annual rate of 704,000 to 692,000.

Consumer sentiment falls in May, lowest since 1980 - 5/16/08 MarketWatch
Consumer sentiment in May fell from the prior month, reaching its lowest level since 1980, according to a Friday media report. In recent months, high fuel and food prices, along with falling home values have pulled down sentiment. The U.S. consumer sentiment index in May fell to 59.5 from 62.6 in April, according to a Friday report from University of Michigan/Reuters. Economists surveyed by MarketWatch were looking for a result of 61.0.

Jobless claims up, once again - 5/15/08 AP in CNN Money
Applications for jobless benefits rises slightly to 371,000 last week, Labor Department reports; fourth straight month of job losses. The number of newly laid off workers applying for unemployment benefits rose slightly last week, indicating the weak economy was still weighing on the job market. The Labor Department reported Thursday that applications for jobless benefits rose by 6,000 last week to 371,000. The gain was in line with expectations.

Industrial output sinks 0.7% in April - 5/15/08 MarketWatch Industrial output of the nation's factories, mines and utilities dropped 0.7% in April in a broad-based decline led by falling production of motor vehicles, the Federal Reserve reported Thursday. "Today's bleak industrial production report bolsters the argument that the economy is either in or heading into a recession," wrote Michelle Meyer, an economist for Lehman Bros. The output of factories fell 0.8%, the biggest decline since September 2005, when Hurricane Katrina disrupted the economy. Factory output was hindered by a strike at American Axle, which rippled through the automotive sector. Industrial production has risen 0.2% in the past year, and is down 1.2% since January. The decline in output was worse than the 0.6% drop expected by economists surveyed by MarketWatch.
Related - AP in the NY Times The nation's industrial output plunged in April, reflecting big cutbacks in autos and other manufacturing industries. The Federal Reserve reported Thursday that industrial production dropped 0.7 percent last month, more than double the decline that economists had expected. Manufacturing output fell by 0.8 percent with half of that weakness coming from large cutbacks in auto production which has been beset by falling demand for new cars and also problems related to a strike at a parts supplier for General Motors. The drop in overall production matched a 0.7 percent decline in February and followed a weak 0.2 percent increase in March. The nation's industrial sector has been feeling the impact of the slowdown in the rest of the economy. A bright spot for manufacturing has been continued strong overseas demand, helped by a weak dollar which has boosted the competitiveness of U.S. products in foreign markets.

April Retail Sales Dipped, but Some Sectors Held Up - 5/14/08 Reuters in the NY Times
United States retail sales weakened modestly in April, but outside the hard-pressed auto sector they were more resilient than many economists had forecast, a government report showed on Tuesday. The report echoed recent data showing underlying economic durability, including fewer job losses in April than feared and a surprisingly strong pace of first-quarter productivity. The Commerce Department said overall retail sales declined 0.2 percent, but if cars were excluded, sales rose 0.5 percent. Economists expected total sales to slip 0.1 percent, but had forecast a gain of just 0.2 percent excluding autos.

U.S. April CPI up 0.2%, core rate up 0.1% - 5/14/08 MarketWatch
U.S. consumer inflation moderated in April, the Labor Department said Wednesday. The consumer price index increased 0.2% in April after a 0.3% gain in the previous month. The core CPI, which excludes food and energy costs, was up 0.1% in April after rising 0.2% in March. Economists were expecting the CPI and the core rate to rise 0.2%. Energy prices moderated after a large jump in March. However, food prices rose 0.9%, the largest gain since 1990.
Related - Food Costs Jump Most in 18 Years - 5/15/08 Washington Post
Rising global grain prices helped spark the largest increase in monthly food costs in nearly 20 years, as consumers paid more in April for cereals and baked goods, and the dairy, meat and other animal products that rely on feedstocks, the government reported yesterday. Food prices have risen at a seasonally adjusted annual rate of 6.1 percent past three months. The 0.9 percent rise from March to April was the biggest one-month advance since January 1990, according to the Bureau of Labor Statistics. The costs of cereal and bakery products increased 1.4 percent from March to April and have risen at a seasonally adjusted annual rate of nearly 20 percent in the past three months. Prices for fats and oils jumped more than 5 percent in April, on a seasonally adjusted annual basis, and have increased more than 26 percent in the past three months. Prices for sugars and sweets increased more than 10 percent during that same period.

Retail sales drop for 3rd time in past 5 months -5/13/08 MarketWatch
U.S. retail sales fell for the third time in the past five months in April, led by a big decline in auto sales, the Commerce Department reported Tuesday. Retail sales fell 0.2% on a seasonally adjusted basis after a 0.2% gain in March. Sales were up 2% in the past year. Sales over the past three months were down 0.4% compared with the prior three months. The figures are not adjusted for price changes. Sales were slightly stronger than the 0.3% drop expected by economists surveyed by MarketWatch.

Economic growth seen at only 0.2 percent - 5/13/08 Reuters
The U.S. economy will barely grow in the second quarter after sluggish growth early in the year, while inflation is expected to rise, said a survey released by the Philadelphia Federal Reserve on Tuesday. The economists surveyed forecast gross domestic product in the current quarter would expand at an annualized rate of 0.2 percent, sharply below their prior forecast of 1.3 percent. The government's preliminary reading of first-quarter U.S. GDP, released on April 30, said it grew at a rate of 0.6 percent, the same pace set in the fourth quarter.

Trade Deficit Narrowed in March -5/9/08 NY Times
Domestic demand for imports fell in March by the most since 2001, the latest indication that the economic slowdown has forced Americans to rein in their spending habits, the government reported on Friday. Americans shied away from buying imported automobiles, which fell 9.3 percent in March, and oil, which dropped 8.9 percent. It was the second consecutive month that crude oil imports had declined. Declines were reported in a variety of other consumer goods ranging from clothing to toys and furniture. At the same time, exports decreased for the first time in 12 months, a troubling sign for American businesses struggling with a pullback among domestic consumers. Foreign purchases have helped prop up the American economy amid the current slowdown. For the month, the Commerce Department reported, the trade deficit narrowed to $58.2 billion from a downwardly revised $61.7 billion in February. The 5.7 percent decrease was more than economists had expected.

U.S. weekly initial jobless claims fall 18,000 to 365,000 - 5/8/08 MarketWatch
The number of people filing for the first time for unemployment benefits fell by 18,000 to 365,000 on a seasonally adjusted basis in the week ending May 3, the Labor Department reported Thursday. The four-week average of initial claims, which smoothes out one-time factors such as bad weather or holidays, moved up by 2,500 to 367,500. The number of people collecting benefits fell by 10,000 in the week ending April 26 to 3.02 million. The four-week average of continuing claims nudged higher by 16,750 to 3 million, the most in four years. Compared with the same time last year, initial claims are up about 17%, while continuing claims are up about 19%.

Jobless Claims Post Sharp Decline - 5/8/08 AP in the NY Times
The number of newly laid off workers seeking unemployment benefits dropped much more than expected last week. The Labor Department reported Thursday that applications for unemployment benefits fell to 365,000, a decline of 18,000 from the previous week. Economists had been looking for a much smaller decrease of around 5,000. Weekly jobless claims have been exceptionally volatile in recent weeks because of strike-related layoffs in the auto industry and an unusually early Easter, which has played havoc with the government's seasonal adjustment measurements.

Retailers Report Mixed Results for April - 5/8/08 AP in the NY Times
Consumers gave some of the nation's retailers a little relief in April after months of dismal sales, gravitating toward less expensive discounters and wholesale clubs but generally still shying away from stores selling clothes and other non-necessities. Monthly sales reports issued Thursday were better than expected, but still pointed to a consumer contending with rising gas prices, sagging home values and worries about jobs. Wal-Mart Stores Inc. and Costco Wholesale Corp. were among the top performers last month, while most mall-based apparel stores struggled.

Worker productivity up at 2.2 percent rate in first quarter - 5/7/08 AP in Yahoo Finance
Worker productivity rose by a better-than-expected amount in the first three months of the year while labor cost pressures eased. The Labor Department reported Wednesday that productivity, the amount of output per hour of work, increased at an annual rate of 2.2 percent in the first quarter. That was slightly higher than the 1.5 percent increase that had been expected. In a sign that inflation could be easing, labor cost pressures slowed a bit. Unit labor costs rose at an annual rate of 2.2 percent, down from a 2.8 percent rise in the final three months of last year.

Consumer borrowing unexpectedly surges in March - 5/7/08 AP in Yahoo Finance
Consumer borrowing rose in March at the fastest pace in four months, more than double the increase of the previous month, in what was seen as a sign of rising economic stress. The Federal Reserve reported Wednesday that consumers increased their borrowing at an annual rate of 7.2 percent, compared with a 3.1 percent rate of increase in February. The gain was much larger than economists had been expecting and reflected strong borrowing on credit cards and also in the category that includes auto loans. The increase in consumer debt totaled $15.3 billion at an annual rate in March, much bigger than the $6 billion increase that economists had been expecting.

Service sector shows growth for first time since December - 5/5/08 CNN Money
Encouraging news for the slumping U.S. economy came Monday as a key survey of non-manufacturing business executives showed unexpected growth in the service sector in April. The Institute for Supply Management's (ISM) non-manufacturing index rose to a reading of 52 from 49.6 in March. Economists were expecting a reading of 49.5, according to a consensus compiled by Briefing.com. A reading above 50 indicates growth in the sector. Sector adds jobs: The report also showed encouraging non-manufacturing labor growth. After three consecutive months of contraction, the service sector employment index rose 3.9 points to 50.8.

U.S. factory orders rise 1.4% in March - 5/2/08 MarketWatch
Orders for U.S.-made factory goods jumped 1.4% in March on strong demand for computers and machinery, the Commerce Department reported Friday. Excluding transportation products, orders for U.S. goods rose by 2.2%, the biggest gain in a year. Orders for durable goods rose 0.1% in March, reversing the 0.3% drop estimated by the government a week ago. Economists had been expecting a gain of 0.2% for factory orders in March, according to a survey conducted by MarketWatch. The surprise in the data was a 2.6% growth rate in nondurable goods orders, the strongest since November.

Jobs: 'Not as bad as we thought' - 5/2/08 CNN Money
Employers trimmed jobs in April for the fourth straight month, according to a government report Friday that was not as weak as Wall Street's expectations. There was a net loss of 20,000 jobs in the month, according to the Labor Department report, compared to the revised loss of 81,000 jobs in the March reading. Economists surveyed by Briefing.com had forecast a loss of 75,000 jobs in April. The unemployment rate slipped to 5% from the 5.1% reading in March. Economists had been forecasting unemployment would rise to 5.2% in the latest report.

Consumer spending up mainly because of sharp price increases - 5/1/08 Yahoo Finance
Don't be fooled by a larger-than-expected increase in consumer spending. People aren't buying more -- they're just paying more for what they buy. The Commerce Department reported Thursday that consumer spending was up 0.4 percent, double the increase economists had forecast. However, once inflation was removed, spending edged up a much slower 0.1 percent. Rising food costs, soaring energy prices and falling employment have pushed consumer confidence to its lowest levels in five years. Incomes in March rose a weak 0.3, but after removing inflation, after-tax incomes were flat.

Manufacturing still weak, employment drops - 5/1/08 CNN Money
A key index of manufacturing activity was unchanged at a weak level in April, with employment in the sector falling dramatically to the lowest point in nearly 5 years, according to a survey of purchasing managers released Thursday. The Institute for Supply Management's (ISM) manufacturing index stayed at the March reading of 48.6. Economists were expecting a reading of 48, according to a consensus estimate compiled by Briefing.com. The tipping point for the index is 50, with a reading above that reflecting growth in the sector. A reading below 50 represents a decline in manufacturing.

Fed cuts rates again and hints at pause - 4/30/08 CNN Money
The Federal Reserve cut its key interest rate by a quarter percentage point Wednesday, but the central bank's statement signaled it may be the last rate cut for at least a while. The cut took the federal funds rate, the key overnight rate at which banks loan money to one another, to 2%. It had been at 5.25% as recently as September, when the Fed started slashing rates in an effort to spur the economy and keep the nation out of recession. Fed policymakers are not set to meet again until June 24 and 25, the longest gap in its calendar of meetings this year. There have been growing complaints that the Fed's aggressive rate cuts this year have been a key to why food and oil prices have skyrocketed lately. The fact that the Fed has cut rates while central banks in Europe and Asia have mostly kept rates steady has led to a weakening of the dollar. That, in turn, has driven up commodity prices.

Slight Growth in Economy, but Consumer Spending Weakens - 4/30/08 NY Times
The American economy remained stuck in the slow lane over the first three months of the year, expanding by a modest 0.6 percent annualized rate, the Commerce Department announced. The weak performance reflected the increasingly thrifty inclinations of American consumers in the face of plummeting real estate prices, tightening credit and a deteriorating job market. Economic growth was also hampered by a continued pullback in construction and business investment. The only factors preventing the economy from sliding backward were the growth of American exports - aided by a weakening dollar - and a buildup of inventories by businesses. Exports and inventories set aside, final sales of American goods and services domestically dipped at a 0.4 percent annualized rate in inflation-adjusted terms, the first decline since the end of 1991. Consumer spending grew at an anemic 1 percent annualized rate, down from 2.9 percent in 2007 and 3.1 percent the year before. The 0.6% GDP growth was ahead of the 0.2% growth rate expected by economists surveyed by MarketWatch.

Home prices fall record 12.7% in past year - 4/29/08 MarketWatch
The decline in U.S. home prices quickened in February, with prices down a record 12.7% in the past year for 20 key cities, according to the Case-Shiller home price index released Tuesday by Standard & Poor's. Prices in 19 of the 20 cities have fallen over the past year, with prices in all 20 cities falling month-to-month for six straight months. The biggest declines were in Las Vegas and Miami, with declines of more than 20% in the past year. Prices in Charlotte, N.C., are up 1.5%.

Consumer Confidence Slips as Home Prices Drop - 4/29/08 NY Times
Americans' confidence in the economy continued to plunge this month as their homes lost value at the fastest rate in two decades, according to reports released on Tuesday. The data suggested that the housing slump was far from a recovery and the job market might continue to weaken, ratcheting up pressure on the Federal Reserve, which began a two-day meeting on Tuesday, to take steps to stave off a prolonged slowdown. Much of the damage has stemmed from a slump in the housing market, where prices are nearly 15 percent off their high in July 2006. The private report, which surveys up to 5,000 American households, dropped to its lowest point since March 2003, at the start of the invasion of Iraq. Americans feel worse about the economy's prospects than any time since the mid-1970s, and many are bracing for job losses. The index fell in April to 62.3 from a revised 65.9 in March and 76.4 in February. Economists surveyed by MarketWatch were looking for a final April result of 63.0.

New-home sales plunge 8.5% to 17-year low in March - 4/24/08 MarketWatch
US home builders have slashed their average prices by a record amount, but sales still plunged by 8.5% to a 17-year low in March, the Commerce Department estimated Thursday. The decline in new-home sales to a seasonally adjusted annual rate of 526,000 was much weaker than the 577,000 pace expected by economists surveyed by MarketWatch. The report gives little hope that the housing market is near a bottom. New-home sales are down 36.6% compared with a year ago. The months' supply of homes on the market rose to 11 months, the most in 27 years. Median sales prices have fallen 13.3% in the past year to $227,600.

US jobless claims fall 33,000 to 342,000 - 4/24/08 MarketWatch
First-time claims for state unemployment benefits fell to its lowest level in two months in the latest week, the Labor Department reported Thursday. The number of initial claims in the week ending April 19 fell 33,000 to 342,000. It's the lowest level since the week ended February 16. The consensus forecast of Wall Street economists was for claims to rise 3,000 to 375,000. Claims in the previous week were revised to an increase of 20,000 to 375,000 compared with the initial estimate of a rise of 17,000 to 373,000. The four-week average of initial claims fell 7,250 to 369,500. Meanwhile, the number of Americans receiving state jobless benefits fell 65,000 to 2.93 million in the week ending April 12. The four-week moving average of continuing claims rose 20,500 to 2.96 million.

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