Economy Update

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Friday, December 31, 2010 - 11:29am

Employment and housing numbers improved in the last economic indicators of the year.

With the economy still struggling, some good news to end 2010. The number of people applying for unemployment benefits fell sharply last week.

The Labor Department says jobless claims dropped by 34,000 to 388,000 the lowest number since July 2008.

Edward Lazear, Former Chairman of the President's Council of Economic Advisers says "it's certainly encouraging news. We'd rather have it go this way than the other."

But some are skeptical this is any kind of trend.

Pedro da Costa, a Reuters economics reporter, says "you have to take these particular numbers with a grain of salt. One you have season factors associated with the end, with the Christmas season and retail hiring and two, you had a pretty massive snow storm that might have prevented people from filing jobless claims."

Two other positive economic reports for the end of 2010: factory activity in the Midwest grew in December at its fastest pace since 1988. And the number of people buying homes rose in November, the fourth increase since June.

Lawrence Yun, Chief Economist at the National Association of Realtors, says "the sales activities are now pointing about 20 percent higher from the low point that we saw few months ago. So it's encouraging but nonetheless we still need to see additional increase to reach the level which I would say would be considered healthy."

Realtors say existing homes sales will rise in 2011 only if more unemployed americans get back on the job.

But unemployment rose to 9.8 percent in November so now most people will be looking to December's rate. The labor department releases that January 7th.
 

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