U.s. Economy | featured news

Strong pickup demand fueled a big jump in U.S. auto sales last month. GM's August U.S. sales rose 10 percent compared with a year earlier, while Ford's rose 13 percent and Chrysler's 14 percent. Most automakers reported strong gains as Americans flowed into dealer showrooms, drawn by model-year closeouts, low-interest financing and appealing new models. Analysts expect overall sales to rise around 20 percent when companies finish reported later Tuesday.

Democrats say answering the question of whether Americans are better off now than they were four years ago requires some context. Massachusetts Senate candidate Elizabeth Warren tells NBC's "Today" show Tuesday that people should remember how far the economy fell and how hard it is to get back from a time when the stock market was crashing and the auto industry was a mess. She says the real issue is who has the best plan to move forward.

Jeffrey A. Michael, a finance professor in Stockton, Calif., took a hard look at his city’s bankruptcy this summer and thought he saw a smoking gun: a dubious bond deal that bankers had pushed on Stockton just as the local economy was starting to tank in the spring of 2007, he said.

The Fed is on the verge of expanding its stimulus policies. We learned that much during the meetings in Jackson Hole, Wyo. But what may be more interesting is the undercurrent of discussion about what happens when those measures prove insufficient.

Most retailers, including Costco Wholesale Corp and Limited Brands Inc , posted better-than-expected sales gains at existing stores in August, in what is expected to be a healthy month as parents and students wrapped up back-to-school purchases.

U.S. consumer spending got off to a fairly firm start in the third quarter, rising by the most in five months and offering hope economic growth would pick up this quarter. Other data on Thursday showed the number of Americans filing new claims for jobless benefits held steady last week.

The number of Americans seeking unemployment benefits was unchanged last week at a seasonally adjusted 374,000, suggesting slow improvement in the job market.

The U.S. economy grew at a tepid 1.7 percent annual rate in the April-June quarter, suggesting growth will stay weak in the second half of the year. Slightly stronger consumer spending and greater exports were the main reasons the Commerce Department reported Wednesday that growth was better than its initial estimate of 1.5 percent. Still, growth has slowed from the 2 percent annual rate in the January-March quarter and the 4.1 percent rate in the fourth quarter of 2011.

Home prices rose more than expected in June, the fifth month in a row of gains in a fresh sign of improvement in the housing market, a closely watched survey showed on Tuesday.

Despite some recently improving economic data, consumer confidence dropped in August to its lowest level since late last year, according to a leading indicator released Tuesday.