US Economy Gets Lift From Housing, Other Tailwinds
Construction companies will add 140,000 jobs this year, Newport forecasts, up from a scant 18,000 last year.
Struggling consumers put off car purchases for years. Now, pent-up demand is being released: Sales reached a 5-year high of 14.5 million last year. Analysts expect sales to reach 15.5 million this year, though still short of the recent peak of around 17 million in 2005.
Production and hiring at automakers and their suppliers are increasing as a result. The auto industry added 52,000 jobs last year, the third annual gain after a decade of declines.â¿¿ BANKING The financial crisis hammered banks and choked off loans to businesses and consumers. But lending has been rebounding. Mortgage and auto loans are rising. Commercial and industrial loans rose 2.2 percent in the July-September quarter from the same period a year earlier. Bank profits reached their highest level in six years that same quarter, according to the Federal Deposit Insurance Corp. Bank of America boosted the value of its mortgage loans 33 percent in the October-December quarter compared with a year earlier. â¿¿ STOCK MARKET The Standard and Poor's 500 stock index has more than doubled from its low in 2009 and is just 4 percent shy of its record high set in 2007. The S&P index has jumped 5.4 percent this month in response to healthy news on housing and corporate profits. The sidestepping of the fiscal cliff at the start of the year helped, too. Higher stock prices are boosting Americans' wealth, providing more fuel for spending and growth. Stocks are getting a lift from Main Street investors for a change. In a reverse from their behavior for most of the past five years, small investors are buying more stocks instead of selling them. Investors put nearly $13 billion into U.S. stock mutual funds in the first two weeks of 2013, according to the Investment Company Institute, a trade group for funds.
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