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It's Only Money

By Maxine Shapiro, KERA 90.1 business commentator

Dallas, TX – It's Friday so "It's Only Money," a review of the big and not-so-big stories of the week. I'm Maxine Shapiro with KERA Marketplace Middays.

The economic news did not paint a pretty picture this week, as reflected by the stock market reaction. Housing starts were down for the third month in a row. Housing permits, a yardstick of future activity, also declined. I don't want to hear dramatic talk of the housing bubble bursting. Every month for the last nine, the naysayers have wanted to put a pin this bubble. Air can be released out of a bubble without bursting. As long as interest rates remain low, owning a home is a viable goal for a lot of Americans. Talk to me about the bursted bubble when interest rates get above 8%.

Hiring seems to be moving at an unhurried pace. Though there was a decline in new claims for unemployment insurance, economists expected a greater decline. The unemployed now number well over the closely watched threshold of 400-thousand, which is solidifying the theory that corporations are keeping their money in their pocket.

Just ask Plano-based EDS how slow corporate spending is. They had to warn Wall Street and the rest of the world that their earlier earnings forecast for its third-quarter might not be the 74 cents a share they predicted. 12 to 15 cents a share is the new projection. EDS' stock fell 53% yesterday to an eleven-year low.

Hey, Fort Worth-based Pier One Imports reported its second-quarter profits soared 60%. Speaking of imports, exports were up this month, putting a little dent in our trade deficit.

And if you're not doing anything next Wednesday or Thursday, head on down to Houston for the Enron auction. Besides millions of dollars worth of office and computer equipment, the tilted "E" is yours for the right price. This is not the big one that stands outside their building. It's a metallic-neon version that draped the adjacent building. Enron hopes to make some of the $50 billion it owes to their creditors. For KERA Marketplace Middays, I'm Maxine Shapiro.

Marketplace Midday Reports air on KERA 90.1 Monday - Friday at 1:04 p.m. To contact Maxine Shapiro, please send emails to mshapiro@kera.org.