The Economic Data Global Express (e-EDGE)
v.5 n.53 Released Dec. 31, 2001
* This issue was actually sent out on Friday, Dec. 28
Produced
by the Los Angeles County
Economic Development Corporation as a public service to the global
community.
EURO-DAY FINALLY ARRIVES IN 12 EU COUNTRIES--WHAT TO EXPECT
After functioning as a financial instrument in
foreign exchange markets and at official levels for the past three years,
the euro will finally become the tangible common currency of consumers
and households in 12 European countries. The United Kingdom, Sweden,
and Denmark will stay out of the system for now. As of January 1,
2002, the 12 Euro-zone countries (Germany, France, Italy, Belgium, Netherlands,
Spain, Portugal, Greece, Finland, Austria, Luxembourg, and Ireland) will
begin using Euro notes and coins in everyday transactions and retire their
national currencies during January and February of the new year.
This historical undertaking will affect the lives of over 300 million people
and is one of the most extraordinary, non-military, logistical and operational
undertakings in history.
The public launching of the euro (currently
worth approximately US$0.90) involves the manufacture and release of over
14.5 billion euro notes and 56 billion euro coins to banks, retail outlets,
and automatic teller machines throughout the 12 member countries of the
European Union. In addition to prices at retail stores and wholesalers,
bank balances and investments at brokerage houses as well as all financial
market transactions have to be converted from national currencies to euro
equivalents.
After an initial "breaking-in" period, the
benefits of a common currency in Europe should become obvious. Capital
and labor movement within the EU are already becoming easier. Price transparency
will be enhanced and will allow for better price comparison for residents
and tourists alike. U.S. exporters will find it easier to sell to
EU buyers and will face lower costs in dealing with one currency instead
of twelve currencies.
While the new currency in circulation represents
a major accomplishment, the EU must now turn to the remaining work to full
economic and financial integration. This requires a common
set of regulations, coordinated economic policies, and the elimination
of non-tariff restrictions to cross-border trade. Sometime in this
decade, if and when the United Kingdom decides to give up its "precious"
pound sterling and adopt the euro, the new currency is likely to become
a formidable competitor to the dollar. Welcome to a new financial
age! (Ken Ackbarali)
DURABLE GOODS ORDERS DOWN IN NOVEMBER
New orders for durable manufactured goods dropped
by 4.8% in November, their fifth decline in the past six months.
October was a notable exception, as orders soared by 12.5%. The primary
reason for last month's decline was a plunge in orders for defense aircraft
and parts, which had more than tripled in October. Orders for nondefense
durable goods rose by 2.7% in November following a 4.8% increase the previous
month.
In contrast to earlier months, most durable
goods industries reported higher orders over the month. The sole
exception was orders for communications equipment, which edged down by
only 0.3%. However, orders this year are running well below year-ago
levels. Nondefense durable goods orders were down by over 13% compared
to November 2000. Orders for high technology products have
fallen the most and were down by almost 27% over the year.
This report contained a few other interesting
items for economy-watchers. (1) October-November shipments of capitals
goods were below their third-quarter pace. However, the rate of decline
was much slower than the previous two quarters. (2) Also, inventories
of durable goods manufacturers dropped by 1.1% last month, following declines
of 0.7% in October and 1.2% in September. If these trends hold through
December, the first item will have a positive (really less negative) effect
on fourth-quarter GDP growth, while the second will reduce reported growth.
It's clear that manufacturers have battened down to weather the current
storms. The big question is: when will the sun come back out?
(Nancy D. Sidhu)
PR: http://www.census.gov/indicator/www/m3/index.htm
CALIFORNIA CONTINUES TO GROW...
According to the Census Bureau, the U.S. population
grew by 3.4 million or 1.2% between April 1, 2000 (the Census 2000 date
of reference), and July 1, 2001--the equivalent of adding another State
of Connecticut. California accounted for 18.5% of the increase with
an addition of 630,000 people, or +1.9%, to 34.5 million. The State
now accounts for around 12% of the total population of the U.S. Of
the addition, 374,000 was due to natural increase (births minus deaths),
and 344,000 came from international immigration. These figures imply
an 88,000 net out-migration from California to other states. California
gets about 25% of the nation's new immigrants, and the growing presence
of immigrant communities here means many will choose to stay in California
rather than move on to other states.
Continued growth of this magnitude will surely
increase the pressure on the State's infrastructure and (natural) resources.
Many of California's neighbors are also growing rapidly and competing for
resources such as water and electricity. During the 15-month period,
the top three growth leaders (in terms of percentages) were Nevada, +5.4%;
Arizona, +3.4%; and Colorado, +2.7%. (George
Huang)
PR: http://www.census.gov/Press-Release/www/2001/cb01-203.html
SOME IMPROVEMENT IN AIRLINE TRAFFIC DURING NOVEMBER
If you consider smaller year-to-year declines
as an improvement. At LAX, total passenger traffic in November was
down by 24.7%, compared with October's drop of 28.8%. International
passenger traffic was off by 27.5%, compared with the October decline of
34.3%. Ontario International bucked the trend, with the November
passenger count off by 13.5%, compared with October's decline of 8.9%.
At John Wayne Orange County Airport, November passenger activity was down
by 7.7%, compared with October's drop of 15.2%. At Palm Springs,
November activity was down by 19.2%, compared with the October drop of
20.7%.
As to air cargo tonnage in November, LAX was
down by 16.7% over the year versus the October decline of 18.2%.
Ontario International remained in the plus column during November, with
a 5.4% increase. International air cargo at LAX was still down
in November. Import tonnage was off by 10.6% over the year, exports
were down by 19.9%, and total international air cargo was down by 14.3%.
(Jack Kyser)
Data: http://www.lawa.org/lax/htmlaf/voltraffic.html
QUICK STATS:
* Census: US new home sales for 11/01: +6.4% to 934,000 annual units (10/01:
+1.7% to 878K a.u.)
* Census: US new durable goods orders for 11/01: -4.8% (10/01: +12.5%)
* Census: US durable goods shipments for 11/01: +0.2% (10/01: +3.4%)
* Census: US unfilled durable goods orders for 11/01: -0.9% (10/01:
+0.7%)
* Census: US durable goods inventories for 11/01: -1.1% (10/01: -0.7%)
* Conference Board: US Help-wanted Advertising Index for 11/01: 45
(10/01: 46)
* Conference Board: US Consumer Confidence Index for 11/01: 93.7 (10/01:
84.9)
* Natl Assn of Realtors: US existing home sales for 11/01: +0.6% to
5.21 million annual units (10/01: +5.7% to 5.18mil.a.u.)
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