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New York, NY, United States (AHN) – Wall Street opened lower Friday after a report showed that the U.S. economy expanded less than forecast..

Just after the opening bell, the Dow Jones Industrial Average was lower by 33 points, the Standard and Poor’s 500 Index was flat and the NASDAQ was up by about 6 points.

Weighing on stocks was a report that showed the U.S. economy expanded at 2.8 percent in the fourth quarter, less than the 3 percent that had been projected.

In Europe the Stoxx Europe 600 Index slipped 0.7 percent as investors await word on developments on the region’s sovereign debt crisis. European Union Economic and Monetary Affairs Commissioner Olli Rehn said authorities are “very close” to reaching an agreement on private-sector involvement in a Greek debt swap.

Despite those words of optimism, the dismal growth of GDP in the U.S. was keeping investors cautious. The health and growth of the U.S. economy is a very important and leading indicator of economic growth worldwide. As analysts like to say, “when the U.S. sneezes, the world catches a cold.”

In corporate news, Ford fell after reporting numbers that missed estimates. Starbucks shares slipped despite reporting better than expected numbers, and Juniper Networks plunged after the second biggest maker of computer networking equipment forecast sales and profits that missed estimates.

In commodities, oil was unchanged at $$99.60 a barrel, gold rose $4.70 to $1,725 a troy ounce and silver was up a few pennies at $33.63.

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Berlin, Germany (AHN) – Signs of an economic contraction in Germany’s economy raised fears of a recession in Europe.

The news escalated concern that demand for oil might fall, causing oil futures prices to drop by as much as 1.1 percent. In addition, the euro weakened against the dollar.

Germany has long served as the engine for economic growth for the entire European Union. Therefore, news that the German economy likely shrank by 0.25 percent during the last three months of 2011 caused alarm and has observers worrying the European Union might slide back into a recession.

Official figures from the Federal Statistics Office show that the German economy only grew by 3 percent during 2011 and that was only achieved because of strong growth during the first half of the year.

Moreover, the Statistics Office said that most of the growth during the first six months was driven by domestic demand. The Statistics Office based the annual figure on an estimate of fourth quarter growth. However, the government won’t post the official data for the last quarter until Feb. 15.

In the meantime, Norbert Raeth from the Statistics Office announced at a press conference Wednesday that the economy likely shrank by “around a quarter of a percentage point” in the fourth quarter.

Although the 3 percent growth rate was down from the 3.7 percent in 2010, Germany still had a stronger figure than the United States or the EU.

According to the Organization for Economic Co-operation and Development (OECD), among its member nations Germany showed better growth than the expected growth rate of the following nations:

• U.S. 1.7 percent
• France 1.6 percent
• United Kingdom 0.9 percent
• Italy and Spain 0.7 percent

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Doha, Qatar David Rosenberg (The Medi – The year 2011 wasn’t only tough for Middle Eastern despots. With the exception of Qatar, the Arab World’s stock markets all ended the year with sharp drops both in share prices and trading volume as unrest took the wind out of much of the regional economy and sent political shivers everywhere.

All told, investors waved goodbye to more than $111 billion in stock market value over 2011, a drop of about 11 percent, according to figures from the Arab Monetary Fund. They took their biggest hit in Egypt, where the combined value of the country’s stocks shed $33 billion last year, a 39 percent decline and the biggest anywhere in the Middle East and North Africa (MENA).

But it wasn’t just the numbers that were bad. Egypt’s stock market was shuttered for 55 days amid the turbulence of President Hosni Mubarak’s ouster. Bahrain’s financial center was cordoned off by police during unrest early in the year and the stock exchange briefly closed until martial law was imposed with the help of Saudi troops. The bourses of the United Arab Emirates and Qatar were denied coveted emerging market status twice in the space of six months.

“The Arab Spring that started last winter, of course, had an impact. That said, there also has been the impact of global bear market. So, in that respect, it wasn’t all about the Arab Spring,” Daniel Brody, chief investment officer of London-based Silk Invest, told The Media Line.

He said the situation is not likely to change without an influx of foreign investment, which is an unlikely prospect for now even if some MENA markets are displaying good fundamentals. “Investors have other concerns right now like Europe. They don’t want to take on what they see as a risk asset,” he said.

Indeed, 2011 was not a good year for stock market investors almost anywhere in the world, figures from MSCI, a company that benchmarks global share market performance, show. Its ACWI index, which tracks 9,000 stocks in 45 markets, shed 10.2 percent. But MSCI’s Arabian Market index, which groups 14 MENA markets except Saudi Arabia, did worse, falling 22 percent last year and wiping out the two previous years of gains.

Even MENA economies that posted strong growth and avoided Arab Spring unrest failed to resist the bearish sentiment. Qatar’s economy enjoyed a tide of cash from growing natural gas exports and $88 billion in government spending, yet the Qatar Exchange’s benchmark QE index registered a mere 1.5 percent gain. Saudi Arabia’s economy benefitted from higher oil prices and massive government spending, but its Tadawul All-Share Index fell 7 percent.

The United Arab Emirates (UAE) also saw a recovery from its real estate-induced slump during 2011, but MSCI’s UAE index shed close to 20 percent.

“To be very honest, there was a disconnect between what was happening in UAE economy and markets,” Fadi Al-Said, a senior fund manager at ING Investment Management in Dubai, told The Media Line. “We saw a major rebound in trade and tourism, but the market didn’t reflect this. In some ways, that is because it is inefficient, but also because it is heavily exposed to the real estate and banking sectors.”

Adding to the pain of falling share prices was a fourth straight year of declining trading volumes. The Arab Monetary Fund estimated that shares traded on the 14 MENA exchanges its covers dropped to $328.5 billion in 2011 from a peak of $1 trillion in 2007 — decline analysts attribute mainly to an exodus of foreign investors after the global financial crisis set in in 2008.

That decline has hit the share-brokering business hard. In the UAE, investment banks like Rasmala and Shuaa Capital gave up their retail brokerage services last year to concentrate on institutional clients. On Monday, they were joined by Taib Securities, the brokerage arm of Bahrain’s Taib Bank, after running up losses the past three years.

Many foreign investment banks also cut back last year. Germany’s Deutsche Bank reportedly moved its head of local equity capital markets back from Dubai to London; Japan’s Nomura shut its Dubai equity research unit; and Britain’s HSBC closed its UAE retail equity brokerage business.

This year isn’t shaping up to be much better. The turmoil of the Arab Spring shows no sign of abating and the outlook for the economies of the Middle East and North Africa looks poor. Although there are a few bright spots in the Gulf, the International Monetary Fund expects economic growth for the region to fall to 3.6 percent from 4 percent in 2011.

Al-Said, nevertheless, expressed the view that the Gulf has the foundations for a market recovery, especially now that a prolonged slump has pushed down valuations to attractive levels. With oil prices again on the upswing, the region’s governments will be in an even stronger position than in 2011 to stimulate economic activity.

“This is one of the few regions which still has ammunition for [state] spending. I’m talking about surpluses that can be spent, about expansionary fiscal policy … You are talking about a region that isn’t in an austerity mode,” he said.

Even Egypt, whose economy is conventionally regarded as deeply troubled by continued political turmoil and plunging foreign reserves, has a potential for a rebound, said Broby. In spite of the turmoil, the economy continues to grow and Egyptian stocks are oversold, he said, warning, however, that investors will hold off on buying.

“People will be looking for Egypt to pass its new constitution before you start seeing the market reflecting the fundamentals,” Broby said.

Meanwhile, markets are making efforts to lure back investors. On Monday, the Qatar Financial Markets Authority announced it had adopted new rules on listing securities and initial public offerings aimed at encouraging small and medium-sized companies to list. It began trading government bonds in the market at the end of 2011, which should help boost liquidity.

The UAE hopes to adjust rules that will enable it to win emerging market status next June, an upgrade that would make it more attractive to big institutional investors abroad.

But the most important development of all, say analysts, is a plan by Saudi Arabia to open up its stock market to foreigner investors. Reuters reported last week that authorities are close to unveiling the long-awaited plan and may announce the rules by Jan. 15 with implementation slated for by the end of the first quarter.

With the region’s biggest trading volumes and market capitalization backed by a growing economy, Saudi Arabia could be the magnet to attracting new capital to the region.

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New York, NY, United States (AHN) – More homeowners are having a hard time making their mortgage payments.

According to credit reporting agency TransUnion, the rate at which mortgage holders were late with their payments by 60 days or more rose in the June-to-September period for the first time since the last three months of 2009.

TransUnion said 5.88 percent of homeowners missed two or more payments, an early sign of a possible foreclosure. That was up from 5.82 percent in the second quarter of 2011.

The problems were widespread across the nation. All but 10 states and the District of Columbia saw delinquency rates rise.

Arizona had the best rate of improvement in the U.S. While still ranked fourth in the country for the number of delinquencies, the state now has a rate of 7.46 percent. That is a vast improvement from where the state was ranked in the fourth quarter of 2009, when the state’s delinquency rate hit 16 percent, the highest for any state since the foreclosure crisis began.

Experts say the delinquencies can no longer be blamed on bad loans. The bad economy is to blame.

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Ankara, Turkey David Rosenberg / The Med – The 7.2-magnitude earthquake that struck eastern Turkey points up the great economic divide between the country’s thriving west and an east in long-term decline.

The Oct. 23 tremor and a series of aftershocks took an estimated 600 lives as of the latest count and left thousands more homeless, but the area at the epicenter – the city of Van with a population just over 1 million – is so bereft of industry and infrastructure that the cost of reconstruction will have little impact on the country’s economy.

Reconstruction efforts may give a boost to the economy but it might just as well deter development by serving as a reminder of how risky the area is, not only to natural disaster but to renewed conflict between militants and the Turkish army in the largely Kurdish region.

“It happened in a place there almost no industrial manufacturing, no major economic activity, mainly in rural areas so it won’t be significant in such a big economy,” Yarkin Cebeci, economist at JP Morgan Chase in Istanbul, told The Media Line. “It could facilitate some investments into the region. The capacity in the region has been to a large extent limited. Rebuilding will be done with new technology.”

The earthquake brought economic activity to a halt in the eastern province due to the destruction and closure of banks. Many lenders, both state-owned and private, have said they will postpone repayments owed by farmers and small business owners in the province.

A week later in Ercis, the town hit hardest by the quake, the Reuters news agency reported that some shops had finally reopened, electricity was back on line in some parts of town and one bank’s ATM was put into service. But concerned about aftershocks, barely any of the city’s nearly 100,000 residents have returned to their damaged homes.

EQECAT, a California-based catastrophe modeler, estimates that total damage caused by the quake is likely to be in the “low single-digit billions” of dollars, compared with Turkey’s nearly $1 trillion economy. That’s about one-tenth of the damage that was caused by the 7.6-magnitude 1999 Izmit earthquake in Turkey’s west that left nearly 20,000 dead.

In the intervening years, the gap between east and west has only grown as the economic boom Turley has enjoyed since 2002 has mainly benefited the metropolitan areas along the country’s Mediterranean coast. In spite of programs to develop the southeast, the region suffers net migration as people seek industrial jobs in the west, according to a report by Euromonitor International, a London-based market research firm.

Between 2005 and 2010, greater Istanbul’s population expanded by almost 38 percent to 12.1 million and is projected to reach 17.8 million by 2020, or more than a quarter of the country’s total, Euromonitor said. The value of goods and service produced by Istanbul and environs amounted to 28 percent of the country’s total, it said.

By comparison, the southeast is mired in poverty and unemployment. Nearly a third of the country’s poor – defined at 50 percent of median household disposable income – lived in the southeast, Euromonitor said. Its unemployment rate in 2010 was 12.4 percent, 0.5 percentage points higher than the national average. But that understates the extent of the problem because the proportion of economically active people in the southeast was low.

Households in Istanbul spent an average of $43,670 on consumer goods in 2010, versus $19,294 in southeast Anatolia. A nationwide minimum wage level has probably had the effect of lifting incomes, but may also be discouraging investment in the region, which can’t make up for its deficiencies by competing for lower-wage jobs.

“With poor infrastructure, less affluent consumers and yet an equally high minimum wage, the east in unable to compete with the west,” the report said.

Southeast Anatolia’s woes are likely to be compounded by a sharp slowdown in Turkey’s economy that was already on its way even before the earthquake struck. The International Monetary Fund is projecting gross domestic product growth will decelerate to 2.2 percent next year from 6.6 percent in 2011.

Last week, Turkey’s central bank struck another blow to economic growth by effectively ending its low-interest rate policy by reducing the availability of loans at the benchmark weekly rate of 5.75 percent and making banks more reliant on shorter-term rates of up to 12.5 percent.

“The latest moves by the central bank certainly trigger a slowdown in monetary lending and credit extension, which will have a negative impact on the country’s growth prospects,” said Sinan Ulgen, an expert on Turkish politics at the Carnegie Endowment for International Peace in Brussels, told The Media Line.

Lying at the intersection between the Arabian and Eurasian tectonic plates, Turkey is prone to earthquakes. Besides the 1999 shaker in the west, eastern Anatolia was struck in 1976 by a magnitude-7.3 earthquake that destroyed several villages and killed 3,000 to 5,000 people. In 1939, a magnitude-7.8 earthquake near Erzincan killed some 33,000 people. On a smaller scale, a magnitude-6.0 earthquake in March 2010 in the east took 51 lives.

Chris Rowan, a geologist specializing in tectonics at the University of Chicago, said in a comment for Scientific American that while all of Turkey faces a high risk of earthquakes, the Van region where last week’s tremor was felt has a more complicated geology than in the west. The “mish-mash of lots of smaller faults” makes it hard for scientists to say where the next will occur.

“The stress changes in the region due to this earthquake may interact in complicated and hard-to-predict ways with other faults in the area, and may lead to a heightened chance of further large earthquakes in the months and years ahead,” he said.

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Chicago, IL, United States (AHN) – Sixty percent of workers who were laid off in the last year have reported finding new jobs, 88 percent of them finding full-time positions. However of those still seeking employment, 56 percent said they are nervous about returning to work after an extended period of unemployment.

The survey, which was conducted by Harris Interactive© from May 19 to June 8, 2011, included more than 800 workers who were laid off from full-time jobs in the last year.

The findings also reflected the anxiety many respondents felt. Fifty percent of laid off, unemployed workers said it was the pressure to prove themselves while 40 percent pointed to fear of the unknown and 21 percent cited new technologies with which they may not be familiar.

Many of the workers who were forced to seek new employment found new jobs in entirely different fields than where they previously worked.

Respondents provided the following real-life examples of how they transitioned to new career paths:

Financial advisor became a grade school teacher, restaurant manager became a computer technician, video store manager became a home health aide, music teacher became an animal care technician and a marketing manager became an engineer

“We need to do a better job as a nation to help workers identify jobs that are in-demand today and are projected to grow in the future,” said Brent Rasmussen, president of CareerBuilder North America. “We have a growing skills gap and the need to get millions of Americans back to work. As the economy recovers, we need to focus on retraining and ‘re-skilling’ workers to help them move to new fields with a greater number of opportunities.”

In addition to changing industries workers are also changing residences. Of workers who were laid off and found new jobs, 36 percent reported they relocated to a new city or state. Of those who haven’t found new jobs yet, 38 percent said they would consider relocating for a position.

Despite the state of the economy the majority of laid off workers who found new jobs reported their pay is similar or higher than their previous position. However for those who still haven’t found work at an established firm or organization, many have decided to work for themselves and start a business.

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Bloomington, IL, United States (AHN) – A recent survey finds that as Americans battle the uncertainties of the nation’s economy and job market, neighbors are readily available to help out those in distress.

The State Farm and Harris Interactive survey of 17,000 people found that the vast majority – 83 percent – are willing to help a neighbor having financial problems.

Other findings showed:

• 44 percent would cook meals for them
• 32 percent would assist with babysitting to help save on childcare costs
• 15 percent would lend a neighbor money
• 10 percent would let a neighbor live with them for a short while

“This data shows that, even in the age of social networking and technology-driven interactions, those who live near us remain important sources of support and even happiness,” said Dr. Keith Hampton, an assistant professor at the Annenberg School for Communication at the University of Pennsylvania and founder of i-Neighbors.org.

The willingness of neighbors to help neighbors during times of financial stress remains true over a wide range of factors. In urban settings, 82 percent would help. In the suburbs and in rural areas, 84 percent indicated they would assist.

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Bloomington, IL, United States (AHN) – Americans are becoming more aware of mounting student loan debt and the value of higher education. According to a new COUNTRY Financial survey, four in five Americans (81 percent) believe the expected average level of student loan debt, $29,000, is too high.

Rising tuition and uncertain employment prospects are likely fueling doubts about the fiscal value of college.

One in four (26 percent) respondents believe that with costs growing higher and an uncertain economy, a college education is not a good financial investment. This latest figure marks a 7 point increase from 2010.

Since 2008, those believing college is a good investment dropped from 81 percent to 58 percent.

“It’s easy to see why Americans are uncertain about college spending, especially since the national student loan debt is at an all-time high,” said Keith Brannan, vice president of financial security planning.

“However, college is a long-term investment and having a degree significantly increases your earning potential,” he went on to say. “That’s why it’s critical to have a plan in place to help you prepare to make that investment.”

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New York, NY, United States (AHN) – The United States economy grew at a slow 1.9 percent pace during the first quarter of the year a slowdown in growth that Federal Reserve policy makers hope will only be a temporary.

In contrast, the economy grew at a more robust 3.1 percent rate in the previous quarter. Still the 1.9 percent figure was better than the 1.8 percent rise in gross domestic product predicted for the first quarter by government officials last month.

Real gross domestic product is the total output of goods and services produced by labor and property located in the U.S.

“The increase in real GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, and nonresidential fixed investment that were partly offset by negative contributions from federal government spending and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased,” the U.S. Department of Commerce Bureau of Economic Analysis said in a statement.

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Washington, D.C., United States (AHN) – Troubling statistics released by the US Bureau of Labor Statistics on Friday revealed that payrolls decreased in 27 states during May.

California showed the largest decrease in jobs with a drop of 29,200 followed by New York that shed 24,700 jobs, Pennsylvania with a drop of 1,4200, Michigan lost 13,400 and Maryland shed 13,300.

However, the jobless rate only fell in 24 states while it rose in 13.

Leading the pack of states that gained in the payroll department was Florida with 28,000 more jobs and Ohio with an additional 12,000.

This report comes on the heels of a report by the International Monetary Fund adjusting its forecast for economic growth in the US downard to 2.5 percent from the 2.8 percent it forecast in April.

Because 70 percent of economic growth comes from consumer spending in the US, until hiring picks up it is unlikely that the economy will grow much. A consumer is simply an American with a job and a paycheck that is sufficient to allow for discretionary spending.

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