- - Sunday, September 18, 2011


EU ministers sign off on tougher budget rules

WROCLAW, Poland | The European Union’s 27 countries overcame a year of infighting to agree Friday to tougher budget rules that make it easier to punish overspending governments and that seek to restore faith in the region’s ability to keep its finances in order.

Polish Finance Minister Jacek Rostowski said his EU counterparts approved the measures at their meeting in Wroclaw, Poland, where the ministers were under international pressure to show some progress in their fight to contain the debt crisis.

Although the new rules will not ease immediate market concerns about debt, they are a first indication that Europe’s states are willing to give up some sovereign powers to bolster longer-term confidence in the region. The yearlong delay and the complicated voting procedures that define the final deal, however, suggests more progress will be hard to come by.

Under the new rules, it will be easier to put sanctions on governments that breach the EU’s limits on debts and deficits, because in most cases a state would have to rally a majority of governments to stop the punishment. That is a reversal of powers, since until now, a majority was necessary to impose sanctions. Governments that are found to ignore warnings that they risk breaking debt rules can also be punished.


Household wealth dipped in spring

Americans’ wealth declined this spring for the first time in a year, as stocks and home values fell. At the same time, corporations increased the size of their cash stockpiles.

The combination could slow an already weak economy because it means businesses and consumers are spending less.

Household net worth dropped 0.3 percent to $58.5 trillion in the April-June quarter, according to a Federal Reserve report released Friday. That followed three straight quarterly increases.

The value of Americans’ stock portfolios fell 0.5 percent to $8.9 trillion in the second quarter. Home values dropped 0.4 percent to slightly less than $16.2 trillion.

Declining wealth is the latest risk to the economy, which is already struggling with high unemployment and meager pay raises. People spend less when they feel poorer, and that slows growth.

Businesses respond by cutting back on hiring and expansion plans. Corporations held a record $2 trillion in cash at the end of June, an increase of 4.5 percent from the January-March quarter.


State AGs join case against T-Mobile-AT&T deal

Seven state attorneys general have joined the Justice Department’s lawsuit to block the merger of AT&T Inc. and T-Mobile USA Inc.

The department announced that state attorneys general from New York, Washington, California, Illinois, Massachusetts, Ohio and Pennsylvania have joined Justice’s antitrust lawsuit against AT&T, T-Mobile and Deutsche Telekom AG, the owner of T-Mobile.

In a statement Friday, the Justice Department said the state attorneys general have assisted throughout the investigation of the proposed merger.

The department filed an amended lawsuit adding the state AGs to the case in federal court in Washington.

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