Productivity and Costs for 4th Quarter 2013

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Productivity and Costs Released On 3/6/2014 8:30:00 AM For Q4r:13 Prior Prior Revised Consensus Consensus Range Actual Nonfarm productivity - Q/Q change - SAAR 3.2 % 3.5 % 2.4 % 1.7 % to 2.9 % 1.8 % Unit labor costs - Q/Q change - SAAR -1.6 % -2.1 % -0.5 % -1.3 % to 0.0 % -0.1 % Highlights Productivity in the fourth quarter rose a revised1.8 percent after a 3.5 percent boost the prior quarter. Expectations were for 2.4 percent increase. Unit labor costs declined an annualized 0.1 percent, following a decrease of 2.1 percent in the third quarter. The market forecast was for a 0.5 percent decline. The rise in productivity reflected a 3.4 percent jump in non-farm output, following a boost of 5.4 percent in the third quarter. Hours worked increased 1.6 percent in the fourth after rising an annualized 1.9 in the third quarter. Compensation firmed to a 1.7 percent rate after rising 1.3 percent in the third quarter. Year-on-year, productivity was up 1.3 percent in the fourth quarter versus up 0.5 percent in the third quarter. Year-ago unit labor costs were down 0.9 percent, compared to up 1.9 percent in the third quarter. Market Consensus before announcement Nonfarm business productivity in the fourth quarter remained healthy, posting at an annualized gain of 3.2 percent after a 3.6 percent boost the prior quarter. Unit labor costs declined an annualized 1.6 percent, following a decrease of 2.0 percent in the third quarter. The rise in productivity reflected a 4.9 percent jump in non-farm output, following a jump of 5.4 percent in the third quarter. Hours worked grew 1.7 percent in both the fourth and third quarters. Compensation eased to a 1.5 percent pace after rising 1.6 percent in the third quarter. Definition Productivity measures the growth of labor efficiency in producing the economy's goods and services. Unit labor costs reflect the labor costs of producing each unit of output. Both are followed as indicators of future inflationary trends.  Why Investors Care   Nonfarm productivity growth has remained healthy during this expansion, but it has prevented employment from growing very fast and this hurt income growth to some extent. Unit labor costs tend to fall when productivity growth accelerates and then rises as productivity growth abates. Data Source: Haver Analytics       2014 Release Schedule Released On: 2/6 3/6 5/7 6/4 8/8 9/4 11/6 12/3 Release For: Q4:13 Q4r:13 Q1:14 Q1r:14 Q2:14 Q2r:14 Q3:14 Q3r:14   Share this page 2 Legal Notices | ©Copyright 1998-2014 Econoday, Inc.  powered by

http://www.moneynews.com/Companies/ukraine-russia-pepsico-gazprom/2014/03/03/id/555697

Crisis in Ukraine May Spark Global Economic Ripple Effects

Monday, 03 Mar 2014 11:41 AM

 

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Russia’s military intervention in Ukraine threatens to derail energy exploration in a region that holds a quarter of the world’s natural gas reserves, weigh on currencies from the Baltic to the Mediterranean, and force American, Western European and Russian companies to work to contain the damage. The conflict has prompted Chevron Corp. to heighten security for employees involved in searching Ukraine’s shale fields for gas. The eastern European nation’s ambitions to become an exporter of shale gas by 2020 could be dashed as the conflict escalates, while Russia faces the prospect of economic sanctions that may curb gas sales that account for 20 percent of its export revenue.
Editor’s Note: 5 Reasons Stocks Will Collapse . . .
“If you’re a major western company looking at the Russian market for investment, you might not want to put your eggs in that basket right now,” said John Lough, a Russia specialist at the Chatham House, a think tank in London. “It doesn’t look like we’re going to see positive news for some time” from the region.
U.S. President Barack Obama on March 1 suspended preparations for a June summit of the G-8 countries in Sochi, where the Olympics wrapped up a week ago. While the U.S. may also suspend talks to improve commercial ties with Russia, serious sanctions are unlikely as the Europeans would have much to lose if trade with Russia were interrupted, according to Ian Bremmer, president of The Eurasia Group, a political-risk consulting company in New York.
“An action-reaction cycle could spiral,” which might spur NATO to send ships into the Black Sea, Bremmer said in an email. “Shots won’t be fired, but markets will get fired up.”
Caviar Chips
Unlike in Soviet days, when Russia and its 140 million consumers were largely isolated from the world economy, domestic and foreign companies alike have much at stake.
Exxon Mobil Corp. and Royal Dutch Shell Plc pump oil and natural gas from Russia’s rich fields. Engineering giant Siemens AG reported sales of 2.2 billion euros ($3 billion) in Russia last fiscal year and plans to build 1,200 rail cars there by 2020. McDonald’s Corp. has more than 350 restaurants in Russia and about 80 in Ukraine. PepsiCo Inc. last year reported Russia revenue of $4.9 billion, from products such as soda, yogurt and potato chips in flavors such as crab and caviar.
“If you’re a citizen in the Crimea and you see tanks rolling around,” said Kenneth Shea, a Skillman, New Jersey-based analyst for Bloomberg Industries, “you’re probably not going to go out to the center of town and go to dinner.” PepsiCo and McDonald’s didn’t respond to requests for comment. Siemens, Exxon and Shell declined to comment.
Furnaces, Factories
Russian companies, meanwhile, supply much of Europe’s energy. OAO Gazprom says it provides about 30 percent of the natural gas that powers electricity generators, furnaces and factories across the region, and Europe buys about a third of the 4.2 million barrels of crude OAO Rosneft pumps daily. Any sanctions that curtail or cut off those exports would have financial consequences for the government of Vladimir Putin.
Gazprom declined to comment. Rosneft, which owns 150 gas stations in Ukraine, said they’re operating normally but declined to comment on volumes sent to Europe.
As trading began across Europe Monday, companies with exposure to Russia and Ukraine saw their shares decline. Gazprom fell by almost 17 percent and Rosneft was off 8.6 percent in Moscow.
Denmark’s Carlsberg A/S, the biggest brewer in Russia, was off 6.9 percent in Copenhagen. The company didn’t respond to requests for comment. Stada Arzneimittel AG, Germany’s biggest generic-drug maker, which makes about a fifth of its sales in Russia, fell more than 8 percent in Frankfurt. Stada said its business so far hasn’t been affected by the tensions.
Currency Hit
Ukraine’s hryvnia lost about 12 percent of its value against the euro in the two weeks ending Feb. 28 as the pro-Russian government in Kiev unraveled amid violent street protests. Russia as well as nearby countries such as Poland, the Czech Republic, Hungary, and Turkey could also see their currencies suffer, said Anders Aslund, a senior fellow at the Peterson Institute for International Economics in Washington and a former adviser to the Russian and Ukrainian governments.
The U.S. and its European allies haven’t taken concrete steps in response to the weekend’s events, when thousands of Russian troops occupied the Crimean peninsula – home to a majority Russian-speaking population as well as Russian military operations – and Ukraine put its armed forces on full combat alert and mobilized its reserves.
G-8 Membership
Russia risks losing its membership in the G-8, while the U.S. is considering imposing sanctions, U.S. Secretary of State John Kerry said. On Monday, Kerry was en route to Kiev to offer support to Ukraine’s leaders.
Ukraine has about 39 trillion cubic feet of proven gas reserves, according to the U.S. Energy Department, enough to supply the country for two decades. Still, more than half the country’s gas comes from Russia because domestic drilling has lagged behind consumption growth.
Chevron, which has a $400 million exploration agreement for Ukraine’s Oleska shale formation, “is closely monitoring the situation,” spokesman Kurt Glaubitz said in an email. Glaubitz said security measures had been taken to protect employees and their families in Ukraine, though he declined to give details.
Metals, another big export industry, could also get hit by the crisis, according to Morgan Stanley analyst Dmitriy Kolomytsyn. A shutoff of Ukrainian steel sales to Russia, though, might benefit Russian steelmakers.
Shops Shuttered
“Russian metal companies would only be hurt in the event of real military action leading to sanctions, banning them from exporting to Europe and the U.S.,” Kolomytsyn said. “But it’s too early to say if such an outcome is possible, as there are no grounds for sanctions yet.”
Russian mobile phone company Mobile TeleSystems, one of the leading providers in Ukraine, shut several shops in Kiev as the unrest was peaking. It suffered no damage, spokeswoman Elena Kokhanovskaya said last week. Russian banks and Gazprom could also be vulnerable if the crisis escalates, said Micro-Advisory, a consulting group that studies the region.
Recent and planned Russian stock offerings are also possible victims of rising tensions. Lenta Ltd., Russia’s No. 2 hypermarket chain, fell as much as 11 percent in London, its second day of trading following an initial public offering.
Children’s goods retailer Detsky Mir Group had planned to sell shares as early as April, people familiar with the matter said last week, while German retailer Metro AG has said it will sell shares in its Russian cash & carry business in the first half. Detsky Mir declined to comment. Metro, whose shares declined as much as 7.9 percent in Frankfurt, says it’s making good progress with the IPO preparations.
“This includes a continuous assessment of the situation in Ukraine,” a Metro spokesman said. “While we won’t comment on the political situation, we hope a peaceful development can be reached.”

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House prices

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FHFA House Price Index

Released On 2/25/2014 9:00:00 AM For Dec, 2013 Prior Prior Revised Consensus Consensus Range Actual M/M change 0.1 % -0.1 % 0.3 % 0.1 % to 0.4 % 0.8 % Y/Y change 7.6 % 7.3 % 7.7 %

Highlights Home prices, according to the FHFA rebounded 0.8 percent in December after easing 0.1 percent the month before. But excluding some monthly volatility, the trend definitely has been upward. Prices have risen on a quarterly basis for ten quarterly in a row. The December increase topped expectations for a 0.3 percent monthly boost. Five Census divisions posted increases, one was flat, and two declined. On a year-ago basis, FHFA home prices for the U.S. were up 7.7 percent versus 7.3 percent in November. Rising home prices have helped support consumer confidence as home equity is returning, albeit moderately. Today's Case-Shiller report also pointed to improvement in home prices.

Market Consensus before announcement The FHFA purchase only house price index for November rose a modest 0.1 percent on a seasonally adjust basis, following a 0.5 percent rise the prior month. The November HPI is the 22nd consecutive monthly price increase in the purchase-only, seasonally adjusted index. Five of nine Census regions showed gains in the latest month while three declined and one was unchanged.

Definition The Federal Housing Finance Agency (FHFA) House Price Index (HPI) covers single-family housing, using data provided by Fannie Mae and Freddie Mac. The House Price Index is derived from transactions involving conforming conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac.  Why Investors Care

The FHFA Home Price Index captures price data for an important segment of the housing market - home purchases with mortgages financed or bundled by federal housing agencies. However, this HPI does not cover high end housing. Data Source: Haver Analytics

Taxes and economic growth

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http://www.heritage.org/federalbudget/charts/2014/top10-percent-income-earners-560.jpg

Consumer sentiment

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Personal Income in December 2013

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2014 Economic Calendar

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Personal Income and Outlays Released On 1/31/2014 8:30:00 AM For Dec, 2013 Prior Prior Revised Consensus Consensus Range Actual Personal Income - M/M change 0.2 % 0.2 % 0.0 % to 0.4 % 0.0 % Consumer Spending - M/M change 0.5 % 0.6 % 0.2 % 0.1 % to 0.4 % 0.4 % PCE Price Index -- M/M change 0.0 % 0.2 % 0.1 % to 0.3 % 0.2 % Core PCE price index - M/M change 0.1 % 0.1 % 0.1 % to 0.2 % 0.1 % Personal Income - Yr/Yr change 2.3 % 2.3 % -0.8 % Consumer Spending - Yr/Yr change 3.5 % 3.3 % 3.6 % PCE Price Index -- Y/Y change 0.9 % 1.1 % Core PCE price index - Yr/Yr change 1.1 % 1.2 % Highlights Personal income was flat in December while spending was up. Income sluggishness may have been weather related. Personal income was unchanged after rising 0.2 percent in November. Markets expected a 0.2 percent rise. The wages & salaries component posted flat in December, following a 0.5 percent boost the month before. Personal spending, however, was moderately strong, rising 0.4 percent after a 0.6 percent boost in November. Spending was led by a 1.5 percent jump in nondurables with services gaining 0.4 percent. Durables declined 1.8 percent after a 1.8 percent increase the month before. The rise in personal consumption was not just price related. Real spending increased 0.2 percent in December after an increase of 0.6 percent in November. Headline inflation warmed a bit with a reading of 0.2 percent after no change in November. Excluding food and energy, PCE price inflation posted at 0.1 percent in December, matching the November pace. On a year ago basis, headline inflation was 1.1 percent in December versus 0.9 percent the month before. Core inflation nudged up to 1.2 percent from 1.1 percent. The year ago numbers are still well below the Fed's goal of 2 percent inflation. Overall, the consumer is still contributing to the recovery in terms of spending. However, on the income side it likely is a good idea to wait for January data to see how much of income sluggishness was weather related even though soft employment growth was a contributing factor. Market Consensus before announcement Personal income in November rebounded 0.2 percent, following a 0.1 percent dip in October. But the important wages and salaries component improved to a 0.4 percent gain in November after rising 0.1 percent the month before. Tugging down on personal income was the proprietors' income category which fell 1.3 percent after a 1.7 percent boost in October. The swing was in the farm subcomponent. Spending also accelerated a bit, jumping 0.5 percent after a 0.4 percent boost in October. No surprise, the latest gain was led by durables (largely motor vehicles) up 1.9 percent, following a 1.0 percent increase in October. Nondurables declined 0.4 percent after a 0.4 percent decrease in October. Lower gasoline prices likely played a role in November. Services jumped 0.6 in November, following a 0.3 percent rise the prior month. Inflation was non-existent. Headline inflation was unchanged on the month for both November and October. Core inflation rose 0.1 percent in each of the latest two months. On a year-ago basis, overall PCE price inflation posted at 0.9 percent in November, compared to 0.7 percent in October. Core inflation came in at 1.1 percent in both November and October. Definition Personal income is the dollar value of income received from all sources by individuals. Personal outlays include consumer purchases of durable and nondurable goods, and services.  Why Investors Care   Changes in taxes or social security cost of living adjustments can cause some sharp variations in monthly disposable income growth. However, on the whole, monthly changes in disposable income fluctuate less than monthly changes in personal consumption expenditures. Data Source: Haver Analytics   Monthly changes in personal consumption expenditures are usually skewed by large changes in spending on durable goods. Spending on nondurable goods and services tend to be less volatile from one month to the next. Data Source: Haver Analytics   Please note: Your browser must display iFrames to view the Interactive charts.

Super Bowl ads or players’ salaries: Which cost more?

By Lauren LysterJanuary 31, 2014 2:12 PMDaily Ticker

It's Super Bowl time. The biggest sporting event of the year has arrived and this year's game at MetLife Stadium in New Jersey has been billed as the most expensive one yet.

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The Super Bowl also means hundreds of millions of dollars are being spent to get in on the action, most of which has nothing to do with which team wins the game. We've followed the money in the above video, to show you where it's being spent and if it's paying off.

First, there are the ads.

According to The Los Angeles Times, 55 commercials will air during this year’s Super Bowl, with companies shelling out an average of $4 million for a 30-second spot. Advertisers spend as much as $2 million dollars to produce ads, which means a one-minute commercial can cost advertisers $10 million. That sounds like a lot and it is. Spending on ad time has gone up 70% alone in the last 10 years. 

Related: The best chicken wings and chili in the U.S.

Then there’s the money flowing into the local economy where the Super Bowl is held. The New York/New Jersy Super Bowl Host Committee estimates this year's game will bring $500 million to $600 million to New York and New Jersey. That sounds impactful, but some sports economists have said it’s really more likely to be a tenth of that judging by past Super Bowls.

Looking back at the 1999 Super Bowl in Miami, for example, the NFL claimed it generated close to $400 million, while a separate study by Robert Baade, a professor at Lake Forest College in Illinois, found it added under $40 million to South Florida’s economy.

Philip Porter, an economics professor at the University of South Florida, says one reason for the discrepancy is that visitors during game-week spend money on NFL souvenirs and at NFL-funded events. This year, for example, Times Square has been transformed into "Super Bowl Boulevard" with free activities for visitors and a $5 toboggan run that benefits charity.So fewer dollars are actually flowing into local businesses than you might think.

Related: Mixed Martial Arts: A Massive Lawsuit Waiting to Happen?

And of course, serious cash has gone into paying the athletes that will be playing Sunday. In the mid-1990s, the NFL instituted a salary capso that large and smaller market teams could compete on more even footing. But that doesn’t mean teams spend their money the same way.

Related: College football fumbles, Norhwestern's team wants to unionize

Looking at how this year’s quarterbacks stack up, the Denver Broncos’ Peyton Manning made $15 million in 2013, while Russell Wilson of the Seattle Seahawks made just over $526,000. (Wilson is a rookie.)

All this money spent and to think, the price for sitting on your couch watching the game is free.

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