Newspaper article THE JOURNAL RECORD

Home Sales Increase Sharply

Newspaper article THE JOURNAL RECORD

Home Sales Increase Sharply

Article excerpt

WASHINGTON (AP) _ New home sales surged to a seven-year high in November and applications for unemployment benefits dropped to a near five-year low last week, the government said Thursday in reports presaging a happy new year for the economy.

The reports, the last to be issued by the government in 1993, were hailed by the Clinton administration as an indication of things to come in 1994. Private analysts said they probably overstated what undoubtedly are positive year-end trends in both the housing and labor markets.

"It's surprising in that it happened to occur as a blip. ... It's not surprising in that it's reflective of the general strengthening in the overall economy," said economist Robert R. Davis of the Savings Community Bankers of America.

Sales of new single-family homes jumped 11.3 percent last month, to a seasonally adjusted annual rate of 807,000, the highest level since April 1986, the departments of Commerce and Housing and Urban Development said.

Meanwhile, the number of Americans filing for unemployment benefits plummeted by 39,000 last week, to a seasonally adjusted 291,000, the lowest since Feb. 4, 1989.

President Clinton, who was golfing at Hilton Head Island, S.C., said, "This shows the results of low interest rates, low inflation, bringing down the deficit, and increasing investment."

"The American people have taken control of their economic destiny," he declared.

And Treasury Secretary Lloyd Bentsen, in a year-end statement, said, "The economic future of this country is brighter than it's been in a long time. I'm confident the good news will continue in 1994."

He predicted the economic growth rate in the final three months of this year would register between a robust 4 percent and 5 percent and continue at a moderate 3 percent next year.

Analysts cautioned that part of the big drop in jobless claims probably occurred because most government offices closed the day before Christmas, leaving fewer days than usual to file claims. …

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