World/Nation Briefs November 24, 2011
Economy gets mixed news ahead of holidays
WASHINGTON - At the start of the critical holiday shopping season, the economy received a dose of mixed news Wednesday.
Consumers barely increased their spending in October, and businesses pulled back on investment in long-lasting manufactured goods. Still, Americans' pay rose by the most in seven months, a sign they may spend more in coming weeks.
Some economists were discouraged by the reports, especially after a separate report earlier this month showed Americans spent more on retail goods in October for the fifth straight month.
Paul Dales, a senior U.S. economist with Capital Economics, said the slower consumer spending growth and decline in business investment suggest economic growth in the October-December quarter could be weaker than first thought. He now expects just 2.5 percent growth, instead of 3 percent.
Consumer spending increased 0.1 percent last month, the Commerce Department said. It was the poorest gain in four months.
Yet people continued to spend more on cars and electronics, analysts noted. Spending on longer-lasting goods rose a solid 0.8 percent. Part of that reflected the introduction of the Apple iPhone 4S last month.
People cut back on non-durable purchases, such as clothing and food. And spending on services, which represent two-thirds of consumer spending, barely grew. That led many analysts to speculate that consumers might be giving up vacations and eating out less because of the weak economy.
Perhaps the best news in the report was that Americans earned more in October after five straight months of paltry pay increases. Income rose 0.4 percent last month, the best showing since March. Private wages and salaries drove the gain.
And when subtracting taxes and adjusting for inflation, income rose 0.3 percent in October.
Yemen president of 33 years quits amid uprising
RIYADH, Saudi Arabia - Yemen's authoritarian President Ali Abdullah Saleh agreed Wednesday to step down amid a fierce uprising to oust him after 33 years in power. The U.S. and its powerful Gulf allies pressed for the deal, concerned that a security collapse in the impoverished Arab nation was allowing an active al-Qaida franchise to gain a firmer foothold.
Saleh is the fourth Arab leader toppled in the wave of Arab Spring uprisings this year, after longtime dictators fell in Tunisia, Egypt and Libya. The deal gives Saleh immunity from prosecution - contradicting a key demand of Yemen's opposition protesters.
Seated beside Saudi King Abdullah in the Saudi capital Riyadh, Saleh signed the U.S.-backed deal hammered out by his country's powerful Gulf Arab neighbors to transfer power within 30 days to his vice president, Abed Rabbo Mansour Hadi. That will be followed by early presidential elections within 90 days.
Saleh has clung to power despite the daily mass protests calling for his ouster and a June assassination attempt that left him badly wounded and forced him to travel to Saudi Arabia for more than three months of hospital treatment.
Medvedev: Russia may target U.S. missile shield
MOSCOW - Russia's president threatened on Wednesday to deploy missiles to target the U.S. missile shield in Europe if Washington fails to assuage Moscow's concerns about its plans, a harsh warning that reflected deep cracks in U.S.-Russian ties despite President Barack Obama's efforts to "reset" relations with the Kremlin.
Dmitry Medvedev said he still hopes for a deal with the U.S. on missile defense, but he strongly accused Washington and its NATO allies of ignoring Russia's worries. He said that Russia will have to take military countermeasures if the U.S. continues to build the shield without legal guarantees that it will not be aimed against Russia.
The U.S. has repeatedly assured Russia that its proposed missile defense system wouldn't be directed against Russia's nuclear forces, and it did that again Wednesday.
But Medvedev said Moscow will not be satisfied by simple declarations and wants a binding agreement.
- The Associated Press