U.S. trade gap narrows on Japan quake impact
The gap between U.S. exports and imports narrowed slightly in April, as Japan's earthquake weighed on the global auto supply chain, according to a government report.
The U.S. imported $43.7 billion more than it exported in April, down from a revised $46.8 billion trade deficit in March, the Commerce Department said Thursday.
Much of that narrowing could be due to temporary disruptions from Japan's March 11 earthquake and tsunami, which slowed the production of auto parts there, economists say.
"This isn't necessarily an exports story," said Jay Bryson, global economist with Wells Fargo. "This is a one-time import story."
Imports of automotive vehicles, parts and engines plunged by $2.8 billion, or nearly 12.9% in April, bringing the overall import component of the report down.
Overall, imports fell about 0.4% in April, to $219.2 billion. Meanwhile, exports rose 1.3% to $175.6 billion.
Because a narrower trade gap strengthens U.S. economic growth, economists usually see it as a welcome sign for the recovery. But in this case, the effect of slower auto production in Japan is likely to be merely temporary.
"It should help the growth numbers a bit," said Robert Kavcic, economist with BMO Capital Markets. "But it is temporary. The drop in imports could be reversed into June and July."
Meanwhile, economists were also looking closely for signs that surging oil prices could have driven imports substantially higher, as was the case in the March trade balance figures.
But in contrast to what happened in March, the report showed the value of U.S. oil imports actually fell in April. Facing oil prices that were roughly $10 a barrel higher, the U.S. cut back its imports by 42 million barrels during the month -- driving the overall imports figure lower.
"Could it be due to sticker shock felt by American consumers? Maybe," Bryson said. But as oil prices level out, he expects oil imports to rebound later in the summer.
Overall, economists surveyed by Briefing.com had expected the deficit to have reached $48.7 billion in April.
CNN
US Stocks Close Higher
U.S. stock market indexes rose in Thursday's trading. The Dow Jones Industrial Average advanced six-tenths of a percent to end at 12,124. The S&P 500 rose seven-tenths of a percent to close at 1,289 and the NASDAQ composite index gained a third of a percent to finish at 2,685.
European stock markets were higher at the close of trading. London's Financial Times 100 index gained eight-tenths of a percent to end at 5,856. The CAC-40 in Paris moved up 1.1 percent to finish at 3,879, and the DAX index in Frankfurt jumped 1.4 percent to 7,160.
Earlier in Asia, Tokyo's Nikkei index gained two-tenths of a percent to close at 9,467. Hong Kong's Hang Seng index lost two-tenths of a percent to finish the day's trading at 22,610.
The price of gold rose more than $6 to trade at $1,544.20 an ounce.
The dollar was higher against the yen and the euro.
America's lost trillions
One reason that the U.S. economy still struggles to achieve sustained growth is that Americans are a long way from recovering the trillions of dollars of household wealth lost during the Great Recession.
U.S. household wealth fell by about $16.4 trillion of net worth from its peak in spring 2007, about six months before the start of the recession, to when things hit bottom in the first quarter of 2009, according to figures from the Federal Reserve.
While a rebound in the stock market, an improved savings rate and consumer steps to reduce debt resulted in net worth gains since 2009, only a little more than half of that lost wealth - $8.7 trillion -- is back on household balance sheets.
That leaves American household wealth $7.7 trillion less than it was before the recession.
"The huge loss of consumption is due to loss of $8 trillion in bubble wealth," said Dean Baker, co-director of Center for Economic and Policy Research.
The gap that remains in household wealth is in stark contrast to the nation's gross national product, the broadest measure of economic activity, which has recovered all of the lost output of the recession. And the wealth gap helps to explain why consumers are still so reluctant to spend a full two years after the official end of the recession.
Much of the lost household wealth came from declines in the value of real estate, which dropped $6 trillion, or nearly 30% of its value, from the end of 2006 to the end of last year. And after posting modest gains in 2009 and the first half of 2010, the value of homes started to fall again in mid-2010.
The most recent figures from the Fed, released Thursday, showed real estate lost another $339 billion in value in the first quarter. That was partly offset by a $68 billion decline in the total owed on mortgages, the main driver of a $74 billion reduction in overall liabilities.
The stock market, which has come off its peaks recently, helped households by adding $885 billion in the value of stocks and mutual funds during the quarter. Overall net worth increased by $943 billion in the quarter.
Experts say the loss of wealth has been a transformative event for most Americans, changing their attitudes on spending, saving and the value of owning a home rather than renting.
CNN
Singapore enters Sin City
Who would have thought that in a little over a year, Singapore would be set to overtake Sin City in the gambling stakes?
According to Frank Fahrenkopf, president of the American Gaming Association, in a report by The Straits Times, the two integrated resorts -- Resorts World Sentosa and Marina Bay Sands -- posted US$5.1 billion (S$6.3 billion) in gaming revenues in 2010, a figure forecast to rise to US$6.4 billion (S$7.89 billion) this year.
A report citing research by the Royal Bank of Scotland has suggested Las Vegas will take $US6.2 billion (S$7.63 billion) this year.
This figure puts the island-state ahead of Las Vegas, once regarded as the world's best gambling destination, but still a long way off from market leader Macau which is posting more than 40 percent growth and cashed in US$23.5 billion (S$28.9 billion) in 2010.
The association remains optimistic on Singapore, estimating it'll rake in 25 percent year-on-year growth in gross gaming revenues this year.
While Singapore may never overtake Macau in the gambling stakes, it could well give Macau a run for its money in due time.
In a report by Channel News Asia, Fahrenkopf highlighted that Macau faces several problems that could put a damper on its continued growth, principally a government cap on the number of new gambling tables at 5,500 until 2013; a quota that is already nearly filled and will restrict growth to around four percent a year.
International powers boost support for Libyan rebels
World powers beefed up financial and moral support for the Libyan opposition Thursday at an international coalition meeting aimed at charting the course of a post-Moammar Gadhafi Libya.
Talk at the meeting in the United Arab Emirates focused on sustaining pressure on the embattled Libyan leader. U.S. Secretary of State Hillary Clinton said "numerous and continuous discussions" on a transition of power were taking place among people close to Gadhafi.
A spokesman for a Libyan opposition group told CNN that Gadhafi's son, Saif al-Islam Gadhafi
, was the primary negotiator for an exit plan for his father, but suggested the timing of the talks might not be good.
"I'm not sure there's a lot of people willing to listen right now," said Mohammed Ali Abdallah of the National Front for the Salvation of Libya.
Abdallah said a southern front had opened up in the fighting and that Gadhafi's days were numbered.
"We are in the final phases," Abdallah said. "Gadhafi's military power has significantly been reduced. He is basically rattled."
Clinton announced an additional $26 million in U.S. aid for the victims of Libya's ongoing war and said time was on the international coalition's side so long as Gadhafi faced sustained pressure.
"The violence must stop," she said. "Gadhafi must go."
Britain's minister for the Middle East and North Africa, Alistair Burt, concurred: "Gadhafi's regime is crumbling," he said in a statement. "He has lost all legitimacy and must go immediately."
Promises of financial assistance flowed at the meeting, the third the international Libya group has held since war erupted.
Italy pledged up to $580 million to the Libyan opposition's Transitional National Council -- which is facing a budget shortfall -- to cover its expenses, but not weapons, Foreign Ministry Spokesman Maurizio Massari said.
And Kuwait is donating the $180 million it promised in April for humanitarian needs, said Sheikh Mohammed Sabah al Salman al Sabah, the Gulf nation's deputy prime minister and minister of foreign affairs.
France, Italy and Qatar are among a small number of countries that have recognized the Transitional National Council as the legitimate government of Libya.
While the United States has yet to officially recognize the rebel government, President Barack Obama "has invited them to open an office in Washington," a senior administration official told reporters traveling with Clinton to the meeting in Abu Dhabi.
The official spoke on condition of anonymity as a matter of practice for a press background briefing.
In Washington, Obama's choice to lead the Defense Department, Leon Panetta, warned Thursday that if Gadhafi survives as leader of Libya, it could undermine American credibility.
"I think it impacts on our national security interests in the world if that happens," Panetta said at his Senate Armed Services Committee confirmation hearing.
The Obama administration has resisted congressional efforts to end or rein in the Libya mission, which started in March.
The Abu Dhabi conference got underway as Gadhafi's forces launched a new attack against the rebel-held port city of Misrata, the scene of some of the bloodiest fighting in the months-long civil war that has killed thousands of civilians.
Source:CNN
Iran summons UK diplomat over remarks on Syria
Iran took Britain to task Thursday over what it says were "unfounded" remarks by the United Kingdom's top diplomat on Tehran's alleged role in helping stifle protests in strife-torn Syria.
The Foreign Ministry summoned Britain's charge d'affaires, Jane Marriott, over the remarks by Foreign Secretary William Hague, state-run Press TV said. Marriott said she convey Iran's protests to the British government.
Hague told the House of Commons on Tuesday that Iran "is combining brutal suppression of opposition leaders at home with the provision of equipment and technical advice to help the Syrian regime crush protests in Syria."
"This is unacceptable, and compounds our concern about Iran's behavior and its intentions over its nuclear program," he said.
Iran's Foreign Ministry said the British government "is not qualified to make such comments about other countries because of (its) interfering measures and destructive role in the region's developments."
It called the comments "completely unfounded and based on a series of lies."
Britain's Foreign Office confirmed the summoning and said the charge d'affaires in Tehran "was asked to explain recent UK statements on Iran, including on Iran's role supporting the Syrian regime in crushing protests."
It emphasized that it "stands by its statements" and has raised the issue in London with the Iranian charge d'affaires.
"We remain extremely concerned by the Iranian government's repression of its own people and its support for violent elements in the region. We have seen credible information suggesting Iran is helping Syria with the suppression of protests there, including through the provision of expertise and equipment."
It also raised another issue, the contention that Iran has provided weaponry to Taliban militants.
"We also note that Iran has provided no response to clear evidence of its provision of arms to the Taliban -- a matter we have referred to the U.N. for investigation," the Foreign Office said.
New Airstrikes Target Libyan Captial
A new round of suspected NATO airstrikes shook the Libyan capital and its suburbs early Friday, a day after allied and Arab nations pledged more than $1.1 billion to help Libya's opposition council and civilians affected by the country's conflict.
The 22-member Libya Contact Group announced the series of financial measures Thursday as they met in the United Arab Emirates to plan for a Libya without its embattled leader, Moammar Gadhafi.
Among the donors, Italy – Libya's former colonial ruler – said it will commit nearly $600 million in assistance to Libyan rebels, including loans and fuel products. France pledged more than $420 million in support. Kuwait, Qatar and Turkey also promised funds.
The United States did not offer direct aid to the rebels. But it announced an additional $26.5 million in humanitarian relief to all Libyans.
U.S. Secretary of State Hillary Clinton told the conference Mr. Gadhafi's “days are numbered.” She later described the rebel Transitional National Council as the “legitimate interlocutor” of the Libyan people .
Australia went a step further, joining a handful of countries – including France, Britain, Italy and Qatar – in formally recognizing the rebel council as the legitimate government of Libya.
Clinton said talks are under way with people close to Mr. Gadhafi that have raised the “potential” for a transition of power. Australian Foreign Minister Kevin Rudd also referred to what he called multiple “feelers” from the Tripoli government, saying the Libyan leader's end “may come sooner” than expected.
In Washington Thursday, CIA chief Leon Panetta said in Senate testimony that the NATO military operation and strong economic sanctions are putting tremendous pressure on Mr. Gadhafi's government. Panetta is U.S. President Barack Obama's nominee to replace Robert Gates as defense secretary.
Meanwhile, Senegalese President Abdoulaye Wade met with Libyan opposition leaders in the rebel stronghold, Benghazi. He told journalists Thursday the sooner Mr. Gadhafi leaves, the better.
Heavy NATO bombardments hit military and command targets across Tripoli Tuesday and Wednesday in some of the heaviest strikes since March. The assaults included air raids near Mr. Gadhafi's residential compound.
A Libyan government spokesman said NATO dropped more than 60 bombs on Tripoli Wednesday, killing 31 people and injuring dozens. Another Libyan official denied accusations that Mr. Gadhafi's regime has committed human rights violations.
Mustafa Shaban commented on Thursday, a day after the chief prosecutor of the International Criminal Court said investigators have evidence Mr. Gadhafi ordered mass rapes of women considered disloyal to his regime.
Luis Moreno-Ocampo said his team is looking into whether the Libyan leader provided soldiers with Viagra-like medicines in order to promote the rape of women. He said he may present new charges of mass rape against Mr. Gadhafi.
Obama Urges Gabon’s President to Root Out Corruption
U.S. President Barack Obama has urged Gabon's President Ali Ben Bongo to root out corruption and protect human rights in the West African country.
Mr. Obama met with Mr. Bongo at the White House Thursday, despite questions about alleged corruption in Mr. Bongo's family and government.
The White House said Mr. Obama welcomed reforms that Gabon has taken under Mr. Bongo to bring more transparency and accountability to government.
Earlier, the White House again defended Mr. Obama's decision to meet with the Gabonese president. White House spokesman Jay Carney said Gabon has been a helpful partner in dealing with Ivory Coast, Libya, and Iran, and supported the United States on issues dealing with human rights.
Carney said it would be naive to expect Mr. Obama to avoid leaders with questionable human rights records.
The White House said the two leaders discussed a wide range of multilateral and regional issues, including security, environmental protection and the economy.
Gabon holds the rotating presidency of the United Nations Security Council this month.
President Obama met with Nigerian President Goodluck Jonathan at the White House on Wednesday afternoon.
A statement said Mr. Obama congratulated Mr. Jonathan on the success of Nigeria's recent elections, which came off more peacefully than the country's previous polls.
He also called on Mr. Jonathan to make fighting corruption a national priority.
Nigeria has a history of graft among top officials. The country's former speaker of parliament was arrested on charges of misappropriating government funds earlier this week.
US Delegation Meets with Contractor Jailed in Cuba
A U.S. delegation has visited an American contractor jailed in Cuba for crimes against the communist state.
Political strategist Donna Brazile said Thursday the delegation spoke with Alan Gross for about two hours and found him “in good spirits.” Brazile said Gross, who is serving a 15-year sentence, “is not bitter” but eager to return home.
The group was in Cuba as part of a trip sponsored by the Center for Democracy in the Americas, which works to improve relations between the two longtime ideological foes, a process that has been hindered by Gross' incarceration.
Gross was arrested in Cuba in December 2009 for bringing communications equipment into Cuba. The contractor has said he was just trying to improve Internet access for the island's small Jewish community.
Former U.S. President Jimmy Carter met with Gross in March and called on authorities there to release him. Mr. Carter said he believed Gross was innocent of serious crimes, but also that Cuban officials had made it very clear to him that Gross's freedom would not be granted.
Gross's mother and daughter are both suffering from cancer, and there have been requests to release the contractor on humanitarian grounds.
The United States and Cuba do not have formal diplomatic relations, only interests sections that are technically part of the Swiss embassies in each other's capitals.
Rihanna Named in Racism Lawsuit
Rihanna was recently named in a racism lawsuit filed by tax lawyer and ex-Gucci employee, Josephine Robinson.
The attorney alleges that she was instructed to withhold 30 percent of the singer’s fee for her Gucci Tattoo Heard ad campaign.
“When [international tax counsel Stan] Sherwood discovered Rihanna was from a Caribbean island [Barbados], he told Robinson to ‘tax the hell out of her’ and find a way to allow Gucci to withhold 30 percent of her fee,” according to details of the lawsuit obtained by the New York Post.
Robinson is seeking $5 million in damages after being fired for what she claims was punishment for complaining about racist remarks in the workplace.
Her lawyer argues that she was subjected to “an unrelenting barrage of racist comments and jokes at her expense by Sherwood and others at Gucci.”
He added: “It is shocking that top level officials of a company as esteemed as Gucci would behave in such an inappropriate manner.”
A Gucci spokeswoman said: “Ms Robinson’s allegations are completely baseless, and the company will defend itself vigorously against this meritless litigation.
“The company is confident that it will prevail.”