Hello, I'm Mark Pearson. Wall Street had its best week of 2009 after hitting a 12-year low on Monday. And, after positive reports from financial giant Citigroup, the Dow Jones Industrial average stormed higher.
Months after receiving billions in federal bailout funds, Citigroup Inc. says it operated at a profit during the first two months of 2009. However, many analysts are still cautious about the overall financial sector — noting that Wall Street has seen many jumps higher since the recession and credit crisis began.
Despite the positive news on Wall Street, retail sales fell in February for the seventh time in the past eight months. The figure was weighed-down by record low auto sales which brought February retail figures down by 0.1 percent. Excluding auto sales, retail figures actually grew in February by 0.7 percent.
A deepening global recession sent the U.S. trade deficit plunging to its lowest level in six years. The trade imbalance fell to $36 billion in January, largely fueled by a three-year low in crude oil imports.
From its all-time peak in 2007 to election day last November, the Dow Jones Industrial average lost 44 percent of its value. Another 21 percent drop during Obama's first six weeks in the oval office makes it the worst market performance ever for a new president.
But a see-saw roller coaster on Wall Street is only part of the uncertainty in Rural America. Agricultural groups are still adjusting to last spring's 2008 farm bill – let alone coming to grips with talk about farm subsidy reforms in Washington.
President Barack Obama: "We have already identified two trillion dollars in savings over the next decade. In this budget, we will end education programs that don't work and end direct payments to large agribusinesses that don't need them." (old sync with date)
In the weeks following President Obama's budget pledge to cut some farm subsidies, many agriculture groups are blasting the proposal as a quick departure from the recent farm bill.
The American Farm Bureau Federation calls the move to slash direct payments to farmers making more than $500,000 in sales a mistake that could "exacerbate the current credit crisis" in rural America. Farm Bureau President Bob Stallman said: "You don't change the rules in the middle of a basketball game and you don't change the provisions of a farm bill that was implemented less than a year ago with the support of more than 500 nutrition, conservation and farm organizations."
Leaders from the National Cotton Council echoed that sentiment and criticized the Obama budget as simply penalizing for "farms that are responsible for the majority of food, feed, and fiber for the United States."
But proponents of farm payment reform say the unprecedented move to cap federal subsidies to top-earning farmers is long overdue. The Environmental Working Group, an advocacy organization best known for publishing an online database of federal farm subsidies, has endorsed the payment cuts.
Federal spending cuts may not have been on the minds of lawmakers and the Obama Administration this week.
President Barack Obama: "I am signing an imperfect omnibus bill because it's necessary for the ongoing functions of government, and we have a lot more work to do. We can't have Congress bogged down at this critical juncture in our economic recovery."
The President signed a $410 Billion appropriations bill intended to fund government departments but lawmakers from both parties included billions in additional earmark spending. The measure includes $20.5 billion for USDA discretionary programs in budget year 2010 – a more than $2.5 billion jump from the previous year.