Rate of Economic Decline Declining; Obama Wants Jobs

"The nation's economic decline is moderating," says the Washington Post, "laying the groundwork for growth in the months ahead," based on the government's latest economic data. The rate of economic decline slowed to 1 percent, down from 6.4 percent earlier this year. Federal spending, including stimulus spending, and export reductions were credited for the change. However, 2008's GDP growth rate turned out to not be as strong as the government once thought. The figure was revised from 1.1 percent to 0.4 percent because "consumers, who account for about two-thirds of economic activity, are still in lockdown mode, reluctant to buy. The job market remains weak." The report, says the New York Times, is "crystallizing expectations of a turnaround in the second half of the year." Despite that, President Obama is sounding a note of restraint, saying, according to the Wall Street Journal, "As far as I'm concerned, we won't have a recovery as long as we keep losing jobs."

Despite weak job reports and spending, consumers have pillaged the government's Car Allowance Rebate System, aka "cash for clunkers." The rebates pay consumers up to $4,500 if they buy a new car with better fuel efficiency and surrender their old "clunker" to the dealer for destruction. Buyers burned through the $1 billion allotment in less than a week. Yesterday, the House voted to provide $2 billion more. Even the newly unemployed, like James Dunn, reports the Journal, are taking advantage. "The economy is picking up," Dunn said Friday. "It seems like it is anyway." However, the Senate has yet to affirm the House action, and the Times reports that "some senators said Friday that the speed at which the money flew out the door was a sign that the government's deal was too good, and perhaps should be modified."

Meanwhile Chevron (CVX), the second largest U.S.-based oil company, saw profits plunge 71 percent this quarter and has "put its entire land-based natural gas drilling operation on hold, citing dismal demand," reports the AP.

A rejection too far for the Apple (AAPL) iPhone has led the FCC to ask why the company rejected a Google (GOOG) Voice application, the Journal reports. Apple officially rejected the app for replicating too many features of their phone, like calling, SMS, and voicemail, which are provided for hefty monthly fees by AT&T (T). It's not the first time AT&T has been rumored, despite denials, to have sway over iPhone apps, which may be why "the letter also seeks information on how AT&T, the exclusive U.S. iPhone carrier, was consulted in the decision, if at all."

Three more directors leave the board of Bank of America (BAC), says the Post. "John Collins, who runs a Boston-based venture capital firm; William Barnet, who runs a real estate investment firm; and Gary Countryman, chairman emeritus of Liberty Mutual Group," have joined the more then 10 other recently departed directors. The moves echo those of Citigroup (C), which has also recently hired directors with far more financial experience than their predecessors had pre-crisis.

This weekend has brought five more bank closures by the Office of Thrift Supervision. But, the Post reports, there was almost a sixth. OTS "accidentally disclosed Friday night that it considered closing a small Pennsylvania bank—a rare breach of the rigorous silence that banking regulators maintain about the health of individual companies." The closures make 69 banks shuttered this year.