U.S. Trade Deficit Declines to Lowest Level in Four Years

Gains in energy production and stronger sales of American-made airplanes, autos and machinery lifted exports to a high.

The trade gap dropped 12.9 percent in November, to $34.3 billion, the Commerce Department said on Tuesday. That is the lowest monthly trade deficit since October 2009.

Exports rose 0.9 percent, to a record $194.9 billion. The gain was aided by a 5.6 percent increase in petroleum exports.

Imports dropped 1.4 percent, to $229.1 billion. A decrease in demand for foreign oil offset a record level of imported autos.

A smaller trade deficit can lift economic growth. It typically shows that American companies are earning more from sales overseas, while consumers in the United States are buying fewer products from foreign companies.

Economists raised their growth forecasts for the October-December quarter after seeing the November trade report.

Jennifer Lee, senior economist at BMO Capital Markets, noted that the trade gap declined in both October and November. She is forecasting growth at an annual rate of 2.4 percent. But after the trade report she said growth could end up stronger.

Paul Ashworth, chief North American economist at Capital Economics, said growth could be 3 percent or higher.

Through 11 months of 2013, the trade deficit is 12.3 percent lower than the same period in 2012. Exports have strengthened, while imports are slightly lower.

Washington Memo: 50 Years Later, War on Poverty Is a Mixed Bag

But looked at a different way, the federal government has succeeded in preventing the poverty rate from climbing far higher. There is broad consensus that the social welfare programs created since the New Deal have hugely improved living conditions for low-income Americans. At the same time, in recent decades, most of the gains from the private economy have gone to those at the top of the income ladder.

Half a century after Mr. Johnson’s now-famed State of the Union address, the debate over the government’s role in creating opportunity and ending deprivation has flared anew, with inequality as acute as it was in the Roaring Twenties and the ranks of the poor and near-poor at record highs. Programs like unemployment insurance and food stamps are keeping millions of families afloat. Republicans have sought to cut both programs, an illustration of the intense disagreement between the two political parties over the best solutions for bringing down the poverty rate as quickly as possible, or eliminating it.

For poverty to decrease, “the low-wage labor market needs to improve,” James P. Ziliak of the University of Kentucky said. “We need strong economic growth with gains widely distributed. If the private labor market won’t step up to the plate, we’re going to have to strengthen programs to help these people get by and survive.”

In Washington, President Obama has called inequality the “defining challenge of our time.” To that end, he intends to urge states to expand their Medicaid programs to poor, childless adults, and is pushing for an increase in the minimum wage and funding for early-childhood programs.

But conservatives, like Representative Paul D. Ryan of Wisconsin, have looked at the poverty statistics more skeptically, contending that the government has misspent its safety-net money and needs to focus less on support and more on economic and job opportunities.

“The nation should face up to two facts: poverty rates are too high, especially among children, and spending money on government means-tested programs is at best a partial solution,” Ron Haskins of the Brookings Institution wrote in an assessment of the shortfalls on the war on poverty. Washington already spends enough on antipoverty programs to lift all Americans out of poverty, he said. “To mount an effective war against poverty,” he added, “we need changes in the personal decisions of more young Americans.”

Still, a broad range of researchers interviewed by The New York Times stressed the improvement in the lives of low-income Americans since Mr. Johnson started his crusade. Infant mortality has dropped, college completion rates have soared, millions of women have entered the work force, malnutrition has all but disappeared. After all, when Mr. Johnson announced his campaign, parts of Appalachia lacked electricity and indoor plumbing.

Many economists argue that the official poverty rate grossly understates the impact of government programs. The headline poverty rate counts only cash income, not the value of in-kind benefits like food stamps. A fuller accounting suggests the poverty rate has dropped to 16 percent today, from 26 percent in the late 1960s, economists say.

But high rates of poverty — measured by both the official government yardstick and the alternatives that many economists prefer — have remained a remarkably persistent feature of American society. About four in 10 black children live in poverty; for Hispanic children, that figure is about three in 10. According to one recent study, as of mid-2011, in any given month, 1.7 million households were living on cash income of less than $2 a person a day, with the prevalence of the kind of deep poverty commonly associated with developing nations increasing since the mid-1990s.

Both economic and sociological trends help explain why so many children and adults remain poor, even putting the effects of the recession aside. More parents are raising a child alone, with more infants born out of wedlock. High incarceration rates, especially among black men, keep many families apart. About 30 percent of single mothers live in poverty.

In some cases, government programs have helped fewer families because of program changes and budget cuts, researchers said. For instance, the 1996 Clinton-era welfare overhaul drastically cut the cash assistance available to needy families, often ones headed by single mothers.

“As of 1996, we expected single mothers to go to work,” Professor Ziliak said. “But if they’re shelling out most of their weekly pay in the form of child care, they can’t make sense of doing it.”

The more important driver of the still-high poverty rate, researchers said, is the poor state of the labor market for low-wage workers and spiraling inequality. Over the last 30 years, growth has generally failed to translate into income gains for workers — even as the American labor force has become better educated and more skilled. About 40 percent of low-wage workers have attended or completed college, and 80 percent have completed high school.

Economists remain sharply divided on the reasons, with technological change, globalization, the decline of labor unions and the falling value of the minimum wage often cited as major factors. But with real incomes for a vast number of middle-class and low-wage workers in decline, safety-net programs have become more instrumental in keeping families’ heads above water.

The earned-income tax credit, for instance, has increased employment among single mothers and kept six million Americans above the poverty line in 2011. Food stamps, formally known as Supplemental Nutrition Assistance Program benefits, kept four million Americans out of poverty in 2011.

Above all, the government has proved most successful in aiding the elderly through the New Deal-era Social Security program and the creation of Medicare in the 1960s. The poverty rate among older Americans fell to just 9 percent in 2012 from 35 percent in 1959.

But for working-age households, both conservatives and liberals agree that government transfer programs alone cannot eliminate poverty. The answer, the White House has said, is in trying to improve households’ earnings before tax and transfer programs take effect.

“Going forward, the biggest potential gains that could be made on poverty would be in raising market incomes,” said Jason Furman, the chairman of Mr. Obama’s Council of Economic Advisers. “In the short run, that means things like the minimum wage, and in the long run, things like early education.”

If Congress approved a proposal to raise the federal minimum wage to $10.10 an hour from its current level of $7.25, it would reduce the poverty rate of working-age Americans by 1.7 percentage points, lifting about five million people out of poverty, according to research by Arindrajit Dube of the University of Massachusetts, Amherst.

But in the meantime, the greatest hope for poorer Americans would be a stronger economic recovery that brought the unemployment rate down from its current level of 7 percent and drew more people into the work force. The poverty rate for full-time workers is just 3 percent. For those not working, it is 33 percent.

Indian Manufacturing Shrinks for First Time in Four Years

BANGALORE, India — Indian factory activity shrank for the first time in more than four years last month, a survey showed Monday, adding to the country’s deepening economic malaise even as the central bank struggles to defend the battered rupee.

The bleak purchasing managers’ index comes hard on the heels of data Friday that showed Asia’s third-largest economy had grown at its slowest quarterly rate in the three months to June since the global financial crisis, suggesting more pain ahead.

The HSBC Manufacturing P.M.I., compiled by Markit, sank to 48.5 in August from 50.1 in July, the lowest reading since March 2009. Economists polled by Reuters had expected a fall to 49.9.

The index, which gauges business activity in Indian factories but not utilities, had been close to the 50 mark that separates growth from contraction since May, but falling orders dragged it under last month.

“Manufacturing activity contracted in August for the first time since March 2009. This was led by a decline in new orders, especially export orders,” said Leif Eskesen, chief economist for India at HSBC, the survey’s sponsor.

The survey showed new export orders shrank for the first time in a year.

In a sign that domestic demand is also faltering, new orders, which include domestic orders, shrank at a faster pace. The index fell for the sixth straight month to 47.5 in August, its lowest since February 2009.

Off the Charts: Five Years After Chaos, Shares of Many Big Banks Are Still Struggling

Two weeks later, Lehman Brothers failed and a panic began. The crisis demonstrated how interconnected the world financial system had become and how vulnerable even apparently healthy banks were when their competitors began to crumble. In the weeks that followed, most large banks around the world had to be bailed out. Their share prices plummeted.

Since then, however, some big banks have performed much better than others — a difference based to a significant extent on just how well, or badly, each bank had been run in the months and years leading up to the crisis.

The accompanying charts show the performance of 25 large banks around the world. As the crisis began, each of them ranked in the top 20 in the world in at least one of three measurements — market capitalization, book value or total assets.

In the weeks and months that followed, all but one of them lost at least half of their market value, as measured in the local currency of the bank’s primary market. The exception was a Chinese bank, the Industrial and Commercial Bank of China, whose shares lost less than a third of their value.

The charts also show the performance of the Bloomberg World Bank Index, which comprises more than 140 banks and has done better than most of the large bank stocks. This was a crisis where bigger was not necessarily better, and where some of the largest banks proved to be far from adequately capitalized, notwithstanding what their books had indicated before Lehman collapsed.

This spring, the world bank index got back to within 3 percent of its level at the end of August 2008, although it has since slipped back and is now 11 percent lower. Few of the large banks shown have done as well.

But a handful of banks turned out to be profitable long-term investments that August. Shares of both JPMorgan Chase and Wells Fargo in the United States are now more than 40 percent higher than they were. Shares of two of the three Chinese banks shown — Bank of China and China Construction Bank — are higher now than they were five years ago, while the third is approximately unchanged. In Britain, HSBC is up about 13 percent, a much better performance than was shown by other large European banks. It did not hurt that HSBC had a significant presence in many developing countries, most of which rode out the recession reasonably well even though some have stumbled this year.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

For a Chef, 41 Years in the Kitchen Takes Its Toll

Monica Almeida/The New York TimesFor Mark Peel, 58, the crazy hours and physical strain of life as a professional chef have meant wrist, shoulder and back pain, a bone spur and hernia operations. But he is aiming to age gracefully, with a less strenuous schedule.

STARTING as a dishwasher at the age of 17, the chef Mark Peel worked his way up at some of the great California restaurants: Ma Maison, Michael’s, Chez Panisse, Spago, Chinois and, finally, for more than two decades, Campanile, his own place in Los Angeles.

Mr. Peel, who used to work nonstop at Campanile and Spago, now takes care to stretch. This is his home kitchen.

Those 41 years in the kitchen have brought him considerable fame: Campanile won the James Beard award as outstanding restaurant in the United States in 2001. They have also brought him carpal tunnel syndrome in both wrists and thoracic outlet syndrome in his shoulders, resulting from repetitive stirring, fine knife movements and heavy lifting. He has a bone spur on one foot and a cyst between toes of the other from constantly standing. He has had three hernia operations and lives with a chronically sore back.

Being a professional chef, like being an elite athlete, tends to be a young person’s game. When he started out, Mr. Peel thought nothing of shifting a 125-pound stockpot full of hot, sloshing liquid from one burner to the next without calling for help, his arms stretched away from his body, muscles tight to control the motion. It was a recipe for trouble down the line.

The 16-hour days he once put in at Spago — seven days a week for seven weeks in a row — are no longer an option for Mr. Peel, who is now 58. He straightens a sore shoulder at the memory of those days. He can still work like that, he says — “just not as often, and not as long.” Today, he says, he can survive perhaps three days of crazy hours, as long as Day 4 includes sleeping in, to recover.

In September, Mr. Peel will open a new Campanile at Los Angeles International Airport. He closed the 190-seat original last fall after 23 years, 16 of them alongside the chef Nancy Silverton, then his wife, and seven more years on his own. His career track record going into the new project is excellent; his body, the worse for wear.

The new, smaller Campanile will open at the American Airlines terminal, in a licensing agreement with Host International. Mr. Peel will “train, taste, advise, direct and organize,” while younger chefs execute the dishes he creates. “At some point, the mind is willing but the body rebels,” Mr. Peel says. “Most chefs over 50 are no longer cooking daily.”

Mr. Peel came of age during an explosion of interest in dining out, and his workload expanded to keep pace. Many in the next generation of young chefs have seen the physical toll on their elders, and they are planning accordingly.

“There’s an arc,” says the chef Jonah Miller, 26, whose awareness of his “shelf life as an active cook” informed his decision to open his own restaurant sooner rather than later. That establishment, Huertas, a Northern Spanish restaurant, will open this winter in Brooklyn. It is a nod in equal parts to Mr. Miller’s youthful ambition — he first volunteered in a kitchen when he was 13 — and the “need to plan for the time when I’m not physically able to work the line, which for most cooks comes in their late 30s.”

“It’s a pretty hard-and-fast rule,” he says, that chefs eventually step away from the action; he aspires to the natural progression from cook to chef to “purely a coach and a mentor.”

Mitchell Davis, executive vice president of the James Beard Foundation, agrees that cooks can age quickly. “Every time I find myself eating in an exciting restaurant, the chef is 28 years old,” he says.

A chef’s early years are arduous, devoted to working the line — cooking some portion of what lands on the plate, shift after shift. In cities like New York and Los Angeles, where high rents and demanding diners require a chef to “maximize every minute of the day,” according to Mr. Davis, it is even harder.

“Cooking on the line is a sport,” says Mr. Miller, who played basketball and baseball in high school. “It’s regimented and it’s continuous. You’re always pushing, just like an athlete: the highest quality you can manage in a specific time frame, doing it again and again.”

Chefs are more likely to sustain injuries than the average American worker, according to the Bureau of Labor Statistics. Sprains, strains and tears are the most common complaints, followed by cuts, lacerations and punctures; burns; and fractures, says Martin Kohli, chief regional economist for the bureau. Musculoskeletal injuries like Mr. Peel’s carpal tunnel syndrome are also common.

When asked to name chefs who have persevered in the kitchen past their youth despite the physical toll, Mr. Peel, Mr. Miller and Mr. Davis all hesitate for a long moment. Mr. Davis comes up with the New York-based Daniel Boulud and David Bouley, who have reputations for being active in the kitchen longer than their peers. But each example is served with a side order of disclaimer; they are the exceptions who prove the rule.

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Helen Thomas | 1920-2013: 50 Years of Tough Questions and ‘Thank You, Mr. President’

Her death was announced by the Gridiron Club, one of Washington’s leading news societies. Ms. Thomas was a past president of that organization.

Ms. Thomas covered every president from John F. Kennedy to Barack Obama for United Press International and, later, Hearst Newspapers. To her colleagues, she was the unofficial but undisputed head of the press corps — her status ratified by her signature line at the end of every White House news conference, “Thank you, Mr. President.”

Her blunt questions and sharp tone made her a familiar personality not only in the parochial world inside the Washington Beltway but also among television audiences across the country.

“Helen was a true pioneer, opening doors and breaking down barriers for generations of women in journalism,” President Obama said in a statement on Saturday. “She never failed to keep presidents — myself included — on their toes.” 

Presidents grew to respect, even to like, Ms. Thomas for her forthrightness and stamina, which sustained her well after the age at which most people had settled into retirement. President Bill Clinton gave her a cake on Aug. 4, 1997, her 77th birthday. Twelve years later, President Obama gave her cupcakes for her 89th. At his first news conference in February 2009, Mr. Obama called on her, saying: “Helen, I’m excited. This is my inaugural moment.”

But 16 months later, Ms. Thomas abruptly announced her retirement from Hearst amid an uproar over her assertion that Jews should “get the hell out of Palestine” and go back where they belonged, perhaps Germany or Poland. Her remarks, made almost offhandedly days earlier at a White House event, set off a storm when a videotape was posted.

In her retirement announcement, Ms. Thomas, whose parents immigrated to the United States from what is now Lebanon, said that she deeply regretted her remarks and that they did not reflect her “heartfelt belief” that peace would come to the Middle East only when all parties embraced “mutual respect and tolerance.”

“May that day come soon,” she said.

Ms. Thomas’s career bridged two eras, beginning during World War II when people got their news mostly from radio, newspapers and movie newsreels, and extending into the era of 24-hour information on cable television and the Internet. She resigned from U.P.I. on May 16, 2000, a day after it was taken over by an organization with links to the Unification Church.

Weeks later, Ms. Thomas was hired by Hearst to write a twice-weekly column on national issues. She spent the last 10 years of her working life there.

When Ms. Thomas took a job as a radio writer for United Press in 1943 (15 years before it merged with the International News Service to become U.P.I.), most female journalists wrote about social events and homemaking. The journalists who covered war, crime and politics, and congratulated one another over drinks at the press club were typically men.

She worked her way into full-time reporting and by the mid-1950s was covering federal agencies. She covered John F. Kennedy’s presidential campaign in 1960, and when he won she became the first woman assigned to the White House full time by a news service.

Ms. Thomas was also the first woman to be elected an officer of the White House Correspondents’ Association and the first to serve as its president. In 1975, she became the first woman elected to the Gridiron Club, which for 90 years had been a men-only bastion of Washington journalists.

Ms. Thomas was known for her dawn-to-dark work hours, and she won her share of exclusives and near-exclusives. She was the only female print journalist to accompany President Richard M. Nixon on his breakthrough trip to China in 1972.

“Helen was a better reporter than she was a writer — but in her prime had more than her share of scoops the rest of us would try to match,” Mark Knoller, the longtime CBS News White House reporter, wrote in a Twitter message on Saturday morning.

And, he added, “Pity the poor WH press aide who would try to tell Helen, ‘You can’t stand there.’ ”

Mark Landler contributed reporting.

Helen Thomas | 1920-2013: 50 Years of Tough Questions and ‘Thank You, Mr. President’

Her death was announced by the Gridiron Club, one of Washington’s leading news societies. Ms. Thomas was a past president of that organization.

Ms. Thomas covered every president from John F. Kennedy to Barack Obama for United Press International and, later, Hearst Newspapers. To her colleagues, she was the unofficial but undisputed head of the press corps — her status ratified by her signature line at the end of every White House news conference, “Thank you, Mr. President.”

Her blunt questions and sharp tone made her a familiar personality not only in the parochial world inside the Washington Beltway but also among television audiences across the country.

“Helen was a true pioneer, opening doors and breaking down barriers for generations of women in journalism,” President Obama said in a statement on Saturday. “She never failed to keep presidents — myself included — on their toes.” 

Presidents grew to respect, even to like, Ms. Thomas for her forthrightness and stamina, which sustained her well after the age at which most people had settled into retirement. President Bill Clinton gave her a cake on Aug. 4, 1997, her 77th birthday. Twelve years later, President Obama gave her cupcakes for her 89th. At his first news conference in February 2009, Mr. Obama called on her, saying: “Helen, I’m excited. This is my inaugural moment.”

But 16 months later, Ms. Thomas abruptly announced her retirement from Hearst amid an uproar over her assertion that Jews should “get the hell out of Palestine” and go back where they belonged, perhaps Germany or Poland. Her remarks, made almost offhandedly days earlier at a White House event, set off a storm when a videotape was posted.

In her retirement announcement, Ms. Thomas, whose parents immigrated to the United States from what is now Lebanon, said that she deeply regretted her remarks and that they did not reflect her “heartfelt belief” that peace would come to the Middle East only when all parties embraced “mutual respect and tolerance.”

“May that day come soon,” she said.

Ms. Thomas’s career bridged two eras, beginning during World War II when people got their news mostly from radio, newspapers and movie newsreels, and extending into the era of 24-hour information on cable television and the Internet. She resigned from U.P.I. on May 16, 2000, a day after it was taken over by an organization with links to the Unification Church.

Weeks later, Ms. Thomas was hired by Hearst to write a twice-weekly column on national issues. She spent the last 10 years of her working life there.

When Ms. Thomas took a job as a radio writer for United Press in 1943 (15 years before it merged with the International News Service to become U.P.I.), most female journalists wrote about social events and homemaking. The journalists who covered war, crime and politics, and congratulated one another over drinks at the press club were typically men.

She worked her way into full-time reporting and by the mid-1950s was covering federal agencies. She covered John F. Kennedy’s presidential campaign in 1960, and when he won she became the first woman assigned to the White House full time by a news service.

Ms. Thomas was also the first woman to be elected an officer of the White House Correspondents’ Association and the first to serve as its president. In 1975, she became the first woman elected to the Gridiron Club, which for 90 years had been a men-only bastion of Washington journalists.

Ms. Thomas was known for her dawn-to-dark work hours, and she won her share of exclusives and near-exclusives. She was the only female print journalist to accompany President Richard M. Nixon on his breakthrough trip to China in 1972.

“Helen was a better reporter than she was a writer — but in her prime had more than her share of scoops the rest of us would try to match,” Mark Knoller, the longtime CBS News White House reporter, wrote in a Twitter message on Saturday morning.

And, he added, “Pity the poor WH press aide who would try to tell Helen, ‘You can’t stand there.’ ”

Mark Landler contributed reporting.

DealBook: Ex-Enron C.E.O.’s Prison Sentence Is Cut by 10 Years

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Homes See Biggest Price Gain in Years, Propelling Stocks

All 20 cities tracked by the Standard & Poor’s Case-Shiller home price index posted year-over-year gains, as they have done for three consecutive months now. The 20-city composite index rose 10.9 percent over the last year. That is the biggest annual increase since April 2006. Several cities – Charlotte, N.C.; Los Angeles; Portland, Ore.; Seattle; and Tampa, Fla. – had their largest month-over-month gains in more than seven years.

Continued strength in the housing market is welcome news for the rest of the economy, particularly given federal government spending cuts that went into effect in March and the end of the payroll tax holiday in January. With home values rising, the construction industry has been more motivated to ramp up building and hire back workers. Consumers are also feeling wealthier and so are more willing to spend money.

“We’ve been sort of pleasantly surprised by the resilience of consumption at the beginning of the year,” said Daniel Silver, an economist at JPMorgan Chase. “Spending has been doing quite well, at least for this expansion, over the first half of the year, due in part to these wealth effects.”

The positive impact of rising home values and the appreciating stock market is expected to offset “at least a third of the fiscal tightening,” said Ian Shepherdson, chief economist at Pantheon Macroeconomic Advisors.

Consumer sentiment has already been improving. On Tuesday, the Conference Board reported that its Consumer Confidence Index rose in May to its highest level since February 2008. Consumers’ assessments about both current conditions and their expectations for the future improved substantially, after having plunged in January after gridlock in Washington over fiscal issues.

“Five years after the start of the financial crisis in earnest, and four years and a week’s time from the beginning of the economic recovery, we’re finally starting to get more of a pickup, more of a reduction in caution in terms of consumers’ behaviors,” said John Ryding, chief economist at RDQ Economics. “It’s been a very drawn-out process, but you have to remember what we’ve been digging our way out of, and after all it’s a far less drawn-out process than what’s been taking place in Europe.”

The strong housing and consumer confidence numbers bolstered the markets, with both the Standard & Poor’s 500-stock index and the Dow Jones industrial average up nearly 1 percent in early afternoon trading.

The double-digit housing price increase is being driven by a confluence of factors.

One, the economy over all has been recovering, so people are finally willing to start buying again. At the same time, the inventory of homes available on the market remains unusually low, thanks to little new building in the last few years and the large number of underwater homeowners who are unwilling or unable to sell..

The limited supply, coupled with growing demand, has pushed prices higher. Of course, higher prices could encourage some homeowners to come off of the sidelines and finally place their homes on the market.

“You’ve had this dynamic that has been favorable for price increases now, but it’s also favorable for supply to come back on market, so that will mean some moderation in the pace of price increases,” said Mr. Silver, who said that he expected home prices to continue growing but not necessarily at the double-digit rate seen in May.

Additionally, there are fewer distressed sales – that is, foreclosures and short sales. As a result, the composition of home sales includes fewer sales at depressed prices to bring down the overall numbers.

Finally, home prices in many areas experienced severe, unsustainable plunges during the recession. Now, prices are returning to healthier levels, and coming off a very low base, so the price appreciation looks sizable.

“Some of the areas with the largest declines in house prices during the crisis have shown the strongest increases in prices more recently,” said Mr. Silver.

In Phoenix, for example, home values have risen 22.5 percent from a year earlier, and Las Vegas likewise posted a 20.6 percent gain.

Economists generally expect home prices to continue rising, particularly as the economy improves and more young people move out of their parents’ homes. And many dismiss concerns of a potential bubble, because housing prices remain well below their highs. Even after 10 straight months of year-over-year gain, the 20-city composite price index is 28 percent below its previous peak in July 2006.

“Talk of a house price bubble seems premature,” said Ed Stansfield, an economist at Capital Economics. “In relation to incomes, rents or their own past, U.S. home prices still look low.”

Victoria Shannon contributed reporting.

March Home Prices See Best Annual Rise in Seven Years

The data on Tuesday also suggested the two segments could act as buffers as the broader economy faces the pinch of belt-tightening in Washington.

The S&P/Case Shiller composite index of 20 metropolitan areas climbed 10.9 percent year over year, beating expectations for 10.2 percent. This was the biggest increase since April 2006, just before prices peaked in the summer of that year.

Prices in the 20 cities gained 1.1 percent in March compared to the month before on a seasonally adjusted basis, topping economists' forecasts for a 1 percent rise.

The housing market turned a corner in 2012, several years after its far-reaching collapse. The recovery has picked up since as inventory has tightened, foreclosures eased and historically low mortgage rates have attracted buyers.

A Reuters poll showed the recovery in the housing market likely has momentum through the rest of the year, with economists ratcheting up their forecasts for price gains in 2013.

Separate data showed consumer confidence picked up in May to its highest in more than five years in the midst of a stock market rally and lower gasoline prices.

Housing and the consumer have shown strength even as there have been hints that tighter fiscal policy is starting to bite in the broader economy. Across-the-board U.S. government spending cuts of $85 billion went into effect in March, while the payroll tax holiday expired at the beginning of the year, raising taxes for many Americans.

The data suggested both areas were performing better than the overall economy, said Sam Bullard, senior economist at Wells Fargo in Charlotte, North Carolina.

"There are some individual circumstances that are helping to propel both of these a little bit stronger than what the actual underlying strength would suggest," said Bullard, pointing to the effect of higher stock prices on consumers, and investor demand for homes in beaten-down regions lifting prices.

Economists expect the pace of growth likely cooled in the second quarter, partly due to tighter fiscal policy, but the second half of the year is seen regaining traction. Investor attention has turned to when the Federal Reserve might start to slow its economic stimulus efforts.

The data lent support to equities where Wall Street rose after comments from central banks around the world reassured investors supportive monetary policies would remain in place. U.S. Treasuries yields rose to their highest levels in over a year.

Housing-related shares rose following the Case-Shiller report before giving up some gains in the afternoon, with the S&P homebuilders ETF up 0.4 percent. The ETF is up nearly 20 percent for the year, outpacing the more than 16 percent surge seen in the benchmark S&P 500 index.

Home prices in Phoenix continued their sharp ascent, rising 22.5 percent from a year earlier. Other standouts included San Francisco, up 22.2 percent, and hard-hit Las Vegas, up 20.6 percent.

Fitch Ratings on Tuesday said the recent home price gains seen in several markets are outpacing improvements in the underlying fundamentals and could stall or even reverse. Many of these areas are in California, Fitch said, citing Los Angeles as an example.

Los Angeles prices rose 16.6 percent from a year ago, the Case-Shiller report said.

For the first quarter of this year, the seasonally adjusted national index rose 3.9 percent, stronger than the 2.4 percent gain seen in the final quarter of last year.

"Low inventories and gradually improving housing demand have combined to push housing starts higher and support home price appreciation," said Michael Gapen, an economist at Barclays in New York.

"We see these factors as remaining in place and expect residential investment to add to GDP growth in the coming quarters. We also expect rising real estate wealth to support household balance sheets and underpin consumption, helping the broader economy to offset a substantial fiscal drag in 2013."

The Conference Board, an industry group, said its index of consumer attitudes jumped to 76.2 from an upwardly revised 69 in April, topping economists' expectations for 71. It was the best level since February 2008.

In a sign of confidence among high-end consumers, jeweler Tiffany & Co reported better-than-expected sales for the first quarter.

Consumer activity accounts for about two-thirds of the economy and while improved sentiment does not necessarily translate into more spending, the improvement was encouraging.

Still, even with the gain in confidence in May, second-quarter consumption growth is likely to have slowed to a 2.5 percent annualized pace from 3.2 percent in the first quarter, according to Capital Economics.

The expectations index rose to 82.4 from 74.3, while the present situation index climbed to 66.7 from 61.

Consumers' assessment of the labor market improved. The "jobs hard to get" index slipped to 36.1 percent from 36.9 percent the month before, while the "jobs plentiful" index gained to 10.8 percent from 9.7 percent.

(Editing by Chizu Nomiyama)

Off the Charts: Housing, Ailing for Years, Starts to Recuperate

The housing industry made no contribution at all.

Now it appears that industry is finally starting to recover. Housing starts are rising at a rapid rate, albeit from a very low level. And last year, residential construction spending, adjusted for inflation, climbed 12 percent, after declining for a record six consecutive years.

The Census Bureau reported this week that single-family housing starts rose to a seasonally adjusted annual rate of 618,000 in February, the highest level since June 2008, months before the collapse of Lehman Brothers turned a recession into a global credit crisis.

Over the last 12 months, 551,000 single-family units were started, and an additional 255,000 multifamily units. As is shown in the accompanying charts, that was an increase of 28 percent from the period a year earlier. Not since the early 1980s, when the economy was coming out of a double-dip recession caused in large part by soaring interest rates that made homes unaffordable, had starts risen so rapidly.

But as can also be seen from the charts, the recovery has not propelled the housing industry far. The total level of starts is still lower than at any time before the recession, and in the fourth quarter of last year, the residential construction industry accounted for only 2.6 percent of the total gross domestic product. That figure was up from the low, reached in mid-2009, of just 2.2 percent, but it was far below the 6.3 percent reached in late 2005, when the housing bubble was at its peak.

The last time housing construction contributed so little to the economy was during World War II.

In normal economic recoveries, housing construction supplies a substantial part of the growth recorded in the first year or two after the recession ends. But in this recovery, it kept shrinking. Over all, real housing spending contracted in every year from 2006 to 2011. But the 12 percent gain last year was the fastest since 1993, another period of recovery.

The building industry, devastated by the collapse of the boom, is only starting to recover. The number of new homes offered for sale peaked at 570,000 in mid-2006, as the boom was ending, and many of the homes built then took years to sell. The latest figures show that only 150,000 new homes were offered for sale in January, including houses that are planned as well as those partly or completely built. That is up only a little from the low of 142,000 reached last summer.

The number of homes being offered before construction begins has remained close to level for two years at a little more than a quarter of the peak. That is a sign that few new communities have been started, despite the rise in housing starts.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

App Smart: Tech Reminders for Those New Year’s Resolutions

This year it’s different. I’m using some apps to help me stick to my resolutions. We’ll see whether the best 21st-century motivational companion is the smartphone or tablet. If you want to try the experiment, too, here’s where to start.

The Astrid Tasks/To-do List app (free on iOS and Android) is not specifically meant for keeping resolutions, but as its name suggests it’s both a to-do list app and a reminders app. To use it for resolutions, just enter them as tasks and set repeating reminders. With all your data inside, Astrid becomes your portable digital conscience, gently nagging you to hit the gym, practice the piano, leave work on time and so on. (Ah, if only my smartphone knew when I was picking up a piece of chocolate.)

The app’s interface is simplicity itself. It’s a list of the tasks you’ve entered, with icons that tell you if each one has been completed or if it’s a recurring task. Entering a task (or a resolution, in this case) is easy: click “add,” type in the resolution and select a reminder alarm if you need one. In my case, the app is going to ping me at 9 a.m. every day to remind me to take a morning jog. If you need moral support, you can tell the app to share your goals with friends via e-mail or Facebook.

The iOS and Android apps differ a bit. The iOS version is cuter, thanks to its icons and cleaner design; the Android version is trickier to operate (I found it hard to see the little “save” icon when setting the time for a reminder, for example). But both versions work well, and both integrate with a cloud-based database so you can sync all your goal data among your devices.

Lift, free on iOS, is a similar motivational app, but with a community angle. The core of this app is a social network: you join groups that help you achieve a goal. For example, if your New Year’s resolution is to quit smoking, several groups can help you do so. You check in with these groups and comment on your actions and the group’s activity, and you can even earn a thumbs-up from group members for your progress.

The app lists existing groups in categories like “popular,” “fitness habits” and “learning habits,” or you can create your own group and invite friends to join you. For those who need a bit of social encouragement to stick to your resolutions, this app may be the best option.

While Lift does have reminders, they’re not the app’s main function, which means it will require a degree of willpower to remember your resolution, turn the app on and check in. The forgetful may not find it the best choice for keeping resolutions.

A new fitness or health regimen is one of the most popular New Year’s resolutions, and Fitocracy (free on iOS) is an app that can help you stick to it. It has a social group setup similar to Lift’s, but it’s exercise-centric, with a much jollier design.

For example, during setup the button to advance to the next settings page is labeled “go forth!” rather than a boring “next.” This playful attitude is really what the app is all about. It awards you points when you finish activities and has gamelike features like reward badges and even “level ups.” This combination of lightheartedness and a sense of community spirit may be exactly what you need to help you keep you exercising.

For a simpler, calendar-based app to help you keep a resolution, try Streaks — Motivational Calendar ($2 on iTunes). After you’ve added a goal, you tap on the app’s calendar to cross off a day when you achieve the goal. It’s a little like playing a game; the app keeps track of the longest streak of days you’ve managed, and your current number.

Though it is much less sophisticated than the others mentioned here, it’s ideal for those pressed for time, because interacting with it is so fast. Momentum Builder is a free Android app similar to Streaks, though its design is not as polished.

I look at a bunch of other resolution-binding apps on the Gadgetwise blog.

Happy New Year from me to you! May your apps help your resolutions come true.

Quick Calls

Google’s Zeitgeist app, free on Android, is a great way to look back at 2012. It’s an interface to Google’s report on how the world searched during the year, and it’s crammed with fascinating data. ... Nokia’s free Xpress, which compresses Web data so your phone doesn’t consume so much of your 3G or 4G data allowance, has been updated to be compatible with all Windows 8 phones. It had been limited to Nokia handsets only.

After 5 Years of Hiding, a Banker Reappears

In a country where displays of wealth are considered unseemly, Mr. Homm posed for photographs in front of his palatial villa on the Mediterranean island of Majorca, Cuban cigar in hand, and used his millions to shake up one of the country’s most sacred institutions, the Borussia Dortmund soccer team.

So perhaps it should not have been a surprise that Mr. Homm has resurfaced in a blaze of publicity. In a series of media interviews, he has vowed to disprove stock-fixing accusations against him by the U.S. Securities and Exchange Commission. And he has written a book about his years underground that he hopes will dissuade others from following the same path as he.

“I think my story is a really hard-core wake-up call,” Mr. Homm, who continues to live under an assumed name in a country he will not identify, said by telephone Friday.

“I’d like to reach a few souls who are trying to get a second Mercedes and a bigger boat,” he said. “I went to the utmost level of excess and it didn’t work.”

Mr. Homm said he had spent much of the past five years living under an assumed name in Colombia as he tried to find himself, and not be found by dubious characters trying to collect a reward of €1.5 million, or $1.9 million, that had been put on his head. The book is entitled “Kopf Geld Jagd,” which means “Head Money Hunt,” a play on the German term for “bounty hunt.”

“I had a long list of enemies,” Mr. Homm writes in his book. An English edition of the book, entitled “Rogue Financier — Adventures of an Estranged Capitalist,” should be available in electronic form shortly, he said

Just who wants to get Mr. Homm remains a mystery. But presumably the people who put up the reward — since withdrawn — were among the people who lost hundreds of millions investing in the hedge fund that Mr. Homm managed from Majorca, Absolute Capital Management Holdings. The fund’s value plunged in September 2007 shortly after Mr. Homm, his Calvin Klein underwear stuffed with cash, boarded a private turboprop plane on the Spanish island and flew to Colombia, according to the account he gives in the book.

If nothing else, Mr. Homm’s reappearance gives Germany something its financial crisis narrative has lacked so far. German banks were big buyers of subprime mortgage loans and helped cause the euro zone crisis by lending freely to Greece, Spain and other countries that are now struggling to repay their debts. But the country has not produced many financiers who can stand as personal symbols of greed and hubris in the manner of Richard S. Fuld Jr., the former chief of Lehman Brothers.

Enter Homm. In the book, Mr. Homm, a 6-foot-7 inch, 53-year-old who holds a bachelor’s degree and a master’s degree in business from Harvard, was both contrite and defiant. He expressed regret for having an underdeveloped sense of scruple, neglecting his children and generally behaving like a jerk. (Mr. Homm used a stronger word to describe himself.)

The main reason for his sudden departure from Europe, he wrote, “was that I needed distance and solitude to find a meaning in my life.”

Mr. Homm, who once shared a €5 million abode on Majorca with a Russian table dancer, said he now prayed daily and planned to devote proceeds from his memoir to schoolchildren in Liberia. He is organizing a charity, Maximum Impact Medicine, whose aim will be to provide inexpensive vaccines to people who do not have access to them now, he said.

To people who may doubt his sincerity, Mr. Homm said: “Watch this space and see in the next year or two if I’m not consistent or not truthful.”

Auto Sales Are the Highest in 4 Years

Autos flew off the lot at the highest sales rate in four years, adjusted for seasonal variations, according to the research firm Autodata.

Over all, a total of 1.19 million cars, trucks and S.U.V.’s were sold in the United States during the month — a 13 percent increase from a year ago.

Japanese and German manufacturers led the sales boom, offsetting weaker results at General Motors and Ford.

The monthly sales rate equaled about 14.9 million vehicles on an annualized basis, and it was the highest seasonally adjusted rate since February 2008, according to Autodata.

Analysts said the robust pace was fed by consumers replacing older vehicles, the wide variety of new fuel-efficient models on the market and the greater availability of credit at low interest rates.

“The industry is continuing its comeback the old-fashioned way: with new products, better inventory management and historically cheap loans,” said Jesse Toprak, an analyst with the auto research Web site TrueCar.com.

Overall industry sales are up 14.5 percent through the first nine months of the year, compared with the same period in 2011.

Many of the gains in September came at Toyota and Honda, the two big Japanese manufacturers that suffered major product shortages after last year’s earthquake and tsunami in Japan.

“We all underestimated the strength of the Toyota and Honda brands and their customer loyalty,” Mr. Toprak said. “They have not only gained back their market share, but increased it.”

Toyota said that it sold 171,000 vehicles during the month, a 41.5 percent increase from a year ago. The company reported that sales of its Prius gas-electric hybrid cars more than doubled from last year.

Honda reported that its sales grew 30.9 percent, to 117,000 vehicles. The company benefited from high demand for its two best-selling passenger cars, the Civic and the Accord. Honda began selling a new version of the Accord in the middle of the month.

The performance of Toyota and Honda contrasted with essentially flat sales at both G.M. and Ford, partly because of tepid sales of pickup trucks.

G.M. said Tuesday that its overall sales grew by 1.5 percent during September, which the company said were its best results for the month since 2008. G.M. said it sold 210,245 vehicles; passenger cars led the way with a 29 percent gain.

But sales of the company’s pickup trucks, which are big profit producers, dropped by 20 percent during September. G.M. attributed the decrease partly to a reduction in sales to rental fleets.

A G.M. executive said the automaker was trying to keep truck inventories low as it continued to focus on introducing new cars like the Chevrolet Spark.

“Passenger cars have been the launch point for a broad and deep G.M. product offensive,” said Kurt McNeil, vice president for United States sales.

Ford said its total sales for September were down 0.2 percent from a year ago. Truck sales dropped 7.6 percent, wiping out gains made by new cars and S.U.V.’s like the Ford Fusion and the Escape.

Ford said it sold 174,000 vehicles during the month, reporting its best results in small cars, sales of which increased by 73 percent.

“Fuel economy remains one of the most important features customers want today,” said Ken Czubay, Ford’s head of United States marketing, sales and service.

Sales of the company’s top seller, the F-series pickup, grew by just 1.2 percent during September, and sales of its Lincoln luxury brand fell 3.1 percent.

One industry analyst said stock investors were betting that an uptick in housing starts would eventually fuel an increase in pickup sales.

“The most popular theme in auto land appears to be to buy companies with pickup exposure,” Brian Johnson of Barclays wrote in a research report on Tuesday.

While G.M. and Ford struggled somewhat, Chrysler continued its steady comeback from very weak sales after its government bailout and bankruptcy in 2009.

Chrysler said its September sales increased 11.5 percent from the year-ago period, its 30th consecutive month of year-over-year sales gains. The company said it sold 142,000 vehicles, and each of its brands had gains, led by an 18 percent increase at Dodge.

The company benefited from the introduction of its Dodge Dart compact sedan, the first high-mileage small car Chrysler has produced since it was acquired by the Italian automaker Fiat. It also outperformed its Detroit rivals in pickups with a 4 percent increase in sales of Ram pickups.

Chrysler’s top American sales executive, Reid Bigland, said the industry’s recovery appeared to be gaining steam in the latter part of the year.

“Going forward with our current product lineup, record low interest rates and a stable U.S. economy, we remain optimistic about the health of the U.S. new-vehicle sales industry and our position in it,” Mr. Bigland said.

Other carmakers reported mixed results during the month. Nissan said it sold 91,000 vehicles, a 1.1 percent decline from a year ago. Like G.M. and Ford, it was hurt by the resurgence at Toyota and Honda.

One of the hottest manufacturers during the month continued to be Volkswagen. The German carmaker, which is already expanding its new assembly plant in Tennessee, said it sold 48,000 Volkswagen and Audi brand vehicles in September, a 32.4 percent increase from a year ago.