EconomicCrisis.US

Regional economic reports on Monday suggested the U.S. economy has clambered back to levels associated with the end of recession, but recovery will be patchy and may prove fleeting.

Economic activity and manufacturing data for the U.S. Mid West and Texas hinted the impact of the global financial crisis is slowly abating as the economy emerges from the longest recession in 70 years.

However, an index of national economic activity slipped on a monthly basis and a Texas manufacturing output index fell.

“Those kind of reports tend to support the argument that this recovery will be more uneven and less V-shaped, but with the caveat that these are somewhat narrow regional surveys,” said Kevin Flanagan, fixed-income strategist for global wealth management with Morgan Stanley in Purchase, New York.
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The seasonally adjusted number of jobless claims in the week to October 17 rose 2.1 percent or 11,000 to 531,000 from the previous week’s revised figure of 520,000, the Labor Department said.

It was higher than the 515,000 forecast by most economists.

The four-week moving average, which smooths out week-to-week volatility, however fell slightly to 532,250 — a drop of 750 from the previous week’s revised average of 533,000.

The total number of Americans receiving unemployment benefits also shrank.

The Labor Department’s figures showed the number for seasonally adjusted insured unemployment during the week ending October 10 was was 5.923 million, a decrease of 98,000 from the preceding week’s revised level of 6.021 million.
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The Obama administration is launching a new effort to prop up the housing market by restoring financing to state and local housing agencies.

Such agencies, known as HSAs, help low- and moderate-income families purchase homes or attain affordable rental housing. They have come under strain amid the financial crisis as investors have shunned their debt, forcing the agencies to curtail their activities.

The administration on Monday announced that Treasury would begin purchasing securities from Fannie Mae and Freddie Mac backed by new housing bonds issued by the HSAs to fund their activities. In addition, Fannie and Freddie will launch temporary credit and liquidity facilities for the HSAs. The state agencies will pay a fee for access to both programs.
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Financial professionals hold the view that the U.S. economy remains in a recession, despite signs of stability in recent months, a survey said Tuesday. The survey was conducted amongst attendees of the 2009 annual conference of the Association for Financial Professionals on October 5.

Around 20% of respondents assessed that the recession will end before of the year, while 69% expect the recession to continue well into 2010. Nearly 22% expect company payrolls to shrink further, while just 14% anticipate their organization to resume hiring over the next six months.
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