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Host Katherine Lanpher talks with TIME business and economics reporters to sort through the headlines, forecasts, news and numbers that will help you weather these challenging times.

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November 2009
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Commentary on the economy, the markets, and business

The downward GDP ratchet begins

Barbara can have her upbeat housing statistics. The Commerce Department's Bureau of Economic Analysis delivered a downer today, revising its estimate of third-quarter GDP growth from 3.5% to 2.8%. The revision was primarily due, the BEA said, to

an upward revision to imports and downward revisions to personal consumption expenditures and to nonresidential fixed investment that were partly offset by an upward revision to exports.

I posted a couple weeks ago about the prediction of Goldman Sachs economist Jan Hatzius that third-quarter GDP will eventually be revised well downward because small businesses are struggling more than big businesses, and timely data on small business is harder for government statisticians to come by. We haven't even really gotten to those revisions yet, and 3Q GDP is already down to 2.8%. I'd say it's going below 2% before all is said and done.

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Another day, another upbeat housing statistic

This morning's happy housing news: homes are now worth what they were in the fall of 2003! Okay, so maybe that's not the cheeriest way to frame the most-recent S&P/Case-Shiller data, though it does, I think, preserve an important piece of context.

If you want to have a glass-half-full sort of day, then a better way to look at the numbers is as follows.

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Home sales surge. Time to party?

The pace of existing-home sales was 10.1% higher in October than it was in September, according to figures out today from the National Association of Realtors (NAR). That jump puts sales back where they were in February 2007 and is sure to bring renewed optimism about the state of the housing market. In September we had an eight-month supply of houses sitting on the market. Now we're down to a seven-month supply. That's in the neighborhood of normal.

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Management wisdom from Larry Ellison

We were at a cocktail party, and [former Apple CEO] Gil Amelio was explaining Apple's predicament to us, and he said: “Apple is a boat. There's a hole in the boat, and it's taking on water. But there's also a treasure on board. And the problem is, everyone on board is rowing in different directions, so the boat is just standing still. My job is to get everyone rowing in the same direction so we can save the treasure.”After he turned away, I looked at the person next to me and asked, “But what about the hole?” —Larry Ellison

I don't have much to add to this lovely demonstration of the dangers of management metaphors. It refers to a party back in 1997, when Apple appeared to be toast, and I got it from a Brent Schlender analysis of Yahoo! and Apple on BNET.

          

New column: Riding the waves

My column this week is a brief foray into the world of the market wave and cycle theorists (mainly Elliott Wave guy Bob Prechter). I'll put up some relevant links later, but right now I've got to run.

          

You are failure-haters, you are gladiators

Sorry for the lack of posting. To make amends, here's a little motivational video for all of you:

          

So I'm riding into Louisville from the airport this morning (I was in town to give a speech to the local CFAs), and I asked my host about the local economy. He reeled off a few employers and then said, "health care, health care's really big here."

Funny thing: I was in Winston-Salem a couple of months ago and heard the same thing. My memory's not so clear on Richmond and Buffalo, which I've also visited recently, but I think health care came up as a major local industry in those cities too. I used to live in Birmingham, Ala., which was formerly all about steel but now prides itself as a medical metropolis. And then there's Pittsburgh, and ...

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Goldman Sachs tries to make amends

Goldman Sachs CEO Lloyd Blankfein is sorry. Speaking yesterday at a conference sponsored by Directorship magazine (which has named him CEO of the Year), Blankfein expressed remorse for the firm's role in helping to bring the country to the brink of financial collapse:

"We participated in things that were clearly wrong and have reason to regret and we apologize for them."

A few hours later, in a move Goldman swore wasn't related to recent efforts to burnish its public image, the firm said it would spend $500 million to foster small-business growth—a helping hand to a Main Street still deeply struggling with the effects of financial crisis and recession (even as Goldman itself is back to record profits).

So, what do you say? Could it be time to forgive the vampire squid?

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New article: the U.S.-China imbalance

I've written a piece for TIME.com that's headlined U.S.-China Trade: Prepare for Continued Imbalance. Which pretty much explains what it's about.

          

Better technology at home than at work

In today's WSJ, Nick Wingfield addresses one of the stranger information-technology developments of the past decade. The off-the-shelf computing technology available to anybody with a few bucks to spend (and in some cases without any bucks, as some of the best stuff is free) is significantly better than what large corporations provide their employees:

For a look at how sharp the divide between work and home can be, consider my experience. The Wall Street Journal gives me a laptop with Windows XP, an operating system I found satisfying when it came out eight years ago but that lacks a lot of modern touches, like a speedy file-search function. My home computer, meanwhile, is a two-year-old iMac running the Leopard version of Apple's Macintosh operating system. Among other virtues, it's got a search function called Spotlight that lets me track down files in a flash.

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