EconomicCrisis.US

Businesses in the U.S. unexpectedly expanded at a faster pace in June and consumer confidence reached a 10-week high, signs that economic growth may pick up in the second half of the year.

The Institute for Supply Management-Chicago Inc.’s business barometer climbed to 61.1, exceeding the highest forecast in a Bloomberg News survey, from 56.6 in May. Readings greater than 50 signal expansion. The Bloomberg Consumer Comfort Index rose to minus 43.9 from minus 44.9.

Stocks climbed for a fourth day as the Chicago group’s figures indicated manufacturing is rebounding after a lull brought on by parts shortages tied to the March earthquake in Japan. The data underscore the view of Federal Reserve policy makers that the first-half slowdown will prove “temporary,” as fuel prices become less of a burden for companies and consumers.
Read the rest of this entry »

The U.S. needs to renew its “innovation economy” to drive future growth as consumers become more frugal and the government focuses on deficit reduction, former Gov. Timothy M. Kaine said Wednesday in Richmond.

In a speech at a symposium sponsored by the University of Richmond’s law school, Kaine, a Democrat who announced his candidacy for the U.S. Senate this week, said the U.S. can no longer rely on debt-fueled consumption for economic growth.

He cited ballooning government deficits, along with increasing household debt and declining savings, as major factors leading to the economic collapse.
Read the rest of this entry »

Treasury Secretary Timothy Geithner warned that the U.S. government may have to bail out major financial institutions again if there’s a crisis as big as the last one, according to a report released Thursday by a group overseeing the Troubled Asset Relief Program.

“We may have to do exceptional things again if we face a shock that large,” Geithner told the Office of the Special Inspector General for TARP in December.

SIGTARP, as the oversight group is known, spoke with Geithner during its investigation of the government bailout of Citigroup Inc. (C) . The group’s findings were released Thursday.
Read the rest of this entry »

Citigroup Inc (C.N) Chief Executive Vikram Pandit said he supports an “enhanced” federal consumer protection authority because problems for consumers can affect the entire financial system.

In prepared testimony for delivery to a bailout watchdog panel in Congress on Thursday morning, Pandit said consumer protection should include uniform standards for all market participants and be linked to a safety and soundness regulator.

But Pandit steered clear of an intense debate in Congress over whether a new consumer financial protection regulator should be a stand-alone agency or placed within an existing regulator, such as the Federal Reserve.
Read the rest of this entry »