The Pentagon announced that the next 5 years will save expenditure of $ 178,000,000,000

The Pentagon said Thursday that over the next 5 years to save 178 billion U.S. dollars in expenditures, but will a lot of money for other recycling projects. At the same time, the Pentagon bureaucracy will be cut the way through to help fill the budget deficit.

 U.S. Defense Secretary Robert - Gates (Robert Gates), said the Pentagon will be in part through the reduction of the number of U.S. military special way to achieve cost savings goals. He also announced that the Pentagon will reduce or cancel the weak performance of the weapons program, which includes 130 billion dollars in the Marine Corps landing craft, kind of landing craft from General Dynamics Corporation (General Dynamics Corp) (GD) design developed.

 The Pentagon's budget plan is ultimately controlled by Congress. Under the House of Representatives Armed Services Committee (Armed Services Committee) Chairman Howard - McKean (Howard McKeon) said: "I am unhappy ", and pointed out that the Pentagon plans a new scale of spending cuts than previously expected.

 Gates said the United States armed forces in the next 5 years to 100 billion U.S. dollars in spending cuts, the money will be diverted to other military projects. He said the Pentagon will be spending an additional reduction of 78 billion U.S. dollars to cover the budget deficit, of which 54 billion U.S. dollars will come from various departments within the Pentagon taken measures to cut spending and reduce from 2015 the number of troops.

Worries the U.S. economic recovery

The U.S. federal government debt investors worried about the market. December 2010 Congress passed tax cuts Obama administration, the U.S. national debt since the collapse of Lehman Brothers suffered the biggest sell-off, the incentive of investors lack confidence in the U.S. government deficit under control. Well-known international rating agency Moody's warned that if the U.S. government deficit and debt levels continued to rise significantly, will be considered in the next 12 to 18 months down the United States sovereign credit rating.

Followed by employment difficult to see improvement. Last November the U.S. unemployment rate rose to 9.8%, the Fed believe that the unemployment rate will remain high in 2011, the year the unemployment rate is still likely to exceed 9%. U.S. unemployment rate will remain in the 80 highest level since early. Since December 2007 the United States since the recession began, about 800 million people lost their jobs.

To make matters worse, the U.S. housing market may continue to slump. Analysts had predicted that in 2010 the U.S. housing market in a modest improvement, but now that the 2011 U.S. house prices will fall as much as 10%. David Wyss, chief economist at Standard & Poor's, said, thought the housing market hit bottom in 2010, but now looks "have to wait another year."

New York University economics professor Nouriel Roubini predicted early December last year, will now double-dip recession in the U.S. housing market, the problem will spread even to the "high end" market. He said the U.S. property market is definitely "is entering the second bottom", the banking industry may face a second wave of huge property losses.

Saddled with high debt, high unemployment, the real estate downturn that "two high and one low," the heavy burden the U.S. economy can hardly be optimistic about the prospects for recovery.

Quantitative easing U.S. economy, the scale of change has improved

According to minutes of the meeting released the same day, Federal Reserve policy makers believe that the recent U.S. economy continues to moderate growth, manufacturing, consumer credit and labor markets have improved, the market's confidence in the U.S. economic recovery has been enhanced, these positive signs with the Government's The new fiscal policy to stimulate the economy as a whole to support the U.S. economic recovery in 2011.

 However, the Fed also warned that the U.S. economy still faces some downside risks, including the real estate market is still in the doldrums, the price may still be lower, the unemployment rate will remain at a high level and so on. In addition, some state and local governments facing budget pressures, the debt crisis worsened in Europe may spillover U.S. financial and economic impact.

 Recently, the Federal Reserve started the second round of quantitative easing measures, attempts to U.S. Treasury yields stay low to stimulate economic growth. However, the recent U.S. bond yields rise. Some analysts said that even if the U.S. economy show signs of strength gradually, while inflation expectations and bond yields rising, the Fed will not change his mind. Nomura believes that if U.S. economic growth continued to accelerate, the Fed may slow the rate of bond purchases, but will not cut 600 billion U.S. dollars of the quantitative easing scale.

 On Friday, Fed Chairman Ben Bernanke will be in the Senate Budget Committee testimony on the economic outlook. Some market participants said that Bernanke may Reviews Recent economic data, and quantitative easing of the Fed explained. If Bernanke's speech show its concerns about rising U.S. yields, the dollar could fall sharply.

Economic data, strong rise in global stock markets good news

Institute for Supply Management data released on the 3rd, December 2010 index of U.S. manufacturing activity was 57 higher than the 56.6 the previous month, showed that U.S. manufacturing has expanded for 17 months straight. In addition, the U.S. Commerce Department figures released by the residential housing and government construction projects to promote growth, in November last year, U.S. construction spending increased 0.4% over the previous month, a record total of nearly 5 months since a new high.

Although the U.S. housing market downturn, but growth in construction spending and further that the U.S. economic recovery is gaining strength. Some analysts said the weak U.S. economy has come out first and do not stop when the state of the economy this year is expected to continue the upward trend appeared late last year, inflation pressures rise. Hatzius, chief economist at Goldman Sachs, said the United States this year, the Fed may no longer impose any economic stimulus measures, but in 2013 the Federal Reserve will not raise interest rates.

Improvement in economic data, but the struggling job market, investors worried about the U.S. economic recovery is sustainable. Last November's U.S. payrolls report disappointed investors no doubt, the market generally expected in December last year, the number of new jobs in the United States will likely return to a level close to 10 million people, the unemployment rate fell to 9.7%.

North America's largest recruitment website operators IOI will be up to Matt Ferguson, CEO, said, U.S. companies have entered the accelerated expansion of the state, the U.S. job market is expected to improve further on this basis.

Clear gains in oil prices better than expected global economic recovery

New Year around the world, the international oil prices in the last trading day of 2010 has broken through the 91 dollars / barrel, a record high the past two years, the annual increase of about 15%. From the trend analysis, the international oil price is likely to continue to rise and break through 100 U.S. dollars / barrel. Then, rising international oil prices recently foreshadowed what? Is under inflationary pressure on the Chinese economy and what impact will? These issues are worth considering.

From the present point of view, affect the changes in international oil prices the main factor is its property instead of the financial attributes of goods. The reason of the financial property of the international oil prices have weakened, because the first half of 2008 experienced a frenzied speculation in international oil prices, U.S. oil futures strengthened on speculation of financial regulation, to curb rampant speculation on Wall Street had an outstanding impact of commodities are greatly overshadowed by the financial attributes. In addition, the dollar "is up", making the U.S. dollar and international oil price fluctuations in commodity prices such as the occasion presented "trade-off" relationship or features become less obvious impact of this can be explained by fluctuations in international oil prices " financial attributes "Why would weaken.

Crude oil closed up after hitting a two-year high

First trading day of 2011, the New York Mercantile Exchange crude oil futures soared to a two-year high, subject to market conditions on the U.S. economic recovery, promote optimism, but later in the trading day price of oil gave up some gains.

February crude oil futures contract settled up 17 cents to $ 91.55 a barrel, or 0.2%. The contract had earlier hit an intraday high of $ 92.58 per barrel for October 2008 since the highest level.

ICE Brent crude settled up 9 cents to $ 94.84 a barrel, or 0.1%.

Investors generally believe that the U.S. economy in 2011 will show a long-awaited acceleration of growth, which makes the expected expansion in demand on energy to heat up.

This week traders will pay close attention to the U.S. Department of Energy is scheduled for 10:30 am EST on the 5th to the latest report on oil and fuel inventories. In addition, the American Petroleum Institute will also publish the 4, 4:30 pm Institute of own energy inventory data.

New York stock market a good start

Investors are increasingly optimistic about the economic outlook, the support, the New York Stock 3 in the first trading day of 2011 ushered in the opener, the three major indexes closed at the highest level in more than two years.

In 2010 just ended, despite the New York Stock Exchange under severe shock and many other factors, but the three major stock indexes end is still the second consecutive year a record double-digit growth. Especially towards the end, as the U.S. economy showing more signs of recovery, the stock market atmosphere, there was greater change in investor optimism driving the market sharply higher in December.

The same day, U.S. economic data further increasing the confidence of investors. According to the U.S. Institute for Supply Management (ISM) report, December ISM manufacturing index for the first 17 months of growth. Which to measure the index of new orders is a significant increase, which made investors excited.

In addition, the U.S. Commerce Department data showed U.S. construction spending in November increased the third consecutive month, the chain increased by 0.4%, exceeding market expectations. Meanwhile, the day a significant increase in commodity prices, the relevant shares constitute support. International oil prices more than two years for the first time intraday $ 92 a barrel, gold futures prices continued to rise slightly, while the international price of copper is hitting the highest level in more than two years.