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Monday, January 05, 2009
Construction Spending Declines 0.6%
Ken Sweet
FOXBusiness
The U.S. Commerce Department said Monday that total construction spending fell in November, though the decline was less than what the market expected.
According to government figures, total construction spending decreased by 0.6% seasonally adjusted annual rate of $1.078 trillion. Economists interviewed by Thomson Reuters expected November construction spending would go down by 1.2%.
The primary cause for the drop was residential construction spending, which fell in November by 4.1% to $336.3 billion. Year over year, construction spending was down 22.8% from a year ago.
Nonresidential property spending climbed 1% in November, the Commerce Department said, with private-sector construction falling by 1.5% to $756.4 billion. Public construction spending increased 1.4% to $322.0 billion.
Construction spending, because of its long time horizon and high costs, is often a lagging indicator of the overall U.S. economy. The decline in construction spending in November, while partially affected by the recent credit crunch, will not show up for several months down the road, economists said.
"The credit crunch has not yet had time to make itself felt in full," said Ian Shepherdson of High Frequency Economics.
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A specialist is a member of a stock exchange who works as an auctioneer for a specific stock and/or stocks. It can be an individual, partnership, corporation or group of firms.
The specialist works to maintain a "fair and orderly market" for respective stocks, matching up buyers and sellers by displaying the best "bid" and "ask" prices at its trading post. If buys are not equal to sells, the specialist evens the scale by buying or selling shares, accordingly. However, they cannot make their own transactions until all investor orders have been placed.
Gauging supply and demand, the specialist sets an opening price for the stocks in its domain. If a price has not been set by the time the market opens, the specialist can delay that particular stock's opening.
Specialists make money off the "spread," which is the difference between bid and ask prices on orders.
