CNN Financial News Producer
The struggling U.S. economy showed just the slightest improvement in the first three months of this year as sharp cutbacks by businesses and the biggest drop in U.S. exports in 40 years overshadowed a rebound in consumer spending.
Gross Domestic Product - the broadest measure of the nation's economic activity - shrank at a far worse-than-expected 6.1% pace in the first quarter, or almost as much as it did in the fourth quarter of 2008.
But while the overall GDP figure was disappointing, there were some signs of improvement in the report's other readings.
Purchases by individuals, for example, rose at an annual rate of 2.2%, the first time personal spending rose since the second quarter of 2008. A smaller trade gap also limited the rate of economic decline.
Fed says economic outlook has improved “modestly”
Also on today’s radar screen, the Federal Reserve says that since policymakers last met in mid-March, the economy has continued to contract, though “the pace of contraction appears to be somewhat slower.”
Ben Bernanke & Company say household spending has shown signs of stabilizing, but remains constrained by ongoing job losses, lower housing wealth and tight credit. And although the economic outlook has “improved modestly” since March, economic activity is “likely to remain weak for a time.”
Policymakers also voted to maintain the target range for the federal funds rate at zero to 1/4 percent, as expected, and said they anticipate that economic conditions are likely to warrant exceptionally low rate levels for “an extended period.”
Survey: optimism about economy grows
Americans are becoming slightly more optimistic about the nation's economy, a CNN/Opinion Research Corp. survey shows, but the glow surrounding President Obama is wearing off for some as the president marks his first 100 days in office.
Some 37% of the people questioned in the poll say the current economic conditions in the country are very poor - a figure that's down from 48% last month and 66% in December. Another 17% now say economic conditions are good, up six points from last month.
Meanwhile, 55% say the economy is the most important issue facing the country today, down eight points from March.
Unemployment rate hits 10% or higher in 100-plus cities
Despite the renewed sense of optimism, unemployment rates in 109 metropolitan areas reached 10% or higher in March - almost eight times more than a year earlier.
The Labor Department reports that the unemployment rates in all of the nation's 372 metropolitan areas rose in March compared with the same month in the prior year, and jobless rates of at least 15% were reported in 18 areas.
Citigroup reportedly looking to pay bonuses
Citigroup is reportedly seeking permission from the Treasury Department to award special bonuses to several of its key employees.
According to the Wall Street Journal, The bank - which is soon to be one-third owned by the U.S. government - wants to use the bonuses to retain staff and raise morale among employees.
The bonuses would be used to retain employees in Citigroup's energy-trading unit. Employees in the unit - which generates hundreds of millions in profits - are said to be threatening to leave because of pay caps imposed by the government’s bailout of Citigroup.
Stocks rally on Fed’s outlook
Wall Street welcomed the Fed’s outlook for the economy and held tightly to the few nuggets of positive news in the GDP report.
The Dow Industrials soared more than 200 points shortly after the central bank released its statement holding interest rates steady at around 2:15 p.m. The Dow closed up 2.11 percent, up 168.78 points.
Program Note: Tune in tonight to hear more from Carlos del Rio on AC360° at 11 p.m. ET.
[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/HEALTH/04/29/swine.flu.cases/art.bangkok.afp.gi.jpg caption="Quarantine officers monitor arrivals with a thermographic device at Bangkok's main international airport."]
Carlos del Rio
Special to CNN
The swine flu outbreak that started less than a month ago has caused more than 150 deaths in Mexico and more than 60 confirmed cases across the United States, Canada and the United Kingdom, with suspected cases in France, Spain, Israel and New Zealand.
It is clear that a new virus has emerged that is different enough that the population's previous exposure to influenza viruses and vaccines do not provide immunity.
So far, public health authorities are meeting this challenge with strength and preparedness. The Mexican and American federal governments deserve credit for their thorough responses.
The major control strategy that has been implemented in Mexico is social-distancing, a range of nonquarantine measures that attempt to reduce contact between persons, such as closing schools, canceling cultural and sports events, and closing museums and parks. In addition, countries are strengthening surveillance, releasing antiviral stockpiles and issuing travel advisories.
Katrina vanden Heuvel
As we mark the first 100 days of his presidency, it is staggering to consider the enormous challenges President Obama inherited from his predecessor, arguably the worst President ever. Can the devastation wrought by an eight-year nightmare be sorted out in 100 Days? Of course it can't. That's why Obama himself talked about needing to measure his accomplishments not by the first 100 days, but by the first 1,000.
Yet as we near this iconic marker - whether one is disappointed by some key appointments (read on), the size of the recovery bill, escalation in Afghanistan, the bank bailout plan or other issues - this President must be given credit for hitting the ground running and confronting challenges head on. Brutal and fundamental fights still lie ahead - on energy, healthcare, the budget, to name a few.
Obama understood the power - both symbolic and real - of swift, smart action, even within the first 100 hours of his inauguration. He pledged to close Guantanamo and the CIA black sites. He quickly passed a strong recovery bill - even if it was smaller than it should have been; that bill and his proposed budget begin to lay out a new blueprint for economic recovery and reconstruction, and a break with ill-conceived dogma about deficit reduction that has defined and limited economic policy for thirty years. He repealed the global gag order, took steps to restore science to its proper place with regard to stem cell research and addressing climate change, and has embarked on a substantive transformation to a clean energy economy.
Let Freedom Ring, President
The swine influenza outbreak provides a fresh rationale for why we must recommit ourselves as a nation to genuine border security, especially along our southern border.
The World Health Organization is now warning that the current swine flu outbreak has “pandemic potential,” and that the illness constitutes a “public health emergency of international concern.” The disease is suspected in the deaths of 149 people in Mexico and dozens of serious illnesses across the United States and around the globe.
With the World Health Organization raising its pandemic alert level, the U.S. Centers for Disease Control and Prevention also recently announced that it is recommending no nonessential travel to Mexico. Despite these warnings, the wide-open U.S.-Mexico border continues to pose a great public health risk to Americans.
[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/WORLD/americas/03/24/us.mexico.relations/art.mexico.juarez.afp.gi.jpg caption="A federal police officer guards a checkpoint earlier this month in Ciudad Juarez, Mexico."]
The Atlanta Journal Constitution
The deadly contagion is spreading, striking down young and old, well-heeled and downtrodden, sophisticates and illiterates. Last year alone, the affliction killed thousands in Mexico and even more in the United States.
Not swine flu. Gun violence. While federal and state authorities are preoccupied with preventing a swine flu pandemic from overwhelming the United States, the epidemic of gun violence rages on, unabated and little noted.
Last Saturday, George Zinkhan III, a well-respected University of Georgia professor, took two handguns to a community theater and killed his wife, Marie Bruce, and two of her theater colleagues while wounding two others, police said. Zinkhan left his 10-year-old daughter and 8-year-old son in his car while he went on his bloody rampage, according to authorities. Then, he dropped the children off at a neighbor’s house — he explained he had an emergency — and fled, police said.
Andrew Martin and Clifford Krauss
The New York Times
The swine flu is producing global hesitation over eating pork.
As more cases of the new influenza emerged on Tuesday, deepening worries about a possible pandemic, several nations slammed their borders shut to pork from the United States and Mexico. Wall Street analysts predicted a sharp decline of pork sales in grocery stores, and some consumers began steering clear of pork chops.
The pork industry reacted with frustration. Medical authorities say that people cannot contract the swine flu from eating properly cooked pork. There is no evidence so far that the people who are becoming sick were in contact with pigs. In fact, authorities are not even sure how susceptible pigs are to infection with the new flu.
Senator Tom Harkin, Democrat of Iowa, convened a hearing on Tuesday on a subject he described as “the so-called swine flu,” even as a campaign was mounted by farm groups to rename the virus “North American influenza.”
[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/images/03/25/art.maryanne.border.jpg caption="Near the U.S.-Mexican border."]
Millions of dollars in stimulus funds will pay to upgrade little-used border crossings, including one that handled just two cars a day last year, while many of the nation's busiest entry points will get nothing, a USA TODAY analysis shows.
Trade advocates are assailing the plan, saying money should go to busy border crossings to ease congestion and boost commerce.
"If we can move traffic much quicker, we're stimulating the economy," said Douglas Doan of the Border Trade Alliance advocacy group. "If you put your funding at ports of entry that have almost no trade, then you're getting no return."
The administration has selected 44 of the 139 federal border crossings to share $720 million in the stimulus package for general upgrades in facilities where vehicles and people from Canada and Mexico are checked. Border crossings handled a total of 325,000 vehicles a day last year and $700 billion in trade.
The Homeland Security Department is developing plans to allot $420 million to 37 "small" border crossings, said Trent Frazier, deputy director of the port modernization office.
Special to CNN
The departure of Arlen Specter from the Republican Party puts an exclamation point on a rough first hundred days for the national GOP in the Obama era.
While many conservatives will say good riddance to the Pennsylvania senator, other leaders understand that without the Arlen Specters of the world staying in the Republican fold, the chances of regaining a majority coalition are severely diminished.
Specter would have lost in a Republican primary to Pat Toomey, a firebrand conservative who used to run the anti-tax group Club for Growth. That is why he decided to become a Democrat.
Sophia A. Nelson
Arlen Specter likes it when he’s described as the best lawyer in the Senate; there are a lot of lawyers in its chambers. Specter, 79, particularly enjoys his reputation as someone who will go wherever the facts lead. This is the man, after all, who served as chief counsel of the Warren Commission, which investigated the assassination of President Kennedy, and it was Arlen Specter, more than anyone else, who devised the controversial theory that a single bullet killed the 35th president.
And it was Specter, who, following the facts, suggested that the commission depose President Johnson in the assassination probe on the reasonable theory that, as Kennedy’s vice president, Johnson had as much to gain by the president’s murder as anyone, and therefore, should have been treated as a suspect. That deposition never happened, but Specter was proud that he tried because that is what the facts demanded.