Finance topics

A coalition of retail groups sued the Federal Reserve on Tuesday, claiming the regulator ignored the law by setting too high a cap on the fees that banks can charge merchants for handling debit card purchases.

The National Retail Federation and other groups claimed in U.S. District Court in Washington that the Fed buckled under pressure from bank lobbyists when it set the cap at an average of about 24 cents per transaction in late June. The previously unregulated fees used to average around 44 cents.

The cap, which took effect Oct. 1, was initially proposed at 12 cents.

American Bankers Association CEO Frank Keating accused retailers of ’seeking more profits from government price controls” by filing the suit, and maintained that retailers have not passed on the savings that resulted from the cap to their customers.

The merchant groups, which included National Association of Convenience Stores and the Food Marketing Institute, said that in raising the cap, the Fed considered expenses that the law did not allow.

Their lawsuit maintains that the board dropped its earlier view that the only costs that should be considered in the fee were those involving the authorization, clearing and settlement of a transaction. Instead, the retailers claim, the Fed added costs, such as fraud losses, associated with a bank’s debit card operations that were not included in the law faxless payday loans.

The suit maintains the cap is an “unreasonable interpretation” that exceeds the authority delegated to the Fed under the law. And it complains the Fed wrongly interpreted another provision of the law that requires merchants have a choice of which network handles their transaction.

The law, commonly known as the Durbin Amendment for Sen. Dick Durbin, D-Ill., who championed it, is part of the financial regulatory reform passed in July 2010.

Banks lobbied hard against the fee cap. They maintain it will cost them about $7 billion in annual revenue.

Attempts to compensate for the loss to this and other regulations by charging customers monthly fees for using debit cards sparked a nationwide furor in recent months, leading the banks to drop their plans.

Minnesota-based TCF Bank dropped an earlier lawsuit challenging the legality of the Durbin Amendment a day after the Fed set the cap above its original proposal.

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Tens of thousands of Egyptians rallied Friday in Cairo’s Tahrir square with Islamists in the forefront to protest against what they say are attempts by the country’s military rulers to designate themselves as the guardians of a new Egypt. It was one of the largest rallies in Egypt in recent months.

Most rallies in Tahrir have been led by liberal- or left-leaning groups. But Friday’s rally was dominated by the country’s most organized political group, the Muslim Brotherhood, which has rarely come out in full force since the protests that forced President Hosni Mubarak to step down in February.

The Brotherhood had until recently avoided confrontation with the ruling Supreme Council of the Armed Forces, but now warns of escalating its protest campaign if plans to give permanent political powers to the military are not scrapped.

“The army has no role in ruling people. Its only job is to protect the country. We want civilian rule chosen through democracy,” said Hani Hegazi, a 28-year old Brotherhood member who traveled by bus to Tahrir from the Delta province of el-Beheira.

Banners read: “Down with military rule. Egypt our country is not a military camp.” Some demonstrators flew the Egyptian flag, while others including ultraconservative Salafis waved a banner declaring Islam’s holy book, the Quran, to be “our constitution.”

The rally was called to protest a document floated by the government which declares the military the guardian of “constitutional legitimacy,” suggesting the armed forces could have the final word on major policies even after a new president is elected. The document, which includes guiding principles for Egypt’s new constitution, also introduces clauses that would shield it from civilian oversight.

Most of Egypt’s pro-democracy groups object to the document, calling it an attempt to perpetuate military rule past the post-Mubarak transitional period which is supposed to end with the election of a new parliament and a new president.

In addition to the Brotherhood, Salafis, left- and liberal-leaning groups such as the April 6 movement and other youth revolutionary alliances joined the rally, demanding a timetable for the end of military rule, which began in February.

They have called for marches from mosques around Egypt to major squares, dubbing it the “Friday of the Single Demand” _ that demand being a clear date for the transfer of power to civilian rule. Many groups have planned to hold an open ended sit-in until a date has been set.

The Brotherhood says the document reinforces “dictatorship.”

“It contains articles that rob the people of their sovereignty and reinforces dictatorship. It constitutes a coup against the principles and goals of the January 25 revolution,” the group said in a statement issued Wednesday. Last-minute negotiations between the government and the Brotherhood failed to stave off their participation in the rally, or scrap the document payday loans lenders.

The show of force comes 10 days before the country’s first parliamentary elections since Mubarak stepped down, when a Brotherhood-affiliated political party is expected to fare well.

Anger against the Supreme Council has been building up over their management of the transition period. Many complain that the generals are recreating the Mubarak regime by cracking down on opponents, by refusing to order a thorough reform of the security services, and by monopolizing decision making. Islamists and liberals alike now express fear that the military council wants to hold on to power, a claim denied by the generals.

The military council had promised to transfer power to an elected civilian government within six months of Mubarak’s ouster. But according to a vague timetable in place, it may not be until early 2013 that a president is elected. Only the dates for the parliamentary elections, which are due to begin in ten days and which will drag into March, are yet known.

Walid Farouk, 32, who wore the heavy beard and traditional robe of the ultraconservative Salafi trend, said that Egypt had seen nothing good from military rule since the army first took power in 1952.

“All of us are scared that the army could try to hold on to power,” he said. “It is time for a civilian government.”

The writing of Egypt’s constitution has been a divisive issue, and details of who will write it and what it contains are at the heart of recent rallies.

Some liberals have supported the idea of writing guiding principles for the constitution, fearing that a parliament controlled by Islamists would insert religious principles into the document.

Even now, some liberals remain opposed to the Friday rally, saying a document is necessary to detail how members of the assembly are to be chosen, and controversial clauses can be negotiated.

But many others have come to distrust the military’s Supreme Council at least as much they distrust the Islamists.

At Friday’s rally, protesters are also expected to celebrate the birthday of one of the most prominent revolutionary to be jailed by the military prosecutor. Alaa Abdel-Fattah, a famous blogger and activist, was detained late last months for refusing to answer to the military prosecution on his alleged role in sectarian violence that left 27, mostly Christians, dead. He turned 30 on Friday.

Many hold the military responsible for the violence, and see Abdel-Fattah’s detention as an attempt to find a scapegoat and discredit activists.

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Asian-Pacific leaders gathering in warm, sunny Honolulu this week will be searching for ways to kickstart faster growth through freer trade, moving on from the gloom over European debt that prevailed days earlier at the G20 summit in chilly Cannes.

In an era of debt crises and protests over inequality, the role of the annual Asian Pacific Economic Cooperation summit may turn out to be just as much about confidence building as it is about combating protectionism.

The leaders of the 21 regional economies “do see freer trade flows as critical to growth and jobs,” said Charles Morrison, president of the East-West Center, a think tank in Honolulu.

“The main contribution APEC can make in the short-run is to restore the feeling that the leaders, ministers and central bankers of the major economies are indeed working closely together,” he said.

APEC’s activities encompass a wide range of issues, including climate change, energy and food security, and politics. But the spotlight in Honolulu will be on its original mission: promoting growth through trade and closer economic ties among Pacific Rim nations from Chile to China.

For President Barack Obama, the Aloha APEC, as the event is being dubbed, is a chance to spotlight progress on re-energizing exports, while pushing for a major Pacific rim trade pact.

The U.S. recently clinched long-sought free trade pacts with South Korea, Colombia, and Panama _ agreements that if ratified will bring to 20 the number of countries that have free trade agreements with the U.S.

Such arrangements are potentially worth billions to American exporters, and thousands of new jobs. Despite a recent surge in exports, the U.S. share in Asian international trade has fallen 9 percent since 1990 as other nations have set trading agreements among themselves.

Europe’s debt troubles remain a concern, with talks Wednesday among deputy ministers focusing on how that may affect the global outlook and on the need for willingness to act to counter those headwinds, said a senior U.S. Treasury official.

Officials agreed on the need to push ahead with reducing trade gaps, especially through flexible management of exchange rates. China’s willingness to make that commitment both in Cannes and in Honolulu could encourage similar moves by other Asia-Pacific economies, he said.

Prospects for major progress in Hawaii on establishing a Pacific-wide free trade zone, encompassing more than half the world’s economic output, remain unclear.

The U.S., Australia, Malaysia, Vietnam and Peru are negotiating to join the bloc, called the Trans-Pacific Partnership, which already brings together the smaller economies of Chile, New Zealand, Brunei and Singapore.

Bringing onboard other big regional powers such as Japan and China, the world’s third and second-largest economies, would vastly expand the bloc’s scope and impact.

But Japan’s debate on joining the TPP, sidetracked by the March 11 earthquake and tsunami disaster, remains in limbo, with the ruling party split fast payday loan no faxing. Prime Minister Yoshihiko Noda is expected to hold a news conference in Tokyo before leaving for APEC, when he may announce a decision.

Supporters view membership as a way to revive Japan’s sagging economy, enabling it to better tap into Asia’s dynamism, but politically influential farmers say that cutting tariffs _ the duty on imported rice, for example, is 778 percent _ would destroy them.

Such moves are risky for other countries as well.

“It’s very difficult for countries to make concessions on significant sectors like agriculture or things like that in an environment where there’s not enough to go around in the first place,” Patrick Chovanec, an associate professor at Tsinghua University’s School of Economics and Management in Beijing.

“In this environment, when the world’s gone through the worst contraction since the 1930s, it’s actually pretty miraculous that everybody’s not at each other’s throats over trade. That is something of an accomplishment,” he said.

China, which has not been invited to join the Pacific trade pact, says Washington’s goals are overly ambitious and run the risk of requiring concessions that might not take into account regional disparities in development.

Despite qualms over the pace and scope of any push for a regional free trade bloc, the 20,000 business and political leaders meeting in Hawaii appear to share a general consensus over the region’s potential _ and need _ to compensate for malaise in the U.S. and Europe.

“Our goal for the meetings is to build a commitment for practical policies that will strengthen the global recovery,” Charles Collyns, the U.S. Treasury assistant secretary for international finance, told reporters at a briefing Monday to preview the meetings.

“The dynamic emerging markets must play a bigger role in bolstering global growth,” he said.

The share of exports in the U.S. GDP has risen to 14 percent from 11 percent over the past few years, the highest share in over 200 years, helped by the rebound from the global crisis, a weak U.S. dollar, strong growth in China and South America as well as by policy.

But so far, the export boom has not provided the oomph needed to make a significant dent in unemployment, partly because most growth has been concentrated in sales of corn and soybeans, coal and other resources, rather than in more labor intensive manufacturing, said Ed Gresser of the Progressive Policy Institute in Washington, D.C.

“The export sector has done really well, but the general economy hasn’t,” he said. “In farm areas there are jobs, but in the cities and suburbs we still have 14 million out of work.”

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Male CEOs with faces that are wider relative to facial height achieve better financial performance for their firms, according to research from the University of Wisconsin-Milwaukee.

Elaine M. Wong, assistant professor in the school’s department of communication, analyzed the features of 55 U.S. CEOs and found that in general, the wider the face, the higher the company’s return on assets.

She did not find the same correlation with women. She hypothesizes that wider faces – which her research also links to greater aggression – may have been an evolutionary necessity for men, but not women.

The successful group of current and former CEOs included Herb Kelleher of Southwest Airlines, who turned a pioneering business model into a high-flying success; Kenneth Wolfe, who expanded Hershey chocolate into new markets, dramatically increasing revenues and William Stavropoulous, who made Dow Chemical Company an industry leader.

All have faces that are wider rather than narrower, according to Wong’s research.

The Star asked her to put some Canadian CEOs to the test.

Jim Balsillie, co-chair of Research-in-Motion, the BlackBerry maker whose fortunes have tumbled this year, has a relatively narrow face, according to Wong’s calculations, forecasting less stellar results.

She put Tim Horton’s CEO Paul House and Loblaw’s chief Galen Weston Jr. squarely in the middle of the pack of 55 U.S. CEOs.

U.S. CEOs with lower facial ratios included Paul Allaire of Xerox, George Fisher of Kodak, and Richard Fuld of Lehman Brothers.

Wong cautions against eyeballing it because looks are deceiving. Barack Obama appears to have a thin face, but it only looks that way because he’s tall and thin. Precise measurements reveal he has a relatively wide face.

Even Wong and her fellow researchers don’t eyeball it. They use computer software to standardize the photos and measure the distance between cheekbones and the distance between the brow and upper lip.

But if Obama has a wide face, how to explain the current state of the U.S. economy? How to explain that a year ago, RIM, run by Balsillie and his partner Michael Lazaridis, was flying high?

The research reveals a trend, not an absolute that will hold true in every case, says Wong. And facial width is only one factor among numerous other variables.

The research was based on previous work by the University of Toronto’s Nicholas Rule, Ph.D., an assistant professor of psychology and Canada Research Chair in Social Perception and Cognition.

Rule’s research showed that people are able to judge successful CEOs from less successful ones based on photographs. They can even judge success later in life based on photographs taken in university.

Studies at Brock University have found that hockey players with wider faces tended to be more aggressive, with more penalty minutes, says Rule.

“It suggests there is something about the face,” says Rule. “What these studies are doing is saying indeed it’s the facial metrics.”

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CUPERTINO, CALIF.—Apple Inc. says there is a problem with its latest mobile operating system that is shortening the battery life of iPhones, iPads and iPods that use the software.

Spokeswoman Natalie Harrison said Wednesday that a small number of customers have reported lower-than-expected battery life on devices running on the company’s iOS 5 operating system.

She said Apple has found bugs in the program and will release a software update to address them in a few weeks.

The latest iPhone, the 4S, comes with iOS 5.

Other devices can be upgraded to run the software: The iPhone 3GS or 4, iPads and an iPod Touch released in September 2009 or later.

Apple shares added $1.59 to $399 in aftermarket trading. Shares ended the regular session up 41 cents at $397.41.

In the meantime, if you’re suffering from battery problems on the iPhone 4S, here are a few things you can try (via Wired and Gizmodo):

1 payday loans. Drain the phone’s battery completely and then charge it up to 100 per cent. Doing so can recalibrate the battery and solve the issue.

2. One user in Apple’s forums found that disabling the calendar in their Exchange mail account and then enabling it again dramatically improved battery life.

3. If neither of those fixes seem to be helping, try adjusting your settings. Normal battery-saving techniques like lowering screen brightness or turning off Wi-Fi or switching to Airplane Mode when you don’t mind being off the grid will help

4. Location: turn off location-based services, or just on the apps you don’t need monitoring your whereabouts constantly. You can also switch off push notifications for email, switching to fetch at longer intervals instead.

Here are a few more useful tips in the video below:

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The Greek government teetered and stock markets around the world plummeted Tuesday after a hard-won European plan to save the Greek economy was suddenly thrown into doubt by the prospect of a public vote.

One day after Prime Minister George Papandreou stunned Europe by calling for a referendum, the ripples reached from Athens, where some of his own lawmakers rebelled against him, to Wall Street, where the Dow Jones industrial average plunged almost 300 points.

Papandreou convened his ministers Tuesday night, and a spokesman said the prime minister was sticking to his decision to hold the referendum, which would be the first since Greeks voted to abolish the monarchy in 1974. Papandreou has also called a vote of confidence in his government, to be held midnight Friday.

“The government is not falling,” said Angelos Tolkas, a deputy government spokesman.

Under a recently amended law, a referendum can be called by presidential decree on issues of grave national concern, if it is proposed by the cabinet and approved by absolute majority in the 300-member parliament.

With several of his lawmakers rebelling, it was unclear whether Papandreou would have enough support to push the idea through. Although he had not set a specific question or date for the referendum, ministers indicated it would likely be held in January.

Papandreou’s decision upended a deal that was the product of months of work by European leaders who were trying, sometimes opposed by their own people, to agree the details of a second bailout for Greece and shore up their own economies in the name of saving the euro, the common currency.

The deal would require banks that hold Greek government bonds to accept 50 percent losses and provide Greece with about $140 billion in rescue loans from European nations and the International Monetary Fund.

But Greeks have been outraged by repeated rounds of tax increases and salary and pension cuts imposed as the government struggles to meet the conditions of a first, $153 billion bailout the country has been relying on since May 2010. With Greece facing a fourth year of recession next year, unions have held frequent strikes, and protests have often degenerated into riots.

A Greek rejection of the second rescue package could cause bank failures in Europe and perhaps a new recession in Europe, the market for 20 percent of American exports. It could also cause Greece to leave the alliance of 17 nations that use the euro.

European leaders made no secret of their displeasure.

“This announcement surprised all of Europe,” said a clearly annoyed French President Nicolas Sarkozy, who has been scrambling to save face for Europe before he hosts leaders of the Group of 20 major world economies later this week.

“Giving the people a say is always legitimate, but the solidarity of all countries of the eurozone cannot work unless each one consents to the necessary efforts,” he said.

French lawmaker Christian Estrosi was even more direct. He told France-Info radio that the move was “totally irresponsible” and reflected “a wind of panic” blowing on Papandreou and his party.

“I want to tell the Greek government that when you are in a situation of crisis, and others want to help you, it is insulting to try to save your skin instead of assuming your responsibilities,” Estrosi said.

Sarkozy and German Chancellor Angela Merkel, who have been at the forefront of Europe’s efforts to contain national debt, talked by phone and agreed to convene emergency talks Wednesday in Cannes, France. Papandreou will also attend.

Merkel also spoke by telephone Tuesday with Papandreou, his office said.

The response was brutal in the international financial markets, especially in Europe. Greece’s general price index plunged to close down 6.92 percent, while in Germany the Dax index, the major stock market average, lost 5 percent _ the equivalent of about 600 points on the Dow.

The French stock market closed down 5.4 percent, the Italian 6.7 percent and London 2.2 percent.

“Talk about your all-time bonehead moves,” said Benjamin Reitzes, an analyst at BMO Capital Markets free business cards.

In New York, the stocks of major banks like Citigroup and JPMorgan Chase were hit hard. The value of the dollar rose, and bond prices jumped so dramatically that analysts said they were stunned.

Analysts said the bond action reflected fears that the turmoil in Greece would tear at the fabric of Europe’s financial system and create a crisis that could engulf the entire European Union, which together forms the world’s largest economy.

“This brings all of the concerns about Europe back to the front burner,” said Scott Brown, chief economist at Raymond James. “If this ends up turning into a financial catastrophe in Europe, then no one will escape it.”

Papandreou’s decision was such a surprise that even the finance minister, Evangelos Venizelos, apparently did not know about it ahead of time. He was unable to make the ministers’ meeting Tuesday after being hospitalized with stomach pains. He was to remain in the clinic overnight.

The main opposition conservatives called for Papandreou’s resignation. But criticism was also intense from Papandreou’s own Socialists, who have been clinging to a shrinking parliamentary majority.

A public vote would allow the party, vilified by an increasingly hostile public during months of strikes, sit-ins and violent protests over austerity measures, to shift responsibility for the country’s fate to the Greek people themselves.

But it was unclear whether Papandreou’s government would last long enough for the referendum to take place _ or even until Friday’s confidence vote.

Several Socialist lawmakers openly rebelled, with one going as far as defecting. Milena Apostolaki’s departure whittled Papandreou’s parliamentary majority to just two deputies, leaving the party with 152 seats in the 300-member legislature.

Apostolaki’s departure “shows clearly that the government itself is losing gradually its cohesion,” said George Tzogopoulos, a political analyst from the Hellenic Foundation for European and Foreign Policy.

He estimated that “that the government will not be able to remain in power for many days” and said it was likely that Papandreou “will call an early election very soon.”

Papandreou did not ask for a vote last year, when Greece got its first round of international bailouts, about the same size as what is being debated now. Some lawmakers wondered why he called for one this time.

“Yesterday’s surprise and irrational announcement of the referendum has led me to doubt something that I considered certain until yesterday: That I am a member of a group that is striving to save our country from bankruptcy,” Socialist deputy Hara Kefalidou said in a letter to Papandreou. “I cannot back a referendum which is a subterfuge by a government that appears unwilling to govern.”

Jean-Claude Juncker, who chairs eurozone ministerial meetings, said the referendum was a dangerous decision that could endanger Greece’s next installment of bailout loans _ without which the country will run out of money in mid-November.

Juncker told RTL radio in Luxembourg that the vote proposal changes the conditions of that deal, according to his spokesman, Guy Schuller.

It was not only international leaders who were taken by surprise.

Venizelos, the finance minister, “found out about it along with all other Greeks” during Papandreou’s speech, which was televised live, an official close to Venizelos told The Associated Press. The official spoke on condition of anonymity to discuss sensitive details.

From his hospital bed, Venizelos launched a telephone campaign to shore up international support for the debt deal, speaking with the German finance minister, the head of Deutsche Bank and the monetary affairs chief for the European Union, among others.

____

Associated Press writers Derek Gatopoulos and Nicholas Paphitis, and APTN producer Ted Tongas in Athens, Angela Charlton in Paris, Raf Casert in Brussels and David McHugh in Berlin contributed.

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U.S. stock futures are lower on worries about the broker MF Global and about Italy’s ability to repay its debts.

Bank stocks dropped sharply in premarket trading after the New York Federal Reserve said it suspended MF Global Holdings from conducting new business as a Treasury bond dealer.

Trading in MF Global shares was halted in premarket trading.

The Wall Street Journal reported Monday that MF Global would seek Chapter 11 bankruptcy protection after large investments in sovereign bonds issued by European countries went against it guaranteed high risk personal loans.

Before the opening bell, Dow Jones industrial average futures are down 106 points, or 1 percent, at 12,062. S&P 500 index futures are down 14, or 1.1 percent, at 1,266. Nasdaq 100 futures are down 23, or 1 percent, at 2,374.

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The 17-nation eurozone is considering two forms of leveraging to boost its euro440 billion ($600 billion) bailout fund’s capacity in a bid to contain the debt turmoil that threatens to engulf more European nations.

A document obtained by The Associated Press, which Germany’s government was sharing with key lawmakers Monday, shows the currency zone wants to give the bailout fund the ability to provide investors with a partial insurance against losses from its member states’ government bonds.

The eurozone document also foresees setting up a special investment vehicle that seeks to attract outside investors such as sovereign wealth funds, combining “public and private capital to enlarge the resources available to” the European Financial Stability Fund, or EFSF.

Leading German opposition lawmakers, who were briefed earlier Monday by Chancellor Angela Merkel on the plan, said the fund’s capacity will be boosted “beyond euro1 trillion” ($1.39 trillion) under the new rules.

But the draft document by the eurozone working group did not provide a headline figure for the bailout fund, stressing “a more precise number on the extent of leverage can only be determined after contacts with potential investors” and rating agencies.

Eurozone governments hope that the enhanced EFSF will be able to protect countries such as Italy and Spain from being engulfed in the debt crisis. To do that, however, it needs to be bigger or see its lending powers magnified.

German lawmakers will vote on the bailout funds’ new rules Wednesday, hours before an EU summit in Brussels is set to adopt them.

The draft document stressed that the EFSF would “benefit from the flexibility to deploy both options, which are not mutually exclusive.” The insurance model is designed to increase the demand for newly issued eurozone government bonds, lower the yields “thereby supporting the sustainability of public finances,” the document said.

Lowering the yields for troubled eurozone governments is a key step to counter the widening debt crisis, because spiraling yields on debt issued by Greece, Portugal and Ireland eventually cut them off from market financing, forcing the eurozone to provide those nations which an emergency loan package.

In the event of a default, “the investor could surrender the partial protection certificate” and “receive payment in kind with an EFSF bond,” the document said, referring to the insurance option.

The new investment facility, a so-called special investment purpose investment vehicle, is meant to allow the EFSF “to attract a broad class of international public and private investors.” The investment structure aims at creating “additional liquidity and market capacity to extend loans, for bank recapitalization via a member state and for buying bonds in the primary and secondary market,” the eurozone draft document said.

Beefing up the bailout fund is one part of a three-pronged eurozone plan to solve the crisis.

The other two parts are reducing Greece’s debt burden so the country eventually can stand on its own and forcing banks to raise more money so they can take losses on the Greek debt and ride out the financial storm that will entail.

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China’s trade with its close ally North Korea nearly doubled in the first seven months of the year compared with the same period in 2010, state media reported Sunday.

The 87 percent increase to $3.1 billion was announced at the start of a visit to the North by Chinese Vice Premier Li Keqiang that reaffirms strong ties between the communist neighbors.

Li said China was hoping for better relations between North and South Korea and a resumption of long-stalled six-nation nuclear disarmament talks.

China wants to work with all parties in promoting the denuclearization of the Korean peninsula and safeguarding regional peace and development, the official Xinhua News Agency quoted Li’s statement as saying.

North Korea relies heavily on China for food and fuel aid and many consumer products. Chinese companies are the main investors in North Korean mining, and the sides recently signed agreements on road building and jointly developing an industrial park on an island near the Chinese city of Dandong.

“The economic and trade cooperation between the two countries has shown great potential, with bilateral trade and investment volume reaching new highs,” Xinhua said, citing the Chinese ambassador to Pyongyang, Liu Hongcai.

Bilateral trade between China and North Korea still is dwarfed by economic ties between China and South Korea. China is South Korea’s largest trade partner.

Trade between Beijing and Seoul rose more than 20 percent in the first eight months of the year to $159 billion and is expected to hit about $250 billion for all of 2011.

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Unemployment rates fell in half of U.S. states last month, a sign that September’s pickup in hiring was felt around the country.

The Labor Department says unemployment rates dropped in 25 states, rose in 14 and stayed the same in 11. That’s a modest improvement from August, when unemployment rose in 26 states.

Nationwide, employers added 103,000 net jobs in September, nearly double the number created in August. Still, that’s not enough to lower the unemployment rate, which stayed at 9.1 percent for the third straight month.

Nevada reported the highest unemployment rate for the 16th straight month. It stayed at 13.4 percent for the second consecutive month. California was next. The rate there fell from 12.1 in August to 11.9 percent. Michigan had the third-highest rate, at 11.1 percent.

Layoffs have slowed at a national level in recent months. The number of people applying for unemployment benefits has fallen to a six-month low, according to a four-week average calculated by the government. That has helped calm fears that the economy was sliding into another recession, as have other recent data.

Manufacturers in the Philadelphia region grew in October after contracting for two straight months, according to a survey by the Federal Reserve Bank of Philadelphia. In September, consumers boosted their spending on retail goods by the most in seven months.

Still, the national unemployment rate has been stuck near 9 percent for more than two years payday loan. Employers have added an average of only 72,000 jobs per month in the past five months. That’s far below the 100,000 per month needed to keep up with population growth. And it’s down from an average of 180,000 in the first four months of this year.

Americans are pessimistic about the economy. And more than half say President Barack Obama does not inspire confidence about a recovery.

A sizable majority _ more than 7 in 10 _ believe the country is headed in the wrong direction, according to a new Associated Press-GfK poll. And 43 percent describe the nation’s economy as “very poor,” a new high. Among those surveyed, less than 40 percent say Obama’s proposed remedies for high unemployment would increase jobs significantly.

Employers pulled back on hiring this spring after seeing less demand from consumers. Higher food and gas prices forced consumers to rein in spending. Consumer spending accounts for 70 percent of economic activity.

Job growth is critical to a recovery in the housing market, which many economists say is years away.

The number of Americans who bought previously occupied homes fell in September to a seasonally adjusted annual rate of 4.91 million homes, the National Association of Realtors said Thursday. The pace matches last year’s sales figures, which were the worst since 1997.

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