Platinum set to hit parity with gold, but comeback may be a blip

SINGAPORE (Reuters) - Platinum is set to reach parity with gold after rallies in recent weeks sent the metal's discount to gold to its narrowest in nine months, but it may be too early to declare platinum's comeback since economic recovery remains weak, especially in Europe.
The spread between gold and platinum narrowed to $31.30 an ounce, its smallest since last April, after platinum staged its biggest two-week rise in about four months on growing expectations of global economic recovery. On average, platinum has stood at a $190 an ounce premium over gold since 1985.
As more than half of platinum is used in industrial applications, the sluggish global economy had dulled the shine of the metal, despite its scarcity and a market deficit caused by supply constraint from top producer South Africa.
That picture may shift this year to platinum's favour, as hopes grow that Europe may stabilise and the global economy embark on a steady path to recovery, lifting outlook for metals used in industries.
"You have a metal which is more expensive to produce than gold, whose supply is not growing and whose market is expected to be in a deficit, such metal should trade at a premium to gold," said Dominic Schnider, an analyst at UBS Wealth Management in Singapore.
But he cautioned that a return to a big premium in platinum would be unrealistic.
"We are going to make it to the parity and a possible $50 premium in platinum. But the global economy is still on a weak footing and it will be too early to call a $100 premium."
The average production cost of platinum was about $1,600 an ounce, while the production cost of gold stood at $1,200 an ounce, he added.
Spot gold traded at $1,668.24 an ounce by 0827 GMT, down about 0.4 percent so far this year after posting gains for the twelfth year in 2012.
Spot platinum traded at $1,635, up more than 6 percent so far this year and leading the performance of the precious metals complex.
Some analysts are less sanguine, citing the protracted dismal economic conditions in Europe.
"I worry we might see a repeat of what happened last March," said Nick Trevethan, senior commodity strategist at ANZ in Singapore, referring to a short period of platinum's premium to gold in early 2012.
"In order for platinum to hold a premium over gold, we need to see a little more strength in demand...especially from Europe. The supply side risk is there, but it hasn't materialised sufficiently to maintain platinum at its traditional premium to gold."
About two thirds of Europe's platinum demand in 2011 went to the auto sector. Car sales in the region are expected to further decline in 2013, as the euro zone debt crisis and government austerity measures sap consumer demand.
The high net longs in U.S. platinum futures and options may pose a threat to a sustained platinum rally, as the speculators loaded with long positions may sell off to take profit in the short run, analysts and traders said.
Net longs in U.S. platinum futures and options bounced from a one-month low to 28,939 lots in the week ended Jan 8, down 18 percent from an October peak of 35,145 lots, but up 59 percent from the 2012 average.

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World stocks higher on China recovery optimism

BANGKOK (AP) — World stock markets rose Monday on optimism that China's economic recovery is firmly taking root.
Many analysts expect China's fourth quarter and 2012 growth figures due Friday to show the world's No. 2 economy continuing to bounce back from its worst slump since the 2008 financial crisis.
Sentiment improved last week after Japan announced a $224 billion stimulus package to boost its recession- and deflation-mired economy. A strong economic recovery has eluded Japan for more than 20 years since the bursting of its financial bubble in the early 1990s.
Britain's FTSE 100 rose marginally to 6,123.87. Germany's DAX gained 0.2 percent to 7,727.68. France's CAC-40 added 0.2 percent to 3,713.79.
Wall Street was set for slight gains, with Dow Jones industrial futures rising slightly to 13,437 while S&P 500 futures gained 0.1 percent to 1,468.20.
Stock markets in Asia posted gains as investors grew more confident about China's economic recovery. China reported improving exports and imports last week, a sign of higher demand both inside and outside the country. More signs of improvement are expected when China releases a slew of data on Friday, including factory output, investment and retail sales.
Hong Kong's Hang Seng rose 0.6 percent to 23,413.26. South Korea's Kospi added 0.3 percent to 2,002.77 and Australia's S&P/ASX 200 advanced 0.2 percent to 4,719.70. Japan's financial markets were closed for a public holiday.
Mainland Chinese stock markets were boosted when Guo Shuqing, chairman of the China's securities regulator, said at a conference in Hong Kong that there was room to raise by "at least" tenfold the quota of foreign institutions allowed to invest in China's domestic stock markets, which are largely off-limits to outsiders because of capital controls.
Mainland China's Shanghai Composite Index soared 3.1 percent to 2,311.74 while the Shenzhen Composite Index for China's second, smaller stock market jumped 3.6 percent to 918.23.
Dariusz Kowalczyk of Credit Agricole CIB in Hong Kong said China's growth likely picked up in the fourth quarter of 2012 to 7.9 percent from 7.4 percent in the three months ended in September. He expects first quarter growth in 2013 to hit 8.5 percent. He said such figures should put to rest worries that China's economy might be in for a hard landing.
"Risks have diminished both externally and domestically, and if they rebound, China has sufficient resources to manage them, so we are upbeat that a relapse will not occur," he said in an email.
Still, a bobble in trade could cause a reversal, while inflation pressure is rising because of poor winter harvests, which would make it harder for Beijing to embark on new stimulus measures without pushing prices up more.
Analysts at Societe Generale have not ruled out a hard landing, which they define as real GDP growth falling below 6 percent, partly because of China's vulnerability to trade shocks.
Among individual stocks, South Korea's SK Telecom advanced 4.2 percent while Hyundai Heavy Industries fell 1.1 percent. In Shanghai, gold retailer Lao Feng Xiang Co. Ltd. jumped 7 percent. China AVIC Avionics Equipment soared 10 percent.
Benchmark oil for February delivery was up 49 cents to $94.05 per barrel in electronic trading on the New York Mercantile Exchange. The contract dropped 26 cents to finish at $93.56 a barrel in New York on Friday.
In currencies, the euro rose to $1.3354 from $1.3338 late Friday in New York. The dollar rose to 89.37 yen from 89.20 yen.

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Stock index futures trade flat to higher

Reuters/Reuters - Traders work on the floor of the New York Stock Exchange June 11, 2012. REUTERS/Brendan McDermid
LONDON (Reuters) - Stock index futures pointed to a flat to higher open on Wall Street on Monday, with futures for the S&P 500 up 0.1 percent at 0844 GMT.
Dow Jones and Nasdaq 100 futures were unchanged.
European shares were also flat, with the FTSEurofirst 300 <.fteu3> just shy of a two-year high. The pan-European index has risen almost 3 percent since the start of the year.
The U.S. economy is expected to grow by 2.5 percent in 2013, improving to 3.5 percent growth in 2014, top Fed official Charles Evans said on Monday. Evans also forecast the U.S. unemployment rate would be 7.4 percent, easing to about 7 percent in 2014. Fed Chairman Ben Bernanke speaks at 2100 GMT. [ID:nL4N0AJ1JA]
Americans are beginning to feel the pinch from austerity measures. Paychecks across the country have shrunk over the last week due to higher federal tax rates, and workers say they are cutting back on spending.
Apple Inc has almost halved its order with suppliers of LCD panels for the iPhone 5 in the current quarter due to weak demand, Japanese daily Nikkei reported on Monday.
Oracle Corp released an update to its Java software for surfing the Web on Sunday, which security experts said fails to protect PCs from attack by hackers intent on committing cyber crimes.
Transocean Ltd said billionaire activist investor Carl Icahn bought a 1.56 percent stake in the offshore rig contractor and is looking to increase his holding.
Japan Airlines Co (JAL) said on Sunday that a Boeing Co 787 Dreamliner jet undergoing checks in Tokyo following a fuel leak at Boston airport last week had leaked fuel during tests earlier in the day.
Pickup truck sales are expected to outpace the broader U.S. auto market this year helped by a recovering housing market and a slew of new models from the three big U.S. automakers, executives and analysts said on Sunday.
American International Group Inc has filed a lawsuit against a vehicle created by the Federal Reserve Bank of New York to help bail out the insurer, in a bid to preserve its right to sue Bank of America Corp and other issuers of mortgage debt that went sour.
Bank of America Corp directors have reached a $62.5 million settlement to resolve investor claims over the bank's acquisition of Merrill Lynch & Co, a person familiar with the matter said, after a federal judge expressed reservations about an earlier version of the accord.
JPMorgan Chase & Co's board is expected to dock the 2012 bonuses of Chief Executive James Dimon and another top executive because of the "London Whale" trading debacle, the Wall Street Journal reported, citing people close to the company.
The first big earnings week of 2013 features major banks Goldman Sachs and JPMorgan Chase & Co, as well as online retailer eBay on Wednesday. Thursday's reports include Citigroup, Bank of America and chip maker Intel . General Electric, the largest U.S. conglomerate, is due to post fourth-quarter earnings on Friday.
The Dow Jones industrial average <.dji> gained 17.21 points, or 0.13 percent, to 13,488.43. The Standard & Poor's 500 Index <.spx> dipped 0.07 points to 1,472.05. The Nasdaq Composite Index <.ixic> added 3.88 points, or 0.12 percent, to 3,125.64.

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Boehner plan would bring top U.S. income tax rate to 39.6 percent: source

WASHINGTON (Reuters) - House of Representatives Speaker John Boehner's latest "fiscal cliff" proposal to President Barack Obama would see the top income tax rates rise to 39.6 percent from 35 percent for those with net incomes above $1 million a year, according to a source familiar with the talks.
The source, who asked not to be identified, emphasized that the income tax rate increase would be in exchange for "significant entitlement reforms/spending cuts." Entitlement programs include Medicare and Medicaid healthcare for the elderly and poor and Social Security retirement benefits.
The White House has not accepted Boehner's proposal, according to another source. Under current law, the top tax rate is scheduled to rise to 39.6 percent on January 1, unless Congress extends the current 35 percent, as Republicans had been urging.

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House Republicans eye limited fiscal cliff bill

WASHINGTON (Reuters) - With time running short before a Dec. 31 deadline, House of Representatives Speaker John Boehner will begin work on legislation that simply would extend current low income tax rates for all families with incomes below $1 million a year, according to an aide.
Negotiations will continue with the White House on a broader tax and spending deal, the Boehner aide said.
Boehner is presenting the plan to rank-and-file Republicans in a closed-door session.
On January 1, income tax increases for most Americans will begin unless Congress acts.
Last July, the Democratic-controlled Senate passed a bill to extend the current low rates for all families with net incomes below $250,000 a year. The House Republican proposal, if passed by the House, would require agreement by the Senate or force a round of negotiations on a compromise between the two chambers.
In excerpts of remarks Boehner was delivering to his Republican members Tuesday morning, the speaker complained that "the White House just can't seem to bring itself to agree to a 'balanced' approach" to deficit-reduction in negotiations. At the same time, Boehner said Republicans were "leaving the door wide open for something better" than just the limited extension of current low tax rates for most Americans.
"Current law has tax rates going up on everyone January 1. The question for us is real simple: How do we stop as many of those rate hikes as possible?" Boehner said.
For months, Democrats have been urging House Republicans to pass a bill protecting middle-class taxpayers from a January 1 rate increase.

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Senator Reid rejects Boehner "fiscal cliff" backup plan

WASHINGTON (Reuters) - House Speaker John Boehner's backup plan that would simply extend low income tax rates for households with incomes below $1 million a year "cannot pass both houses of Congress," Senate Majority Leader Harry Reid said on Tuesday.
Reid, a Democrat, said Boehner instead should focus on reaching a broad deficit-reduction deal with President Barack Obama. "Now is the time to show leadership, not kick the can down the road," Reid said.
Last July, Reid's Democrats passed a bill in the Senate that would have continued low tax rates, which are set to expire on December 31, for families with net incomes below $250,000.

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House Republicans say resigned to tax hike in fiscal cliff

 Republicans in the U.S. House of Representatives are resigned to seeing some sort of income tax increase in legislation to avoid a "fiscal cliff," but such efforts could be doomed in the absence of spending cuts, some Republican lawmakers say.
Congress and President Barack Obama are gearing up for a last-ditch attempt to avoid $600 billion in tax increases and spending cuts that could halt progress in the U.S. economy, which lately has been showing signs of gaining ground.
The White House said Obama will host a meeting on Friday with the four top congressional leaders - Senate Majority Leader Harry Reid, Senate Minority Leader Mitch McConnell, House of Representatives Speaker John Boehner and House Minority Leader Nancy Pelosi. The Republicans have a majority in the House, while Obama's Democrats control the Senate.
House Speaker John Boehner informed his 241 Republican members on Thursday that the House would come back into session late on Sunday in anticipation of possible fiscal-cliff votes.
This Sunday's session "was about the only thing decided" during a half-hour conference call among House Republicans, said Representative Jeff Flake of Arizona, who will leave the House at the year-end to join the Senate.
In an interview shortly after the phone call, Flake said Republicans in the House and Senate were resigned to seeing some sort of increase in top income-tax rates, although he did not specify a dollar threshold.
While he said he did not want to see any income tax rates go up, Flake said: "I've felt we should've moved a week or two ago to accept the top rate going up and tell the president 'congratulations.'"
The bigger problem in avoiding the fiscal cliff, Flake said, would be if Obama demanded cancellation of the $109 billion in automatic spending cuts set to begin on January 2 without alternative spending cuts to replace them.
"There will be resistance from a lot of House conservatives to a deal that does that," Flake said.
Asked if the days leading up to next Monday, December 31 could thus be fruitless, Flake said, "That is what I am afraid of."
A Senate Democratic aide did not discount the possibility of some spending cuts being included in a limited bill to avert the fiscal cliff - even if they fell far short of the $1 trillion or so in cuts over 10 years that at one point was being discussed in talks between Boehner and Obama.
'TIRED OF WAITING'
Representative Tom Cole of Oklahoma, who also participated in Thursday's House Republican conference call, said its overarching theme was that the Senate should take the bill passed by the House earlier this year to extend all expiring income tax rates and amend it in a way senators see fit.
The House could then either accept that measure, or amend it, and bounce it back to the Senate.
"People are tired of waiting on the Senate to do things," Cole said.
Senate Democrats counter that last July they passed a bill extending the Bush-era tax cuts - except on net household income above $250,000 a year.
Nevertheless, the Senate must still couple its tax-cut bill with Obama's request for extending jobless benefits and possibly some other budget or tax measures.
"I assume the House would want to come back on Sunday knowing that we (the Senate) were going to do something on Friday or Saturday," said Senator Roy Blunt of Missouri, a member of the Senate's Republican leadership.
House Republican leaders informed their members that the chamber could stay in session dealing with the fiscal cliff through Wednesday, January 2 - the last day of the current Congress and a day before the new Congress is sworn in.
Cole said Boehner "made very apparent he is not interested in passing a bill that didn't have a majority of Republicans" supporting it.
But Cole said this was "not quite as elusive to achieve" as many people thought. He said Boehner had "over 200 votes" out of 241 Republicans for his failed "Plan B" - a bill extending lower tax rates except for millionaires - which everyone knew would not become law.
Thus, a bill with prospects of being enacted could attract more support, Cole suggested.
If a new bill came to the House floor to raise taxes on upper incomes, Boehner could force passage with a combination of Democratic and Republican votes.
With public opinion polls showing that Republicans would get most of the blame if the country were to go over the fiscal cliff, some House Republicans have become nervous about their political fortunes.
Both Flake and Cole told Reuters that during Thursday's conference call, some Republicans urged Boehner to bring the House back to Washington sooner than Sunday - a request Flake described as being aimed at improving the "optics" of House Republicans being absent from Washington so close to the December 31 deadline.
But Boehner stuck with his promise to give members at least 48 hours notice of a return.
Cole remained upbeat about a positive end to the fiscal-cliff mess that has gripped Washington for two months now.

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French government says will propose a rejigged 75 percent tax plan

 The French government will redraft a proposal for a 75 percent upper income tax band and resubmit it, the prime minister's office said on Saturday, after the Constitutional Council rejected the measure included in the 2013 budget.
"It will be presented as part of the next budget law," Prime Minister Jean-Marc Ayrault's office said in a statement, without giving a time frame. The statement said the Council's rejection of the 75 percent tax would not affect efforts to trim the public deficit.

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French court rejects 75 percent millionaires' tax

PARIS (Reuters) - France's Constitutional Council on Saturday rejected a 75 percent upper income tax rate to be introduced in 2013 in a setback to Socialist President Francois Hollande's push to make the rich contribute more to cutting the public deficit.
The Council ruled that the planned 75 percent tax on annual income above 1 million euros ($1.32 million) - a flagship measure of Hollande's election campaign - was unfair in the way it would be applied to different households.
Prime Minister Jean-Marc Ayrault said the government would redraft the upper tax rate proposal to answer the Council's concerns and resubmit it in a new budget law, meaning Saturday's decision could only amount to a temporary political blow.
While the tax plan was largely symbolic and would only have affected a few thousand people, it has infuriated high earners in France, prompting some such as actor Gerard Depardieu to flee abroad. The message it sent also shocked entrepreneurs and foreign investors, who accuse Hollande of being anti-business.
Finance Minister Pierre Moscovici said the rejection of the 75 percent tax and other minor measures could cut up to 500 million euros in forecast tax revenues but would not hurt efforts to slash the public deficit to below a European Union ceiling of 3 percent of economic output next year.
"The rejected measures represent 300 to 500 million euros. Our deficit-cutting path will not be affected," Moscovici told BFM television. He too said the government would resubmit a proposal to raise taxes on high incomes in 2013 and 2014.
The Council, made up of nine judges and three former presidents, is concerned the tax would hit a married couple where one partner earned above a million euros but it would not affect a couple where each earned just under a million euros.
UMP member Gilles Carrez, chairman of the National Assembly's finance commission, told BFM television, however, that the Council's so-called wise men also felt the 75 percent tax was excessive and too much based on ideology.
FRANCE UNDER SCRUTINY
Hollande shocked many by announcing his 75 percent tax proposal out of the blue several weeks into a campaign that some felt was flagging. Left-wing voters were cheered by it but business leaders warned that talent would flee the country.
Set to be a temporary measure until France is out of economic crisis, the few hundred million euros a year the tax was set to raise is a not insignificant sum as the government strives to boost public finances in the face of stalled growth.
Hollande's 2013 budget calls for the biggest belt-tightening effort France has seen in decades and is based on a growth target of 0.8 percent, a level analysts view as over-optimistic.
Fitch Ratings this month affirmed its triple-A rating on France but said there was no room for slippage. Standard & Poor's and Moody's have both stripped Europe's No. 2 economy of its AAA badge due to concern over strained public finances and stalled growth.
The International Monetary Fund recently forecast that France will miss its 3 percent deficit target next year and signs are growing that Paris could negotiate some leeway on the timing of that goal with its EU partners.
The INSEE national statistics institute this week scaled back its reading of a return to growth in the third quarter to 0.1 percent from 0.2 percent, and the government said it could review its 2013 outlook in the next few months.
Saturday's decision was in response to a motion by the opposition conservative UMP party, whose weight in fighting Hollande's policies has been reduced by a leadership crisis that has split it in two seven months after it lost power.
The Constitutional Council is a politically independent body that rules on whether laws, elections and referenda are constitutional.

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Rejected French tax measures worth 300-500 million euros: finance minister

The French Constitutional Council's rejection on Saturday of a 75 percent upper income tax rate and other minor measures in the 2013 budget will affect some 300-500 million euros worth of tax revenues, Finance Minister Pierre Moscovici said.
"The rejected measures represent 300 to 500 million euros. Our deficit-cutting path will not be affected," Moscovici told BFM television.
He added that the Socialist government would resubmit a proposal to raise taxes on high incomes in 2013 and 2014.

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AP Sources: 'Fiscal cliff' deal emerging

 Working with Congress against a midnight deadline, President Barack Obama said Monday that a deal to avert the "fiscal cliff" was in sight but not yet finalized. The emerging deal would raise tax rates on family income over $450,000 and individual income over $400,000 a year, increase the estate tax rate and extend unemployment benefits for one year.
"There are still issues left to resolve but we're hopeful Congress can get it done," Obama said at a campaign-style event at the White House. "But it's not done."
In the building New Year's Eve drama, the parties still were at an impasse over whether to put off the automatic, across-the-board spending cuts set to take effect at the beginning of the year and if so, how to pay for that.
One official said talks were focused on a two-month delay in the across-the-board cuts but negotiators had yet to agree on about $24 billion in savings from elsewhere in the budget. Democrats had asked for the cuts to be put off for one year and be offset by unspecified revenue.
The president said that whatever last-minute fixes are necessary, they must come from a blend of tax revenue and constrained spending, not just budget cuts.
And a little more than an hour after Obama spoke, Senate Republican leader Mitch McConnell said it was time to decouple the two major issues.
"We'll continue to work on smarter ways to cut spending, but let's not let that hold up protecting Americans from a tax hike that will take place in about ten hours," he said.
Officials emphasized that negotiations were continuing and the emerging deal was not yet final. And a confident Obama, flanked by cheering middle class Americans in a White House auditorium, jabbed Congress, saying lawmakers were prone to last-minute delays.
"One thing we can count on with respect to this Congress is that if there's even one second left before you have to do what you're supposed to do, they will use that last second," he said.
Speaking shortly afterward on the Senate floor, Sen. John McCain said that "at a time of crisis, on New Year's Eve...you had the president of the United States go over and have a cheerleading, ridiculing-of-Republicans exercise." The Arizona Republican lost the 2008 presidential race to Obama.
Unless an agreement is reached and approved by Congress at the start of the New Year, more than $500 billion in 2013 tax increases will take effect immediately and $109 billion in cuts will be carved from defense and domestic programs
Though the tax hikes and budget cuts would be felt gradually, economists warn that if allowed to fully take hold, their combined impact — the so-called fiscal cliff — would rekindle a recession.
The current proposal in the works would raise the tax rates on family income over $450,000 and individual income over $400,000 from 35 percent to 39.6 percent, the same level as under former President Bill Clinton. Also, estates would be taxed at 40 percent after the first $5 million for an individual and $10 million for a couple, up from 35 percent to 40 percent.
Unemployment benefits would be extended for one year. Without the extension, 2 million people would lose benefits beginning in early January.
A Republican official familiar with the plans confirmed the details described to The Associated Press.
The officials requested anonymity in order to discuss the internal negotiations.
The president said his hopes for a larger, more sweeping deal have been dashed and said that such an accommodation was not possible "with this Congress at this time."
But even with this fight not finished, Obama warned Republicans, specifically, about the battles still ahead. He said he would not accept any debt-reduction deals in the new year that rely on slashing spending without raising taxes, too. Cuts alone won't happen anymore "at least as long as I'm president, and I'm going to be president for the next four years."
Urgent talks were continuing Monday afternoon between the White House and congressional Republicans, with longtime negotiating partners Vice President Joe Biden and Senate Republican leader Mitch McConnell at the helm. Underscoring the flurry of activity, another GOP aide said the two men had conversations at 12:45 a.m. and 6:30 a.m. Monday.
An agreement on the proposed deal would also shield Medicare doctors from a 27 percent cut in fees and extend tax credits for research and development, as well as renewable energy.
The deal would also extend for five years a series of tax credits meant to lessen the financial burden on poorer and middle-class families, including one credit that helps people pay for college.
The deal would achieve about $600 billion in new revenue, the officials said.
Despite the progress in negotiations, Senate Majority Leader Harry Reid warned that time was running out to finalize the deal.
"Americans are still threatened with a tax hike in just a few hours," said Reid, D-Nev., as the Senate began an unusual New Year's Eve session.
Liberal Sen. Tom Harkin, D-Iowa, took to the Senate floor after Reid to warn Democratic bargainers against lowering levies on large inherited estates and raising the income threshold at which higher tax rates would kick in.
"No deal is better than a bad deal. And this look like a very bad deal the way this is shaping up," said Harkin.
Letting tax rates rise for couples with incomes of $450,000 a year is a concessions for Obama, who campaigned for re-election on a pledge to set the levels at $200,000 for individuals and $250,000 for couples. It also marked a significant concession by Republican leaders who pledged to continue the George W. Bush-era tax cuts for all income earners. .
The hope of the White House and lawmakers was to seal an agreement, enact it and send it to Obama for his signature before taxpayers felt the impact of higher income taxes or federal agencies began issuing furloughs or taking other steps required by spending cuts.
Regardless of the fate of the negotiations, it appeared all workers would experience a cut in their take-home pay with the expiration of a two-year cut in payroll taxes.
In a move that was sure to irritate Republicans, Reid was planning — absent a deal — to force a Senate vote Monday on Obama's campaign-season proposal to continue expiring tax cuts for all but those with income exceeding $200,000 for individuals and $250,000 for couples.
As the New Year's Eve deadline rapidly approached, Democrats and Republicans found themselves at odds over a host of issues, including taxing large inherited estates. Republicans wanted the tax left at its current 35 percent, with the first $5.1 million excluded, while Democrats wanted the rate increased to 45 percent with a smaller exclusion.
The two sides were also apart on how to keep the alternative minimum tax from raising the tax bills of nearly 30 million middle-income families and how to extend tax breaks for research by business and other activities.
Republicans were insisting that budget cuts be found to pay for some of the spending proposals Democrats were pushing.
These included proposals to erase scheduled defense and domestic cuts exceeding $200 billion over the next two years and to extend unemployment benefits. Republicans complained that in effect, Democrats would pay for that spending with the tax boosts on the wealthy.
"We can't use tax increases on anyone to pay for more spending," said Sen. Kay Bailey Hutchison, R-Texas.

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Escape Villas Offers Family Vacation Rentals for the Holidays

Trade the cold winter weather in North America for a tropical Christmas vacation in Costa Rica, where travelers can spend their holidays enjoying outdoor family adventures in the comfort of an Escape Villa family vacation rental.

Manuel Antonio, Costa Rica (PRWEB) December 19, 2012
As the holiday season approaches, more Americans are planning to travel for Christmas compared to 2011, according to a report by HomeAway, Inc. – an online vacation rental marketplace. The number of families traveling in December is expected to nearly double, rising from 22 percent in 2011 to 40 percent this year.
And while everyone looks forward to a “White Christmas,” some families are trading in blankets of fresh snow for the pristine white sands of a tropical beach. Costa Rica has long been a sun-kissed haven for vacationers seeking outdoor thrills and wildlife encounters, and its balmy weather is a welcome respite during the blustery winter season.
Escape Villas, Costa Rica’s leading vacation rental company, sees a ten-fold increase in reservations during the holiday season, with the majority of bookings made by large family groups. “One of the terrific features about vacation rentals is that extended families can stay together with all the creature comforts of home – but with a lot more space and privacy. They have their own swimming pool, kitchen, laundry facilities and an array of other amenities at no extra charge," says Escape Villas spokesperson, Sara Hopkins
With an impressive portfolio of villas and vacation rentals in some of Costa Rica’s most family-friendly locales, including Manuel Antonio, Tamarindo and Flamingo, Escape Villas caters to those seeking plenty of warm sunshine with easy access to national parks, beaches, nature tours and vibrant nightlife. According to Ms. Hopkins, most guests book their holiday beach vacation rentals at least six months in advance, sometimes even earlier.
On why families choose Escape Villas for their holiday plans, Sara Hopkins explains, “A Christmas vacation in Costa Rica takes the stress out of the holidays, as families can enjoy each other’s company in one of the most spectacular places in the world. The kids never forget the year Santa visited their beachfront home, where every day promised a new and exciting adventure.” Another built-in benefit to their vacation rentals: private chef services. No more slaving in the kitchen, as families can relax and spend time together while someone else prepares a home-cooked holiday feast.
When considering a holiday rental, timing is everything. Costa Rica has two tourism periods: a high season that lasts from December-April and corresponds with the country’s dry weather. And a low season, which runs from May-October, during Costa Rica’s rainy months. December and January are known for their fabulous climate, with cool breezes and average temperatures hovering around 82 F.
While prices may be steeper during this peak time, travelers are willing to shell out extra funds to reap the season’s many rewards, according to Escape Villas’ reservations manager. Recent statistics from a HomeAway, Inc. poll reveal that 31 percent of travelers are booking a vacation rental this December, and 21 percent say they’d pay more for more spacious accommodations, especially those that included a pool or spa tub, kitchen and laundry facilities.
Costa Rica has been a treasured vacation destination for many tourists during the festive holiday months. With its temperate climate, proximity to North America, and wealth of adventure activities, the perks of Christmas in paradise are many. And with more airlines offering direct flights into San Jose and Liberia, travelers have new budget-conscious options for booking their vacation. This past October, Canadian carrier WestJet announced non-stop seasonal service from Toronto to Guanacaste’s Liberia terminal. Other low-cost airlines including Spirit, JetBlue and Frontier also provide direct flights from major U.S. cities like New York, Denver and Orlando.

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Shiny Reputation Highlights Airbnb for their Focus on Local Neighborhood Information

Shiny Reputation proclaims their opinion on the recent launch of Airbnb’s Neighborhoods program, in which they are looking to narrow the focus of their site to concentrate on services in local neighborhoods where rental properties are located.

San Francisco, CA (PRWEB) December 19, 2012
Shiny Reputation has issued an announcement about the launch of the Airbnb Neighborhood program, which seeks to give users of its online holiday lodging rental marketplace more information about the areas in which the lodging is located.
The editor of ShinyReputation.com stated, “Local businesses will benefit greatly from the launch of neighborhood ratings by Airbnb, in which local neighborhoods are rated based on transportation, services, quality of local restaurants and more. This will create an all in one service for renters. The service, which is in its trial stage in San Francisco, will lessen Airbnb’s members need to use services such as Yelp. We still see Yelp going strong and always tell businesses that improving your reputation online is key to developing the business relationship with patrons. The neighborhoods service is another resource.”
Airbnb is an online marketplace in which people can offer their homes, apartments, and other types of lodging for rent directly to travelers, bypassing hotels and apartment-finding services. Airbnb was founded in San Francisco in 2008, and has since grown to host more than 200,000 unique listings in 26,000 cities in 192 countries across the globe. On Airbnb, individuals can search for lodgings available in a certain city for a certain timeframe, and then choose from the listings on offer by private renters in that location. Payment is done through the website itself, while all interactions between renters and lodgers are done on a personal basis. The Neighborhoods program is an attempt to give travelers more information about specific local areas of cities they travel to and choose lodgings in the area of their choosing. Currently the program is for information purposes only, and is not yet a channel for marketing online. “That being said the photos used to highlight the local businesses on the neighborhoods tool are amazing. Most travel savvy individuals will seek out those businesses’ websites. It is always recommended that server uptime monitoring receive some attention as we are primarily connected via the internet.”
Airbnb has launched the Neighborhoods program in this city in which it is headquartered, San Francisco, California. San Francisco is the financial, cultural, and technological capital of the West Coast of the United States. With over 800,000 residents in the city itself and more than 7.5 million in the metropolitan San Francisco Bay Area, it is one of the largest and most important cities in the US. The San Francisco Bay Area is known for being the home of Silicon Valley, and the center of technological innovation in the US. Some of the tech companies with headquarters in the area include Apple Computers, Adobe, HP, Google, and Intel.
The launch of Airbnb’s local Neighborhood program will give local businesses further exposure within this large community of travelers, and possibly increase business. Additionally, it will position Airbnb as a rival to Yelp when looking at local businesses and determining where to stay, and what to do. It has yet to be determined if the program will be successful, but local businesses should be entranced by the thought of become visible to a new pool of potential customers.

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KSL Cars Adds Contact At Once! Live Chat in Ads

Utah Dealerships Can Integrate Chat to Connect with Potential Buyers

Atlanta (PRWEB) December 19, 2012
Contact At Once!, the leading live chat provider connecting online and mobile car shoppers to auto dealers, today announced that it has been selected by KSL Cars, Utah’s leading online marketplace, as its exclusive provider of live chat for automotive advertising. KSL Cars will bundle Contact At Once! in its auto dealer packages.
Contact At Once! live chat is used by over 10,000 automobile dealerships and the world’s busiest online automotive shopping sites. Dealers who use Contact At Once! say they typically experience a 25% increase in the number of connections with website visitors.
“Contact At Once! was the first to put live chat in online automotive classifieds and they have unique features that make the software especially well-suited for connecting thousands of shoppers with dealers through chat in ads,” says Eric Bright, KSL’s Vice-President of E-Commerce.
“More and more shoppers prefer text and chat to old-fashioned lead forms and they like the instant access, as well as the convenience,” says Lloyd Hecht, Contact At Once! Director, Business Development. Advertising with mobile and desktop text and chat options can draw more attention and appeal to shoppers who might be reluctant to call or email.”
KSL Cars is the leading provider of auto classifieds in Utah, serving more than 45,000 car shoppers per month. Another factor in choosing Contact At Once! was ease of use and implementation, says Bright. “Our advertisers can be chatting with potential car buyers in a matter of minutes.”
About Contact At Once!

Contact At Once! pioneered the use of website chat in automotive advertising, enabling instant connections between online shoppers and dealerships through search websites, dealership websites, social media and mobile sites. More than 10,000 customers rely on Contact At Once! chat to drive incremental sales opportunities and increase return on advertising investments. For more information, visit http://www.autodealerchat.com.
About KSL

KSL.com is owned and operated by Deseret Digital Media (DDM), and powers the largest online marketplace in Utah - including auto, real estate, deals and local search verticals. In total, Deseret Digital Media properties attract more than 5.5 million unique visitors and serve nearly 300 million page views per month. The DDM network of web sites includes KSL.com, Deseretnews.com, DeseretBook.com, MormonTimes.com, LDSChurchNews.com, FM100.com, OK.com and 1035TheArrow.com. Deseret Digital Media's two-part vision is to become the largest and most compelling regional commerce marketplace in the United States and to also become a world-leading, values-based digital content marketplace. Deseret Digital Media is a part of Deseret Media Companies.

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BedEd.org Launches Blog for Mattress Reviews, Education, Consumer Tips & More

New blog, BedEd.org announces launch; to promote consumer awareness via buying guides, shopping tips, product reviews, and information related to mattresses and sleep.

Tempe, AZ (PRWEB) December 19, 2012
BedEd.org launches mattress education blog designed to offer consumer resources including reviews, buying guides, shopping tips, and more.
Shopping for a new bed can seem like a daunting task with so many brands, models, and types in the marketplace. How can consumers figure out the best bed for their needs? BedEd.org seeks to help shoppers make the research process a little smoother with informational support regarding mattresses, brands and innovations.
Using an easy to navigate blog format, the website will provide first hand research as well as write ups and summaries of third party reviews and research. As an information aggregate, the blog will contain information on the spectrum of companies and offerings available, making research simpler and more efficient for shoppers.
Planned topics are to include mattress buying guides, pros and cons of specific mattress types and brands, product reviews, and sleep hygiene tips. They will also run series detailing the best mattress types based on specific needs in response to common concerns and reader questions. The blog also hopes to serve as a social tool via commentary on personal experience and recommendations.
The blog’s initial post takes an informational stance on mattress material composition and effects on health. Titled “What’s in Your Bed? Choosing the Best Mattress for Your Health” the post outlines how flame retardants, volatile organic compounds, and allergens impact sleepers. Using these criteria, it is explained why natural latex and memory foam offer superior alternatives for individuals concerned about mattress health.
Upcoming posts will include tips for combating allergies in the bedroom, detailed information on mattress types, and how to pick the best beds for back pain and fibromyalgia. BedEd.org offers newsletter options and a Twitter feed for interested readers to receive updates on recent posts and industry news.

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Five Star Service Award for SIPP Providers Dentons Pensions

Dentons Pensions are the only Bespoke SIPP Providers to be Awarded 5 Stars at Financial Adviser Service Awards – the benchmark for service levels in the retail financial marketplace.

Godalming Surrey (PRWEB UK) 20 December 2012
Hosted by comedian Stephen K Amos, The Financial Adviser Service Awards were held on 22 November 2012 at The Natural History Museum. Dentons Pensions were the only bespoke SIPP Provider to win the 5 Star ‘excellent service’ Award, which is voted for by advisers.
The Financial Adviser Service Awards identify the importance of the highest possible quality services from all financial product providers to their IFA clients. They are well known to be the absolute benchmark for premium service levels across the retail finance marketplace.
“Dentons has always been focused on delivering exceptional service and flexibility – reacting to changes in the marketplace and making it easier for advisers to do business. It’s why we are delighted to have been awarded 5 stars at the Financial Adviser Service Awards 2012,” said David Fox, Director of Sales & Marketing.
These are not the first awards that Dentons has won. Having already received the Investor In Customers (IIC) ‘outstanding’ award, Dentons’ SIPP earlier this year was given a 5 star rating by Defaqto, a leading UK independent financial research company. The rating shows the level of benefits provided, allowing adviser’s clients to base decisions on features, not just on price. With this level of service and understanding, clients can be confident they will enjoy a comprehensive range of features, options and benefits.
These awards underline Dentons’ commitment to advisers and their clients whose ethos has always been one of delivering service and flexibility to clients without putting unnecessary barriers in the way. With the SIPP marketplace becoming increasingly crowded in recent years the continued delivery of a market leading service proposition has become crucial. As one of the few areas where a firm can really stand out from the competition, one can see that service remains a key focus for Dentons.
So the root of this success? The average pension consultant at Dentons has been there for over 20 years and each one is skilled at dealing with a range of investments from simple to complex transactions, including property purchase. Working with all appointed professionals to ensure everything runs smoothly and allowing clients to use their own contacts and to manage their own properties (if required) is part of the key to Dentons’ success. It currently manages in excess of 700 properties.
Dentons has made a huge investment in their SIPP and SSAS propositions, supported by an interactive website and secure adviser portal, giving advisers instant access to their client information 24 hours a day. The sales, technical and marketing functions have been strengthened and a new technical advisory service for advisers has been launched.
Overall, Dentons ethos has always been one of delivering service and flexibility to its clients without putting unnecessary barriers in the way. In such a competitive marketplace, introducers and clients want more than just competitively priced products. Dentons listens to client needs and this award endorses their ongoing commitment to deliver.

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Wall Street sinks after election as "fiscal cliff" eyed

NEW YORK (Reuters) - The Dow industrials lost more than 300 points in a sell-off on Wednesday that drove all major stock indexes down over 2 percent in the wake of the presidential election as investors' focus shifted to the looming "fiscal cliff" debate and Europe's economic troubles.
The Standard & Poor's 500 Index posted its biggest daily percentage drop since June, with all 10 S&P sectors solidly lower and about 80 percent of stocks on both the New York Stock Exchange and the Nasdaq ending in negative territory. Both the Dow and the S&P 500 closed at their lowest levels since early August.
Financial stocks and energy shares, two sectors that could face increased regulation after President Barack Obama's re-election, were the weakest on the day. The S&P financial index (.GSPF) lost 3.5 percent, while the S&P energy index (REU:^GSPEI) fell 3.1 percent. An S&P index of technology shares (.GSPT) slid 2.8 percent as the stock of Apple Inc (AAPL) entered bear market territory.
Obama's victory had been anticipated, though many polls indicated a close race between the president and Mitt Romney, his Republican challenger, going into election day.
The election was considered a major source of uncertainty for the market, but now the focus turns to the fiscal cliff, with investors worrying that if no deal is reached over some $600 billion in spending cuts and tax increases due to kick in early next year, it could derail the economic recovery.
The Republican Party retained control of the U.S. House of Representatives, while the Senate remained under Democratic control.
David Joy, chief market strategist at Ameriprise Financial in Boston, said this kind of divided government was disappointing "since that configuration has resulted in gridlock and there's no clear path towards unlocking that.
"It holds implications for how quickly we resolve the fiscal cliff issue, or whether it gets resolved at all," said Joy, who helps oversee $571 billion in assets.
The market's losses were broad, with pessimism exacerbated by overseas concerns after the European Commission said the region would barely grow next year, dashing hopes for improvement in the short term.
Still, some viewed the day's slide as a buying opportunity, saying it was unlikely that no deal would be reached on the fiscal cliff and arguing that Europe's troubles were already priced into markets.
"There's no question that Europe is lagging the rest of the developed and emerging world, but stocks will find a base soon, when investors start seeing through some of the smoke over the region and cliff," said Richard Weiss, who helps oversee about $120 billion in assets as a senior money manager at American Century Investments in Mountain View, California.
The Dow Jones industrial average (^DJI) slid 312.95 points, or 2.36 percent, to close at 12,932.73. The Standard & Poor's 500 Index (^GSPC) fell 33.86 points, or 2.37 percent, to 1,394.53. The Nasdaq Composite Index (^IXIC) lost 74.64 points, or 2.48 percent, to close at 2,937.29.
The S&P 500 closed below the key 1,400 level for the first time since August 30, while the Dow ended under 13,000 for the first time since August 2.
About 7.81 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, slightly below last year's daily average of 7.84 billion, though Wednesday's volume did surpass that of many recent sessions.
Contributing to the Nasdaq's decline, Apple shares fell 3.8 percent to $558, off 20.8 percent from an all-time intraday high of $705.07 set on September 21. That slump puts the stock of the world's most valuable publicly traded company in bear market territory.
Despite Wednesday's sell-off, all three major U.S. stock indexes were still up for the year. At Wednesday's close, the Dow was up 5.9 percent for 2012 so far, while the S&P 500 was up 10.9 percent and the Nasdaq was up 12.8 percent.
Wednesday's plunge was a reversal from Tuesday's rally when voting was under way. Defense and energy shares were among the market leaders that day, causing speculation that some investors were betting on a Romney win.
On Wednesday, an index of defense shares (.DFX) fell 2.9 percent, its biggest one-day drop in a year. Shares of United Technologies (UTX) dropped 2.9 percent to $77.68 while Lockheed Martin (LMT) sank 3.9 percent to $91.15.
Energy shares fell as investors bet that the industry may see increased regulation in Obama's second term, with less access to federal lands and water. Crude oil shed more than 4 percent while an index of coal companies (.DJUSCL) plunged 8.8 percent. Coal firms Peabody Energy (BTU) lost 9.6 percent to $26.24 and Arch Coal (ACI) sank 12.5 percent to $7.58.
Among financials, JPMorgan Chase & Co (JPM) fell 5.6 percent to $40.46 and Goldman Sachs (GS) dropped 6.6 percent to $117.98.
"The notion that you may have gotten a respite on the financial services side (with regulation) if Romney had been elected is obviously being unwound," said Mike Ryan, chief investment strategist at UBS Wealth Management Americas in New York.
Healthcare stocks were mixed as President Obama's re-election rules out the possibility of a wholesale repeal of his healthcare reform law, though questions remain as to what parts of the domestic policy will be implemented. The S&P health care index (REU:^GSPAI) shed 1.9 percent. In contrast, Tenet Healthcare (THC) was the S&P 500's biggest percentage gainer, up 9.6 percent at $27.34.
In 2008, stocks also rallied on election day, but then fell by the largest margin on record for a day following the vote, with each of the three major U.S. stock indexes posting losses ranging from 5 percent to 5.5 percent.
After the bell, both Qualcomm Inc (QCOM) and Whole Foods Market Inc (WFM) reported results. Qualcom's revenue beat expectations, sending shares up 8 percent to $62.75 in extended trading, while Whole Foods dropped 3.3 percent to $92.75 after the bell. In the regular session, Qualcomm slid 3.7 percent to close at $58.12, while Whole Foods dropped 2.1 percent to $95.93.

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Coal company announces layoffs in response to Obama win

A coal company headed by a prominent Mitt Romney donor has laid off more than 160 workers in response to President Obama's election victory.
Murray Energy said Friday that it had been "forced" to make the layoffs in response to the bleak prospects for the coal industry during Obama's second term. In a prayer circulated by the company, CEO Robert Murray said Americans had voted "in favor of redistribution, national weakness and reduced standard of living and lower and lower levels of personal freedom."
"The American people have made their choice. They have decided that America must change its course, away from the principals of our Founders," Murray said in the prayer, which was delivered in a meeting with staff members earlier this week.
"Lord, please forgive me and anyone with me in Murray Energy Corporation for the decisions that we are now forced to make to preserve the very existence of any of the enterprises that you have helped us build."
Murray cited pending regulations from the Environmental Protection Agency and the possibility of a carbon tax as factors that could lead to the "total destruction of the coal industry by as early as 2030."
In August, Murray shuttered an operation in Ohio, again blaming the Obama Administration and its alleged "war on coal."
Mitt Romney echoed this line on the campaign trail, accusing Obama of undermining the country's energy security.
Administration officials responded to these attacks by affirming that Obama supports "clean coal." They also pointed out that more coal miners were on the job in the U.S. this year than at any time since 1997, and that U.S. coal exports have risen 31%.
Domestically, however, coal production has dropped sharply, falling roughly 15% in 2011 versus years prior, according to the National Mining Association.
But the industry's woes go way beyond Obama's policies.
Utility companies are increasingly ditching coal in favor of cheaper, cleaner natural gas. In addition, the recession and improved energy efficiency have crimped demand for power.
Looking ahead, the coal industry faces a rule going into effect in 2015 that tightens the amount of mercury coal plants can emit, as well as regulations on mountain-top mining. Both will make coal production and coal-fired power plants more expensive.
The rules themselves are not Obama's doing, although he has implemented them fairly quickly. Most stem from the Clean Air Act, which was signed by Richard Nixon and strengthened during the first Bush presidency.
CNNMoney's Steve Hargreaves contributed reporting.

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U.S. to Pass Saudi Arabia in Energy Production, IEA Says: Huge Foreign Policy, Economic Implications

A new report by the International Energy Association says the U.S. will become the world's largest oil producer by 2017, overtaking current leaders Saudi Arabia and Russia. U.S. energy policies initiated by the George W. Bush administration and implemented by President Barack Obama have moved the U.S. toward energy independence and away from Middle East energy sources. U.S. oil production has risen rapidly since 2008 and oil imports are at their lowest level in two decades.
"North America is at the forefront of a sweeping transformation in oil and gas production that will affect all regions of the world, yet the potential also exists for a similarly transformative shift in global energy efficiency," says IEA Executive Director Marian von der Hoeven in a statement.
The IEA also says the U.S. could become self-sufficient in energy by 2035 and a net exporter of natural gas by 2020. The Obama administration's push to develop and grow domestic natural gas capabilities has led to a natural gas drilling boom. Production has jumped 15% in four years but the glut in natural gas supplies have also caused the price of natural gas to plummet. According to the White House, the U.S. holds a 100-year supply of natural gas and domestic production is at an all-time high. The Daily Ticker's Aaron Task and Henry Blodget both agree that the explosion in domestic energy production could alter the geopolitical landscape and U.S. labor market.
"The foreign policy implications are maybe even bigger than the economic ones," says Task.
"For 50 years or more we have been just addicted and coupled to a region of the world where so many people hate us," Blodget adds.
Oil and petroleum imports have fallen an average of more than 1.5 million barrels per day and domestic crude oil production has increased by an average of more than 720,000 barrels per day since 2008. As domestic drilling has expanded so has the number of oil and gas production jobs. According to the Federal Reserve Bank of St. Louis, job growth in these industries has risen 25% since January 2010.
Related: The Fracking Revolution: More Jobs and Cheaper Energy Are Worth the "Manageable" Risks, Yergin Says
President Obama says natural gas production could support 600,000 jobs by the end of the decade. Most of these positions are highly desirable from a financial standpoint. Drilling and support jobs pay about $34.50 an hour, 50% more than the national average according to The New York Times.
Cheap natural gas and the administration's eagerness to expand U.S. energy production has shifted resources away from green energy technologies like solar and wind.
Related: Robert F. Kennedy Jr.: Renewable Energy Is Key to U.S. Growth
The method of extracting natural gas from shale rock formations has come under intense scrutiny. Many local cities and communities have already banned the practice. Hydraulic fracturing, more commonly referred to as hydrofracking or fracking, involves injecting large amounts of sand, water and chemicals into the ground at high pressures. Critics of fracking say this process produces millions of gallons of wastewater that contain highly corrosive salts and carcinogens. These radioactive elements could pollute water sources such as rivers and underground aquifers and pose serious dangers to the environment and individuals.

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Eurozone back in recession in Q3

LONDON (AP) -- The 17-country eurozone has bowed to the inevitable and fallen back into recession for the first time in three years as a sprawling debt crisis took its toll on the region's stronger economies.
And with surveys pointing to increasingly depressed conditions across the eurozone at a time of high unemployment in many countries, there are fears that the recession will deepen, and make the debt crisis even more difficult to handle.
Official figures Thursday showed that the eurozone contracted by 0.1 percent in the July to September period from the quarter before as economies including Germany and the Netherlands suffer from falling demand.
The decline reported by Eurostat, the EU's statistics office, was in line with market expectations and follows on from the 0.2 percent fall recorded in the second quarter. As a result, the eurozone is officially in recession, commonly defined as two straight quarters of falling output.
"We can dispense with the euphemisms and equivocation, and openly proclaim that the euro area economy is indeed in technical recession," said James Ashley, senior European economist at RBC Capital Markets.
Because of the eurozone's grueling three-year debt crisis, the region has the focus of concern for the world economy. The eurozone's economy is worth around €9.5 trillion, or $12.1 trillion, which puts it on a par with the U.S. economy. The region, with its 332 million population, is the U.S.'s largest export customer, and any fall-off in demand will hit order books.
While the U.S has managed to bounce back from its own savage recession in 2008-09, albeit inconsistently, and China continues to post still-strong growth, Europe's economies have been on a downward spiral — and there is little sign of any improvement in the near-term.
The eurozone has managed to avoid returning to recession for the first time since the financial crisis following the collapse of U.S. investment bank Lehman Brothers, mainly thanks to the strength of its largest single economy, Germany.
But even that country is struggling now as confidence wanes and exports drain in light of the debt problems afflicting large chunks of the eurozone.
Germany's economy grew a muted 0.2 percent in the third quarter, down from a 0.3 percent increase in the previous quarter. Over the past year, Germany's annual growth rate has more than halved to 0.9 percent from 1.9 percent.
Perhaps the most dramatic decline among the eurozone's members was seen in the Netherlands, whose economy shrank 1.1 percent on the previous quarter.
Five eurozone countries are in recession — Greece, Spain, Italy, Portugal and Cyprus. Those five are also at the center of Europe's debt crisis and are imposing austerity measures, such as cuts to pensions and increases to taxes, in an attempt to stay afloat.
As well as hitting workers' incomes and living standards, these measures have also led to a decline in economic output and a sharp increase in unemployment.
Spain and Greece have unemployment rates of over 25 percent. Their young people are faring even worse with every other person out of work. As well as being a cost to governments who have to pay out more for benefits, it carries a huge social and human cost.
Protests across Europe on Wednesday highlighted the scale of discontent and with economic surveys pointing to the downturn getting worse, the voices of anger may well get louder still.
"The likelihood is that this anger will continue to grow unless European leaders and policymakers start to act as if they have a clue as to how to resolve the crisis starting to unravel before their eyes," said Michael Hewson, markets analyst at CMC Markets.
The wider 27-nation EU, which includes non-euro countries, avoided the same fate. It saw output rise 0.1 percent during the quarter, largely on the back of an Olympics-related boost in Britain.
The EU's output as a whole is greater than the U.S. It is also a major source of sales for the world's leading companies. Forty percent of McDonald's global revenue comes from Europe - more than it generates in the U.S. General Motors, meanwhile, sold 1.7 million vehicles in Europe last year, a fifth of its worldwide sales.

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