September 17, 2019

Getting Japan to Spend

“Things are generally looking brighter, aren’t they?” Mr. Horii said, as he scrutinized, then dismissed, cheaper alternatives at the bustling Yodobashi Camera electronics store. The Bose ones he has his eye on, which he’ll hook up to his TV, go for about $400.

“I don’t really need it, but I want it,” he said. “A good economy means you can buy things you don’t really need.”

Prime Minister Shinzo Abe’s bid to revive Japan’s deflated economy hinges on consumers like Mr. Horii starting to feel flush enough to start splurging on the finer things in life.

A wide recovery in consumer spending has been the weakest link in “Abenomics,” the bold economic stimulus strategy that Mr. Abe has pushed since taking office in late December.

Abenomics has already brought big profit bumps to the nation’s exporters, thanks to a yen made weaker by Mr. Abe’s aggressive policies. He found a kindred spirit in Haruhiko Kuroda, the Bank of Japan’s new governor, who has committed the central bank to easing the money supply and reinflating the economy. Stock markets have rallied, as foreign investors jumped back into a country they had all but written off for its seemingly unshakable stagnation.

Numbers released on Friday by the government provided more proof of Japan’s corporate recovery. Industrial production rose by a robust 2 percent in May from the previous month. Tokyo’s benchmark Nikkei index climbed 3.5 percent Friday on the strong showing.

Reversing a 15-year-long slide in prices, which Mr. Abe has singled out as both a cause and a symptom of waning profits, wages and consumption, is a tougher order. For companies to feel confident enough to start raising prices, Japan’s consumers have to start spending again, and data confirming that trend is still mixed.

Separate figures released on Friday showed that household spending fell 1.6 percent in May from a year earlier, confounding economists’ expectations of a 1.3 percent rise. Still, for the first time in seven months, Japan’s core consumer prices in May did not fall compared to the previous year, staying flat for that month after falling 0.4 percent the previous month.

“We are comfortable with our view that the uptrend of consumption continues,” Masamichi Adachi, Tokyo-based economist at JPMorgan Securities Japan, said in a note Friday. “An expected rise in summer bonuses, paid in June and July, and improvement in general sentiment are the main reasons,” he said.

There are some signs that after years of penny-pinching, conspicuous spending is on the rise again in Japan. But for now, it is starting at the very top, among the financiers, professionals and other well-to-do Japanese who have benefited from the recent stock market gains.

Sales of Ferrari cars in Japan have jumped almost 20 percent so far this year, figures from the Japan Automobile Importers Association show, thanks to this newfound exuberance among the nation’s rich.

“We’ve seen confidence start to explode over the last months,” said Herbert Appleroth, chief executive of Ferrari Japan. “We’re seeing some of the highest growth in the world here.”

At the Hankyu Umeda department store in Osaka, sales of luxury watches, jewelry and other luxury items are surging, which lifted overall sales in May by 63 percent compared with the previous year, the sixth straight month of double-digit increases.

“Japanese shoppers are tired of cheap,” said Keiji Uchiyama, manager of the marble-floored store, brimming with imported fragrances, pastel macaroons and slick designer bags. “They’ve scrimped for so long, but now they’ve had enough,” he said.

Article source: http://www.nytimes.com/2013/06/29/business/global/japanese-consumers-start-to-buy-tentatively.html?partner=rss&emc=rss

Consumer Spending and Home Sales Were Up in May

WASHINGTON — Americans spent more in May as their income rose, encouraging signs after a slow start to the year. But spending was weaker in April, February and January than previously estimated.

The Commerce Department said on Thursday that consumer spending rose 0.3 percent last month, nearly erasing a decline of similar size in April. Income rose 0.5 percent.

Consumers, benefiting from low inflation, spent more at retail businesses in May, notably for cars, home improvements and sporting goods.

In another bright spot, the number of people who signed contracts to buy homes in the United States jumped in May to the highest level in more than six years, a sign home sales will probably rise in the months ahead.

The National Association of Realtors said Thursday that its seasonally adjusted index for pending home sales rose 6.7 percent to 112.3 last month. That is the highest level since December 2006. Signed contracts have risen 12.1 percent in the last 12 months.

The increase could reflect an effort by potential buyers to complete deals before mortgage rates rise further. Mortgage rates rose in May and then jumped after the Federal Reserve chairman, Ben S. Bernanke, suggested last week that the Fed could slow its bond purchases later this year.

The increase points to healthy gains in home sales in the coming months. There is generally a one- to two-month lag between a signed contract and a completed sale.

The activity report should provide comfort as it shows that housing is still holding on, said Jennifer Lee, an economist at BMO Capital Markets.

Still, rising rates could weigh on demand later this year. The average rate on a 30-year mortgage soared this week to 4.46 percent, the highest in nearly two years, according to a report Thursday by the mortgage giant Freddie Mac. But rates are still low by historical standards.

“Despite the rise in mortgage rates and house prices, housing affordability will still be well above its long-term average,” said Joseph LaVorgna, an economist at Deutsche Bank.

Article source: http://www.nytimes.com/2013/06/28/business/economy/consumer-spending-and-home-sales-were-up-in-may.html?partner=rss&emc=rss

U.S. Households’ Finances Regain Lost Ground

Without adjusting for inflation, the net worth of American households is now higher than before the recession struck five and a half years ago, the Federal Reserve said on Thursday.

Household net worth jumped by just over $3 trillion, or 4.5 percent, to $70.3 trillion in the first quarter of 2013, surpassing the $68.1 trillion reached in 2007.

After adjustment for inflation, total net worth still stands below the peak reached in mid-2007, said Dean Maki, chief United States economist at Barclays.

The encouraging report from the Fed comes amid other signs that Americans are feeling slightly better about the economy.

In a New York Times/CBS News poll conducted May 31 to June 4, 39 percent of respondents said that the recent condition of the economy was very or fairly good, the highest share saying this not only since President Obama took office but also since the recession officially began in December 2007.

About a third of respondents said that the economy was getting better, similar to what the trend had been in the previous six months. (Another 24 percent said that it was getting worse and 42 percent said the economy was staying about the same.)

Nearly half of respondents — 46 percent — rated the job market in their areas as very good or fairly good, with a third saying that they thought their local job markets would improve over the next year.

The poll has a margin of sampling error of plus or minus three percentage points.

Despite newfound optimism in some quarters, the economy continues to send mixed signals. Even as consumer spending remains healthy and the housing market rebounds, the labor market has been much slower to recover and many Americans at middle and lower income levels remain worse off than before the downturn.

The latest report on jobs will come Friday morning, when the Labor Department reports employment data for May. Month-to-month numbers have been bumpy this year, with the economy adding a robust 332,000 jobs in February, then slowing to a pace of 138,000 new positions in March and 165,000 in April.

Economists are looking for the report to estimate that the economy created roughly 165,000 jobs in May, with the unemployment rate holding steady at 7.5 percent. On Thursday, the government reported that initial claims for unemployment benefits fell by 11,000, to 346,000, just under the four-week moving average of 352,500.

Trading on financial markets was volatile as investors readied positions ahead of the Labor Department report.

After spending much of the day in negative territory, the stock market staged a late-day rally. The Dow Jones industrial average rose 80.03 points to 15,040.62 and the Standard Poor’s 500-stock index inched up 13.66, to 1,622.56. The Nasdaq composite index increased by 22.58, to 3,424.05.

The bond market rose modestly, with the yield on 10-year Treasury bonds falling slightly to 2.08 percent.

In the currency markets, the dollar fell sharply against the yen and the euro on Thursday, and continued to fall Friday morning. Currency traders will be watching the jobs data on Friday for signs about the economy’s underlying strength and the Fed’s next move on monetary policy.

The lackluster gains in jobs and income for most Americans stand in contrast to the rally on Wall Street and increase in home prices so far this year.

In the first quarter of 2013, real estate holdings accounted for a $784 billion gain in household net worth, while the value of corporate shares and mutual funds increased by nearly $1.5 trillion, the Fed said.

The stock market gains primarily benefit a fairly narrow stratum of American society, Mr. Maki noted, with the top 20 percent of earners holding 80 percent of stocks.

“That group always accrues the bulk of the benefits from a rising stock market,” he said.

The Federal Reserve report also showed that Americans remained cautious, continuing to reduce debt levels and strengthen their personal balance sheets. Household borrowing sank at an annual rate of 0.6 percent in the first quarter, with mortgage debt declining by $53.2 billion.

The implosion of the housing sector, and the stock market tumble in 2008 and early 2009 took a huge toll on the net worth of American families. Between 2007 and 2008, household net worth dropped by nearly $13 trillion, a decline of nearly 20 percent.

While unemployment remains high by historical standards at 7.5 percent, the economy has shown signs of life lately. Consumer spending has held up this year, despite fears that an increase in payroll taxes and cutbacks in government spending might cool the economy.

The stock market has surged in 2013 in anticipation of better economic growth and expectations that the Federal Reserve will not pull back on its efforts to stimulate the economy until evidence is much stronger that jobs are more plentiful and living standards are improving. But stocks have wavered in recent days on worries that the central bank will not keep pumping as much money into the financial system.

Catherine Rampell contributed reporting.

Article source: http://www.nytimes.com/2013/06/07/business/economy/us-households-finances-regain-lost-ground.html?partner=rss&emc=rss

Economix Blog: Test Your Economic Literacy

CATHERINE RAMPELL

CATHERINE RAMPELL

Dollars to doughnuts.

The Department of Education on Wednesday released its latest report on the economic proficiency of 12th graders, based on the test scores of nearly 11,000 students tested in 2012. It found little change in average economic literacy compared to test scores from 2006, although students in the lower part of the score distribution (at the 10th and 25th percentiles) made gains.

In case you want to know how you would stack up against these students, here are some sample questions from the report, followed by the answers.

1. Suppose that the price of grapes increases by a large amount. What will happen in the short term to the quantity of grapes demanded? Explain why.

2. Which of the following best describes an opportunity cost for a student who chooses to quit a full-time job to go to college?
A) Paying state and federal income tax
B) Having a higher level of education
C) Giving up current wages and benefits
D) Paying for housing and meals

3. Which of the following changes is most likely to cause an increase in employment?
A) An increase in consumer spending
B) An increase in interest rates
C) A decrease in business investment
D) A decrease in income

4. A high rate of unemployment that lasts for several years has economic costs for a nation. What are two of these economic costs?

5. a. Explain why United States steel manufacturers would support a tariff on imported steel.
b. Explain why United States steel workers would support a tariff on imported steel.
c. Explain why United States consumers would be hurt by a tariff on imported steel.
d. Explain why a steel tariff might be adopted even if it hurts United States consumers.

6. Which of the following is one way in which economic growth can help a nation reduce its poverty level and increase its standard of living?
A) Economic growth increases the demand for imports, thereby raising the demand for foreign exchange.
B) Economic growth increases the supply of labor, thereby increasing wages.
C) Economic growth increases disposable income, thereby raising the demand for luxury items.
D) Economic growth increases the demand for labor, thereby raising income levels.

Answers from the report:

    1. Demand will fall. When the prices of goods or services increase, individuals will look for substitute goods to avoid paying the higher price, and therefore, the quantity of goods or services demanded will fall.
    2. C
    3. A
    4. Acceptable answers include: expenses incurred by governments when providing financial support to the unemployed; decrease in aggregate demand in the economy that is caused because of lower consumer incomes; loss of tax revenue to the government; increases in poverty; decreases in the standard of living; and increases in the cost of providing job training programs to the unemployed.
    5. (a) Acceptable answers: The price on imported steel would rise, so people would use more U.S. steel. Domestic manufacturers might also favor tariffs because tariffs would tend to increase revenue and profits for domestic producers and would decrease foreign (import) competition in an industry. (b) If imported steel is more expensive and people buy more U.S. steel, then U.S. companies will need more workers to handle increased demand. The same forces might also increase wages at the U.S. steel companies. (c) The tariff would increase the price of imported steel, so U.S. consumers could be harmed because they might pay higher prices for goods using steel as an input in their production. (d) The tariff would bring in money for the government. Tariffs are also sometimes adopted to protect jobs in a given industry as part of the political process.
    6. D

Article source: http://economix.blogs.nytimes.com/2013/04/24/test-your-economic-literacy/?partner=rss&emc=rss

Housing and Auto Sales Lifted Economy, Fed Says

WASHINGTON (AP) — A strengthening housing recovery and robust auto sales contributed to moderate economic growth across the United States in late February and March, according to a Federal Reserve survey released Wednesday.

Growth was moderate or modest in all of the Fed’s 12 banking districts, and it accelerated in two — New York and Dallas — from January and early February.

The survey suggested that the economy performed better in March than some government data on hiring and consumer spending had indicated. That could mean the economic weakness might have been temporary.

The Fed survey, which is based on anecdotal reports, found that hiring was unchanged or improved slightly compared with the previous report. And it noted that consumer spending — which drives most of the economy — grew modestly. But the report also said higher taxes and a spike in gasoline prices had slowed sales.

By contrast, the Labor Department said earlier this month that job growth slowed sharply in March. And retail sales declined in March by the most in nine months, a separate report said last week.

Dana Saporta, an economist at Credit Suisse, said the survey was “consistent with the larger picture of steady if unspectacular growth.”

“We get caught up in the monthly volatility of the data, and we need to step back,” she said.

Zach Pandl, an economist at Columbia Management, an investment firm, said the rosier tone of the survey was probably a reason that several Fed policy makers recently expressed optimism despite sluggish economic data.

The Fed survey said the recovery in home construction was gaining momentum and creating more construction jobs. It is also increasing factory output of housing-related goods, like lumber.

The report did note some weak spots. Several districts said manufacturers of military-related goods had cut jobs in response to government spending cuts that started taking effect March 1.

Still, it said that overall growth was moderate, an upgrade from the “modest to moderate” pace in the previous two reports.

The Fed report, called the beige book, provides an overview of economic conditions from Feb. 22 through April 5. The information will be discussed along with other economic data during the Fed’s next policy meeting on April 30 and May 1.

At that meeting, most analysts expect the Fed to maintain its low interest rate policies but take no new steps. The Fed is expected to stick with its plan to keep short-term interest rates at record lows at least until unemployment falls to 6.5 percent. And it will most likely continue buying $85 billion a month in Treasury and mortgage bonds to try to keep long-term rates low and encourage borrowing, spending and investing.

Debate has heated up among Fed policy makers about when to start curtailing the bond-buying program, which began last fall. At their last meeting March 19-20, a majority of Fed officials said they favored continuing the bond purchases at least through the middle of this year. But many members indicated that they want to start winding down the program before the end of the year, as long as hiring and the economy continued to improve.

Since that meeting, some government reports had suggested that the economy weakened in March. Employers added only 88,000 jobs in March, a sharp slowdown from average gains of 220,000 in November through February. And consumers cut back on spending at retail stores and restaurants last month, a sign that higher Social Security taxes might have made more Americans cautious about spending.

Article source: http://www.nytimes.com/2013/04/18/business/economy/housing-and-auto-sales-lifted-economy-fed-says.html?partner=rss&emc=rss

Spending Cuts Weigh on Manufacturing

Data so far had shown little sign that higher taxes and the $85 billion in across-the-board government spending cuts that took effect March 1, known as the sequester, had weighed on economic activity.

“It suggests the economy was probably starting to slow at the end of the quarter, possibly reflecting the impact of the fiscal headwinds coming from sequestration and higher taxes,” said Millan Mulraine, a senior economist at TD Securities.

The Institute for Supply Management said on Monday that its index of national factory activity fell to 51.3 last month from 54.2 in February. A reading above 50 indicates expansion in the manufacturing sector. New orders, an indicator of future growth, accounted for much of the drop in the index.

The I.S.M. report was at odds with a separate report showing that factories gained steam in March on strong order growth, closing out the best quarter for the sector in two years.

The financial data firm Markit said its manufacturing purchasing managers index rose to 54.6 last month from 54.3 in February. A reading above 50 indicates expansion.

“We are beginning to see where the government spending cuts will reduce demand,” said Joel L. Naroff, chief economist at Naroff Economic Advisors. “In those sectors and parts of the country that will feel the wrath of sequestration, adjustments are being made.”

Separately, the Commerce Department reported on Monday that construction spending advanced 1.2 percent in February. Spending declined 2.1 percent in January.

The construction report added to a series of other data that has suggested economic growth accelerated in the first quarter from the fourth quarter’s anemic 0.4 percent annual pace.

Data on employment, consumer spending, industrial production and housing have been relatively strong.

Some economists raised their growth estimates for the January-March period as a result of the construction report.

Macroeconomic Advisers lifted its forecast by one-tenth of a point to 3.6 percent. JPMorgan Chase raised its estimate from 2.7 percent to 3.8 percent. Part of the increase reflected strong consumer spending.

Construction spending in February was bolstered by a 1.3 percent rise in private construction projects. Spending on private residential projects increased 2.2 percent to the highest level since November 2008.

“Housing is catching fire,” said Ryan Sweet, a senior economist at Moody’s Analytics. “All the conditions are in place for further improvement with housing, even with lingering risks. Housing will keep the economy going forward even with the fiscal constraints.”

Article source: http://www.nytimes.com/2013/04/02/business/economy/us-manufacturing-slows.html?partner=rss&emc=rss

Euro Watch: Euro Zone Unemployment Rose to Another Record in January

That, along with new data showing a decline in inflation in the euro zone, could prompt the European Central Bank to take steps to stimulate the economy when its governing council meets on Thursday, analysts said.

Unemployment in the 17-nation euro zone climbed to 11.9 percent in January from 11.8 percent the previous month, according to Eurostat, the statistical office of the European Union.

For the 27 nations of the European Union, the jobless rate was 10.8 percent, up from 10.7 percent in December. All of the figures were seasonally adjusted.

A separate Eurostat report showed price pressures easing in February. In the euro zone, the annual inflation rate was 1.8 percent, down from 2 percent in January and below the central bank’s 2 percent target.

The jobless data suggests “that wage growth is set to weaken from already low rates” and further depress consumer spending, which has already been hurt by government austerity measures, wrote Jennifer McKeown, an economist at Capital Economics in London, in a research note.

Ms. McKeown said that the low inflation and high joblessness “should leave the E.C.B.’s policy options open,” and that the central bank “might discuss an interest-rate cut or other unconventional policies.”

There was some bright news on Friday. A survey of European purchasing managers by Markit, a data and research firm, showed that German manufacturing output grew for a second consecutive month in February as new business levels improved.

The composite German purchasing managers’ index rose to 50.3 — just above 50, the level that separates growth from contraction — from 49.8 in January. And the Federal Statistical Office in Wiesbaden reported that German retail sales rose 3.1 percent in January from December, when sales fell 2.1 percent.

Another bit of data this week also supports the view that the German economy will recover from a fourth-quarter slump. The European Commission’s economic sentiment indicator for the euro zone rose to 91.1 in February from 89.5 in January, with German confidence leading the gain.

“German industry is clearly rebounding and taking advantage from better external traction,” wrote Gilles Moëc, an economist at Deutsche Bank in London.

Employment is sometimes seen as a lagging indicator of economic growth because companies try to avoid adding to their costs until they are convinced that a rebound is at hand.

But despite the glimmers of hope in German industry, there are few reasons to regard a recovery as imminent. Markit’s overall euro zone purchasing managers’ index was unchanged in February at 47.9, indicating continued contraction.

Olli Rehn, the European commissioner for economic and monetary affairs, forecast on Feb. 22 that the euro zone economy would shrink 0.3 percent this year, about the same as last year. The bloc’s debt problems, and the tax increases and government spending cuts that have been prescribed as the remedy, have sapped spending power, reducing business demand for labor.

In absolute terms, Eurostat estimated that 19 million people in the euro zone and more than 26 million in the European Union were unemployed in January.

Spain’s unemployment rate was 26.2 percent, and Portugal’s was 17.6 percent. Austria had the lowest rate, at 4.9 percent, followed by Germany and Luxembourg, at 5.3 percent each.

Greece’s unemployment rate in November, the latest month for which Eurostat has figures for the country, was 27 percent.

France, which has the second-largest euro zone economy, after Germany’s, had a 10.6 percent jobless rate in January. Britain, which is not a euro member, had a 7.7 percent rate in November.

That compares with unemployment rates of 7.9 percent in the United States in January and 4.2 percent in Japan in December.

This article has been revised to reflect the following correction:

Correction: March 1, 2013

An earlier version of this article carried a headline that misstated the month of the data. The report was for January, not February. An earlier version of the article also misstated the name of a federal agency in Wiesbaden, Germany. It is the Federal Statistical Office, not the Federal Statistics Office.

Article source: http://www.nytimes.com/2013/03/02/business/global/euro-zone-unemployment-rose-to-new-record-in-january-as-inflation-eased.html?partner=rss&emc=rss

Retail Sales Barely Rise, Hinting at Slow Growth

The Commerce Department said on Wednesday that retail sales edged up 0.1 percent after a 0.5 percent rise in December.

The small increase suggested that the expiration of a two-percentage-point payroll tax cut on Jan. 1 and higher tax rates for wealthier Americans were weighing on the economy.

Still, economists said consumer spending was unlikely to buckle given rising home values, moderate job growth and rallying stock market prices.

“We are starting to see the impact of higher taxes, but we have a positive wealth effect from increasing house prices and a boost from equities,” said Robert Dye, chief economist at Comerica Bank. “My expectation is that consumers are able to continue to increase spending, but only moderately.”

Core sales, which exclude automobiles, gasoline and building materials and correspond most closely with the consumer spending component of gross domestic product, ticked up 0.1 percent.

Consumer spending, which accounts for about 70 percent of the American economy, grew at a 2.2 percent annual rate in the fourth quarter. That helped to soften the blow to the economy from slower inventory accumulation and sharp cuts in military spending.

The government said last month that economic output slipped at a 0.1 percent rate in the final three months of 2012.

However, the retail sales report showed core sales were a bit stronger in November and December than previously reported. In addition, businesses, excluding auto dealerships, accumulated slightly more inventory in December than earlier thought.

Taken together with a smaller trade deficit in December, the data suggested the government would raise its estimate for fourth-quarter gross domestic product when it publishes a revision later this month. Even so, the economy most likely grew at a rate under 1 percent in the fourth quarter, economists said.

Growth in consumer spending is expected to retreat from the pace of the fourth quarter as households adjust to smaller paychecks and higher gasoline prices. Prices at the pump have increased 30 cents so far this year.

Estimates of consumer spending growth in the first quarter currently range from 0.7 percent to 1.8 percent.

Some economists were encouraged that consumers had maintained purchases, though at a slow pace, despite a reduction in their disposable incomes.

“By no means are we completely out of the woods when it comes to the impact of higher taxes,” said Michael Feroli, an economist at JPMorgan Chase. “Evidence from past episodes suggests it could take up to two quarters for spending to fully adjust to new tax realities.”

A softer pace of consumer spending is expected to limit G.D.P. growth to a 1.8 percent rate this quarter, according to a Reuters poll of economists. For the year as a whole, economists expect growth of just 2.3 percent.

A separate report from the Labor Department showed that higher oil prices helped push up the cost of imported goods by 0.6 percent last month. Import prices had fallen by 0.5 percent in December.

Still, nonpetroleum import prices edged up just 0.1 percent in January and have risen just 0.2 percent over the last year, showing a lack of broad inflation pressure.

Article source: http://www.nytimes.com/2013/02/14/business/economy/us-retail-sales-show-slight-rise-in-january.html?partner=rss&emc=rss

Adbusters’ War Against Too Much of Everything

Skip the mall and the neighborhood store, resist the urge to shop online and, by all means, don’t buy anything you don’t truly need.

So says Kalle Lasn, 70, maestro of the proudly radical magazine Adbusters, published in Vancouver, British Columbia. Mr. Lasn takes gleeful pleasure in lobbing provocations at global corporations — and his latest salvo is “Buy Nothing Christmas.”

“As our planet gets warmer, as animals go extinct, as the humans get sicker, as our economies bail and our politicians grow ever more twisted,” Americans just go shopping, Adbusters says on its Web site. Overconsumption is destroying us, yet shopping is “our solace, our sedative: consumerism is the opiate of the masses.”

“We’ve got to break the habit,” Mr. Lasn said in a telephone interview. “It will be a shock, but we’ve got to shift to a new paradigm. Otherwise, I’m afraid will be facing a new Dark Age.”

Of course, retailers will be facing a Dark Age if people really stop shopping. And because consumer spending accounts for roughly 70 percent of United States gross domestic product, an abrupt shift to nonconsumption would drive the already faltering economy to its knees.

There are no signs that consumers are heeding Mr. Lasn’s call, says Marshal Cohen, chief retail analyst at the NPD Group. “I find that people are shoppers or they’re not,” he said. “Shoppers keep shopping.”

So it’s easy to dismiss this latest campaign as yet another empty gesture from a figure on the radical fringe. Why take Mr. Lasn’s words seriously?

Well, last year, a campaign prompted by Mr. Lasn and his magazine improbably caught fire. It was Occupy Wall Street.

Adbusters gave Occupy its name and opening date and designed the poster with Occupy’s defining image: an elegant ballerina perched atop Wall Street’s raging bull while gas-masked figures loomed in the background. The poster contained this text: “What Is Our One Demand? #OccupyWallStreet. Sept. 17th. Bring Tent.” A digital version went viral.

Mr. Lasn’s main role in the Zuccotti Park occupation, however, pretty much ended there: he remained in Vancouver, never visiting the Lower Manhattan encampment and participating in the local organizational work that made it possible. But his contribution began long before then.

Born in Estonia, Mr. Lasn lived for several years in German resettlement camps with his parents after they fled the advancing Soviet army toward the end of World War II. The family moved to Australia when he was 7. He graduated from the University of Adelaide, where he studied theoretical and applied mathematics and then worked four years for the Australian military, writing computer code for war games.

Then he moved to Tokyo, where the skills he developed in Australia served him well. He started a market research company and, he says, did computer-based studies of ad campaigns for global corporations. The work was lucrative, and he used his money to see the world. It was 1968, and a left-wing student rebellion in Paris resonated worldwide. He says he imbibed the spirit of rebellion, and it changed him.

“Until Occupy, the greatest political movement I’d ever seen was the uprising of ’68. It really inspired me, and I’ve been running on that energy — and have been trying to recapture it — ever since.”

LAST year, he says, he did recapture it. Stirred by the uprisings in Algeria, Tunisia and Egypt — the Arab Spring — he and colleagues at Adbusters “began to consider the possibilities of achieving a soft regime change in the United States, of finding some way to tap into the revolutionary zeitgeist.” Out of those discussions came the idea of Occupy Wall Street.

Max Haiven, a postdoctoral fellow in art and public policy at New York University, who has studied Adbusters for years, said: “That was a fantastic initiative for them. They’ve been in global anticonsumption battles for years, and Adbusters has called for many big campaigns that never really happened. This one did. In a way, they got lucky.”

He added: “What led to Occupy Wall Street taking off was not just the iconic image of the ballerina and the bull but a number of factors — including on-the-ground activists building an organization through many, many meetings and relationships and hard work in New York and elsewhere. Adbusters didn’t do that. Other people did it.”

Mr. Lasn acknowledges the truth of that, and says he’s not a community organizer and certainly not a graceful politician. “I’ve said some things that have pissed people off,” he says. And it’s not just corporations like Nike, McDonald’s and Philip Morris that have been stung by him. Israel’s policies toward Palestinians are an Adbusters target.

Article source: http://www.nytimes.com/2012/12/23/business/adbusters-war-against-too-much-of-everything.html?partner=rss&emc=rss

Consumer Spending Spurs Forecasts for Faster Growth

In light of the latest figures, some analysts said the economy could end up growing faster in this quarter and next year than they had thought.

“I see momentum building,” said Joel Naroff, chief economist at Naroff Economic Advisors. “If Washington makes the moves it needs to make, then the economy should pick up speed next year,” he said, a reference to the bumpy negotiations between the White House and Congressional Republicans to avert tax increases and spending cuts that are to take effect on Jan. 1.

The Commerce Department reported that consumer spending, which fuels about 70 percent of the economy, rose 0.4 percent in November compared with October. Spending dipped 0.1 percent in October. But that decline was linked in part to disruptions from Hurricane Sandy.

Incomes rose 0.6 percent in November, the biggest gain in 11 months. That reflected a rebound in wages and salaries, which were depressed in October. Damage from Hurricane Sandy in the Northeast prevented some people from working at the end of October and reduced wages at an annual rate of $18 billion.

A separate report from the Commerce Department showed that a category of durable-goods orders that tracks business investment had risen 2.7 percent. That gain came after an upwardly revised 3.2 percent increase in October, the biggest in 10 months.

The back-to-back increases came after a period of weakness in so-called core capital goods that had raised concerns about business investment, a driving force in the economy.

The economy grew in the July-to-September quarter at a solid 3.1 percent annual rate. But some analysts said they thought growth would slow significantly in the October-to-December period. They predicted that consumers and businesses would cut back on spending because of worries about tax increases and spending cuts.

But after Friday’s reports, Peter Newland, an economist at Barclays Capital, said Barclays was raising its estimate of growth in the current quarter to a 2.4 percent annual rate from a previous estimate of 2.2 percent.

Mr. Naroff said fourth-quarter growth could reach a 2.6 percent annual rate. He said he expected growth to reach 3.2 percent in the first quarter of 2013 and 3.6 percent in the second quarter.

He said those estimates were based on his confidence that Washington policy makers would avert the sharp tax increases and spending cuts, which could set off a recession if they remained in place for much of 2013.

“I remain hopeful that saner heads will prevail in Washington,” Mr. Naroff said.

Economists said the budget impasse and the uncertainty it had created about tax rates were hurting consumer confidence. The University of Michigan said on Friday that its index of consumer sentiment for December fell to 72.9, its lowest point since July. It was a sharp drop from the November reading of 82.7, a five-year high.

Article source: http://www.nytimes.com/2012/12/22/business/economy/consumer-spending-spurs-forecasts-for-faster-growth.html?partner=rss&emc=rss