Tag Archives: economy

Japan stocks fall after economy contracts, other markets up

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Shares fell in Tokyo s have sunk while other global markets and U.S. futures gained after Japan reported a record economic contraction amid the coronavirus pandemic

BEIJING —
Japanese stocks sank while other global markets and U.S. futures gained Monday after Japan reported a record economic contraction amid the coronavirus pandemic.

The Nikkei 225 in Tokyo fell 0.8% to 23,096.75 after data showed the world’s third-largest economy shrank 27.8% from a year earlier in the three months ending in June. That was bigger than the deepest decline during 2008-09 financial crisis.

“The road ahead looks choppy as a resurgence in Covid cases will weigh on domestic and overseas spending,” said Stefan Angrick of Oxford Economics in a report.

In early trading, the FTSE 100 in London gained 0.1% to 6,097.97. The DAX in Frankfurt was up 0.1% at 12,913.62 and France’s CAC 40 added less than 0.1% to 4,964.88.

On Wall Street, futures for the benchmark S&P 500 Index and for the Dow Jones Industrial Average were up 0.3%.

The S&P 500 ended last week little changed. The index declined less than 0.1% while the Dow gained 0.1%. The The Nasdaq composite dipped 0.2%.

In Asia, the Shanghai Composite Index rose 2.3% to 3,436.80 and Hong Kong’s Hang Seng gained 0.7% to 25,347.34. South Korean markets were closed for a holiday.

The S&P-ASX 200 in Sydney shed 0.8% to 6,076.40 while India’s Sensex advanced 0.3% to 37,994.08. New Zealand advanced while Singapore and Bangkok declined.

Bangkok’s main index lost 0.5% after Thailand reported its economy shrank 12.2% from a year earlier in the quarter ending in June. That was its worst performance since 1998 during the Asian financial crisis.

Investors in Asia were looking ahead to central bank meetings this week in China, Indonesia and the Philippines, with few other market-moving events in sight.

In the United States, economists say consumer spending could be under more pressure after government aid including additional $600 weekly unemployment benefits expired. Investors are counting on Washington for another economic lifeline, but legislators are far apart on a possible package.

In energy markets, benchmark U.S. crude gained 20 cents to $42.21 per barrel in electronic trading on the New York Mercantile Exchange. The contract slipped 23 cents on Friday to settle at $42.01. Brent crude, the standard for international oil prices, added 17 cents to $44.97 per barrel in London. It 16 cents the previous session to $44.80.

The dollar declined to 106.47 yen from Friday’s 106.59 yen. The euro gained to $1.1835 from $1.1843.

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Oil value dives as OPEC, Russia fail to agree on output reduce

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OPEC and key ally Russia have didn’t agree to chop oil manufacturing to comprise the drop within the value of crude

VIENNA —
OPEC and key ally Russia didn’t agree Friday on a reduce to grease manufacturing that might have contained the plunge within the value of crude brought on by the brand new coronavirus outbreak’s huge disruption to world enterprise.

The value of oil fell sharply in worldwide markets consequently, with the worldwide benchmark plunging 9.4%, down by a 3rd because the begin of the 12 months.

Whereas cheaper oil will translate into extra reasonably priced vitality for customers and companies, it hurts producing nations and corporations, 1000’s of employees have already been laid off within the U.S. oil patch.

The unraveling of the talks in Vienna additionally underscores the restricted energy of the cartel to affect world vitality markets, in contrast to its heyday within the 1970s. The US just lately turned the world’s greatest oil producer and retains on pumping at full capability.

The 14 OPEC nations had wished to chop output by 1.5 million barrels a day, or about 1.5% of world manufacturing. OPEC nations like Saudi Arabia and Iran say they want non-member allies like Russia to take 500,000 barrels of that reduce on themselves.

Russia, nevertheless, proved reluctant and OPEC Secretary Basic Mohammed Barkindo of Nigeria stated Friday that the assembly had been adjourned.

“On the finish of the day, there was the overall painful resolution of the joint convention to adjourn the assembly,” Barkindo stated. He stated casual talks would proceed as a result of the state of affairs was pressing.

“The numbers are clear: the demand destruction is actual,” he stated.

Barkindo stated “one or two” non-OPEC nations on the talks Friday had been reluctant to comply with the proposed cuts.

Russia and different non-OPEC nations have been working with the cartel lately and agreed on earlier cuts. Nonetheless, Russia can tolerate low oil costs higher than Saudi Arabia can and seems reluctant to slash output of its essential revenue-making export.

Whereas Saudi Arabia can produce oil cheaply, it wants $83.60 per barrel to stability its state funds, in response to the Worldwide Financial Fund, as it’s nearly solely depending on oil income. Russia wants solely $42.40 a barrel.

Analysts say OPEC might wrestle to maintain oil costs from falling additional, notably as the total impression of the virus outbreak on the worldwide economic system has but to be understood.

“There’s nonetheless an excessive amount of uncertainty concerning the quantity of demand destruction,” analysts at analysis agency Petromatrix stated in a observe to traders.

The unfold of the coronavirus has sharply lowered air journey and thus the demand for gasoline, whereas trade in China, the world’s second largest economic system, has been severely disrupted by means of shutdowns and journey restrictions. German airline Lufthansa stated Friday it and its subsidiaries will scale back their capability over the approaching weeks to as little as 50% of the extent earlier than the coronavirus disaster began.

Some economists assume the worldwide economic system might shrink within the first quarter for the primary time because the monetary disaster, sapping demand for vitality.

The worldwide benchmark for crude oil fell $4.72 to settle at $45.27 a barrel on Friday. It had been buying and selling over $50 in latest days, and is down from $69 as just lately as early January, earlier than the outbreak.

The U.S. benchmark WTI plunged $4.62, or 10.1%, to settle at $41.28 a barrel. With oil beneath $50 a barrel, U.S. producers, together with oil giants resembling Exxon, are scaling again drilling as their earnings get hit. The oil patch has already been shedding hundreds of jobs and struggling by means of a surge of bankruptcies, and decrease costs will exacerbate these issues.

Barkindo stated OPEC was decided to keep away from a repeat of the large market droop that started in 2014, when the cartel held off manufacturing cuts with a purpose to not lose market share to a resurgent U.S. oil trade. That led to a fall within the value of oil from over $100 a barrel to beneath $40 by 2015.

Even when OPEC and its allies agree on a manufacturing reduce within the coming days or even weeks, analysts say costs are unlikely to rise a lot. That is as a result of the worldwide economic system is slowing quickly. But in addition as a result of the the U.S., which isn’t a part of OPEC and in contrast to Russia doesn’t cooperate in its output choices, has ramped up lately, flooding the market and maintaining costs down.

———

McHugh reported from Frankfurt, Germany. AP Enterprise Author Cathy Bussewitz contributed from New York.

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Stocks mostly rise but Japan skids on stark economic data

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Global stocks mostly rose on Monday

BANGKOK —
Global stocks mostly rose Monday, with Shanghai’s benchmark jumping over 2% after the central bank rolled out support for the economy amid a virus outbreak that has infected over 71,000 people globally. Japan’s market slumped, however, on weak economic growth figures.

Britain’s FTSE 100 gained 0.3% to close at 7,433.25, while France’s CAC 40 gained 0.3% to 6085.95. Germany’s DAX added 0.3% as well to end the day at 13,783.89. Wall Street remained closed for Presidents’ Day. Futures for the S&P 500 and the Dow Jones Industrial Average edged 0.2% higher in electronic trading.

The Shanghai Composite index jumped 2.3% to 2,983.62 after the central bank and government announced a slew of measures to support the economy as the country battles an outbreak of a new virus that has killed 1,774 people.

The People’s Bank of China cut its one-year medium-term lending rate to 3.15% from 3.25%. It also injected some 300 billion yuan ($43 billion) into the markets through short-term purchases of securities and other injections of cash.

Such moves will likely be followed by more, said Julian Evans-Pritchard of Capital Economics, given that many of the companies worst affected by the virus outbreak are smaller ones that lack access to loans from major state-run banks.

The government has also announced plans for tax cuts and other measures to help companies struggling with shut-downs of cities and plunging consumer spending and travel.

“We think the People’s Bank of China will need to expand its re-lending quotas and relax constraints on shadow banking in order to direct more credit to struggling (small- and medium-sized companies),” Evans-Pritchard said in a commentary.

The Nikkei 225 index in Tokyo skidded 0.7%, to 23,523.24 after the government reported the economy contracted 6.3% in annual terms in the last quarter.

Analysts said the contraction in the Japanese economy, the world’s third-largest, reflected the impact of typhoons, trade tensions and crimped consumer spending after the sales tax rose to 10% from 8% as of Oct. 1. The seasonally adjusted economic data was announced as Prime Minister Shinzo Abe faces pressure over spreading cases of the new viral illness COVID-19 and markets around the region see a mounting toll from its impact on travel and tourism as authorities strive to contain it.

“Consumer spending, which slumped following the tax hike in the fourth quarter of 2019, will now struggle to do anything except contract further in the first quarter as the impact of Covid-19 weighs on consumer sentiment, weighing in particular on the consumer services sector,” analysts at ING bank wrote in a report to investors.

“Some further government spending may help to curb any further contraction in GDP beyond (the first quarter of 2020). But that will not stop what started off as a technical downturn from evolving into a full-blown recession,” they said.

Elsewhere in the region, Sydney’s S&P ASX/200 edged 1% lower to 7,125.10. South Korea’s Kospi fell 0.1% to 2,242.17, while the Hang Seng in Hong Kong climbed 0.5% to 27,959.60. India’s Sensex shed 0.4% to 41,082.82.

Benchmark U.S. crude oil picked up 7 cents to $52.12 per barrel in electronic trading on the New York Mercantile Exchange. It closed 1.2% higher on Friday, notching its first weekly gain in six weeks. Brent crude oil, the international standard, rose 2 cents to $57.34 a barrel.

The slide in oil prices has weighed on energy stocks. The sector is the biggest loser in the S&P 500, down 10.2% so far this year.

More than three quarters of S&P 500 companies have reported earnings and the results so far show solid growth. Companies are expected to report overall profit growth of just under 1% when all the reports are in, according to estimates from FactSet.

In currency markets, the dollar rose to 109.91 Japanese yen from 109.77 yen on Friday. The euro edged down to $1.0836 from $1.0839.

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Cost of China’s anti-virus fight rises with workers idle

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BEIJING —
Real estate agent Du Xuekun’s sales usually jump after the Lunar New Year holiday. But this year, Du has been at home for a month with no income after vast swathes of China’s economy were shut down in a sweeping effort to contain a virus outbreak.

Du, who lives in Jiaozhuo, near the central city of Zhengzhou, is one of millions of people who are bearing the soaring cost of the most extreme anti-disease measures ever imposed. Some businesses are reopening, but Beijing has told the public to stay home if possible.

“People will buy food and clothes online but for sure won’t buy an apartment without seeing it,” said Du.

Industries from auto sales to travel to retailing effectively shut down after curbs were imposed starting Jan. 23 with the suspension of most access to Wuhan, an industrial metropolis of 11 million people at the center of the outbreak.

Travel restrictions expanded to cities with more than 60 million people, while curbs on business spread nationwide. The Lunar New Year holiday was extended to keep factories and offices closed. Nationwide, thousands of restaurants and cinemas have been shut to prevent crowds from gathering.

The rising losses threaten to become a political liability for the ruling Communist Party. Local officials have been ordered to revive business activity but are moving cautiously.

By Sunday, some 1,665 deaths and 68,500 cases had been reported in the two months since the first infections in December.

Economists warn optimism that the disease might be under control is premature. Even if auto manufacturing and other business resumes as planned, activity won’t be back to normal until at least mid-March.

Losses are expected to be so large that forecasters have cut estimates for China’s economic growth.

Forecasters including Capital Economics say growth, already at multi-decade lows, might fall to 2% in the three months ending in March, down from the previous quarter’s official figure of 6%.

“If the economy really gets into a tailspin, the challenge for the party will be substantially increased,” said Steve Tsang, director of the China Institute at London’s School of Oriental and African Studies.

Locking down Wuhan might have hurt more than it helped by causing panic and was “very damaging to the economy,” said Tsang.

“They will have to rethink the lockdown approach,” he said.

The ruling party has responded to the mounting economic pressure by promising tax breaks and subsidies to companies hurt by the anti-disease measures.

The government needs to “maintain stable economic operation and social harmony,” President Xi Jinping said Wednesday.

On Friday, the Ministry of Finance announced that companies with monthly sales below 100,000 yuan ($14,000) will be exempt from value-added and other taxes. It said companies that cannot repay loans might be allowed to invoke “force majeure,” a last-resort legal measure that can waive obligations in disasters.

Travel and hospitality were hardest-hit after the government canceled group tours and told businesspeople to put off travel. Airlines canceled thousands of flights and hotels closed.

The manager of a travel agency in Shenyang, the biggest city in China’s northeast, said its monthly revenue, usually 100,000 yuan ($14,000), fell to zero. He said the agency still is paying rent and wages of 20,000 yuan ($2,800) a month.

“We don’t expect to see a recovery until May or June,” said the manager, who would give only his surname, Xu. “We do hope the government can give us a tax exemption or reduction, but we still have seen no subsidies.”

Property sales have fallen to almost zero over the past three weeks. The industry employs millions of people and drives demand for appliances, furniture and other consumer goods.

Du, the real estate salesman, said he usually closes two sales a month and earns 7,000-8,000 yuan ($1,000-$1,100). He needs to make a 3,000-yuan ($430) monthly loan payment whether he works or not.

“I have no base salary and live on commission,” said Du, 27. “Without sales, there will be no income.”

Chinese leaders already were struggling to shore up economic growth that slowed to 6.1% last year thanks to weak consumer demand and a tariff war with Washington. Some economists, citing industry surveys and other data, say real growth already was much weaker than that.

The anti-disease measures closed factories that supply the world with smartphones, furniture, shoes, toys and household appliances. That sent shockwaves through other developing countries that supply industrial components and iron ore, copper and other commodities.

South Korea and other economies that rely on China as an export market face potential job losses.

E-commerce companies are hiring extra workers to cope with a flood of demand as families stay home and buy groceries online. But streets in Beijing and other major cities are still empty and eerily quiet.

Auto sales plunged 20.2% in January from a year earlier, deepening a 2-year-old decline in the industry’s biggest global market. Sales fell 9.6% last year to 21.4 million, well below their 2017 peak of 24.7 million.

That is squeezing global automakers that look to China to drive revenue as they spend billions of dollars to develop electric vehicles to meet government sales targets.

“Enterprises are under huge pressure,” said a statement by an industry group, the China Association of Automobile Manufacturers.

China rebounded relatively quickly from its 2002-03 outbreak of SARS, or severe acute respiratory syndrome, but economic conditions now are less rosy.

SARS struck when China was entering a history-making boom powered by construction and exports. Growth peaked at a blistering 14.2% in 2007. By contrast, the latest virus hit in the midst of a slowdown.

In smartphones, Apple, Huawei and other brands face a potential hit because China is both their No. 1 market and global production base.

Shipments might fall as much as 50% this quarter compared with the final three months of 2019, according to research firm Canalys.

There is a “high risk” that component suppliers, with factory workers still stranded in their hometowns by travel bans, “will not be able to ramp up to normal capacity if the outbreak is prolonged,” Canalys said in a report.

Apple and other global vendors face a “serious impact” if the virus spreads and those suppliers close, the report said.

“The current situation will likely lead to some of the worst ever shipment numbers,” it said.

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Cost of China’s anti-virus fight rises with workers idle

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BEIJING —
Real estate agent Du Xuekun’s sales usually jump after the Lunar New Year holiday. But this year, Du has been at home for a month with no income after vast swathes of China’s economy were shut down in a sweeping effort to contain a virus outbreak.

Du, who lives in Jiaozhuo, near the central city of Zhengzhou, is one of millions of people who are bearing the soaring cost of the most extreme anti-disease measures ever imposed. Some businesses are reopening, but Beijing has told the public to stay home if possible.

“People will buy food and clothes online but for sure won’t buy an apartment without seeing it,” said Du.

Industries from auto sales to travel to retailing effectively shut down after curbs were imposed starting Jan. 23 with the suspension of most access to Wuhan, an industrial metropolis of 11 million people at the center of the outbreak.

Travel restrictions expanded to cities with more than 60 million people, while curbs on business spread nationwide. The Lunar New Year holiday was extended to keep factories and offices closed. Nationwide, thousands of restaurants and cinemas have been shut to prevent crowds from gathering.

The rising losses threaten to become a political liability for the ruling Communist Party. Local officials have been ordered to revive business activity but are moving cautiously.

By Sunday, some 1,665 deaths and 68,500 cases had been reported in the two months since the first infections in December.

Economists warn optimism that the disease might be under control is premature. Even if auto manufacturing and other business resumes as planned, activity won’t be back to normal until at least mid-March.

Losses are expected to be so large that forecasters have cut estimates for China’s economic growth.

Forecasters including Capital Economics say growth, already at multi-decade lows, might fall to 2% in the three months ending in March, down from the previous quarter’s official figure of 6%.

“If the economy really gets into a tailspin, the challenge for the party will be substantially increased,” said Steve Tsang, director of the China Institute at London’s School of Oriental and African Studies.

Locking down Wuhan might have hurt more than it helped by causing panic and was “very damaging to the economy,” said Tsang.

“They will have to rethink the lockdown approach,” he said.

The ruling party has responded to the mounting economic pressure by promising tax breaks and subsidies to companies hurt by the anti-disease measures.

The government needs to “maintain stable economic operation and social harmony,” President Xi Jinping said Wednesday.

On Friday, the Ministry of Finance announced that companies with monthly sales below 100,000 yuan ($14,000) will be exempt from value-added and other taxes. It said companies that cannot repay loans might be allowed to invoke “force majeure,” a last-resort legal measure that can waive obligations in disasters.

Travel and hospitality were hardest-hit after the government canceled group tours and told businesspeople to put off travel. Airlines canceled thousands of flights and hotels closed.

The manager of a travel agency in Shenyang, the biggest city in China’s northeast, said its monthly revenue, usually 100,000 yuan ($14,000), fell to zero. He said the agency still is paying rent and wages of 20,000 yuan ($2,800) a month.

“We don’t expect to see a recovery until May or June,” said the manager, who would give only his surname, Xu. “We do hope the government can give us a tax exemption or reduction, but we still have seen no subsidies.”

Property sales have fallen to almost zero over the past three weeks. The industry employs millions of people and drives demand for appliances, furniture and other consumer goods.

Du, the real estate salesman, said he usually closes two sales a month and earns 7,000-8,000 yuan ($1,000-$1,100). He needs to make a 3,000-yuan ($430) monthly loan payment whether he works or not.

“I have no base salary and live on commission,” said Du, 27. “Without sales, there will be no income.”

Chinese leaders already were struggling to shore up economic growth that slowed to 6.1% last year thanks to weak consumer demand and a tariff war with Washington. Some economists, citing industry surveys and other data, say real growth already was much weaker than that.

The anti-disease measures closed factories that supply the world with smartphones, furniture, shoes, toys and household appliances. That sent shockwaves through other developing countries that supply industrial components and iron ore, copper and other commodities.

South Korea and other economies that rely on China as an export market face potential job losses.

E-commerce companies are hiring extra workers to cope with a flood of demand as families stay home and buy groceries online. But streets in Beijing and other major cities are still empty and eerily quiet.

Auto sales plunged 20.2% in January from a year earlier, deepening a 2-year-old decline in the industry’s biggest global market. Sales fell 9.6% last year to 21.4 million, well below their 2017 peak of 24.7 million.

That is squeezing global automakers that look to China to drive revenue as they spend billions of dollars to develop electric vehicles to meet government sales targets.

“Enterprises are under huge pressure,” said a statement by an industry group, the China Association of Automobile Manufacturers.

China rebounded relatively quickly from its 2002-03 outbreak of SARS, or severe acute respiratory syndrome, but economic conditions now are less rosy.

SARS struck when China was entering a history-making boom powered by construction and exports. Growth peaked at a blistering 14.2% in 2007. By contrast, the latest virus hit in the midst of a slowdown.

In smartphones, Apple, Huawei and other brands face a potential hit because China is both their No. 1 market and global production base.

Shipments might fall as much as 50% this quarter compared with the final three months of 2019, according to research firm Canalys.

There is a “high risk” that component suppliers, with factory workers still stranded in their hometowns by travel bans, “will not be able to ramp up to normal capacity if the outbreak is prolonged,” Canalys said in a report.

Apple and other global vendors face a “serious impact” if the virus spreads and those suppliers close, the report said.

“The current situation will likely lead to some of the worst ever shipment numbers,” it said.

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401(k)s hit records as workers sock away more, stocks jump

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Fidelity Investments says the average 401(k) balance rose to a record $112,300 last year

NEW YORK —
How’s your 401(k) doing?

President Donald Trump likes to ask that question around the country, sometimes throwing out big gains like 90% or 95%. The average 401(k) did indeed hit a record last year, although its growth was considerably less than that.

The average 401(k) balance rose 17% last year to $112,300 from the end of 2018, according to a review of 17.3 million accounts by Fidelity Investments. The average individual retirement account, or IRA, balance rose the same percentage to $115,400.

Surging markets around the world were a big reason for the growth: The S&P 500 index had one of its best years in decades with a 31.5% return. Investments of all types logged gains, from junk bonds to stocks from developing economies.

But workers’ better savings habits also played a big role.

Fidelity said the average worker set aside 8.9% of their pay in their 401(k) in the fourth quarter, a record. Combined with employer matches, the average total savings rate was 13.5% in the quarter, tying its record last reached in the spring of 2019.

“Nobody can control the market, so the behaviors of people contributing to their 401(k)s are what get us the most excited,” said Katie Taylor, vice president of thought leadership at Fidelity. “We have people saving 13.5%, which is really close to the 15% that we recommend. That’s a great story.”

In many cases, workers may not even realize they’re saving more. Most employers give the option for workers to automatically increase their contributions each year, without having to do anything. Some employers even automatically sign up their employees for these auto-escalation programs, requiring them to opt out if they don’t want their contribution levels to steadily rise.

Such features are on top of programs where employers automatically enroll new hires in the 401(k) plan. They all lean on the power of inertia to help workers build up bigger nest eggs. It’s a sharp turnaround from earlier years when workers had to take an extra step to join the 401(k) plan and fill out paperwork whenever they wanted their contribution levels to change.

“There’s always a way, if you don’t want to do it, where you can unenroll, but these automatic programs have been a game changer,” Taylor said.

Consistent contributions — and giving them time to grow — are keys to building bigger portfolios. Among workers who have been in their 401(k) plan for 10 straight years, the average balance rose to a record $328,200, according to Fidelity.

Such figures, though, count only people who have a 401(k). Many lower-income workers, particularly at smaller employers, could not save in a 401(k) even if they wanted to because their companies don’t offer access to one. Legislation passed late last year aims to make it easier for smaller employers to band together and offer plans.

Nearly half of all U.S. households aged 55 and over, 48%, had no retirement savings at all as of 2016, according to estimates from the Government Accountability Office.

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So goes the neighborhood? Resort wrestles with rental rise

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LAKE PLACID, N.Y. —
Lake Placid is a picture-book village in the Adirondack Mountains offering tourists crisp air, pretty peaks, Winter Olympic sites and, lately, a lot more houses to rent for the weekend.

The rising popularity of short-term rentals on services like Airbnb is alarming residents who fear they’re gobbling up so much of the housing market that workers who want to live there are getting frozen out.

“What about the families? They’re not here anymore,” said longtime resident Zay Curtis, as he drove through the snowy village to point out rentals. “The neighborhoods are slipping away.”

Short-term rentals like those listed on Airbnb are surging all over, but they loom larger in smaller resort areas like this village of 2,400.

Since December 2017, the number of Airbnb and HomeAway listings in and around Lake Placid has grown from 555 entire places to 684, according to AirDNA, a short-term rental data provider. As conversions continue, officials are struggling with a contentious question that also echoes in many Atlantic beach towns and on the shores of Lake Tahoe: How do resorts balance neighborhood concerns against the economic benefit of tourists who stay in short-term rentals?

“It fuels the economy here. I’m telling you, if they were to stop vacation rentals, this would be a ghost town,” said Sharon Middendorf, a rental owner and part-time resident.

Seasonal rentals are nothing new in Lake Placid, famous for the 1980 U.S. Olympic hockey team’s medal-winning “Miracle on Ice.” Homeowners and landlords have long rented out spare rooms and the area around the village is dotted with condominium developments that cater to vacationers.

It’s the growth of home rentals in residential neighborhoods that’s raising alarms.

About a third of the housing units in the larger Town of North Elba are generally for vacation or temporary seasonal use, up from about a fifth in 2010, according to a new report commissioned by the village and the town. And half of the village and town’s homeowners live elsewhere.

The rapid rise of rentals has fueled the sort of complaints heard in Los Angeles or London: noisy parties, trash, overpacked homes. But some residents say they’re also taking homes off the market that local workers could buy or lease.

Melissa Furnia said she was priced out of Lake Placid despite a good job at the agency that oversees former Olympic facilities. She wanted to buy a home where she was raised, where her parents live, where she works and where she volunteers as an EMT.

But with median single-family homes valued at $300,000, she purchased a home for a third of the price a half hour away.

“It’s heartbreaking,” she said. “Lake Placid is where I want to be. It’s where I always wanted to be.”

W hile Lake Placid bustles with tourists, its population is dropping, as is school enrollment .

Huda Scheidelman, chairwoman of a group of area rental owners, said affordable housing is a nationwide issue and it is unfair to blame short-term rentals for the local crunch. Operators point out that many rental listings include large, lakeside homes that are out of reach for buyers of modest means.

Lake Placid Mayor Craig Randall said local leaders were expected to soon propose a permitting system for short-term rentals that could include a 90-day annual limit for homes not occupied by the owner.

“I think this will begin to calm it down a little bit,” he said. “It also provides reassurance to those second-home owners that we’re not totally pulling the carpet out from underneath them.”

If approved, Lake Placid would join a growing list of resort areas tackling the issue.

In South Carolina, the beach resort town Kiawah Island in November amended its short-term rental regulations to, among other things, cap the number of licenses in certain residential districts. The caps, effective in January, ensure that no more than 20% of developed lots in those districts can be used for short-term rentals.

“While being sensitive to the tourism market that we love and appreciate on the island, we also exist to protect the residential character of the island,” said Stephanie Braswell, the town’s communications director.

Voters in South Lake Tahoe, California, narrowly approved a ballot measure in 2018 severely restricting short-term rentals in residential areas by 2022. A group of businesses and property owners promptly sued. If the measure stands, it would reduce the number of vacation home rentals from a high of about 1,700 to 300, said former city manager Frank Rush.

Lake Placid also is likely to face legal challenges if it goes ahead with the 90-day limit, said Scheidelman, chairwoman of Gold Medal Hospitality group. She agrees there should be regulations to address concerns like noise and parking, but she said the rules need to be reasonable.

“I think something that is unreasonable is restricting the rental business to the point where guests actually are not feeling welcomed to Lake Placid,” she said.

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US productivity up 1.7% in 2019, best gain in 9 years

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US productivity rises 1.4% in Q4 and gains 1.7% for all 2019, best showing since 2010

WASHINGTON —
U.S. productivity rebounded in the final three months of last year, helping to boost productivity growth for the year to the best showing in nearly a decade.

The Commerce Department said Thursday that productivity grew at an annual rate of 1.4% in the October-December quarter, a significant improvement from a 0.2% drop in productivity in the third quarter.

For the year, productivity increased 1.7%, up from gains of 1.3% in both 2018 and 2018. While a 1.7% rise in productivity is considered modest, it was the best annual showing since a 3.4% advance in 2010.

Labor costs rose 1.4% in the fourth quarter, a slowdown from a 2.5% jump in the third quarter. For the year, labor costs rose 2%, up from a 1.8% gain in 2018.

Productivity, a key factor needed to boost living standards, has been lagging for most of this record-long expansion, now in its 11th year. But economists believe there are some signs at least that productivity may finally be starting to improve.

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