US economic growth improves to 2 pct. rate in Q3

The U.S. economy expanded at a slightly faster 2 percent annual rate from July through September, buoyed by an uptick in consumer spending and a burst of government spending.
Growth improved from the 1.3 percent rate in the April-June quarter, the Commerce Department said Friday.
The pickup in growth may help President Barack Obama's message that the economy is improving. Still, growth remains too weak to rapidly boost hiring. And the 1.74 percent rate for 2012 so far trails last year's 1.8 percent growth, a point GOP nominee Mitt Romney will emphasize.
The report is the last snapshot of economic growth before Americans choose a president in 11 days.
The economy improved because consumer spending rose 2 percent in the July-September quarter, up from 1.5 percent in the second quarter. Spending on homebuilding and renovations increased more than 14 percent. And federal government spending expanded sharply on the largest increase in defense spending in more than three years.
Growth was held back by the first drop in exports in more than three years and flat business investment in equipment and software.
The economy was also slowed by the severe drought this summer in the Midwest. That sharply cut agriculture stockpiles and reduced growth by nearly a half-point.
The government's report covers gross domestic product. GDP measures the nation's total output of goods and services — from restaurant meals and haircuts to airplanes, appliances and highways.
The first of three estimates of growth for the July-September quarter sketched a picture that's been familiar all year: The economy is growing at a tepid rate, slowed by high unemployment and corporate anxiety over an unresolved budget crisis and a slowing global economy.
While growth remains modest, the factors supporting the economy have changed. Exports and business investment drove growth for most of the recovery, but are now fading. Meanwhile, consumer spending has ticked up and housing is adding to growth after a six-year slump.
Consumer spending drives nearly 70 percent of economic activity.
Businesses have grown more cautious since spring, in part because customer demand has remained modest and exports have declined as the global economy has slowed.
Many companies worry that their overseas sales could dampen further if recession spreads throughout Europe and growth slows further in China, India and other developing countries. Businesses also fear the tax increases and government spending cuts that will kick in next year if Congress doesn't reach a budget deal.
Since the recovery from the Great Recession began in June 2009, the U.S. economy has grown at the slowest rate of any recovery in the post-World War II period. And economists think growth will remain sluggish at least through the first half of 2013. Some analysts believe the economy will start to pick up in the second half of next year.

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Disney buying Lucasfilm for $4.05 billion

Disney is paying $4.05 billion to buy Lucasfilm Ltd., the production company behind "Star Wars," from its chairman and founder, George Lucas. It's also making a seventh movie in the "Star Wars" series called "Episode 7," set for release in 2015, with plans to follow it with Episodes 8 and 9 and then one new movie every two or three years.
The Walt Disney Co. announced the blockbuster agreement to make the purchase in cash and stock Tuesday. The deal includes Lucasfilm's prized high-tech production companies, Industrial Light & Magic and Skywalker Sound, as well as rights to the "Indiana Jones" franchise.
Disney CEO Bob Iger said in a statement that the acquisition is a great fit and will help preserve and grow the "Star Wars" franchise.
"The last 'Star Wars' movie release was 2005's 'Revenge of the Sith' — and we believe there's substantial pent-up demand," Iger said.
Kathleen Kennedy, the current co-chairman of Lucasfilm, will become the division's president and report to Walt Disney Studios Chairman Alan Horn. Lucas will be creative consultant on new "Star Wars" films.
Lucas said in a statement, "It's now time for me to pass 'Star Wars' on to a new generation of filmmakers."
The deal brings Lucasfilm under the Disney banner with other brands including Pixar, Marvel, ESPN and ABC, all companies that Disney has acquired over the years. A former weatherman who rose through the ranks of ABC, Iger has orchestrated some of the company's biggest acquisitions, including the $7.4 billion purchase of animated movie studio Pixar in 2006 and the $4.2 billion acquisition of comic book giant Marvel in 2009.
Disney shares were not trading with stock markets closed due to the impact of Superstorm Sandy in New York.

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Has Obama Been Good for Millionaires?

The question of whether Americans are better off than they were four years ago depends, of course, on the American.
For the 12 million unemployed, the answer is most certainly no.
But for many of America's millionaires, the answer may be more affirmative.
A new study from WealthInsight, the London-based wealth-research and data firm (and yes, they are non-partisan), showed that the United States added 1.1 million millionaires between Jan. 1, 2009 and the end of 2011, the latest period measured. There were 5.1 million millionaires in America at the end of 2011, compared with around 4 million at the end of 2008.
That works out to more than 1,000 millionaires a day under the Obama administration. (They defined millionaires as people with total net worth of $1 million or more, excluding primary residence).
(Read more: Rich Will Spend More Under Romney: Poll)
"It's true that Obama has been good for millionaires, at least in absolute terms," said Andrew Amoils, analyst at WealthInsight. "He certainly hasn't been bad for millionaires."
Amoils said that quantitative easing and financial bailouts especially helped the finance sector, which accounts for the largest share of millionaires. It also helped that markets recovered in 2009.
The timeframe is worth noting. Measured against the 2007 peak, when 5.27 million Americans had a net worth of at least $1 million, the nation lost 165,360 millionaires. Their combined wealth is down six percent, to $18.8 trillion from a peak of more than $20 trillion in 2007.
We don't know how 2012 will turn out, though if stock markets continue to strengthen, the millionaire count for 2012 is likely to increase. Wealth Insight says the number of millionaires in America will grow to more than six million by 2016, and their combined fortunes will jump 25 percent over the same period.
(Read more: Millionaires Give Nine Percent of Income to Charity)
Where did all the millionaires come from between 2008 and 2011?
Mainly from retail, tech and finance -- and in both blue and red states.
Of the sectors adding the largest number of people worth $30 million or more, the retail, fashion, and luxury goods sector ranked first. That was followed by energy and utilities, then tech, telecoms and finance. Transportation and construction saw the biggest drops.
The number of people worth $30 million or more grew 26 percent in Connecticut since 2008, 20 percent in Kansas, 12 percent in Michigan, showing that the wealth creation was nationwide.

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Obama Wins 2012 Election: Why Your Taxes Are Going Up

When President Obama and the new Congress begin to tackle important legislation and federal policy in January, one of the key issues will be how to reform America's byzantine tax code.
Obama campaigned on a platform to raise taxes on the wealthiest Americans, declaring that millionaires and billionaires need to "pay their fair share." The president proposed the highly controversial "Buffett Rule," which would make sure those individuals earning more than $1 million a year would pay at least 30% of their income in federal taxes.
Related: Do the Rich Have a Moral Obligation to Pay Higher Taxes? Gov. Jerry Brown Says 'Yes'
The top individual tax rate is currently 35% but few U.S. households and individuals actually pay that much; various tax deductions and loopholes reduce one's tax burden.
According to the Obama campaign, the richest 400 taxpayers in 2008 (who each made more than $110 million that year) paid an average income tax rate of just 18%. In 2009 over 20,000 U.S. households with more than $1 million in income paid a federal tax rate of less than 15%.
Obama has vowed to raise the top income tax rate for individuals to 39.6% and let the Bush-era tax breaks end for the highest income earners. The majority of Americans — those who are lower to middle class — could also see a 2% tax increase if Congress allows the temporary payroll tax holiday to expire at the end of the year.
Related: Here's Why Your Taxes Are Going Up 2% Next Year: Just Explain It
Nearly half of voters support raising taxes on incomes over $250,000, according to Tuesday night's exit polls.
Len Burman, a professor of public affairs at Syracuse University and a co-founder of the bipartisan Tax Policy Center, believes higher tax rates play just a small role in resolving the nation's budget woes.
"In the long term [Obama] is going to need to raise taxes on more than just the rich," Burman says in an interview with The Daily Ticker. "The budget problem isn't going to be solved without broader-based tax increases, preferably done in the context of tax reform and also serious entitlement reform. We're not going to be able to solve this on the tax side alone."
Burman, who recently co-wrote the new book "Taxes in America: What Everyone Needs to Know," says tax rates do not need to be raised for any income group if Congress and the White House would agree on one simple change: raising the capital gains rate, i.e. the profits from the sale of an investment. Assets, such as stocks, art or real estate, that are held for at least a year are currently taxed at a special 15% rate; Obama wants to raise that to 20%.
"The problem with a low tax rate on capital gains is not that it allows Mitt Romney and Warren Buffett to pay very low taxes but that it creates this huge opportunity for tax sheltering," he notes. "There's a whole industry that's devoted to coming up with these schemes. [Raising capital gains rates] could make the tax system more progressive and allow for lower tax rates" and a reduction in the deficit Burman says.
Obama's tax proposal also targets the Alternative Minimum Tax, the Estate Tax and as well as many personal tax credits and itemized deductions. Obama would make permanent the 2007 AMT patch and index it for inflation. He would raise the estate tax to 45% from 35% on estates worth more than $3.5 million. He would lower the corporate tax rate to 28% from 35% and provide a refundable $3,000 credit per added employee for companies that expand their workforce. He would tax carried interest as ordinary income.
Related: Corporate Tax Loopholes=Corporate Socialism: Pulitzer Prize Winner David Cay Johnston
A divided Congress refused to compromise with Obama during his first term and could very well dismiss the president's tax reforms for the next four years. Republicans are loathe to raise taxes by even a penny and Obama has said he would veto any budget bills that did not include tax increases. Neither party wants to raise taxes in a weak economy. But the options available for reducing the deficit and generating new revenue are few and far between.

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Gunmen kill six in northeast Nigeria church attack

Gunmen killed six people at a church in northeast Nigeria early on Tuesday, the third year running that Christmas services have come under deadly attack in the country, the military said.
The strike took place after a Christmas Eve midnight service outside the town of Potiskum in northeastern Yobe state, where Islamist sect Boko Haram has carried out several attacks this year.
"Unknown gunmen attempted to attack Potiskum but were repelled by the troops. While they were fleeing, they attacked a church in a village known as Jiri," said military spokesman Eli Lazarus, who confirmed that six people were killed.
Members of Boko Haram have killed hundreds in a campaign to impose sharia law in northern Nigeria.
The group killed dozens in a series of bombings across northern Nigeria on churches on Christmas Day last year, mirroring similar attacks in 2010 which killed more than 40.
This year the police and army pledged to protect churches, boosting security in major northern towns and cities and restricting people's movement.
At least 2,800 people have died in fighting in the largely Muslim north since Boko Haram launched an uprising against the government in 2009, watchdog Human Rights Watch says.
Potiskum, which lies in Boko Haram's northeastern stronghold, has been one of the areas worst affected by the insurgency.
Security experts believe Boko Haram is targeting worshippers to spark a religious conflict in a country of 160 million people split roughly equally between Christians and Muslims.
Many churches in Nigeria's biggest northern city, Kano, and elsewhere in the north were almost empty for Christmas Day services on Tuesday, local residents said.
Two people were killed in separate attacks on Tuesday in Kano, a police source said. He said gunmen riding motorcycles killed the driver of a government worker and another civilian.
Pope Benedict used part of his Christmas message to the world on Tuesday to highlight the need for reconciliation in Nigeria, saying "savage acts of terrorism continue to reap victims, particularly among Christians".

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Egypt constitution approved with 63.8 percent: election committee

Egypt's new constitution, drafted by Islamist supporters of President Mohamed Mursi, has been approved by 63.8 percent of voters in a two-round referendum, the supreme election committee said on Tuesday.
The result, which followed votes held on December 15 and on December 22, matched an earlier unofficial tally given by Mursi's Muslim Brotherhood.
"We have seriously investigated all the complaints," judge Samir Abu el-Matti of the Supreme Election Committee told a news conference. The final official turnout was 32.9 percent.

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Affleck Won't Be Running for Senate

Those hoping the United States Senate may get a little less gray and a bit more celebrity-studded won't be getting their Christmas miracle today.
Despite speculation, Ben Affleck announced late Monday he would not go after John Kerry's Senate seat in his native Massachusetts if the senator is confirmed as secretary of state.
The actor, who has been an increasingly popular presence in the political world recently, wrote on his Facebook page: "I love Massachusetts and our political process, but I am not running for office."
Chatter around a possible run went into overdrive Sunday when during an appearance on CBS' "Face the Nation" the Cambridge native decidedly did not rule it out saying, "One never knows. I'm not one to get into conjecture."
In the post he mentions his charity work in the Congo, something he discussed on ABC's This Week as well as testifying before Congress, as one of the reasons he's not interested in entering Bay State politics.
"Right now it's a privilege to spend my time working with Eastern Congo Initiative (ECI), supporting our veterans, drawing attention to the great many who go hungry in the U.S. everyday and using filmmaking to entertain and foster discussion about issues like our relationship to Iran," Affleck said.
The movie star added his praise of Kerry, writing: "We are about to get a great Secretary of State."
"There are some phenomenal candidates in Massachusetts for his Senate seat. I look forward to an amazing campaign," Affleck added.
As for some of those candidates on the list, Gov. Deval Patrick is likely to appoint a replacement to fill Kerry's seat in the interim period. Former Massachusetts governor and Democratic presidential nominee Michael Dukakis, as well as Vicki Kennedy, the widow of Ted Kennedy, are on Patrick's list, according to reports.
Scott Brown, who lost to Elizabeth Warren in November, is widely believed to be the likely Republican nominee and is viewed as a strong contender. On the Democratic side there are several names often mentioned currently in the U.S. House of Representatives: Edward Markey, Michael Capuano, and Stephen Lynch. Other possibilities include Martha Coakley, the state attorney general who originally lost to Brown in the 2010 special election held after Kennedy's death, which Brown won.

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First Lady Tracks Santa From Hawaii

While President Obama spent his Christmas Eve afternoon golfing with friends, the first lady was hard at work helping children from across the country track Santa's every move.
Mrs. Obama took roughly 30 minutes out of her Hawaiian family vacation to answer calls from children asking where Santa was located as part of the annual NORAD Tracks Santa program run by the North American Aerospace Defense Command, according to a White House official.
"Have you been a good boy this year?" Mrs. Obama asked Fischer from North Carolina.
"Yes, ma'am" responded the polite 5-year-old, who asked Santa to bring him a four-wheeler this year. Klye from Winona, N. J., wanted to know what the first lady's favorite present was when she was a young girl.
"When I was little. I loved Barbie dolls. I was a big Barbie doll kid, and every Christmas I got a new Barbie. One year I got the Barbie townhouse and the camper. It was very exciting," Mrs. Obama said. The first lady helped children track Santa and his sleigh as he delivered toys to little girls and boys in Africa, the Middle East and Europe.
"He's moving pretty fast. That's pretty exciting, isn't it?" she asked the Schaack children from Rocklin, Calif.
"He's going like 100 miles an hour!" one of the boys replied. "You guys go to sleep soon now so that he'll come to your house, all right?" the first lady cautioned.
The Obamas spending Christmas at their vacation home along the shores of Kailua, a quiet beach town on the east end of Oahu.

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U.S. urges Egyptians to bridge divisions after constitutional vote

The United States on Tuesday urged all sides in Egypt to increase political engagement after Egyptian officials announced that voters had overwhelmingly approved a new constitution drafted by President Mohamed Mursi's Islamist allies.
"President Mursi, as the democratically elected leader of Egypt, has a special responsibility to move forward in a way that recognizes the urgent need to bridge divisions," State Department spokesman Patrick Ventrell said in a statement, noting that many Egyptians had voiced "significant concerns" over the constitutional process.
"We hope those Egyptians disappointed by the result will seek more and deeper engagement. We look to those who welcome the result to engage in good faith. And we hope all sides will re-commit themselves to condemn and prevent violence," Ventrell said. (Reporting By Andrew Quinn; Editing

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Little change in overtreatment at doctors' offices

Although some Americans are getting more of beneficial treatments that were underused in the past, including drugs for heart disease, others are still being overtested or overtreated for a range of conditions, according to a new study. Researchers found U.S. doctors' offices made progress on six of nine "quality indicators" for recommended and underused therapies but only scaled back on two of 11 unnecessary and potentially harmful health services. Those findings reflect a growing concern over skyrocketing health care costs - and the realization that doctors and hospitals are going to have to find places where services can be scaled back. "We all know that we need to do something about it, and one component of the high health care costs is the overuse and misuse of therapies and interventions," said Dr. Amir Qaseem, director of clinical policy at the American College of Physicians. It's not about getting rid of services that are too expensive, he told Reuters Health, but evaluating what current tests and treatments may offer little value for certain patients. For example, two overuse indicators included in the new analysis are screening men age 75 and up for prostate cancer and screening women 75 and older for breast cancer. "For men who are getting screened over the age of 75, the likely benefit doesn't happen within a patient's lifetime," Qaseem said, because prostate cancer is often very slow-growing. And that's assuming prostate specific antigen (PSA) tests are beneficial at all. Regardless of a man's age, however, the tests can still lead to invasive biopsies that come with side effects such as a risk of incontinence and impotence. "We really need to start looking at some of these services that may be harmful," added Qaseem, who wasn't involved in the new research. The findings are based on nationally representative studies of adult care in outpatient offices, conducted by the Centers for Disease Control and Prevention. Data came from 79,083 office visits in 1998-1999 and 102,980 visits in 2008-2009. During that span, the use of many recommended therapies improved. For example, 28 percent of people with coronary artery disease were given aspirin in 1998-1999, compared to almost 65 percent a decade later. Likewise, the use of statins more than doubled in those same patients, from 27 percent to 59 percent. In people with diabetes, statin prescriptions increased from 12 percent to 36 percent. However, there was little change in rates of unnecessary and overused services, including some types of cancer screening for older adults or x-rays and urine tests done as part of a general check-up. Two of those overuse indicators improved: cervical cancer screening for women over 65 dropped from 3 percent to 2 percent, and unnecessary antibiotic prescribing for asthma flare-ups fell from 22 percent to 7 percent. On the other hand, rates of prostate cancer screening for older men increased, from between 3 and 4 percent to almost 6 percent, according to findings published Monday in the Archives of Internal Medicine. The lead author on the study from New York's Mount Sinai School of Medicine, Dr. Minal Kale, said the set of quality indicators her team used doesn't necessarily represent all tests and treatments provided in outpatient care. And she added that the overuse of medical services is a complicated issue. "Culturally, there's a lot of resistance to limiting access to health care services because it quickly becomes politicized," Kale told Reuters Health. "The question about overuse really needs to come back to quality. It's about quality of the care that we're delivering to patients." The goal, she said, is to "increase the value and the quality of our health care system while also paying attention to the costs."

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