TOKYO (3/10/14)--The Japanese government Friday declared that Bitcoin was not legal tender, but that the digital peer-to-peer payments system could be subject to taxes.
"Bitcoin are neither Japanese nor foreign currencies and its trading is different from deals stated by Japan's bank act as well as financial instruments and exchange act," according to a document from Prime Minister Shinzo Abe's cabinet (
The Wall Street Journal
Japan did say that the bitcoin sales, related transactions and gains on exchange rates would be subject to income, corporate and consumption taxes.
The country is trying to define Bitcoin and the government's role in regulating it in light of the bankruptcy of Mt. Gox, a Tokyo-based Bitcoin exchange. The Feb. 28 bankruptcy filing cited a loss of 850,000 bitcoins, worth about $450 million at the time (
In other Bitcoin news, the Canadian-based Flexcoin exchange also closed down last week after hackers made off with about 440,000 euros ($610,000). It said owners could receive some bitcoins back from computers that weren't connected to the Internet and couldn't be raided (
WASHINGTON (3/10/14)--Student loans and pent-up demand for autos helped boost nonrevolving consumer credit by $13.7 billion in January, according to Friday's data from the Federal Reserve.
The $2.8 billion increase in nonrevolving credit more than covered the $700 million drop in revolving credit at credit unions in January.
"Consumers are taking advantage of extremely low interest rates" to finance education and big-ticket items such as autos and vacations, said analysts at Moody's (
Credit unions' revolving credit experienced a 7.4% slowdown in January from December's seasonally adjusted numbers.
The Fed's report indicates consumers are reluctant to take on too much credit card debt with revolved credit ticking downward 0.2%, Moody's said. After two months of harsh weather, however, consumers may be ready to take on new purchases delayed by snow.
Credit quality continues to improve as well. According to the American Bankruptcy Insitute, total bankruptcy filings in the U.S. decreased 12% in February over the same period last year. Consumer filings dropped to 69,380 from February 2013's number of 78,614.
Total commercial filings in February decreased to 2,813, representing a 24% decline from the 3,722 business filings recorded a year prior. Total commercial chapter 11 filings also decreased 27%, to 452 filings in February from the 619 filings recorded a year ago.
WASHINGTON (3/7/14)--Jobless claims fell by 26,000--from 349,000 to 323,000--for the week ending March 1, according to Labor Department data released Thursday.
Wall Street Journal
reported this week, claims for unemployment benefits have sunk to a three-month low.
While the size in the drop surprised forecasters, the volatile shifts in numbers could be explained, in part, by recent holidays or the winter weather that's thumped much of the Northeast and South Atlantic regions of the country (
The four-week moving average for initial claims, which may more accurately reflect jobless trends, dropped by 2,000 last week to 336,500. Analysts note that this rate sits slightly above the claim levels consistently reported in the pre-recession era.
Continuing claims, or those claiming at least a second week of unemployment, fell to 2.9 million in the week ending Feb. 22, a second straight week of decline. The four-week moving average backpedaled by 14,750 to 2.93 million.
Moody's analysts say continuing claims had been climbing since early December, but that the recent trend could be a sign that the labor market has started to rebound as the inclement weather backs off.
Thanks to this decline, though, the insured unemployment rate, which measures both filed claim volume and length, has fallen to 2.2%.
The Labor Department also reported that the total number of Americans claiming benefits from all unemployment insurance programs stood at about 3.5 million for the week ending Feb. 15. That's about an 86,000 decrease from the previous week.
Economists now await today's release of the Labor Department's new-hire numbers, which are expected to show a 152,000-job growth spurt for February, an improvement from previous months.
WASHINGTON (3/6/14)--Weekly mortgage applications rose 9.4% on a seasonally adjusted basis for the week ending Feb. 28, according to the Mortgage Bankers Association's weekly survey.
On an unadjusted basis, the market composite index, which measures mortgage loan application volume, increased 11% compared with the previous week.
The refinance index posted a 10% gain from the previous week. On a four-week moving average basis, however, refinance activity dropped by 2.5% over the past month. At 9.6%, refinance activity is 63% lower than the same period one year ago.
Many homeowners have already refinanced, and with rates eclipsing 5%, the forecast for refinance originations "appears gloomy," said analysts from Moody's (
Purchase applications have dropped by 11.8% over the past month and are 15.7% below their year-ago level. Demand is essentially unchanged from three years ago, said Moody's.
Rates for 30-year fixed-rate mortgages fell by 6 basis points to 4.47%--unchanged from four weeks ago and 77 basis points higher than February 2013. Thirty-year fixed-rate jumbo mortgages decreased by 10 basis points to 4.37%.
The five-year adjustable-rate mortgage rate moved 8 basis points lower, ending the week at 3.09%. The interest rate is 54 basis points higher compared with a year earlier.
WASHINGTON (3/6/14)--The economy continues to grow at a "modest to moderate" with improved conditions in eight of the 12 Federal Reserve Districts, according to the Fed's Beige Book commentary released Wednesday.
From January to early February, severe winter weather slowed activity in the Northeast districts of New York and Philadelphia. Auto, retail and manufacturing sales were particularly hard hit.
Richmond, Va.; Chicago and Minneapolis did report positive sales in weather-related goods, however.
The district reports were mixed on loan demand and volume. Analysts at Moody's noted, "Falling mortgage and refinancing applications were among the few areas of weakness reported across districts" (
Credit quality is improving as delinquency rates tick downward or remain stable.
The slower pace in residential housing markets was attributed to the unusually severe winter. Home inventories were low in most districts, and housing prices continue to appreciate.
Commercial real estate conditions continue to improve from the previous report, according to seven of 12 districts.
Weather continues to hamper economic forecasts, but the report reinforces the bias that the economic slowdown is short lived, according to Eric Green of TD Securities (
The anecdotal report was released two weeks before the Federal Open Market Committee's March policy meeting.
IRVINE, Calif. (3/5/14)--Housing prices increased an unexpected 0.9% in January, according to the U.S. CoreLogic Home Price Index released Tuesday, reflecting 23 months of year-over-year increases in home prices nationally.
January's number is 12% higher than January 2012, and CoreLogic forecasts that February prices will follow suit with a 12.5% year-over-year growth rate.
"Polar vortices and a string of snowstorms did not manage to weaken house price appreciation in January," said CoreLogic Chief Economist Mark Fleming. "The last time January month-over-month and year-over-year price appreciation was this strong was at the height of the housing bubble in 2006."
Strong sales in states unaffected by winter weather contributed to the unseasonably positive pricing. According to Moody's, home prices likely will continue to increase because of investor purchases and limited completion of homes under construction (Economy.com March 4).
WASHINGTON (3/4/14)--Americans' personal spending ramped up in January primarily because of services being purchased not physical goods, according to Monday's report from the Commerce Department.
Services rose 0.9%--the largest jump since October 2001. The Affordable Care Act pushed spending in the health-care arena, including enrollment in insurance exchanges.
Winter weather continues to affect the economy with consumers spending more on utilities, tightening budgets and reducing product consumption, according to analysts at Moody's (
February numbers will likely be just as erratic given the severe weather. Shoppers and travelers stayed home, and construction was hindered. "The outlook is more uncertain than usual," Paul Dales, senior U.S. economist at Capital Economics, told
The Wall Street Journal
Excluding special factors such as health-care allowances, cost-of-living adjustments and the expiration of the long-term unemployment benefits, personal income increased $23.7 billion (0.2%) in January, compared with a decrease of $15.1 billion (0.1%) in December.
Disposable personal income, which is personal income less personal current taxes, rose $45.2 billion, or 0.4% in January, compared with the $9.7 billion decrease (-0.1%) in December, the Commerce Department reported.