Jobs: September Labor report disappoints
The latest jobs numbers came out this week, and they’re “discouraging,” said Catherine Rampell in The New York Times. The Labor Department’s monthly jobs report showed just 148,000 new jobs in September. The numbers reflect the period just before last month’s federal government shutdown, which delayed the report’s release and “is expected to weigh on growth” when October’s report is released. While unemployment fell from 7.3 to 7.2 percent—thanks to new jobs in construction, wholesale trade, transportation, and warehousing—the change “was not statistically significant.” And workers’ participation rate in the labor force and average workweek length stayed flat.
Now we can expect the Federal Reserve to stay its course, said Sarah Portlock and Jonathan House in The Wall Street Journal. Central bank officials have said they are waiting to see “substantial improvement” in the labor market before pulling back on the Fed’s $85 billion monthly bond purchases. That controversial monetary policy, known as quantitative easing, is “aimed at driving down interest rates and encouraging hiring.” These latest weak jobs numbers not only “helped assure investors that the Fed will leave its bond-buying program unchanged” next week but also “likely raised the bar for action at the Fed’s mid-December meeting.”
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Pharma: GSK sales hit by bribery probe
GlaxoSmithKline’s Chinese drug sales plunged 61 percent in the latest quarter, said Ben Hirschler in Reuters.com. The fall, “described by Deutsche Bank analysts as ‘dire,’” was largely thanks to a Chinese government probe into allegations that “GSK had bribed doctors to boost drug sales.” Beijing police said the British drugmaker paid up to $490 million to travel agencies “to facilitate bribes to doctors and officials.” But chief executive Andrew Witty said GSK has no plans to pull out of China, calling it “critically important” to the company’s future.
Airlines: Cities defend carrier merger
At least seven cities have “a lot to lose” if a federal lawsuit thwarts the pending merger of American Airlines and US Airways, said Terry Maxon in The Dallas Morning News. In a letter this week, the mayors of Dallas, Fort Worth, Miami, Philadelphia, Phoenix, Chicago, and Charlotte, N.C., urged the Department of Justice to drop its antitrust suit seeking to block the merger. The municipal leaders said blocking the merger would harm local businesses and “put our cities at an unnecessary competitive disadvantage” to other airlines’ hubs, such as Atlanta and Newark, N.J.
Economy: Spain out of recession
The Spanish economy is growing again, said Tobias Buck in the Financial Times. The Bank of Spain released preliminary data this week showing that the country’s gross domestic product grew 0.1 percent in the third quarter, ending “a recession that lasted more than two years, ravaged public finances, and left one in four workers without a job.” The central bank also projected increased consumption, indicating that “the gradual recovery is spreading to other segments of the economy.”
Regulators: SEC to okay crowdfunded IPOs
Crowdfunding won’t just be for startups anymore, said Matt Krantz in USA Today. The Securities and Exchange Commission voted this week to propose rules that would let public investors buy stock in new companies through a crowdfunding website. The rules “could reinvent the way that companies raise money by allowing them to bypass the traditional costs of going public, which usually involved hiring costly investment bankers and accountants.” But the SEC would impose limits on crowdfunded IPOs, capping the amount a company could raise or investors could invest.
