Archive for the ‘AP-Business’ Category

NEW YORK (AP) -- Stocks are closing their worst day this year after Greece hit a roadblock on its way to a critical bailout.

The Dow Jones industrial average is finishing down 89 points, or 0.7 percent, at 12,801. The broader Standard & Poor's 500 is down nine points to 1,343. It is the first losing week for the index this year.

The Nasdaq composite is closing down 23 points at 2,904.

Stocks fell all day on news that European finance ministers were insisting that Greece cut even more in wages and spending if the nation hopes to get bailout money to pay its creditors.

Three stocks fell for every one that rose Friday on the New York Stock Exchange. Volume was light with just 3.5 billion shares trading hands.

NEW YORK (AP) -- On a normal day, 4 billion shares of stock change hands on the New York Stock Exchange. One in 10 belongs to a single company. It's not McDonald's or IBM, both of which have been on a tear.

It's Bank of America - bailed out by the government three years ago, reviled for being part of the mortgage frenzy that helped wreck the economy and selling for not much more than an ATM fee.

When the market goes up because of positive news about the economy, Bank of America stock shoots up past the stocks of other big banks. When traders get worried about Greek debt, Bank of America takes the biggest plunge.

The big swings are not driven by a fundamental bet that the bank will be more profitable because the economy is getting better or a real concern that it will lose more money than others if there is a default in Greece.

Instead, Bank of America is the stock of the moment for high-frequency trading, the supercomputer-driven buying and selling that barely existed a few years ago and now accounts for as much as two-thirds of U.S. trading.

The bank's single-digit stock price and flood of shares on the market - three times as many as its nearest big-bank competitor - make it an attractive target for hedge funds and banks that employ high-powered, computerized trading.

"The movement of Bank of America stock on most days has nothing to do with Bank of America," says Joseph Saluzzi, co-founder of brokerage firm Themis Trading.

In other words, the stock moves because it moves. Bank of America stock has risen or fallen 1 percent or more on 20 days this year. The Standard & Poor's 500 index has only done it three times.

For the year, Bank of America is up 46 percent, best of the 30 stocks that make up the Dow Jones industrial average. Big banks collectively are up 15 percent.

In high-frequency trading, investors use computer algorithms to exploit small changes in a stock's price. If a computer can seize on a stock like Bank of America a fraction of a second faster than the rest of the market, it can book a tiny profit.

Those pennies add up over tens of millions of shares a day to produce big gains. And when computers rush to buy or sell a stock like Bank of America, it can result in accelerated moves in the stock price. Buying leads to more buying, selling to more selling.

Bank of America is part of the Standard & Poor's 500, and therefore held in mutual funds in the retirement accounts of millions of Americans. And mutual fund managers hate high-frequency trading.

Not only does it make the stocks in their portfolios more volatile, but fund managers fume that high-frequency computers can detect their stock orders, step in to change the price of a stock slightly and pocket a small profit.

"It has nothing to do with the fundamentals," says Leon Cooperman, a billionaire investor, chairman of hedge fund Omega Advisors and former CEO of Goldman Sachs Asset Management.

For computers to move in and out quickly, there must be enough shares available to trade. Bank of America has a truckload - 10.5 billion shares outstanding, compared with 3.8 billion for JPMorgan Chase and 2.9 billion for Citigroup.

The stock traded as high as $15.31 last year. Then investors, worried about how deep the bank's mortgage problems might be, drove it below $10 in July. High-frequency traders pounced, and Bank of America's volume exploded. It was 147 million shares last summer. On Thursday, 477 million shares changed hands.

The low price put it in the sweet spot for high-frequency trading. If a high-frequency operation is trading blocks of 100 shares at a time to capitalize on a 1-cent change, there's a lot less risk working with a $5 stock than a $500 one.

It makes Bank of America "a juicy trade at very little risk," says Adam Sussman, director of research at Tabb Group, a markets advisory firm.

In 2009 and 2010, Citigroup, then part-owned by the government, was in the same spot. Its price was in single digits, and it seesawed day to day. It was often the highest-volume stock - as many as 500 million shares changing hands in one day.

Last year, Citi reduced the number of shares by exchanging one share for every 10. That brought its stock price up - $33 on Wednesday - and high-frequency traders stopped flocking to it. Volume on a normal day has dropped to 50 million.

Bank of America went the opposite way in November and December and sold 400 million more shares to the market to raise $3.5 billion and improve its financial stability.

Today, some investors - the human ones - are buying Bank of America because they like CEO Brian Moynihan's efforts to shore up the company's finances. Other investors won't touch it because they are afraid of the billions Bank of America is still spending to fight mortgage lawsuits. Charles Bobrinskoy, director of research at Ariel Investments, even calls the company "unanalyzable."

But none of those groups is driving the stock. Some days, it moves with little or no tangible reason.

On Jan. 5, the stock jumped 8 percent with no explanation. The Wall Street Journal blogged that the stock was rising on "reports/rumors/blind hopes" about President Barack Obama appointing a new head to the federal housing agency.

NEW YORK (AP) -- A different kind of F-word is stirring a linguistic and political debate as controversial as what it defines.

The word is "fracking" - as in hydraulic fracturing, a technique long used by the oil and gas industry to free oil and gas from rock.

It's not in the dictionary, the industry hates it, and President Barack Obama didn't use it in his State of the Union speech - even as he praised federal subsidies for it.

The word sounds nasty, and environmental advocates have been able to use it to generate opposition - and revulsion - to what they say is a nasty process that threatens water supplies.

"It obviously calls to mind other less socially polite terms, and folks have been able to take advantage of that," said Kate Sinding, a senior attorney at the Natural Resources Defense Council who works on drilling issues.

One of the chants at an anti-drilling rally in Albany earlier this month was "No fracking way!"

Industry executives argue that the word is deliberately misspelled by environmental activists and that it has become a slur that should not be used by media outlets that strive for objectivity.

"It's a co-opted word and a co-opted spelling used to make it look as offensive as people can try to make it look," said Michael Kehs, vice president for Strategic Affairs at Chesapeake Energy, the nation's second-largest natural gas producer.

To the surviving humans of the sci-fi TV series "Battlestar Galactica," it has nothing to do with oil and gas. It is used as a substitute for the very down-to-Earth curse word.

Michael Weiss, a professor of linguistics at Cornell University, says the word originated as simple industry jargon, but has taken on a negative meaning over time - much like the word "silly" once meant "holy."

But "frack" also happens to sound like "smack" and "whack," with more violent connotations.

"When you hear the word `fracking,' what lights up your brain is the profanity," says Deborah Mitchell, who teaches marketing at the University of Wisconsin's School of Business. "Negative things come to mind."

PARIS (AP) -- France was stripped Friday of its top-notch credit rating and rumors swirled in financial markets that its debt-burdened neighbors would be next, complicating Europe's efforts to solve its financial crisis.

Finance Minister Francois Baroin told a French TV station that France had been downgraded by one notch by credit rating agency Standard & Poor's. That would mean a rating of AA+, the same as the United States since it was downgraded last summer.

Rumors coursed through the markets that Austria and Italy could be downgraded next, perhaps as early as the end of the day's stock trading in New York. S&P had warned 15 European nations in December that they were at risk for a downgrade.

Baroin said France had received a change to its rating "like most of the eurozone," referring to the 17 European nations that use the euro currency, but there was no confirmation from S&P that any other nation had been downgraded Friday.

A credit downgrade would escalate the threats to Europe's fragile financial system and raise the costs at which the affected countries - some of which are already struggling with heavy debt loads and slow economic growth - borrow money.

WASHINGTON (AP) -- A sign that Europe's crisis has begun to weigh on the U.S. economy emerged Friday from a report that exports to the continent sank in November - far more than overall U.S. exports did.

Europe, which consumes nearly one-fifth of America's exports, may already be in a recession. A weakening Europe could further shrink demand for American goods and slow the U.S. economy just as the job market has started to strengthen.

"The decline in our sales to Europe was fairly large and may be the start of a longer-term trend in declining exports to the continent," said Joel Naroff, chief economist at Naroff Economic Advisors.

The U.S. trade deficit rose 10.4 percent in November to $47.8 billion, the Commerce Department said.

Higher oil prices were the main reason the deficit widened. Oil rose above $100 per barrel in November. It had been as low as $75 a barrel the previous month. More expensive oil drove the value of imports up 1.3 percent, to a record $225.6 billion.

Overall exports dropped 0.9 percent to $177.8 billion. American exports to Europe fell much more sharply - nearly 6 percent.

Economic growth weakens when exports decline because factories tend to produce fewer goods. And U.S. companies earn less. Friday's trade report led some economists to cut their growth estimates for the October-December quarter.

Many economists had expected growth to be stronger after seeing more hiring, an increase in company stockpiles and faster production at U.S. factories. Most had been predicting that the economy would grow this quarter at an annual rate of roughly 3 percent.

But Paul Dales, senior U.S. economist for Capital Economists, said he now expects growth to be closer to 2 percent, in part because of the weaker trade report and also because of December's disappointing retail sales.

"The widening in the U.S. trade deficit in November ... is perhaps the first real sign that the crisis in Europe and the more general global slowdown is starting to take its toll on the U.S.," Dales said.

WASHINGTON (AP) -- Unemployment is higher than it's been going into any election year since World War II.

But history shows that won't necessarily stop President Barack Obama from reclaiming the White House.

In a presidential election year, the unemployment trend can be more important to an incumbent's chances than the unemployment rate.

Going back to 1956 no incumbent president has lost when unemployment fell over the two years leading up to the election. And none has won when it rose.

The picture is similar in the 12 months before presidential elections: Only one of nine incumbent presidents (Gerald Ford in 1976) lost when unemployment fell over that year, and only one (Dwight Eisenhower in 1956) was re-elected when it rose.

Those precedents bode well for Obama. Unemployment was 9.8 percent in November 2010, two years before voters decide whether Obama gets to stay in the White House. It was down to 8.7 percent in November 2011, a year before the vote. It fell to 8.5 percent in December and is expected to fall further by Election Day.

Obama can take comfort in President Ronald Reagan's experience. In November 1982, the economy was in the last month of a deep recession, and unemployment was 10.8 percent, the highest since the Great Depression. A year later, unemployment was down to 8.5 percent. By November 1984, it was still a relatively high 7.2 percent, but the downward trend was unmistakable. Reagan was re-elected that month in a 59-41 percent landslide.

"A sense that things are on the mend is really important to people," says Andrew Kohut, president of the Pew Research Center. The trend holds up even when the changes in unemployment are slight. President Bill Clinton was re-elected handily even though the unemployment rate was only 0.2 percentage points lower in November 1996 than it had been two years earlier and was the same as it had been a year before.

Under Obama, unemployment peaked at 10 percent in October 2009, nine months into his presidency, before it began coming down in fits and starts. Along the way it stayed above 9 percent for 21 straight months.

WASHINGTON (AP) -- President Barack Obama is highlighting companies that have returned jobs to the U.S. and he says that's one more way of putting people back to work.

The White House plans a forum Wednesday, called "Insourcing American Jobs," that will bring together business leaders who shifted work back home. The president said Saturday in his weekly radio and Internet address that the event will discuss ways business leaders can return more jobs to the country.

"We're heading in the right direction. And we're not going to let up," Obama said on the heels of the government reporting Friday that the unemployment rate fell to 8.5 percent in December.

Obama noted that the jobs report showed the economy added more than 200,000 private sector jobs last month and that more than 3 million private sector jobs had been added during the past 22 months. He said the nation was "starting 2012 with manufacturing on the rise and the American auto industry on the mend."

The president said the U.S. couldn't return "to the days when the financial system was stacking the deck against ordinary Americans," citing his decision to install former Ohio Attorney General Richard Cordray as the director of the new Consumer Financial Protection Bureau while the Senate was on break, circumventing Republican opposition to the appointment.

NEW YORK (AP) -- Boarding an airplane has never been safer.

The past 10 years have been the best in the country's aviation history with 153 fatalities. That's two deaths for every 100 million passengers on commercial flights, according to an Associated Press analysis of government accident data.

The improvement is remarkable. Just a decade earlier, at the time the safest, passengers were 10 times as likely to die when flying on an American plane. The risk of death was even greater during the start of the jet age, with 1,696 people dying - 133 out of every 100 million passengers - from 1962 to 1971. The figures exclude acts of terrorism.

Sitting in a pressurized, aluminum tube seven miles above the ground may never seem like the most-natural thing. But consider this: You are more likely to die driving to the airport than flying across the country. There are more than 30,000 motor-vehicle deaths each year, a mortality rate eight times greater than that in planes.

"I wouldn't say air crashes of passenger airliners are a thing of the past. They're simply a whole lot more rare than they used to be," says Todd Curtis, a former safety engineer with Boeing and director of the Airsafe.com Foundation.

The improvements came even as the industry went through a miserable financial period, losing $54.5 billion in the past decade. Just to stay afloat, airlines eliminated meals and added fees for checked luggage.

But safety remained a priority. No advertisement of tropical beaches can supplant the image of charred metal scattered across a field.

There are still some corners of the world where flying is risky. Russia, the Democratic Republic of the Congo and Somalia have particularly high rates of deadly crashes. Russia had several fatal crashes in the past year, including one that killed several prominent hockey players. Africa only accounts for 3 percent of world air traffic but had 14 percent of fatal crashes.

Still, 2011 was a good year to fly. It had the second-fewest number of fatalities worldwide, according to the Flight Safety Foundation, with 507 people dying in crashes. Seven out of 28 planes in fatal crashes were on airlines already prohibited from flying into European Union because of known safety problems. (There were fewer fatalities in 2004 - 323 - but there were also fewer people flying then.)

There are a number of reasons for the improvements.

- The industry has learned from the past. New planes and engines are designed with prior mistakes in mind. Investigations of accidents have led to changes in procedures to ensure the same missteps don't occur again.

- Better sharing of information. New databases allow pilots, airlines, plane manufactures and regulators to track incidents and near misses. Computers pick up subtle trends. For instance, a particular runway might have a higher rate of aborted landings when there is fog. Regulators noticing this could improve lighting and add more time between landings.

- Safety audits by outside firms. The International Air Transport Association, an industry trade group, started an audit program in 2003. Airlines prove to the industry and each other that they have proper maintenance and safety procedures. It's also a way for airlines to seek lower insurance premiums, which have also dropped over the past 10 years.

NEW YORK (AP) -- Stocks rose Thursday morning after the government reported that the number of claims for unemployment benefits remained at a level consistent with modest job growth. Contracts to buy homes rose to the highest level in a year and a half.

The four-week average of unemployment claims fell to a three-and-a-half-year low of 375,000, an indication that hiring could pick up.

The National Association of Realtors says its index of sales agreements jumped 7.3 percent last month. The news sent stocks of home builders sharply higher. PulteGroup Inc., Lennar Corp. and Masco Corp. all rose close to 4 percent.

The Dow Jones industrial average rose 75 points at 12,227 at 10 a.m. It fell nearly 140 points the day before.

The S&P 500 was up 7 points at 1,257, and is at breakeven for the year. The Nasdaq composite index rose 6 at 2,596.

Europe's debt woes weighed on currency markets. The euro fell to its lowest level against the dollar this year and a decade-low against the Japanese yen. At one point the euro's value against the dollar hit $1.28, the lowest level since September 2010.

ROME (AP) -- Italy's borrowing costs fell for a second day Thursday but the country's new premier said his government has more to do before it convinces financial markets it can manage the heavy debts that have made it the focus of the eurozone crisis.

Mario Monti said he was encouraged by the bond auctions at which the interest costs paid out by Italy to bond investors eased. He said his government of technocrats, in office for just a month and a half following the resignation of Silvio Berlusconi, was preparing a package of measures to get the Italian economy moving again, including efforts to boost competition and liberalize the labor market.

"Yesterday and today went pretty well, this is encouraging," Monti said at a news conference after the Italian treasury tapped investors for around euro7 billion ($9.2 billion). "But we absolutely don't consider the market turbulence to be over."

The amount raised, however, was less than the euro8.5 billion ($11 billion) maximum sought and contributed to ongoing weakness in the euro, which fell to a 15-month low against the dollar of $1.2866.

The most keenly awaited result from Thursday's batch of auctions was the euro2.5 billion ($3.3 billion) sale of ten-year bonds at an average yield of 6.98 percent. That's lower than the record 7.56 percent it had to pay at an equivalent auction last month, when investor concerns over the ability of the country to service its massive debts became particularly acute.

However, the country's borrowing rate on the key 10-year bond remains uncomfortably close to the 7 percent level widely considered to be unsustainable in the long run. Greece, Ireland and Portugal all had to request financial bailouts after their 10-year bond yields pushed above 7 percent. In the secondary markets, Italy's yield continues to hover around the 7 percent mark.

"Investors are still waiting for more progress on the reform front to ensure Italy can improve its muted growth and productivity performance since the adoption of the euro," said Raj Badiani, a senior economist at IHS Global Insight.

WASHINGTON (AP) -- The number of people seeking unemployment benefits rose last week after three weeks of decline.

Even with the gain, applications remained at a level consistent with modest hiring. And the broader trend over the past month suggests job growth could pick up further in the new year.

Weekly applications increased by 15,000 to a seasonally adjusted 381,000, the Labor Department said Thursday.

The four-week average, a less volatile measure, dropped for the fourth straight week to 375,000. That's the lowest level since June 2008.

"Despite the rise in the weekly claims data, the longer-term trend ... suggests that the recovery in the labor market is maintaining its momentum," said Michael Gapen, an economist at Barclays Capital, in a note to clients.

Applications generally must fall below 375,000 - consistently - to signal that hiring is strong enough to reduce the unemployment rate.

While layoffs have fallen sharply since the recession officially ended two and a half years ago, many companies have been slow to add jobs.

Economists caution that the figures can be volatile around the holidays. The data for seven states, including California and Virginia, were estimated because of the Monday holiday, a Labor Department spokesman said. Those estimates have in the past proven reliable, the spokesman said, and haven't required major revision.

Hiring has improved in recent months. Employers have added an average of 143,000 net jobs a month from September through November. That's almost double the average for the previous three months.

Next year should be even better. A survey of 36 economists by the Associated Press this month found that they expect the economy will generate an average of about 175,000 jobs per month in 2012.

More small businesses plan to hire than at any time in three years, a trade group said earlier this month. And a separate private-sector survey found more companies are planning to add workers in the first quarter of next year than at any time since 2008.

Technology stocks fell Wednesday, dragged down by a weak earnings report from the business software maker Oracle Corp.

Broad market indexes were flat. The Dow Jones industrial average eked out a gain of 4 points after having been down 104 points at midday.

Technology stocks in the Standard & Poor's 500 index fell 2 percent. Oracle plunged 12 percent after the business software company said it was struggling to close deals.

The rare earnings miss by Oracle seemed to reinforce worries that businesses and the government may cut back on technology spending. Especially worrying was a weak 2 percent gain in new software licenses, a key sign of demand from other businesses. Oracle had predicted gains of as much as 16 percent.

Those worries hurt other big technology companies. IBM Corp. was by far the biggest loser in the Dow, falling 3.1 percent to $181.47. A bright spot was the BlackBerry maker Research In Motion Ltd., which jumped 10 percent to $13.78 on rumors that it might be a takeover target.

Investors also had more to worry about from Europe. New data showed extensive lending from the European Central Bank to European banks. The initial reaction to the $639 billion in lending by the ECB was positive, but then worry set in that Europe's banks needed so much help in the first place.

"Long-term, people were a little bit concerned that banks needed more money than we thought they did," said Joe Bell, a senior equity analyst with Schaeffer's Investment Research.

The Dow edged up 4.16 points, less than 0.1 percent, to close at 12,107.74. On Tuesday the Dow jumped 337 - its biggest gain this month - on a strong bond sale in Spain and a surge in new home construction in the U.S.

The Standard & Poor's 500 rose 2.42 points, or 0.2 percent, to 1,243.72. Outside of the 2 percent decline for technology companies, prices rose or were flat in the rest of the S&P 500's 10 sectors.

WASHINGTON (AP) -- Some say they'll spend less on groceries. Others expect to cut back on travel. For many, there would be fewer meals out.

Across the country, Americans are bracing for another financial hardship: smaller paychecks starting in January, if Congress doesn't break a deadlock and renew a Social Security tax cut.

The tax cut, which took effect this year, benefits 160 million Americans - $1,000 a year, or nearly $20 a week, for someone making $50,000, as much as $4,272 or $82 a week for a household with two high-paid workers.

The tax cut is set to expire Jan. 1. If lawmakers don't renew it for 2012, analysts say the economy would slow as individuals and families looked for ways to spend less.

"Of course, it changes my plans," said Craig Duffy, an information-technology worker from Philadelphia and new father of twins. Duffy said his family already has tightened spending, so "we'll have to find a way to cut back."

That might mean canceling a planned trip to visit the twins' grandparents in Wisconsin, Duffy said.

The tax cut is part of legislation that would also renew benefits for the long-term unemployed. If the unemployment benefits aren't renewed, starting in January nearly 6 million people would lose weekly checks averaging about $300 - the main source of income for most of them.

House Republicans have rejected a Senate-passed bill that would extend the payroll tax cut for two months and let the long-term unemployed continue to receive benefits during that time. That plan would give lawmakers time to work on a yearlong extension.

But most lawmakers have left Washington, and no negotiations are scheduled before the year ends.

If Congress doesn't renew the two measures for 2012, analysts say the economy's growth would slow by as much as 1 percentage point.

Less money in paychecks means less consumer spending, which powers the U.S. economy. Many people who say they already depend on each paycheck for living expenses say they can't cut spending deeply. Instead, they'll trim at the edges, wherever they can.

"It will limit my spending from week to week," said Jennifer Stempel, an office manager from Denver.

Stempel said that could mean making fewer impulse buys at the grocery store, packing her lunch each day and rejoining a carpool she quit after gas prices declined this year.

"I was starting to relax about (travel expenses), but now I don't know," Stempel said.

Michael Allara of Raleigh, N.C., said a higher tax would further pressure his family, which includes three small children.

"I'm already trying to save as much as I can to pay for college," Allara said. "I don't know where the money would come from."

The tax cut lowered the Social Security tax on incomes of up to $106,800 from 6.2 percent to 4.2 percent. It's meant a maximum savings of $2,136 for an individual.

Without a deal, Americans would begin 2012 facing a tax increase just as an election year begins.

Smaller paychecks and reduced spending would coincide with a still-vulnerable period for the U.S. economy. Though growth has strengthened in the final months of 2011, some analysts say the gains might be hard to sustain. Workers' pay isn't rising much. And Europe may be on the verge of a recession that would undermine the American economy.

"A failure to extend the payroll tax holiday and the extended unemployment benefits would be a serious hit to the economy," said Mark Zandi, chief economist at Moody's Analytics. "The risk of a recession would rise and be uncomfortably high, particularly early next year, when the fallout from Europe's troubles will be the greatest."

WASHINGTON (AP) -- The economy is ending 2011 on a roll.

The job market is healthier. Americans are spending lustily on holiday gifts. A long-awaited turnaround for the depressed housing industry may be under way. Gas is cheaper. Factories are busier. Stocks are higher.

Not bad for an economy faced with a debt crisis in Europe and, as recently as this summer, scattered predictions of a second recession at home. Instead, the economy has grown faster each quarter this year, and the last three months should be the best.

"Things are looking up," says Chris Rupkey, chief financial economist at the Bank of Tokyo-Mitsubishi UFJ.

When The Associated Press surveyed 43 economists in August, they pegged the likelihood of another recession at roughly one in four. The Dow Jones industrial average was lurching up or down by 400 points or more some days.

There was plenty of reason for gloom. A political standoff over the federal borrowing limit brought the United States to the brink of default and cost the nation its top-drawer credit rating.

Most analysts now rule out another recession. They think the economy will grow at an annual rate of more than 3 percent from October through December, the fastest pace since a 3.8 percent performance the spring of 2010.

Many economists still worry that the year-end surge isn't sustainable, in part because the average worker's pay is barely rising. And Europe may already be sliding into a recession that will infect the United States.

The outlook could darken further if Congress can't break the impasse blocking an extension of a Social Security tax cut for 160 million Americans and emergency unemployment benefits.

Yet for now, the economy is on an upswing that few had predicted:

- JOBS: The number of people applying for unemployment benefits came in at 366,000 last week, down from a peak of 659,000 in March 2009. Even in good economic times, the figure would be between 280,000 and 350,000.

Employers have added at least 100,000 jobs five months in a row, the longest streak since 2006. And the unemployment rate fell from 9 percent in October to 8.6 percent last month, the lowest since March 2009.

Small businesses are hiring again, too, according to the National Federation of Independent Business.

Business is up at AG Salesworks in Norwood, Mass., which helps technology companies like Motorola find new customers. The firm has hired 26 workers to restore its staff to 56, erasing the job cuts from the recession. CEO Paul Alves plans to add an employee or two a month as long as growth continues.

"I do see more confidence than I saw 12 months ago," Alves says. "But it's good, not great. Robust isn't the word I'd use."

- SPENDING: The holiday shopping season has turned out better than anyone expected. Sales from November through Saturday were up 2.5 percent. Americans have spent $32 billion online, 15 percent more than a year ago. Retails sales were up in November for the sixth month in a row. People are spending, in particular, on clothes, cars, electronics and furniture.

- CONSUMER CONFIDENCE: Americans felt better about the economy in November than they had since July, according to the Conference Board, a business group that tracks the mood of consumers.

The board's consumer confidence index climbed 15 points to 56 in November, the biggest one-month jump since April 2003. During the Great Recession, the index fell as low as 25.

"It seems like the confidence of the traditional American consumer is higher right now," says Jim Newman, executive vice president of operations at the digital marketing company Acquity Group, which has added 100 jobs since summer.

- GAS: Falling prices at the pump have freed more money for consumers to spend on appliances, furniture, vacations and other things that help drive the economy. The national average for regular unleaded has sunk to $3.21 a gallon since peaking at $3.98 in May, according to the AAA Daily Fuel Gauge.

- INVENTORIES: Businesses are restocking shelves and warehouses, more confident that customers will buy their products. In October, their inventories were up 8.7 percent from a year earlier. An increase in inventories is expected to account for perhaps a third of growth this quarter.

The battered housing market might be showing signs of recovery. Home construction rose more than 9 percent in November from October, driven by apartment building. And the National Association of Realtors said Wednesday that sales of previously occupied homes rose 4 percent in November.

WASHINGTON (AP) -- The Senate passed legislation Saturday extending a Social Security payroll tax cut and jobless benefits for just two months, handing President Barack Obama a partial victory while setting the stage for another fight in February.

It also brought a peaceful end to a year-long battle over spending by passing a $1 trillion-plus catchall budget bill that wraps together the day-to-day budgets for 10 Cabinet departments and military operations in Iraq and Afghanistan. The House passed the measure Friday, and the White House has signaled that Obama will sign it.

The renewal of the 2-percentage-point cut in the Social Security payroll tax for 160 million workers and unemployment benefits averaging about $300 a week for the additional millions of people who have been out of work for six months or more is a modest step forward for Obama's year-end jobs agenda.

As a condition for GOP support of the payroll tax measure, Obama has to accept a provision that forces him to decide within 60 days whether to approve or reject a proposed a Canada-to-Texas oil pipeline that promises thousands of jobs.

Obama didn't reference the pipeline issue in a brief appearance at the White House after the vote. He welcomed the Senate's passage of the payroll tax cut and unemployment insurance extension and said it would be "inexcusable" for Congress not to extend them for the rest of 2012 when lawmakers return from their holiday break.

The budget bill, passed 67-32, heads to the White House for Obama's signature; the payroll tax measure won a 89-10 tally that send it back to the House - where many Republicans only reluctantly support it - for a vote early next week.

A spokesman for House Speaker John Boehner, R-Ohio, would not predict whether the House would accept the Senate payroll tax measure, saying GOP leaders would have to discuss it with the rank and file. But Democrats assume Senate Republicans would not have allowed the short-term measure to advance without a signal from Boehner that the House would go along.

Democratic and GOP leaders opted for the short-term extension of the payroll tax and jobless benefits measure after failing to agree on big enough spending cuts to pay for a full-year renewal. The measure also provides a 60-day reprieve from a scheduled 27 percent cut in the fees paid to doctors who treat Medicare patients.

BENTONVILLE, Ark. (AP) -- Wal-Mart has opened an internal investigation to determine whether its overseas operations have complied with U.S. federal law as it pertains to permitting, licensing and inspections.

The Bentonville, Ark., retailer offered few details about the investigation in a quarterly report filed Thursday with the Securities and Exchange Commission.

The company said that it opened the investigation after reviewing policies, procedures and internal controls tied to its global anti-corruption program. It said that it is taking "appropriate remedial measures."

"We are taking a deep look at our policies and procedures in every country in which we operate," said Wal-Mart spokesman Dave Tovar in an email. "As a result of information obtained during that review and from other sources, we have begun an internal investigation related to compliance with the" Foreign Corrupt Practice Act.

SEATTLE (AP) -- Boeing's Machinists union votes Wednesday on a four-year contract extension that would ensure a long stretch of elusive labor peace as the new version of the 737 is built in Washington state.

The union announced last week that it reached a tentative deal following secret talks initiated by the company. If workers ratify the pact, as expected, the Machinists say they'll drop their National Labor Relations Board complaint over Boeing's decision to open a nonunion plant in South Carolina.

The relationship between Boeing Co. and the union's 28,000 workers in Washington, Oregon and Kansas has been contentious, to say the least. The Machinists have gone on strike in 1987, 1995, 2005 and 2008, the last being a 58-day bruiser that helped delay delivery of the new 787 and cost the company dearly.

"It's been a rough ride the last 25 years," said Robley Evans, a forklift driver and union official. "To think about having five years of labor peace and not the standard stuff we go through, it's good. We're hopeful this is the new way of negotiating."

The deal calls for annual wage increases of 2 percent, cost-of-living adjustments, an incentive program intended to pay bonuses between 2 percent and 4 percent, a ratification bonus of $5,000 for each member, and improvements in the pension program. But it also would raise workers' share of health costs.

Crucially for the union, it would ensure that jobs for Boeing's updated 737 line - the 737 Max - stay in the Puget Sound region. Boeing said in July it was studying other locations for the new 737.

Industry analyst Wayne Plucker, of the San Antonio, Texas, research firm Frost and Sullivan, said the agreement is good for both sides. Considering the looming Defense Department budget cuts that threaten defense contracts across the industry, Boeing is going to need solid performance from its commercial airplanes division, Plucker said.

"Boeing needs a peaceful time," he said. "Their competition with Airbus and their challenges to come on the defense side made it kind of a pivotal thing to have a quiet, peaceful time, labor relations-wise.

"It's also a big deal for the Machinists union. They got the agreement that the 737 will be done in Seattle - that's a huge deal. There are far more of them built than there ever will be of the 787. So it's a win for the union, and for the Seattle area."

SYDNEY (AP) -- Australia's ruling party voted Sunday to overturn a long-standing ban on exporting uranium to India, despite fierce opposition from critics who argued such sales are unsafe because India has not signed the Nuclear Nonproliferation Treaty.

Prime Minister Julia Gillard urged members of her center-left Labor Party during its annual conference to allow the exports in the interest of the national economy, arguing there are safeguards in place to ensure the uranium would be used for peaceful purposes.

"We need to make sure that across our regions we have the strongest possible relationships we can, including with the world's largest democracy, India," Gillard said. "That's why today we should determine to change our platform and enable us, under safeguards, to sell uranium to India."

The party's vote to amend an executive policy does not need parliamentary approval.

Australia holds 40 percent of the world's known uranium reserves. It does not sell uranium on the open market and bans nuclear power generation at home.

But it sells uranium only for the purpose of power generation under strict conditions banning any military applications in bilateral trade agreements with the United States, China, Taiwan, Japan, South Korea and several European countries.

Australia's previous conservative government started negotiations with energy-hungry India on uranium sales. But the Labor government immediately ended the talks when it came to power in 2007, ruling out exports unless New Delhi signed the Nuclear Nonproliferation Treaty.

Gillard had previously noted that the U.S. lifted a "de facto international ban" on nuclear cooperation with India in 2005 when it signed a deal with New Delhi to trade uranium and work together on civil atomic power generation.

WASHINGTON (AP) -- Factories are producing more. Construction is growing. People are buying more cars. The holiday shopping season is off to a strong start.

Normally, all that would suggest a bright outlook for the economy. Problem is, employers still aren't hiring much, the number of people seeking unemployment benefits remains high and Europe's debt crisis poses a grave threat to the future.

Thursday's mixed economic picture came a day before the government will report on unemployment and job growth for November. That report is expected to show a modest net gain of 125,000 jobs, scarcely enough to keep up with population growth. The unemployment rate is projected to remain 9 percent.

Analysts say the economy remains locked in a good-but-hardly-good-enough position: It's growing consistently, yet too weakly to induce employers to hire aggressively.

"The economy is picking up momentum as we close out 2011," said Neil Dutta, an economist at Bank of America Merrill Lynch. At the same time, it faces "an ongoing flu in Europe" and other challenges, such as uncertainty about future taxes and spending in the United States, Dutta said.

For now, factories are expanding. The Institute for Supply Management, a trade group of purchasing managers, says its manufacturing index rose to 52.7 in November, up from 50.8 in October. Any reading above 50 indicates expansion. Factories have grown for 28 straight months.

Manufacturers are slightly more hopeful about the next few months because of cheaper raw materials and healthy demand, said Bradley Holcomb, head of the ISM's survey committee.

Still, he said, companies have tempered their outlook because of concerns about whether the economy will grow consistently, uncertainty about federal taxes and regulation and fear that Europe's debt crisis may trigger a global economic panic.

Mark Vitner, an economist at Wells Fargo, suggested that employers are reluctant to hire freely because the U.S. economy's future appears hazy.

For one thing, a Social Security tax cut that provided an average $1,000 in extra cash this year for about 160 million Americans could expire at year's end. Republican lawmakers did take steps Thursday to extend the cut, along with emergency unemployment benefits. But it's still uncertain whether the money will be renewed.

In addition, the Obama administration's health care reform could slow hiring next year, Vitner said, because it will require companies to provide coverage by 2013 or pay a fine.

And any worsening of Europe's financial crisis could cause U.S. and European banks to cut back on lending and hoard cash. That would slow the economy.

Concerns about a credit crunch led the Federal Reserve and five other central banks to take coordinated action this week to lower the cost of dollar loans in Europe and elsewhere.

FRANKFURT, Germany (AP) -- The central banks of the wealthiest countries, trying to prevent a debt crisis in Europe from exploding into a global panic, swept in Wednesday to shore up the world financial system by making it easier for banks to borrow American dollars.

Stock markets around the world roared their approval. The Dow Jones industrial average rose almost 500 points, its best day in two and a half years. Stocks climbed 5 percent in Germany and more than 4 percent in France.

The action appeared to be the most extraordinary coordinated effort by the central banks since they cut interest rates together in October 2008, at the depths of the financial crisis.

But while it should ease borrowing for banks, it does little to solve the underlying problem of mountains of government debt in Europe, leaving markets still waiting for a permanent fix. European leaders gather next week for a summit on the debt crisis.

The European Central Bank, which has been reluctant to intervene to stop the growing crisis on its own continent, was joined in the decision by the Federal Reserve, the Bank of England and the central banks of Canada, Japan and Switzerland.

"The purpose of these actions is to ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity," the central banks said in a joint statement.

China, which has the largest economy in the world after the European Union and the United States, reduced the amount of money its banks are required to hold in reserve, another attempt to free up cash for lending.

The display of worldwide coordination was meant to restore confidence in the global financial system and to demonstrate that central banks will do what they can to prevent a repeat of 2008.

That fall, fear gripped the financial system after the collapse of Lehman Brothers, a storied American investment house. Banks around the world severely restricted lending to each other. Investors panicked, resulting in a meltdown in stocks.

In October 2008, the ECB, the Fed and other central banks cut interest rates together. That action, like Wednesday's, was a signal from the central banks to the financial markets that they would be players, not spectators.

This year, investors have been nervously watching Europe to see whether they should take the same approach and dump stocks. World stock markets have been unusually volatile since summer.

The European crisis, which six months ago seemed focused on the relatively small economy of Greece, now threatens the existence of the euro, the common currency used by 17 countries in Europe.

There have also been signs, particularly in Europe, that it is becoming more difficult to borrow money, especially as U.S. money market funds lend less money to banks in the euro nations because of perceived risk from the debt crisis.

European banks cut business loans by 16 percent in the third quarter. And no one knows how much European banks will lose on their massive holdings of bonds of heavily indebted countries. Until the damage is clear, banks are reluctant to lend.

Banks are also being pressed by European governments to increase their buffers against possible losses. That helps stabilize the banking system but reduces the amount of money available to lend to businesses.

"European banks are having trouble borrowing in general, including in dollars," said Joseph Gagnon, a former Fed official and a senior fellow at the Peterson Institute for International Economics. "The Fed did the Europeans a favor."

The central banks are reducing by half a percentage point - to about 0.6 percent - the rate they charge banks for short-term dollar loans. The lower rate is designed to get credit flowing again. Dollars are the No. 1 currency for international trade.

The Fed had offered dollar swaps from December 2007, when world financial markets were weakening because of fear about subprime mortgages, until February 2010. It reopened the program in May 2010, as European debt concerns grew, and planned to end it Aug. 1, 2012.

Wednesday, in addition to lowering the interest rate on dollars borrowed, the Fed extended the program to Feb. 1, 2013. If it works, the rates on dollar loans will drop, and stock and bond markets will calm down.

"It shows that policymakers are on the case," said Roberto Perli, managing director at the International Strategy & Investment Group, an investment firm. He said it has symbolic value even if it does not have a big impact on credit markets.

MANCHESTER, N.H. (AP) -- Confronting Republicans, President Barack Obama on Tuesday dashed into the home of the nation's first presidential primary, urging GOP lawmakers to support a payroll tax cut next week and stand by their own pledges not to increase taxes.

Obama sought to steal the spotlight from Republican presidential contenders who have blanketed the political battleground with anti-Obama messages while tending to a state expected to be heavily contested in the next year's general election.

"The next time you hear one of these folks from the other side ... talking about raising your taxes, you just remind them that ever since I've got into office, I've lowered your taxes, haven't raised them," Obama said at a high school gymnasium. "That's worth reminding them."

The president said "in the spirit of Thanksgiving," Democrats in Congress would offer Republicans another chance next week to consider a plan to extend and expand the cut in payroll taxes that fund Social Security. Obama said it would save the typical middle class family about $1,000 in taxes.

"Don't be a Grinch. Don't vote to raise taxes on working Americans during the holidays," Obama said.

Even as he sought to draw a bright line with Republicans over taxes, Obama was reminded about the unhappiness among some in the Occupy Wall Street movement. As he began to speak, Obama was briefly interrupted by protesters who screamed, "Mic check!" and then chanted, "Mr. President - over 4,000 protesters, over 4,000 protesters, have been arrested."

Obama paused to let the demonstrators speak. "No, no, no. That's OK," Obama said. The crowd then sought to drown out the protesters with chants of "Obama!"

Working the crowd after the speech, Obama was handed a note from the protesters that amounted to a script of their chant. Captured in photographs, the note said peaceful demonstrators had been arrested while "banksters" destroy the economy "with impunity."

The note urges Obama to stop the assault on protesters' First Amendment rights and says his "silence sends a message that police brutality is acceptable."

Presidential hopeful Mitt Romney, meanwhile, was airing his first TV ads in the Granite State, a spot sharply critical of Obama's economic record. The former Massachusetts governor also ran ads in New Hampshire newspapers that say to Obama, "I will be blunt. Your policies have failed."

Traveling to New Hampshire, White House spokesman Jay Carney swiped at the ad, which plays audio of Obama from the 2008 presidential campaign declaring "if we keep talking about the economy, we're going to lose."

Obama, however, was quoting the campaign of Republican presidential candidate John McCain, a distinction the ad doesn't make and that alters its meaning. In fact, the Romney campaign statement announcing the ad includes Obama's full quote: "Sen. McCain's campaign actually said, and I quote, if we keep talking about the economy, we're going to lose."

"Seriously? I mean, an ad in which they deliberately distort what the president said?" Carney said. "It's a rather remarkable way to start. And an unfortunate way to start."

New Hampshire, with only 4 electoral votes, has been a key target in recent presidential elections. Republican George W. Bush carried the state in 2000, but Democrats took it back in 2004. Obama lost the 2008 New Hampshire primary in a surprise to Hillary Rodham Clinton but bounced back to win the state in the general election.

Billy Shaheen, a longtime Democratic operative in New Hampshire and the husband of Sen. Jeanne Shaheen, said Republicans' huge gains in the state during the 2010 midterm elections served as a wake-up call for the state's Democrats.

"After the 2010 election, New Hampshire got a taste of what the tea party can do, and it's not happy. I think an undercurrent exists that's ready to be tapped for the 2012 election," he said. "We're not proud of what has been going on in the state capitol, and we're getting ready. We let our guard down in 2010, but we've come too far to go back."

NEW YORK (AP) -- Stock indexes drifted between gains and losses Tuesday after the government lowered its estimate of economic growth in the third quarter. Higher borrowing costs for Spain also renewed worries about Europe's debt crisis.

Hewlett-Packard Co. sank 2.8 percent, dragging down the Dow Jones industrial average. H-P lowered its earnings forecast for the 2012 fiscal year after the market closed Monday. The tech giant said it was being "cautious," citing Europe's debt crisis and weak consumer spending.

The Commerce Department said the U.S. economy grew at a 2 percent annual rate in the July-September period, down from its initial estimate of 2.5 percent. Economists had expected the figure to remain unchanged.

The Dow Jones industrial average was down 30 points, or 0.3 percent, at 11,516 as of 2 p.m. Eastern. The Dow had been down as many as 113 points shortly before noon. After H-P, aluminum maker Bank of America Corp. had the biggest fall among the 30 stocks in the index, 2 percent.

The Standard & Poor's 500 index was down 2 points at 1,191. Both the Dow and S&P briefly turned slightly higher in early afternoon trading.

The S&P has lost 5.2 percent over the past week on worries that Spain could get dragged into Europe's debt crisis and as Congress neared a deadlock over cutting the U.S. budget deficit.

WASHINGTON (AP) -- With a special deficit-reduction supercommittee floundering, the top Republican in Congress warned Thursday that he won't permit savings from winding down the wars in Iraq and Afghanistan to pay for President Barack Obama's jobs spending agenda.

Democrats on the deficit panel proposed last week to use war savings to pay for a $300 billion jobs program along the lines President Barack Obama wants, plus take steps to protect the upper middle class from the alternative minimum tax and extend financing for doctors who treat Medicare patients.

"I've made it pretty clear that those savings that are coming to us as a result of the wind down of the war in Iraq and the war in Afghanistan should be banked, should not be used to offset other spending," said House Speaker John Boehner. But the Ohio Republican did not address whether war savings could be used to extend expiring tax cuts such as popular business tax breaks or Obama's expensive proposal to renew payroll tax cuts that expire at the end of December.

Boehner also said he's frustrated that all six supercommittee Democrats have yet to unite around a specific plan, even though there's now less than a week before the panel's official deadline.

"They've never really put paper on the table. It's very frustrating," Boehner said.

By all accounts, the deficit panel is at a stalemate.

Despite small steps in recent weeks toward addressing core solutions to the nation's intractable deficit problem, such as new taxes and curbs on the growth of enormously expensive government benefit programs, both sides said further progress had come to a halt.

Less than a week remains before a Thanksgiving deadline for the panel to vote on a plan cutting deficits by at least $1.2 trillion over a decade. Whatever remaining hope there was appeared to have washed away Wednesday after both Democrats and Republicans on the 12-member panel traded rhetorical salvos about whether the other side was negotiating in good faith.

PARIS (AP) -- Global stocks slid further Thursday, as investors worried that Europe's debt crisis was intensifying and spreading to larger countries in the 17-nation eurozone.

Bond investors pushed up borrowing rates for Spain and also for France, where the spread, or extra yield, demanded compared to safe-haven German bonds widened to a record 2 percentage points.

Meanwhile Germany's chancellor Angela Merkel again brushed aside pressure for a quick-fix solution to the euro crisis despite the mounting market tensions, arguing that spreading debt liability could ruin Europe's competitiveness and a massive European Central Bank bond-buying drive wouldn't resolve its problems.

The German chancellor argued in a speech Thursday to an economic conference that rather than look for quick fixes, Europe needs to consider growth-promoting measures that don't immediately cost money, such as labor-market reforms - and that such measures will require patience.

The results of a Spanish debt auction soured sentiment. The country paid nearly 7 percent to raise euro3.56 billion ($4.8 billion) in 10-year bonds, the highest rate since 1997 and a level seen as unsustainable over the long term.

Demand was relatively weak. The amount of debt sold came in under the euro4 billion maximum target set by the Treasury and the bid to cover ratio was 1.54, compared to 1.76 last time.

"The results of the Spanish bond auction are revisiting familiar fears for investors," said David Jones, chief market strategist at IG Index.

After the auction, yields on Spanish 10-year bonds shot up to 6.75 percent on the secondary market. That was 4.88 percentage points above the yield of the equivalent benchmark German bund. However, the yield dropped back to end the day at 6.44 percent on mooted bond-buying from the European Central Bank, which never comments on the speculation.

France too saw its borrowing costs rise, after it raised euro6.98 billion ($9.41 billion) at an auction of mid-term bonds that saw strong demand.

Italian bond yields ended the day a little lower at 6.81 percent after new premier Mario Monti vowed to focus on restoring growth, while warning that the end of the euro "would cause the disintegration of the united market."

NEW YORK (AP) -- Hardly a day goes by without some politician or pundit pointing out that companies are hoarding cash - roughly $3 trillion of it. If only they would spend it, the thinking goes, the economy might get better.

But the story is not as simple as that. Though it seems to have escaped nearly everyone's notice, companies have piled up even more debt lately than they have cash. Financial experts say it makes companies more vulnerable than they look.

"The record cash story is bull market baloney," says David Stockman, a former U.S. budget director.

U.S. companies are sitting on $358 billion more cash than they had at the start of the recession in December 2007, according to the latest Federal Reserve figures, from June. But in the same period, what they owed rose $428 billion.

Companies borrow money all the time, of course. They borrow to build factories, cover expenses, even make payroll. The problem: Debt doesn't go away. A business can cut costs during a recession. But it can't just shred the IOUs.

Heavy debt means companies could have to dip into those reserves of cash to pay their lenders. And when interest rates eventually go up, companies will have to spend more money just to service the debt.

In the last recession, which ended in June 2009, small businesses that depended on credit cards and bank loans got slapped with higher rates just as sales began to drop. Some got cut off all together.

Peter Boockvar, equity strategist at Miller Tabak & Co., says business debt is too high even if the U.S. manages to stay out of a second recession. If economic growth doesn't pick up, "they'll be more bankruptcies, and more defaults," he predicts.

Even if companies used cash to pay off what they owe, they would be left with plenty of debt - in fact, an amount equal to 83 percent of all the goods and services they produce, according to Federal Reserve data for incorporated businesses.

That's an improvement from March 2009, the low point of the Great Recession, when companies owed 95 percent. To stay afloat, companies tapped credit lines at banks, increasing debt while they were bringing in less money. They burned through cash to meet expenses.

Before the recession, though, you have to go back at least six decades to find a time when companies owed so much compared with what they produce, says Andrew Smithers, a London consultant who has written extensively about debt.

BERLIN (AP) -- Prosperous Germany has a surprising message for sinking Greece: Help Wanted.

With a shrinking labor force and buoyant economy, Germany desperately needs skilled workers to keep its industrial engine churning forward. Increasingly, it's seeking them from Greece and other European laggards like Spain and Portugal where unemployment is soaring amid fears of financial implosion.

Germany quickly overcame the financial meltdown that started in 2008 and unemployment is now at a 20-year low of 6.6 percent. Companies are so desperate to fill skilled labor shortages that the government has taken to organizing matchmaking sessions between German firms and job seekers from crisis-hit countries.

Greek civil engineer Christos Kotanidis moved to Erlangen in southern Germany three months ago and quickly found work with industrial giant Siemens.

The 33-year-old's former company in Saloniki put him on part-time earlier this year because, struck by the financial crisis, it could no longer afford to pay full salaries. It took Kotanidis only six weeks to land a full-time position in Germany.

"I decided to look for a job in Germany because it has a stable economy," Kotanidis said. "In Greece the economic situation is bad now, but the future looks even worse."

Unemployment in Greece is currently at 16.7 percent, but among young people it is even higher with more than 42 percent of people under 24 not finding any work. In Spain, overall unemployment hovers at around 20 percent, and more than 45 percent of people under the age of 25 are without a job. Portugal, Italy and Ireland, the other countries bearing the brunt of the debt crisis, also have bleak employment pictures.

There are no hard numbers on how many professionals from Europe's crisis zone have been hired in Germany. Immigration to Germany has shot up by 13 percent in the past five years, and more than half of the newcomers are from within the European Union. EU citizens do not need to apply for a visa or work permit if they take a job within the bloc.

NEW YORK (AP) -- The Dow Jones industrial average lost more than 240 points in early trading after Italy's borrowing costs soared.

The yield on the benchmark Italian government bond spiked above 7 percent, a sign that investors are losing faith in the country's ability to repay its debt. Analysts say Italy will not be able to refinance its debt at current rates, which will force it to either enact deep austerity measures or to receive financial assistance to prevent a default.

Greece, Portugal and Ireland required bailouts when their bond yields rose above 7 percent. But unlike those countries, Italy's $2.6 trillion in debt is too large for other European nations to bail out.

ROME (AP) -- Financial markets pounded Italy on Wednesday, sending a clear message that they want Premier Silvio Berlusconi out immediately despite his plan to stick around a little longer.

Berlusconi has pledged to resign after the Italian parliament passes the financial reforms that European officials have been demanding for months. The process can take up to two weeks - and even though the opposition vowed Wednesday to speed that up, markets were clearly wary of what might transpire in the meantime.

"Berlusconi is the supreme political maneuverer. And no one will believe he has resigned until, yes, he has done so. Simple as that," said Jan Randolph, head of sovereign risk analysis at IHS Global Insight "He survived confidence votes before and he has made comebacks. No one really believes he is gone until he is gone."

Italy's key borrowing rate spiked well above the 7 percent level that eventually forced other eurozone countries like Greece and Portugal to seek bailouts, surging to a high of 7.40 percent, up 0.82 of a percentage point from the previous day.

No one is suggesting that Italy is headed for an immediate bailout. Randolph said it will take a while for the higher borrowing rate to cause problems for Italy's "mountain of debt."

But the markets are whipping up a catastrophic scenario, something analysts say is the only thing that can make sure Berlusconi budges.

"With a catastrophic scenario - and it seems we are facing now a catastrophic scenario - maybe Berlusconi can be pushed to support a new government. Or maybe his party will crumble," said Roberto D'Alimonte, a political analyst at Rome's LUISS University.

In the event Italy's respected president cannot form a new government after Berlusconi officially resigns, the billionaire will remain on as a caretaker prime minister with fewer powers but still in office until elections can be held, D'Alimonte said. February is the earliest date being floated.

That is exactly what the markets don't want.

Noted economist Nouriel Roubini, who has lived in Italy, expressed a similar view on Twitter: "Yields at 7%: markets are telling Berlusconi to leave NOW. They don't buy his scheme of pretending to leave in 2 weeks after budget is passed."

D'Alimonte said the markets want a technical government, led by former EU competition commissioner Mario Monti, who now runs the prestigious Bocconi University. Berlusconi and his allies claim such a solution would be undemocratic, however - ignoring the fact that any plan to put in Berlusconi's hand-picked successor, former justice minister Angelino Alfano, would also be undemocratic.

NEW YORK (AP) -- U.S. stock indexes wobbled between small gains and losses in afternoon trading Monday as investors worried that Europe's debt crisis would spread to Italy.

Italy's borrowing rates spiked Monday to the highest level since the country adopted the euro. Unlike Greece, Portugal or Ireland - all of which received financial lifelines - Italy has too much debt to be rescued by its European neighbors. Prime Minister Silvio Berlusconi has rejected suggestions that he resign to make way for more cost-cutting.

Concerns about Italy outweighed a deal Greece's two main political parties reached over the weekend to share power in a new government. The move increases the likelihood that the country will move ahead with austerity measures it promised to implement as part of a financial rescue agreement with lenders. That relieved investors by reducing the chances of an imminent default by Greece, which would rattle financial markets and cause losses for major European banks.

Europe's debt crisis continued to take investor's attention away from relatively good news about the economy and U.S. companies. "Every day it seems like it's the butting of heads between whatever the latest rumor is out of Europe with good economic data and corporate earnings," said Karyn Cavanaugh, a market strategist with ING Investment Management. "It's overshadowing the fact that earnings are on track to be the best year ever."

NEW YORK (AP) -- Worries that a planned Greek referendum could scuttle a plan to resolve Europe's debt crisis rattled markets Tuesday morning. The Dow Jones industrial average plunged nearly 200 points, and European stock indexes fell broadly. The dollar and U.S. government bond prices rose as traders moved into assets considered safe.

The Greek government shocked financial markets with news that it would put its unpopular cost-cutting plan to a public vote. If it's defeated, the country could drop the European currency and default on its debt, which would put the European banking system and regional economies at risk of another crisis.

"The Greek referendum puts the connections between European countries at risk, from free-trade agreements to the common currency," said Guy LeBas, chief fixed income strategist at Janney Montgomery Scott.

NEW YORK (AP) -- Despite being known as a jinx month for the stock market, this October is shaping up to be one of the best months on record. The main reason is progress in Europe toward containing that region's debt crisis.

The Standard & Poor's 500 index has gained 12 percent for the month, which puts the broadest stock-market measure on track for its best month since January 1987. Despite a decline early Monday, the Dow Jones industrial average is still up 10.8 percent in October, its best month since August 1982.

The big breakthrough on Europe came early Thursday of last week, when European leaders reached a far-ranging agreement to shore up the region's banks and prevent a debt crunch in Greece from bringing down the financial system there.

But a lack of many key details in the plan has made markets jittery again, and on Monday fresh reminders of how the Europe crisis can affect U.S. financial institutions helped bring the market lower.

NEW YORK (AP) -- Stocks are surging in early trading after European leaders agreed on a deal to slash Greece's debt.

The U.S. economy grew between July and September at its fastest rate in a year, and Dow Chemical Co. became the latest big company to report stronger earnings.

Global markets soared Thursday after the European agreement, which is aimed at preventing a two-year debt crisis there from dragging the world into another recession.

Ten minutes after the opening, the Dow Jones industrial average jumped 256, or 2.2 percent, to 12,125. The S&P 500 rose 32, or 2.6 percent, to 1,274. The Nasdaq rose 67, or 2.5 percent, to 2,718.

Treasury yields are rising as investors feel less need for safer investments.

NEW YORK (AP) -- A former board member of Goldman Sachs and Procter & Gamble pleaded not guilty Wednesday to federal charges accusing him of acting as "the illegal eyes and ears in the boardroom" for a friend, a billionaire hedge fund founder sentenced this month to 11 years in prison in the biggest insider trading case in history.

The case, built partially on wiretaps used for the first time in insider trading, has offered unprecedented insight into greed at the highest levels of Wall Street. The arrest of Rajat Gupta took it one step higher.

WASHINGTON (AP) -- President Barack Obama says he wants to make sure millionaires are taxed at higher rates than their secretaries. The data say they already are.

"Warren Buffett's secretary shouldn't pay a higher tax rate than Warren Buffett. There is no justification for it," Obama said as he announced his deficit-reduction plan this week. "It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million."

On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.

The 10 percent of households with the highest incomes pay more than half of all federal taxes. They pay more than 70 percent of federal income taxes, according to the Congressional Budget Office.

NEW YORK (AP) -- Stocks are tumbling as investors worry that Greece won't qualify for a new installment of emergency funds in time to avoid defaulting on its debt.

Investors also appear pessimistic about a Federal Reserve policy decision expected Wednesday. The Fed has hinted it might take new economic stimulus measures. But many analysts think they won't be announced this week.

President Barack Obama on Monday called for $1.5 trillion in new taxes to help reduce the U.S. deficit, saying "we can't just cut our way out of this hole."

In midmorning trading, the Dow Jones industrial average is down 185 points, or 1.6 percent, at 11,324. The Standard & Poor's 500 index is down 19, or 1.6 percent, at 1,197. The Nasdaq composite is down 22, or 0.9 percent, at 2,599.

VOULIAGMENI, Greece (AP) -- Greece will try to avoid international "blackmail and humiliation" by speeding up reforms and civil-service staff cuts, the finance minister said Monday, hours before holding an emergency teleconference with creditors.

Greece's international bailout creditors stepped up the pressure at the start of a crucial week in the nearly two-year debt crisis, urging the government to do more to heal its finances. Global markets were skeptical, however, and stocks fell sharply on fears Athens will default on its mountain of debt.

Out of patience with the Socialist government's delays on promised reforms, Greece's partners and creditors are threatening to cut the cash lifeline without which the country would go bankrupt in less than a month.

Athens is struggling with a deepening recession that is eating away at the impact of its austerity measures while also causing unemployment and public anger to grow.

International debt inspectors will talk to finance chief Evangelos Venizelos around 1600 GMT.

"We expect the Greek authorities to explain, in particular, how they intend to close the fiscal gaps in 2011 and 2012 and how they plan to proceed with the structural reforms and privatizations," said Amadeu Altafaj Tardio, a spokesman for the European Commission.

Initially, Athens said the teleconference would be followed by a ministerial meeting under Prime Minister George Papandreou, who canceled a scheduled trip to the U.S. on Saturday. But government spokesman Elias Mossialos later said in an interview with Real FM radio that the meeting could be moved to another day depending on the course of separate talks between Venizelos and his fellow ministers.

Ahead of the discussions, Venizelos said the government still seeks to generate euro3 billion ($4.1 billion) more revenues next year than it spends, before counting the cost of interest on existing debts.

Greece's economy is expected to contract by about 5.5 percent this year - more than the 3.5 percent earlier assumed - and a further 2.5 percent in 2012, according to new government and IMF estimates.

"The country cannot go forward without the true implementation of major structural reforms - we have delayed them," Venizelos said at a conference south of Athens, adding that achieving the 2012 target was vital.

NEW YORK (AP) -- A promise by European leaders to help Greece avoid default sent stocks sharply higher Wednesday for the third straight day.

The leaders of Greece, France and Germany agreed in a teleconference that Greece was an "integral" part of the 17-country bloc that uses the euro. Greece also said it would stick to agreements to trim its debts, a condition for getting more financial help. The statements were intended to calm fears that Greece was headed for default or might be forced to drop the euro.

The Dow Jones industrial average rose 140.88 points, or 1.3 percent, to close at 11,246.73. The Dow sank as many as 112 points within the first hour of trading, then rose steadily through the rest of the day.

SANTA ANA, Calif. (AP) -- It's early in the morning on the 10th anniversary of the nation's worst terrorist attack, and John Wayne Airport starts to hum with the mundane rituals of airline travel.

Passengers occupy themselves with smartphones, laptops and fast-food breakfast. Travelers in line for security whip out driver's licenses and boarding passes. Flight attendants call out names of passengers to check in at the counter. Someone left a belt at the X-ray. Could you please claim it?

Yet the date's significance is palpable, here and at other airports around the world.

At Boston's Logan Airport, where the jetliners that brought down the World Trade Center took off, ticket agents, baggage screeners and other workers paused at 8:46 a.m. for a moment of silence to mark the time the first plane struck the twin towers. At the Tampa, Fla., airport, an honor guard of law enforcement officers carried flags while a bagpiper and a bugler played.

LONDON (AP) -- British Prime Minister David Cameron arrives in Moscow on Sunday trying to secure crucial new trade and warmer ties with an often difficult ally, some five years after the poisoning death of a Kremlin critic in London revealed bitter differences.

Cameron is making the first visit to Russia's capital by a British leader in six years, and will hold the first talks by any British official with Prime Minister Vladimir Putin in more than four years - hoping to revive relations ahead of the ex-president's possible return to power in a 2012 election.

In one hiccup ahead of the visit, Russia's Embassy in London said its website was brought down in an apparent cyberattack. The embassy said on Twitter it had launched a mirror - or alternative - website.

THESSALONIKI, Greece (AP) -- Greece will meet ambitious savings targets despite a deepening recession this year, the prime minister said Saturday, to secure the continued flow of international rescue loans that are protecting the debt-crippled country from a catastrophic bankruptcy.

As George Papandreou delivered his annual, keynote speech on the economy in Greece's second-largest city of Thessaloniki, police on the streets outside clashed with violent demonstrators as more than 25,000 people - from taxi-drivers to sports fans - joined a wave of anti-austerity protests.

Two people were arrested and nearly 100 people detained, police said, while at least two demonstrators were injured during the clashes in the northern port city.

"We will push through all the major changes our country has needed for years," Papandreou said in a nationally televised address. "And we will take whatever other decisions are needed, we will do whatever is necessary to keep the country on its feet."

MARSEILLE, France (AP) -- Wealthy countries and international lenders promised more money Saturday to encourage democratic reforms in Arab nations, promising at least $58 billion.

After Tunisia and Egypt ousted their authoritarian regimes earlier this year, eight of the world's most developed economies along with rich Arab countries and a raft of development banks had pledged in May to give $40 billion in support to their nascent democracies and hopefully keep them on the path to open government.

Those uprisings set off a cascade of revolts across the Middle East, and the Group of Eight and others are now increasing their pledges and expanding the recipients to include Morocco and Jordan.

BEIJING (AP) -- U.S. Ambassador to China Gary Locke said Friday a stronger U.S. economy is in China's interest and he will promote trade and human rights as the new envoy in Beijing, a focal point for U.S. diplomacy.

"The highest priority of the United States today is to create jobs for Americans and revitalize our economy. Given our economic interdependence, a stronger American economy is in the economic self-interest of the Chinese people," he said to university students.

A former commerce secretary, Locke is the first Chinese-American to hold the post. It's become increasingly important as China's economy, now the world's second-largest, grows steadily, and the United States fitfully copes with high unemployment.

WASHINGTON (AP) -- President Barack Obama is challenging congressional Republicans to back an aggressive plan to cut payroll taxes in an effort to revive the economy and entice employers to hire more workers.

Obama wants to extend and expand a payroll tax cut that is scheduled to expire at the end of the year. He reminded lawmakers that if they fail to act, they will be allowing taxes to increase on nearly every worker who earns a wage, starting in January.

That is a prospect the president wants to avoid as he embarks on a tough re-election fight, with unemployment stuck at 9.1 percent.

NEW YORK (AP) -- Parents have a new goal this back-to-school shopping season: Buy their kids the name brands they want without spending like it's 2007.

After the recession began in late 2007, cost-conscious consumers sought out the cheapest shirts and shoes they could find at merchants like Wal-Mart and Target to keep their budget in check. But these days, value is the name of the game.

Shoppers who are just as concerned about style and quality as price are flocking to factory outlets, where they can snag Gap, Nike, Vans and other designer clothes and accessories for 25 to 70 percent off. In fact, a quarter of parents said they plan to do the bulk of their back-to-school shopping at factory outlets and discount stores, compared with just 16 percent planning to do so at malls, according to the American Express Spending and Saving Tracker.

BEIJING (AP) -- Chinese millionaire Su builds skyscrapers in Beijing and is one of the people powering China's economy on its path to becoming the world's biggest.

He sits at the top of a country - economy booming, influence spreading, military swelling - widely expected to dominate the 21st century.

Yet the property developer shares something surprising with many newly rich in China: he's looking forward to the day he can leave.

Su's reasons: He wants to protect his assets, he has to watch what he says in China and wants a second child, something against the law for many Chinese.

The millionaire spoke to The Associated Press on condition that only his surname was used because of fears of government reprisals that could damage his business.

China's richest are increasingly investing abroad to get a foreign passport, to make international business and travel easier but also to give them a way out of China.

LONDON (AP) -- Wall Street braced for losses on Tuesday after world stock markets took a beating over fears that the U.S. economy was heading back into recession.

Any troubles in the world's largest economy cast a long shadow over the markets, and a report Friday that the U.S. economy failed to add any new jobs in August caused European and Asian stock markets to sink sharply Monday.

That jobs figure was far below economists' already tepid expectations for 93,000 new U.S. jobs and renewed concerns that the U.S. recovery is not only slowing but actually unwinding. U.S. hiring figures for June and July were also revised lower, only adding to the gloom.

The full impact of the jobs report will hit U.S. markets on Tuesday, since trading there was closed Monday for the U.S. Labor Day holiday.

WASHINGTON (AP) -- The job market is even worse than the 9.1 percent unemployment rate suggests.

America's 14 million unemployed aren't competing just with each other. They must also contend with 8.8 million other people not counted as unemployed - part-timers who want full-time work.

When consumer demand picks up, companies will likely boost the hours of their part-timers before they add jobs, economists say. It means they have room to expand without hiring.

And the unemployed will face another source of competition once the economy improves: Roughly 2.6 million people who aren't counted as unemployed because they've stopped looking for work. Once they start looking again, they'll be classified as unemployed. And the unemployment rate could rise.

WASHINGTON (AP) -- Employers stopped adding jobs in August, an alarming setback for an economy that has struggled to grow and might be at risk of another recession.

The government also reported that the unemployment rate remained at 9.1 percent. It was the weakest jobs report since September 2010.

Stocks tumbled on the news. The Dow Jones industrial average sank 245 points soon after trading began.

A strike by 45,000 Verizon workers lowered the job totals. Those workers are now back on the job.

The weakness in employment was underscored by revisions to the jobs data for June and July. Collectively, those figures were lowered to show 58,000 fewer jobs added. The downward revisions were all in government jobs.

CERNOBBIO, Italy (AP) -- Business leaders and finance experts gathered in Italy offered a downbeat assessment of the global economy Friday - with several predicting another recession due to a calamitous cocktail of sluggish growth, eurozone dysfunction, and financial market volatility.

The year's events - from natural disasters and violent uprisings to fears of debt defaults - have not only sent shock waves through the financial world but also caused a slump in confidence among consumers and industry.

"There is a significant probability of a double-dip recession," pronounced New York University economist Nouriel Roubini, in opening remarks that lived up to his nickname of "Dr. Doom" - earned for forecasting a financial crisis years before the 2008 crash, even as many reveled in the boom times.

More than 400,000 homes and businesses lost power Saturday as Hurricane Irene slammed into the East Coast.

Winds of up to 80 miles per hour whipped ashore Saturday morning, ripping power lines from poles and snapping trees in half. Hospitals, emergency call centers and other crucial facilities were holding up, but officials said it could get much worse as Irene churns north.

Gasoline supplies were falling as drivers top off their tanks on their way out of town. Pump prices rose about 3 cents per gallon overnight in New Jersey and Pennsylvania.

The power losses were most heavily concentrated in Wilmington and Wrightsville Beach, N.C., where Progress Energy reported 250,000 customers without power, mostly residences.

"We expect those numbers to increase," Progress spokeswoman Julia Milstead said.

NEW YORK (AP) -- Travelers across the country are facing days of grief ahead as thousands of flights are being cancelled because of Hurricane Irene.

Airlines are scrapping more than 8,300 flights this weekend from North Carolina to Boston, grounding passengers as Irene sweeps up the East Coast. There were more than 3,600 cancellations on Saturday alone.

All New York City-area airports closed to arriving flights at noon on Saturday, when the city's public transportation system shut down. The biggest airlines, United Continental Holdings Inc. and Delta Air Lines Inc., canceled thousands of flights each. Ronald Reagan Washington National Airport and Washington Dulles International Airport were both open as of noon, but most flights had been cancelled.

SAN FRANCISCO (AP) -- It's easy to forget now, but Apple's magnetism was once confined to a cult-like following of geeks seduced by the elegance and simplicity of the company's computers.

Over the past decade, though, Apple has emerged as a trendsetter and a wealth-making machine - the rare company that appeals to the cool cats hanging out in hip cafes and the fat cats looking to make another killing on Wall Street.

In the process, Apple has left an indelible mark that extends far beyond that first personal computer Steve Jobs and Steve Wozniak introduced 35 years ago. Since then, Apple has transformed the music, retailing, marketing and cellphone industries. Now, it's engineering yet another evolution in computing with the increasingly popular iPad tablet.

Those achievements have endeared Apple to the masses, turning its product announcements into the technology industry's latter-day version of a Beatles concert and turning its familiar logo into an emblem of exquisite taste.

NEW YORK (AP) -- Warren Buffett is coming to the rescue of another fallen giant.

Buffett's Berkshire Hathaway announced Thursday that it would invest $5 billion in Bank of America Corp., giving a much-needed vote of confidence in the struggling bank.

The bank's stock had plunged 52 percent in the past year on concerns over the bank's mortgage problems and worries that it would have to sell large amounts of stock to shore up its balance sheet.

Investors' confidence in the bank took another blow this month as its mortgage headaches got even worse. On Aug. 8, American International Group Inc. sued Bank of America for more than $10 billion, saying the bank deceived AIG by selling it overvalued mortgage-backed securities.

Much of the Charlotte, N.C. bank's problems stem from its 2008 purchase of Countrywide Financial Corp., the country's largest mortgage lender. Bank of America has been under heavy pressure from investors for selling them securities based on mortgages that later lost value.

The bank paid a total of $12.7 billion earlier this year to settle claims that it sold investors faulty mortgage investments. Investors have become worried that the bank would have to pay out even more to settle future claims.

Buffett, one of the most successful and respected investors of all time, has lent his credibility to several other icons of American business at times when investors' confidence in them was waning. His investments have usually proven to be both prescient and profitable.

Buffett pumped $5 billion into Goldman Sachs Group Inc. at the height of the 2008 financial crisis, helping to reverse a crisis of confidence in the investment bank and the U.S. banking system in general. He also invested $3 billion in General Electric Co.

Those investments, which paid annual dividends of 10 percent, wound up being lucrative. Berkshire made $2 billion from the Goldman investment alone. Unlike the Bank of America deal, those companies approached Berkshire seeking financial help and the stamp of approval that came with the endorsement of the legendary investor.

Buffett said in a statement Thursday he called Bank of America's CEO Moynihan to ask about investing because he considered the bank a strong, well-led company.

Berkshire will receive a dividend of 6 percent on his investment in Bank of America. Berkshire will get 50,000 preferred shares and warrants to purchase 700 million shares of common stock at $7.14 per share. Buffett can exercise the warrants at any time in the next 10 years. If he does, it would make him the banks largest shareholder with a stake of 7 percent.

An hour after the deal was announced, Buffett had already made a profit on paper of $500 million on the stock warrants thanks to a surge in Bank of America's stock price. After closing at $6.99 Wednesday, the stock jumped 87 cents or 12 percent to $7.86 Thursday. Bank of America's stock traded as high as $15 in January, before its mortgage woes worsened.

Buffett's investment in Bank of America sent the stocks of other banks higher too. Citigroup Inc. rose 2.7 percent and Morgan Stanley rose 3.4 percent.

Berkshire also holds investments in several other banks. One of Berkshire's biggest stock investments is a 16 percent stake in Wells Fargo & Co. Berkshire also holds stakes in US Bancorp, M&T Bank Corp. and the Bank of New York Mellon Co.

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AP Business Writers Christina Rexrode and Josh Funk contributed to this story.

WASHINGTON (AP) -- The number of people who bought new homes fell for the third straight month in July, putting sales on track to finish this year as the worst on records dating back half a century.

Sales of new homes fell nearly 1 percent in July to a seasonally adjusted annual rate of 298,000, the Commerce Department said Tuesday. That's less than half the 700,000 that economists say represent a healthy market.

Housing remains the weakest part of the economy. Last year was the worst for new-home sales on records that go back nearly 50 years.

While new homes represent less than one-fifth of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs and $90,000 in taxes, according to the National Association of Home Builders.

WASHINGTON (AP) -- News flash: Congressional Republicans want to raise your taxes.

Impossible, right? GOP lawmakers are so virulently anti-tax, surely they will fight to prevent a payroll tax increase on virtually every wage-earner starting Jan. 1, right?

Apparently not.

Many of the same Republicans who fought hammer-and-tong to keep the George W. Bush-era income tax cuts from expiring on schedule are now saying a different "temporary" tax cut should end as planned. By their own definition, that amounts to a tax increase.

WASHINGTON (AP) -- The number of people applying for unemployment benefits rose back above 400,000 last week. Still, the four-week average, a more reliable gauge of the job market, fell to the lowest level since mid-April.

The report suggests that the economy is creating jobs but not nearly enough to lower the high unemployment rate.

Weekly applications rose 9,000 to a seasonally adjusted 408,000, the Labor Department said Thursday. That's the highest level in four weeks. Applications have been above 400,000 for 18 of the past 19 weeks.

The four-week average dropped for the seventh straight week to 402,500.

MOUNTAIN VIEW, Calif. (AP) -- Google Inc. is buying cell phone maker Motorola Mobility Holdings Inc. for $12.5 billion in cash. It's by far Google's biggest acquisition and a sign the online search leader is serious about expanding beyond its core Internet business and setting the agenda in the fast-growing mobile market.

Google will pay $40.00 per share, a 63 percent premium to Motorola's closing price on Friday.

Five-year-old Frank Allocco is 37,000 feet above America, face pressed against the window.

"Cool," he says to his 6-year-old sister. "Francesca, look."

It's their first flight. They ignore a Harry Potter DVD and video games. Instead, there are rivers, mountains and tiny cars below.

Francesca chimes in: "Wow, Frank, look at that cloud."

For Frank and Francesca, soaring high above the country is magical. The kids from Park Ridge, Ill., are treated like stars. A flight attendant gives them wing pins. Mom and dad snap photos.

For most of us, though, the romance of flight is long gone - lost to Sept. 11, 2001, and hard-set memories of jets crashing into buildings.

We remember what it was like before. Keeping all our clothes on at security. Getting hot meals for free - even if we complained about the taste. Leg room.

Today, we feel beaten down even before reaching our seats. Shoes must be removed and all but the tiniest amounts of liquids surrendered at security checkpoints. Loved ones can no longer kiss passengers goodbye at the gate. And airlines, which have struggled ever since the day terrorists used airplanes as missiles, are adding fees, squeezing in passengers and cutting amenities to survive.

The stock market buckled Monday under the weight of a crisis in Europe and danger of recession at home. Reeling from a downgrade of American debt, the Dow Jones industrials plunged 634 points.

It was the worst day for the market since the financial crisis in the fall of 2008 and extended Wall Street's sudden, sharp decline. Stocks have lost 15 percent of their value in just two and a half weeks.

Monday was the first trading day since Standard and Poor's downgraded the United States' risk-free credit rating, and the selling started at the opening bell. The Dow dropped 250 points in minutes. For the rest of the day, investors looked for safer places for their money. With few buyers left for stocks, the market could only drift lower.

The Dow finished the day down 5.5 percent. The point decline was the worst since Dec. 1, 2008, and the sixth-steepest ever. The average ended at 10,809.85, its first close under 11,000 since November.

FRANKFURT, Germany (AP) -- A risky European Central Bank decision to fight the continent's debt crisis by buying Spanish and Italian bonds on Monday started pushing down the soaring interest yields threatening those countries with financial disaster.

But some analysts warned that the move transfers significant risk to the balance sheet of an institution long reluctant to move beyond its traditional role controlling inflation. Others warned that a half-hearted intervention would not stamp out the crisis.

The radical expansion of the ECB's bond-buying program cements the bank's unwilling role as the institution with primary responsibility for solving's Europe 21-month-old financial crisis.

The ECB had been reluctant to become directly involved in averting the crisis, instead pushing politicians to get their countries' finances under control and build up their own crisis management system.

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NEW YORK (AP) -- U.S. stock futures tumbled Monday amid a rout in global stocks after Standard & Poor's downgraded the U.S. credit rating for the first time.

S&P cut the long-term debt rating for the U.S. by one notch to AA+ from AAA late Friday. The move wasn't unexpected, but it comes when investors are already feeling nervous about a weak U.S. economy, European debt problems and Japan's recovery from its March earthquake.

Ahead of the opening bell, Dow Jones industrial futures are down 222 points, or 1.9 percent, to 11,181. S&P 500 futures are down 27, or 2.3 percent, to 1,171. Nasdaq 100 futures are down 50, or 2.3 percent, to 2,134.

In Europe, the German DAX index fell 2 percent. In Asia, Japan's Nikkei 225 index fell 2.2 percent.

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TOKYO (AP) -- The world's leading economies on Sunday urgently discussed the stability of financial markets after a historic U.S. credit downgrade rattled investors already worried about European debt crises.

Deputies from the Group of 20 advanced and emerging economies talked by telephone Sunday about proposals to minimize market shocks, South Korea's central bank said. And the financial ministers from the Group of Seven economies planned talks before Asian markets open Monday.

The countries are concerned Standard & Poor's downgrade of the U.S. credit rating late Friday will shake global markets. In a sign of the fallout, Middle East markets tumbled Sunday on the first day of business after the downgrade.

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JERUSALEM (AP) -- Israel on Sunday formed a panel of government ministers and some of the country's leading economic experts to draw up a plan to reduce the soaring cost of living, marking a new effort to defuse demonstrations over prices that drew over a quarter-million people onto the streets the night before.

The announcement comes after three weeks of mushrooming protests sparked by complaints over housing costs. Since then, the protests have gained new momentum as Israelis grow increasingly frustrated with their struggle to make ends meet despite economic growth in the country that is outpacing that of other developed nations. Saturday's turnout of over 250,000 people in public squares presented Israel's most stable government in years with a chorus of discontent it could not afford to ignore.

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The person spoke on condition of anonymity because the level and timing of the contacts had yet to be confirmed.

Standard & Poor's downgrade of the U.S. credit rating Friday night added to growing fears over debt levels and economic growth in the world's biggest economy and in large European nations such as Italy and Spain. The downgrade is also set to hurt Europe, whose economy is closely linked to the U.S. and whose weak members depend on strong demand abroad for their goods to help them grow.

Many economists see the world's big central banks as the last line of defense at this moment in the crisis, after policymakers in Europe and the U.S. have failed to agree on the kind of shock-and-awe moves that many investors demand.

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