Euro zone unemployment hits 10-year high in May

July 2nd, 2009 . Posted in Financial | No Comments »
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Unemployment in the 16 countries that use the euro spiked to a ten-year high in May, reinforcing concerns any recovery will take time now that more than 15 million people are out of work.

Eurostat, the statistics office of the EU, said Thursday the seasonally-adjusted unemployment rate for the euro zone in May stood at 9.5 percent of the work force, up from April’s 9.3 percent. It said just over 15 million people were unemployed in May, up 273,000 on April’s figure.

The increase was expected in the markets in light of the ongoing fall in output across Europe — in the first quarter of 2009, the euro zone economy saw output plunge by 2.5 percent as the global recession hit the industrial sector in particular.

The unemployment rate was at its highest level since May 1999.

Spain is the euro zone’s biggest casualty. Its jobless rate rose to 18.7 percent in May from 18 percent in April.

The lowest unemployment rate in the euro zone was in the Netherlands where only 3.2 percent of the working population were without a job in May, and Austria, where only 4.3 percent were jobless.

The unemployment rate in Germany, Europe’s biggest economy, was unchanged at 7.7 percent in May.

Unemployment is a lagging indicator, so the number of jobless will likely continue to rise for a while even when the recession officially ends. Recent economic releases have stoked hopes that the euro zone may start to see some sort of recovery towards the end of the year but that high unemployment levels will continue to weigh on consumption and sentiment.

“Given that labor market developments tend to lag behind those in the wider economy, unemployment almost certainly has considerably further to rise,” said Jennifer McKeown, European economist at Capital Economics. Mckeown said she expects euro zone unemployment to hit 12 percent next year, the level many people think the U.S. will hit too.

The unemployment news comes just hours ahead of the European Central Bank’s latest interest rate decision. Though the rate-setting governing council is set to keep its benchmark rate unchanged at the record low of 1 percent, its president Jean-Claude Trichet is expected to note the recent improving economic signals though maintaining his view that recovery will take time.

Including the eleven countries that don’t use the euro but are in the EU, such as Britain and Sweden, the unemployment rate rose to 8.9 percent in May from 8.7 percent in the previous month. May’s rate was the highest since June 2005.

The EU-wide rate has been swelled by the Baltic countries, which are in a deep recession following the collapse of debt-fueled economic boom. Latvia, whose economy slumped by a staggering 18 percent year-on-year in the first quarter, saw its unemployment rate, climb to 16.3 percent in May from 15.3 percent in April.

Thursday’s European unemployment figures will be followed by June figures for the United States.

Analysts expect June’s U.S. unemployment rate to rise around 0.3 of a percentage point to 9.7 percent and that another 400,000 jobs were lost during the month. Though still high, the job losses are way down on the numbers recorded earlier in the year. That improving trend was evident in a survey Wednesday from the ADP private payrolls firm, which showed that private sector employment fell by 473,000 in June, down on the 532,000 jobs shed in May.

Elsewhere, Eurostat said the industrial producer price index — a broad gauge of price pressures within industry — fell by 0.2 percent in the euro zone in May from the previous month and by 0.4 percent across the EU as a whole.

On a year-on-year basis, industrial prices were down 5.8 percent in the euro zone and by 5.7 percent in the EU.

Capital Economics’ McKeown said the unemployment and producer price data have combined to stoke renewed fears about a damaging deflationary spiral of falling prices, that may require the European Central Bank to do more to stoke the economy. Higher unemployment tends to reduce the bargaining power of those in work, causing wage pressures to ease. It also cuts into consumption.

“While the ECB seems unlikely to cut interest rates or announce new unconventional measures today, bolder policy support might be needed in future,” she said.

KB Home 2Q loss narrows, new orders up from 1Q

June 26th, 2009 . Posted in Financial | No Comments »
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From Yahoo.Finance

KB Home is reporting a smaller loss for its second quarter than a year ago but the earnings results still missed Wall Street’s estimates.

But the homebuilder says its new home orders and cancellation rate improved compared with the first three months of the year.

The Los Angeles-based company said Friday it lost $78.4 million, or $1.03 per share, for the three months ended May 31. It lost $255.9 million, or $3.30 cents per share, a year earlier.

It says quarterly revenue tumbled 40 percent to $384.5 million.

Analysts expected a smaller loss of 64 cents per share. Their estimates typically exclude one-time items.

But KB Home says its new home orders climbed 59 percent from the first quarter and the number of buyers backing out of contracts dropped.

Easy Money-Saving Changes

May 11th, 2009 . Posted in Financial, Money Management, Personal Budgeting | 6 Comments »
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Start Saving!
One of the most obvious and easy ways to save some extra cash is to change some of the way you use products and items in your everyday life.  The key is to make minor changes.

For instance, always buy the cheapest hand soap you can find.  The quality doesn’t necessarily go up with the price and you can use it in place of ‘bath soap.’

Always use the whole product.  Turn bottles upside down and drain to get the last bit from them.  Tear open sugar and flour sacks to get everything; squeeze or cut open tubes to use it all before running out to buy more.  You’ll be surprised at how much there really is left!

Also, never use more than you need.  Just because it says on the box that you need a full cup, doesn’t mean that you really do it need it.  Half a measure of laundry detergent and a half teaspoon of dish soap are examples of what are usually enough, rather than what the manufacturer says.

To save some cash, you can use some of the things in your house in some unique ways.  Instead of spending lots of money on the fancy floor cleaners, try using ammonia.  It does a great job, and you can use plain water in between times.  If your furniture needs some polishing, mix equal parts of white vinegar and vegetable oil and rub on the furniture.  Buff with a cloth until it shines.

For a freezer bag, use empty chip bags and close with masking taps.  Also try a bowl with a lid, such as a margarine tub.

If your skin is feeling a little dry, there are several substitutes for expensive lotion.  Petroleum jelly rubbed into your hands at night after a warm water soak, mayonnaise (rinse w/ cold water after), or any other oil based food.  Just be sure to put it on immediately after your hands have been in water.

To save some money on laundry, dissolve a bar of handsoap in water to replace laundry detergent.  Add three gallons of hot water, mix thoroughly and add a cup of washing soda.

Sure, these are small changes, but added up, they can put some extra change into your pocket throughout the year!

Cut Back on Spending

May 6th, 2009 . Posted in Credit, Financial, Money Management, Refinance | No Comments »
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At first it may seem difficult to limit spending and stick to a budget, however there are a few practical changes that you can make everyday that will cut your spending more than you expect.

Firstly, alter credit car behavior.  Start to pay cash whenever possible.  This will help you avoid making a purchase unless you actually have the money available.  If you decide to make a credit card purchase, be prepared to pay the balance off monthly.  This will save a lot of money through avoiding interest charges.  If you already have a credit card balance, then transfer to a card with a low interest rate.  Also, find a card that does not charge an annual fee.

Another tip is to pack your lunch everyday.  All of those lunch hours spent at restaurants will add up.  Bringing your own lunch can save you several dollars every day, which will add up over time.

Use your cell phone during off peak hours.  Some people will spend a couple hundred dollars a month on phone charges.  Avoid this by making most calls during off peak times.  Check with your service and plan to find out when you have cheaper or unlimited calls.

Stop throwing away the Sunday newspaper before skimming through the advertisements.  Clip some of those coupons and check out the sales.  This may seem tedious, but the savings are often worth it.  Many stores will double or triple the amount of the coupon.  This technique can save you up to 20 or 30 dollars each time you head to the food store.

Additionally, refinance.  Mortgage rates have been extremely low over the past year.  This has been a great opportunity to reduce the monthly house payment significantly.  If you are planning to have your house paid off prior to retirement, then you may want to factor this in before refinancing.

Finally, bundle your insurance.  Many insurance companies will offer their customers lower rates if they purchase multiple policies.  For instance, some people use the same agent for multiple cars, and others combine their cars and house.  Always keep in mind that a dollar here and there really begins to add up.  Avoid the temptation of thinking that changing your spending habits wouldn’t save that much money.

Avoid Spending Pitfalls!

April 23rd, 2009 . Posted in Credit, Loan, Personal Budgeting | No Comments »
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With all the advantages that are evident from personal budgeting, it is no wonder that more and more people are relying on them to reduce debts and increase their savings.  However, all ‘budgeters’ need to be careful to avoid some common pitfalls that appear often.

Credit cards may seem like small pieces of plastic, however they can cause a great deal of trouble for the owners.  It is common for people to make unwise purchases, which they would have avoided otherwise, because they had the credit card in their wallet.  The best solution for many people is simply to get rid of credit cards and begin paying only by cash, check, or debit cards.  You may want to keep one card handy for emergencies, but it is probably best to keep it out of reach, and far away from your wallet.

Another problem with budgeting is impatience.  There are financial goals set, but people do not have the patience to complete a savings program.  For instance, an individual begins setting aside money for a new car; however, after a few months they discover the car of their dreams.  Rather than waiting, they make the purchase.  This could pose some serious financial strains.  Discipline is a must to prevent impatience from breaking your budget.

Once a person makes a budget, they often fail to adjust it when necessary.  A budget is created using a set of expenses and income figures that are liable to change.  As these figures do change, it is important that the budget changes to reflect the adjustments.  There could be some major deficits if this is not done appropriately and promptly.

Of course nobody forgets about Christmas or Hanukkah, however many people do not consider budgeting for holidays when creating a budget.  Therefore, adequate funds have not been set aside for presents, food, parties, etc.  These items should be factored in and saved for throughout the year.

Finally, many people factor in transportation and accommodations for vacations in their budget, however they underestimate money needed for food, entertainment, and spending money.  Keep in mind that all the resorts and tourists areas are double or triple what you would normally pay.

With a little planning, you’ll be on your way to saving more money than you ever thought possible!

Start Saving!

April 15th, 2009 . Posted in Financial, Money Management | No Comments »
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So you are loaded down with bills to pay each month and are wondering how you can begin a savings account for emergencies and other high-expense endeavors.  In other words, where can you find that extra cash to put away for later?

Firstly, when configuring your budge, plan for your savings first.  You will grow richer each month if you begin to pay yourself first.  Before paying any bills, decide on a set amount that you will pay yourself first—maybe five or ten percent—or whatever you decide—of your paycheck.  Then, deposit the amount into a savings account before paying any bills.

When you do this at the beginning of the month, your entire paycheck will not suddenly slip through your fingers.  If you wait until the end of the month, there may be nothing left to save.  Paying yourself first will give you a systematic way to make your money grow.  Regardless of your profession or your income, this system will work if you stick to it.

Another technique you may try for saving money is to empty your extra change into a coffee can or a jar each day.  At the end of the month, roll the coins and put them into your savings account.  You may be able to save 30 or 40 dollars each month just with your spare change.

Remember that good money management is more than just a mathematical formula.  It’s too closely tied with the ups and downs of living to be just that.  Your money management plan is always subject to change if your life situation changes.  The object of a good budget is to make your money go the farthest in helping you reach your goals, it is not there to force to you to abide by rules.

Don’t get discouraged if the budget plan doesn’t work perfectly right away.  It may involve some revising and editing until it fits your needs.  Then, make sure to review it often, and be sure it is making the best use of every penny!  Because we know how helpful those spare pennies can be!

Create and Maintain a Budget

April 2nd, 2009 . Posted in Financial, Money Management | No Comments »
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The first step to avoiding the troubles of financial debt is to create and maintain a budget.  It’s not as intimidating as it sounds, don’t worry.

First off,  create a list of all your monthly income and also a list of your monthly expenses.  When determining income, list all sources including alimony, child support, side jobs, etc.  In calculating expenses, be sure to include housing, food, transportation, utilities, entertainment, etc.  To gain an accurate reflection of actual expenses, sit down each night and write down expenses, just make sure to save receipts.  Determine if your income covers all of your expenses.  If the answer is no, then some expenses need to be reduced.

Adjust expenses.  If it is a small discrepancy, it may mean reducing some minor expenses like entertainment or cell phone plan.  If the deficit is larger, you may need to downsize your vehicle or living arrangements.  If your income covers all of your expenses, you still may want to trim some of the excess fat off your spending habits.  This can free up extra money for things such as vacations or college funds for your children.

Additionally, consider if you need to add new categories.  Some areas that are often overlooked are debt reduction, emergency savings funds, and retirement savings.  An emergency fund ensures there is an adequate amount available to cover unforeseen events (car emergency, etc), should it arise.  This will eliminate the need for using credit which can quickly damage your budget.

There are several advantages to sticking to your budget.  Firstly, most people have set financial goals that they would like to reach in the future.  Sometimes it may be a trip, a brand new car, or a college education.  A budget can help people save money to make these goals a reality.  Additionally, many people are crushed under heavy consumer debt.  Without a disciplined pattern of spending, it is virtually impossible to make much headway in reducing debt.  A personal budget will provide the necessary framework to begin eliminating these inflated account balances.

If executed properly, a budget will allow a person to simultaneously meet their expenses, place money into savings, and pay back outstanding debts.  Therefore, it is anyone’s best interest to create and implement a budget.

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March 26th, 2009 . Posted in Uncategorized | 1 Comment »

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