Consumer spending flat
WASHINGTON – U.S. consumers spent no more in May than in April after seeing almost no gain in their pay. The lack of growth in consumer spending and wages suggests that a faltering job market is slowing the economy.
The Commerce Department said Friday that consumer spending was unchanged in May. Income growth edged up 0.2 percent, but that was mostly because of gains from investments. Wages, the largest component of income, were essentially flat.
Americans cut back spending on cars and other long-lasting manufactured goods, even though they paid less for gas. Consumers did increase how much they spent on services for the second straight month, one of the few positive signs.
Some economists are hopeful that lower gas prices could lead consumers to spend more this summer.
AOL’s new COO gets big job
NEW YORK – AOL is promoting its head financial officer to chief operating officer. The company has tasked him with organizing the online media conglomerate into three divisions.
AOL Inc. announced the promotion of Artie Minson Jr. on Friday morning. Minson will be in charge of executing the company’s plan to break itself into three groups.
The new Content Brands Group will include Huffington Post Media, which oversees Moviefone, TechCrunch, Patch and the Huffington Post website. AOL bought the Huffington Post last year. The AOL Membership Group will include AOL Mail and other consumer products. And the Advertising.com Group will hold AOL’s business services, ADTECH, Pictela and other products related to advertising.
AOL’s stock rose 2.4 percent, or 67 cents, to $28.17 Friday afternoon. That’s 19 cents shy of its high over the past year. The stock has risen 86 percent so far in 2012.
Madoff brother pleads guilty
NEW YORK – The younger brother and business partner of disgraced financier Bernard Madoff pleaded guilty Friday to charges he doctored documents, but insisted he knew nothing about his brother’s historic Ponzi scheme and was “in total shock” when he found out about it.
An emotional Peter Madoff, 66, entered the plea to charges of conspiracy and falsifying records in a deal that permits him to remain free on $5 million bail pending his Oct. 4 sentencing. He agreed not to contest a 10-year prison sentence.
“My family was torn apart as a result of my brother’s atrocious conduct,” he said. “I was reviled by strangers as well as friends who assumed that I knew about the Ponzi scheme.”
Peter Madoff told the judge he was “deeply ashamed and terribly sorry” but that he didn’t know about the scam until his brother revealed it in 2008.
Sony-led group buys Brit label
LOS ANGELES – A group led by Sony Corp. said Friday it has purchased Britain’s EMI Music Publishing for $2.2 billion from Citigroup, creating the world’s largest music copyrights company with a catalog that includes hits from Motown, The Beatles, Jay-Z and Norah Jones.
Now all that remains of the storied British label group is its recorded music division, which Vivendi’s Universal Music Group has offered to buy for $1.9 billion. That deal is being looked at by European and U.S. regulators. If they approve sometime later this year, the world’s major music companies will be reduced from four to three.
By acquiring EMI, Sony/ATV, a 50-50 joint venture between Sony and the Michael Jackson estate, will control just over 2 million copyrighted songs. The new entity is estimated to capture nearly a third of publishing revenue in the world.