November 18, 2017

Consumer Confidence Slips From 6-Year High

Data reported on Friday suggested that a recent jump in interest rates, in anticipation of the Federal Reserve’s tapering its bond purchases as early as next month, was starting to weigh on households.

“People have been shocked by how much mortgage rates have risen in the past couple of months. The chatter about the Federal Reserve is also a big deal,” said Christopher Low, chief economist at FTN Financial in New York.

The Thomson Reuters/University of Michigan’s preliminary reading on the overall index on consumer sentiment slipped to 80.0 from July’s six-year high of 85.1. August’s reading was the lowest in four months.

The survey’s barometer of current economic conditions fell to 91.0 in August from 98.6 the month before. The gauge of consumer expectations slipped to 72.9 from 76.5 in July.

In a separate report, the Commerce Department said housing starts rose 5.9 percent, to a seasonally adjusted annual rate of 896,000 units. That was just below economists’ expectations for a 900,000-unit rate.

Permits to build homes rose 2.7 percent in July, to a 943,000-unit pace. Economists had expected them to rise to a 945,000-unit pace.

“I think we are looking at a situation where some air is coming out of the housing recovery given the higher mortgage rates,” said Michael Hanson, senior economist at Bank of America Merrill Lynch in New York.

Long-term interest rates have risen by more than a full percentage point over the last three months on the view that the Fed will soon start trimming the $85 billion in monthly bond purchases that it has been making to keep borrowing costs low and stimulate the economy.

That in turn has prompted a rise in mortgage rates, which threatens to sap some of the strength from a housing recovery that has been pushing prices higher for more than a year.

Economists expect the Fed to make an announcement on tapering next month.

Data this week for industrial production, residential construction and employment have missed market forecasts, which could lower expectations for a significant pickup in growth in the second half of the year.

The economy grew at a rate of only 1.4 percent in the first half of 2013, held back by tighter fiscal policy.

Aside from higher mortgage rates, the residential construction figures last month could reflect supply constraints. Builders have been complaining about a shortage of labor and materials.

Still, home building remains on a firmer footing and should again contribute to economic growth this year.

A report on Thursday showed confidence among single-family homebuilders neared an eight-year high in August, with builders fairly upbeat about sales prospects over the next six months.

Though residential construction accounts for only about 3.1 percent of gross domestic product, housing has a wider reach in the economy. Analysts estimate that for every single-family home built, at least three jobs lasting a year are created.

Economists expect average monthly housing starts for the whole of 2013 to top one million.

Article source: http://www.nytimes.com/2013/08/17/business/economy/consumer-confidence-in-august-slips-from-six-year-high.html?partner=rss&emc=rss

Crisis-Struck Europeans Losing Faith in Governments

BERLIN — Less than 10 percent of people in the European countries hardest hit by the sovereign debt crisis believe that their leaders are doing a good job at fighting corruption, reflecting a crisis of faith in government since the crisis crippled much of the euro zone in 2008, an anti-corruption group has found.

A global survey of people’s views on corruption by Transparency International, released on Tuesday, revealed a deep disconnect between elected leaders and the people they govern. Roughly half of the 114,000 people surveyed viewed political parties as the most corrupt institutions, and more than half think their governments are run by special interest groups, the survey showed.

João Paulo Batalha, a board member at Transparency International in Portugal, pointed to the near unraveling of the government of Prime Minister Pedro Passos Coelho last week as an example of how seeking to address his country’s problems by focusing solely on the fiscal aspect has led to the frustration reflected in the survey.

‘’I think the problem is deeper than that and it has to do not with the amount of money that the government has spent, but it has more to do with the way the government spends money,’’ Mr. Batalha said. ‘’There are huge conflicts of interest between the public sector and the private sector. There are huge problems with wasteful spending that is not just wasteful because of incompetence, but because of corruption.’’

The ‘’Global Corruption Barometer’’ is the widest survey conducted to date by the international corruption watchdog organization, based in Berlin. It asked people in 107 countries about their opinions of their governments and which institutions they see as the most corrupt.

Only 23 percent of those surveyed internationally believed that their government’s efforts to fight corruption were effective, down from 32 percent in 2008. In Portugal, for example, only 8 percent expressed confidence in their leaders’ abilities to fight corruption. That compares with 21 percent in 2007, before the outbreak of the financial crisis.

Even in Europe’s more prosperous countries the mood has soured. Only 11 percent of Britons surveyed and 13 percent of Germans saw their government as effective in fighting corruption, both well below the global average of 22 percent.

While corruption remains most rampant in many of the world’s developing countries, where the survey found most people said they had to pay bribes to receive public services, the wealthier economic powers were not immune from corruption.

‘’In many countries there are no clear lobby regulations,’’ said Miklos Marschall, a director at Transparency International, who called on European countries to establish more clear codes of conduct and clear ethics declarations. ‘’Nineteen out of 25 European countries do not regulate lobbying at all.’’

Across the globe, 51 percent of people surveyed saw political parties in their countries as the most corrupt institutions, followed by the police and the judiciary.

The media did not fare as badly, but it was seen as most corrupt in Australia and Britain. Some 69 percent said it was the most corrupt institution in Britain, up from 39 percent three years ago, reflecting the series of scandals around phone hacking and the Leveson Inquiry.

The Leveson Inquiry into the ethics of the British press was set up after a scandal over phone-hacking at one of the newspapers of Rupert Murdoch’s media empire, which has a strong grip on the media in both Australia and Britain.

Still, nearly 9 out of 10 people surveyed said they would act against corruption and two-thirds of those who were asked to pay a bribe had refused, suggesting that governments, civil society and the business sector need to do more to engage people in thwarting corruption, Transparency International said.

Article source: http://www.nytimes.com/2013/07/10/business/global/crisis-struck-europeans-losing-faith-in-governments.html?partner=rss&emc=rss

She Owns It: The Truth About Working From Home

From the left: Jessica Johnson, Deirdre Lord, Beth Shaw, and Susan Parker.Earl Wilson/The New York Times From the left: Jessica Johnson, Deirdre Lord, Beth Shaw, and Susan Parker.

She Owns It

Portraits of women entrepreneurs.

At the most recent meeting of the She Owns It business group, the owners talked about the pros and cons of allowing workers to do their jobs from home.

“I’m a huge advocate of having everyone together for the sharing of ideas and communication, but I think that, as a business owner, you need to be flexible,” said Beth Shaw, who owns YogaFit. She said she had had both successful — and unsuccessful — remote-work arrangements. Her chief financial officer worked remotely from 2002 to 2009. “It started to really not work at all to not have your main accounting person in the building,” Ms. Shaw said.

But YogaFit has found several positions can be handled effectively from outside the office. For example, the company’s hosting manager, who books YogaFit’s trainings, works from home four days a week. Additionally, the company’s conference manager and the person who manages YogaFit’s trainers work remotely.

Jessica Johnson, who owns Johnson Security Bureau, wanted to know whether Ms. Shaw required her remote workers to provide her with any sort of reporting or documentation.

“I mostly leave them to their own devices,” Ms. Shaw said, although she does require the hosting manager to report how many trainings the company has each month, how many people attend each training and how many sessions are canceled. She said these numbers provided “a really good barometer of whether she’s booking correctly.”

Susan Parker, who owns dress manufacturer Bari Jay, said the employees’ roles dictated where they could work. For example, her customer service staff must be in the office between 9 a.m and 5:30 p.m. because that’s when the phones ring. But Bari Jay’s designer has more flexibility. “If she says she needs to work from home, great, go do it,” said Ms. Parker, who added that she knew the designer would get her job done.

Additionally, Ms. Parker’s sales manager works remotely — and effectively — from Florida. “He’s calling me all day nonstop, so I know he’s working,” Ms. Parker said. “For someone to work from home, you have to trust that they’re going to do what they need to do.”

“I totally agree,” said Deirdre Lord, who owns the Megawatt Hour, an energy-related start-up. “I think it depends on the individual, your relationship with that individual, or the manager’s relationship with that individual. It’s very hard I think to set rules, but the issue is some people, if they see you making certain things work for some people, then they say, ‘What about me — why can’t I work from home?’”

That is a big concern, said Alexandra Mayzler, who owns Thinking Caps Group, which recently changed its name from Thinking Caps Tutoring — and got a new Web site. “I think there’s something to be said for set vacation days that you have to take and ‘set-ish’ hours to work because I think when you’re working from home, you start feeling like you’re working all the time,” she said.

“I’ve worked from home and had that experience,” said Ms. Shaw. In fact, she added, “I have that experience now.”

Ms. Mayzler said she struggled with setting different rules for different employees. She is currently dealing with this issue in her New York office, where she has found it can create friction when one employee has more flexibility than another. While employees may logically understand that different roles have different demands, “it’s hard to care when everybody went home and you didn’t,” she said.

She says she thinks the problem can be especially pronounced in a small business. “If you have 1,000 people, and people are coming in and out, that’s one thing,” she said. “But when you have three people, and you only have one person who’s constantly there from 9 to 5, it doesn’t feel good.”

Ms. Lord said that as her company, which has five employees, shifted from product development to sales and marketing mode, she and her colleagues were primarily working remotely. “I don’t worry about this group getting their work done, which is really nice,” she said.

Plus, Ms. Shaw pointed out, hours logged in the office are no guarantee of productivity.

Ms. Lord said her co-founder, with whom she has worked on and off since 1998, is “the definition of an effective remote worker.” He can always be reached, gets his work done, and is proactive when it comes to initiatives. “I think those people are quite unusual, to be honest,” she said.

“What I’m learning is, most people need structure,” Ms. Mayzler said — even if they think they don’t.

Ms. Johnson, who used to work in pharmaceutical sales, said the use of reporting and metrics could help provide structure. As a sales representative, she covered a large multistate territory, and her employers required daily or weekly reports from her. “They basically had a measure of security that the people in the field were doing what they were supposed to do and a level of accountability,” she said. Additionally, she and her manager reviewed metrics such as number of daily or weekly sales calls made. “You know how they say, ‘If it’s not measured, it won’t get done,’” she said.

“Right,” Ms. Lord said.

Ms. Johnson says she thinks it critical for companies that employ remote workers to determine the metrics relevant to their jobs and at least start them on some type of reporting system. While she said she disliked generalizations, she thought it was particularly important to impose structure on younger workers. “They’re so used to being independent but really don’t understand the responsibility that comes with being independent,” she said.

“I actually could not agree more,” said Ms. Lord, who recalled getting her very first job and thinking she couldn’t leave her desk for a second — not even to go to the post office. “I don’t think the world is ever going to operate that way again,” she said. “There’s a generation of people who are like, ‘I want to go kayaking. Can I kayak today, instead?’”

To harness the talent and creativity of this generation requires a hard-to-balance combination of imposed discipline and the creation of something they want to be a part of, Ms. Lord said. “I think actually that’s really what Marissa Mayer is trying to do,” she added, referring to the chief executive of Yahoo, which recently said it would require employees to work in-house. “It sounds like no one at Yahoo ever wanted to darken the doors of that place.” Which is why, she continued, Ms. Mayer “took the draconian route, and I don’t think I blame her for that.”

“Really shaking it up,” Ms. Mayzler said.

“She had to shake it up,” Ms. Lord said. “And then maybe she’ll create a culture that everyone’s really excited about — then she can give that flexibility back.”

You can follow Adriana Gardella on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/03/19/the-truth-about-working-from-home/?partner=rss&emc=rss

Markets Dragged Down by Holiday Sales Decline

Stocks fell for a third straight day on Wednesday, dragged down by retail stocks after a report showed a decline from last year’s holiday shopping.

Trading was light, with volume well below this year’s daily average. The day’s volume was the lightest full day of trading in 2012. Many senior traders were still on vacation during this holiday-shortened week, and major European markets were closed for the day.

Many investors said concerns about the United States budget discussions and the possibility of tax increases kept shoppers away from stores, suggesting markets may struggle to gain any ground until that issue is resolved. The CBOE Volatility Index, a barometer of investor anxiety, rose 4.46 percent, closing above 19 for the first time since Nov. 7.

A number of 2012’s strongest performers advanced, a sign that portfolio managers may be buying securities with big gains to improve the appearance of their holdings before presenting the results to clients. Bank of America, which has more than doubled in 2012, added 2.6 percent, rising to $11.54 on Wednesday.

Holiday-related sales rose 0.7 percent from Oct. 28 through Dec. 24, in contrast to a 2 percent increase last year, according to data from MasterCard Advisors SpendingPulse. The Morgan Stanley retail index fell 1.8 percent, while the SPDR SP Retail Trust slipped 1.7 percent.

“With the ‘fiscal cliff’ hanging over our heads, it was hard to convince people to shop, and now it’s hard to convince investors that there’s any reason to buy going into year-end,” said Rick Fier, director of trading at Conifer Securities in New York.

President Obama is due back in Washington early Thursday for a final effort to negotiate a deal with Congress to bridge a series of tax increases and government spending cuts set to begin next week, the so-called fiscal cliff many economists worry could push the nation’s economy into recession if it takes effect.

Coach fell 5.9 percent to $54.13 as the biggest decliner in Standard Poor’s 500-stock index, followed by Amazon.com, down 3.9 percent at $248.63, and Abercrombie Fitch, off 3.5 percent at $45.44. Ralph Lauren, Limited Brands and Gap also ranked among the S. P. 500’s biggest decliners.

The Dow Jones industrial average slipped 24.49 points, or 0.19 percent, to 13,114.59. The S. P. 500 lost 6.83 points, or 0.48 percent, to 1,419.83. The Nasdaq composite index dropped 22.44 points, or 0.74 percent, to 2,990.16.

J. C. Penney was a notable exception to the weakness in retail stocks, surging 4.4 percent to $20.75 as the S. P. 500’s biggest gainer. It was followed closely by Bank of America and Genworth Financial, which each gained nearly 3 percent for the day.

“People want to show they own names like these, making them prime window-dressing candidates,” said Wayne Kaufman, chief market analyst at John Thomas Financial in New York.

“Bank of America keeps going up even though it’s overbought and you’d expect a pullback at these levels,” he said. “No one wanted it when it was under $10 a share, but they want it now.”

The S. P. 500 has fallen 1.5 percent over the last three sessions, the worst three-day decline since mid-November. The Dow Jones transportation average, viewed as a proxy for business activity, fell 0.6 percent.

“While it’s unlikely there could be a budget deal at any time, no one wants to get in front of that trade,” said Mr. Fier of Conifer. “Investors can easily make up for any gains when there’s more action in 2013.”

Data showed that single-family home prices rose in October, reinforcing the view that the domestic real estate market was improving, as the S. P./Case-Shiller composite index of 20 metropolitan areas gained 0.7 percent in October on a seasonally adjusted basis.

Article source: http://www.nytimes.com/2012/12/27/business/daily-stock-market-activity.html?partner=rss&emc=rss