Consumer spending up a scant 0.2 percent
WASHINGTON – U.S. consumers increased their spending in December at a slower pace, while their income grew by the largest amount in eight years. Income surged because companies rushed to pay dividends before income taxes increased on high-earners.
The Commerce Department said Thursday that consumer spending rose 0.2 percent last month. That’s slightly slower than the 0.4 percent increase in November.
Income jumped 2.6 percent in December from November, the biggest gain since December 2004. The main driver of the increase was dividend payments, which companies accelerated to beat the January rise in income tax rates.
Wages and salaries grew 0.6 percent.
Consumer spending, which accounts for about 70 percent of economic activity, is expected to slow this year. That’s because consumers are receiving less take-home pay starting this month because of an increase in Social Security taxes.
Analysts predict the January report will show slower income growth because most bonuses and dividends were paid out in December.
Labor group to suspend Wal-Mart picketing
Labor groups say they will end their picketing at Wal-Mart stores for at least 60 days as part of a settlement with the National Labor Relations Board. But they vowed they will continue to press the world’s largest retailer to better overall working conditions, including wages.
The agreement, announced by the labor board Thursday, comes after the discounter filed a complaint on Nov. 20 with the board against the United Food and Commercial Workers International Union. It said that demonstrations at the stores organized by union-backed OUR Walmart that culminated on the day after Thanksgiving threatened to disrupt its business and intimidate customers and other store workers.
OUR Walmart is made up of former and current Wal-Mart workers.
Meanwhile, OUR Walmart filed its own charge with the labor board. It cited attempts by Wal-Mart to deter workers from participating in what the group called legally protected walkouts.
Iowa brokerage head sentenced to 50 years
CEDAR RAPIDS, Iowa – A judge has sentenced Peregrine Financial Group Inc. founder Russ Wasendorf Sr. to 50 years in prison for stealing $215 million from investors and concealing his theft for 20 years.
U.S. District Judge Linda Reade said at Thursday’s sentencing hearing in Cedar Falls that Wasendorf knowingly caused “staggering losses” to investors, employees and creditors that grew larger over 20 years.
Prosecutors said Wassendorf victimized more than 13,000 customers.
Apple blocks Java for security reasons
NEW YORK – Some Mac users were taken by surprise Thursday as their computers stopped running programs written using the Java programming language after Apple blocked Java due to security problems.
Java allows programmers to write a wide variety of Internet applications and other software programs and run them on most computers, including Apple Inc.’s Mac. However, earlier this month the U.S. Department of Homeland Security recommended disabling Java in Web browsers to avoid potential hacking attacks. Oracle Corp., which owns Java, has issued updates that fix known vulnerabilities, but the DHS expects that there are more flaws in Java’s coding.