U.S. markets slide Friday
NEW YORK, Jan. 29 (UPI) -- Upbeat gross domestic product figures could not keep U.S. stock markets from falling Friday.
The Commerce Department said the U.S. economy surged 5.7 percent in the fourth quarter in a preliminary estimate that soundly beat expectations.
Economists expected a rise between 4.5 percent and 4.8 percent. But the government said the GDP was helped with a 2 percent increase in consumer spending and increased exports.
Falling technology and financial stocks, however, eroded confidence throughout the day, with shares dropping at Bank of America, JPMorgan Chase, Intel and Microsoft.
By close, the DJIA lost 0.52 percent, 53.13 points, to 10,067.33. The Standard & Poor's 500 lost 0.98 percent, 10.66, to 1,073.87. The Nasdaq composite index dropped 1.45 percent, 31.65, to 2,147.35.
On the New York Stock Exchange, 955 stocks advanced and 2,065 declined on a volume of 5.4 billion shares traded.
The benchmark 10-year U.S. Treasury bill rose 14/32 to yield 3.588 percent.
The euro fell to $1.3862 from Thursday's $1.3863. Against the yen, the dollar fell to 90.19 yen from Thursday's 90.25 yen.
In Tokyo, the Nikkei 225 index lost 2.08 percent, 216.25, to 10,198.04.
In Britain, the FTSE 100 index rose 0.83 percent, 42.78 points, to 5,188.52.
Parts company says Toyota problem unsolved
ELKHART, Ind., Jan. 29 (UPI) -- U.S. auto parts supplier CTS said Toyota had exonerated its gas pedal components linked to unexpected acceleration that has triggered a massive recall.
Mitch Walorski, director of investor relations at CTS, an Indiana company, said Japanese automaker Toyota Motor Co. "acknowledged that they (CTS components) did not cause any accidents or injuries related to that condition of the pedal," ABC News reported Friday.
CTS has already begun shipping new gas pedals to Toyota, which said it had developed a new spacer that would take care of the problem in 2.3 million vehicles. Toyota has said the problem involves wear caused by condensation that, in turn, retards the engine's return to idle.
Sean Kane at Safety Research & Strategies in Massachusetts said the problem, which was first attributed to gas pedals sticking to floor mats, "has nothing to do with some kind of acceleration pedal or with the floor mats."
"It has to do with other components in these vehicles, most likely in the electronics," Kane said.
A Philadelphia Toyota owner, Dr. Alan Ostroff, said he was keeping his car parked until the problem was resolved.
His Prius "took off" unexpectedly while he was behind the wheel, although the model is not on the recall lists.
Debt fear maybe misguided, economists say
DAVOS, Switzerland, Jan. 29 (UPI) -- The fear of rising government debt could be premature in many nations, including the United States, economists in Davos, Switzerland, said.
In an interview, Chief Economist at Standard Chartered Bank Gerard Lyons said the primary repercussion from mounting debt is a decline in government spending and long-term investment, not the often-stated fear of countries going into default, MarketWatch reported Friday.
Nobel laureate Joseph Stiglitz, a professor at Columbia University, said the U.S. economy would benefit more from another shot of stimulus spending than from the three-year freeze on most federal spending announced by President Barack Obama in his State of the Union address.
Also attending the World Economic Forum in Switzerland, Chair of the House Financial Services Committee Barney Frank, D-Mass., said U.S. spending was misplaced. "If we do not in the United States begin now a reduction in spending on the military … we're not going to get out of this," Frank said.
Fear of debt has been tagged as the most often-named issue among the economists and world leaders gathered at the forum, MarketWatch said.
In the United States, decisions are now "constrained by long-term deficit fears," Frank said.
Economists honor Brazil's president
DAVOS, Switzerland, Jan. 29 (UPI) -- Economists in Davos, Switzerland, awarded Brazil's President Luiz Inancio Lula da Silva the World Economic Forum's first Global Statesmanship Award Friday.
In the past seven years, "31 million Brazilians have joined the middle class and 20 million have been lifted out of absolute poverty," said Brazil's Minister of Foreign Relations Celso Amorim, accepting the award on the president's behalf.
Reading a statement prepared by Lula da Silva, the foreign minister said, "I would like to stress that the best policy for development is the fight against poverty. It is also one of the best recipes for peace. And we found out last year that it is also a powerful shield against crisis."
"This lesson learned by Brazil is applicable to any part of the world, be it rich or poor," he said.
"We have to govern with creativity and justice. And we have to do this now, before it is too late," he said.
