Morning Business Memo…
After six painful years, the national foreclosure crisis may soon be drawing to a close. Listings firm RealtyTrac says the number of homes in the foreclosure process is down to the lowest level since the housing bubble burst. January's total fell 28 percent compared to the year before. Lenders took possession of fewer homes last month. In California - one of the worst hit states during the crisis - foreclosures are down 75 percent over a year ago. Florida ranked highest among the states for the fifth month in a row. One in every 300 Florida housing units had a foreclosure filing in January - more than twice the national average.
The recession in the eurozone deepened in the last three months of last year, as the previously strong German economy faltered. Eurostat, the EU's statistics office, says the eurozone economy shrank by 0.6 percent from the previous three-month period. The decline was bigger than the drop expected in financial markets. The drop in economic activity was the steepest since the first quarter of 2009.
President's Day weekend will be the retail industry's first big sale event of the year. Clothing and home items will be on sale this weekend. Lindsay Sakraida of DealNews.com says shoppers should "look for even big ticket items like mattresses, furniture, bed and bath items even tools." Selection is limited but this can be a great time to find winter clothes. "Coats are especially good if you want a really high end coat but don't want to pay hundreds of dollars, you can get them for up to 80 percent off." Consumer electronics products will be on sale, says Sakraida, with "some really great discounts on big screen TVs. They're no longer a huge premium and many consumers can now afford them."
The boards of American Airlines and US Airways have agreed to merge, creating the world's largest airline. The combined carrier will be called American Airlines, but run by US Airways management with CEO Doug Parker in charge. AMR creditors will get 72 percent of the combined carrier. The merger will bring a crucial injection of cash for American Airlines, which is now in Chapter 11 bankruptcy. "With firm orders for more than 600 new mainline aircraft, the combined airline will have one of the most modern and efficient fleets in the industry," says a company statement this morning. Passengers may not see many changes soon. "This merger probably won't officially occur where they fly as one airline for at least two years. So I don't see anything different happening in the short term," says Rick Seaney, CEO of FareCompare.com. Some worry about higher fares in the future and a loss competition. "American will have a monopoly on virtually every route that they fly," says SMU economics professor Bernard Weinstein.
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc
- American Airlines