Personal income up 6% in 1990
Americans earned 6.0 percent more in 1990 than they did in 1989 -- and spent every bit of it, the government said today.
The Commerce Department said personal incomes slowed from a 7.7 percent gain in 1989 while consumer spending slipped from a 6.6 percent advance in 1989 to a 6.0 percent increase last year.
Incomes in December rose 0.7 percent to a seasonally adjusted annual rate of $4.75 trillion, the largest increase since a similar 0.7 percent gain last March.
A Commerce spokesman said the increase came from longer hours worked and higher rates of pay. Unemployment actually rose in December. The December advance followed a revised 0.4 percent increase in November, which originally had been reported to be 0.3 percent.
Consumer spending also rose 0.7 percent to a seasonally adjusted annual rate of $3.75 trillion, up from a revised 0.1 percent advance in November. It was the biggest increase since a 0.8 percent gain last September. The increase was due largely to utilities and new car sales.
Procter & Gamble profits soar
The Procter & Gamble Co., the world's largest maker of soaps, detergents and other household and personal care products, today reported a 40 percent leap in profits to $490 million for the latest quarter.
P&G said earnings for the quarter ended Dec. 31, its first fiscal quarter, were boosted by a jump in sales to $6.86 billion, up from $6.03 billion a year earlier, when it earned $350 million.
Jan. jobless figures on tap
A chart of the nation's unemployment rate for the last six months does little to encourage the belief that the recession will be short or mild. In stair-step fashion, the jobless rate just keeps rising. Economists are divided over how high it can go, but most see it topping out by midyear, perhaps around 7 percent. The severity of the job market's slippage will become more evident Friday, when the Labor Department reports the unemployment rate for January.
* The Commerce Dept. tomorrow totes up durable goods for December, as well as the employment cost index for 1990's fourth quarter.
Additionally, Commerce Wednesday reports leading indicators for December. The deadline for a new contract between USX Corp. and the United Steelworkers of America is Thursday. Commerce Friday reports construction spending for December.
Money market funds swelling
Money market funds are swelling at a time when bad news about banks is escalating, but experts disagree whether the headlines are prompting depositors to close their savings accounts.
"We are seeing a substantial amount of money going into money market funds and I think it's fair to assume some of this is investors taking their money out of bank funds," said Martha Wittbrodt, editor of IBEC-Donoghue's Money Fund Report.
"I think people are concerned because of the headlines about the banking industry and in general are looking to the money market funds as maybe a little safer than having their money in the bank," said Paul Suckow, director of fixed income securities at mutual fund operator Oppenheimer Management Corp.
Money market funds are mutual funds that pool money from individuals and institutional investors to buy short-term securities such as bank certificates of deposit, Treasury bills and corporate debt called commercial paper. They provide a steady share price of $1 and usually offer check-writing privileges.
For the week ended Jan. 9, money market funds reported a $16.7 billion increase, the largest weekly inflow in the past five years recorded by the Investment Company Institute in Washington.
Gas prices drop nationwide
Motorists saw gasoline prices drop more than 3 cents over the past two weeks as crude oil prices fell after the start of the Persian Gulf war, according to a nationwide survey released yesterday.
The average price for all grades of gasoline at full- and self-service stations was 130.35 cents per gallon on Friday, down 3.08 cents from Jan. 11, according to the biweekly Lundberg Survey.
Japan's steel exports down
Japan's steel exports down: Japan produced 2.2 percent more steel in 1990 than the previous year, but exported 15.7 percent less, the Ministry of International Trade and Industry said today.
Production totaled 110 million tons in 1990, the ministry said. Press reports said exports of 17 million tons were the lowest since 16 million tons in 1969.
A ministry official, speaking on condition of anonymity, said previous years' figures were not immediately available. But the official attributed the export decline to reduced demand by China and the Soviet Union.
Partial payments on way
Depositors at nine closed Rhode Island banks and credit unions will get partial payments from their accounts this week, a month after the institutions were shut down because their private deposit insurer failed.
Rhode Island Gov. Bruce G. Sundlun announced the plan last night after about 300 angry depositors marched on the Statehouse demanding all their money immediately.