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George Chamberlin's Money in the Morning

The missing piece of the economic recovery -- jobs -- continues to be elusive. The Labor Department reported this morning that the number of people filing for unemployment benefits in the past week remained unchanged at 505,000. However, the number of people receiving jobless benefits on an ongoing basis declined to 5.61 million.

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Companies are still cutting jobs. AOL said today that it will cut its payroll by nearly a third when it is spun off by Time Warner on Dec. 9. The company said it will eliminate up to 2,300 positions from its current staff of nearly 7,000.

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Stocks are likely to do something today that they haven't done for more than a month -- experience back-to-back daily declines. The Dow Jones industrials dropped 11 points yesterday but the selling this morning is more aggressive, with the index down more than 140 points in early trading. The mood of the investment community seems to shift on a daily basis based on the current economic headlines.

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Traders are also reacting to news from the Mortgage Bankers Association that the number of delinquent active loans rose to 9.64 percent in the third quarter. It is important to factor in that about 40 percent of all homes are mortgage free, so the delinquent rate for all owner-occupied homes is closer to 6 percent, still high but not media-drooling high.

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I had the chance yesterday to speak at a meeting of student counselors for the San Diego Unified School District. I admire these people and can't imagine how hard their jobs must be. I shared with them a new report from the Alliance for Excellent Education that studied the economic impact of high school dropouts. The group found that about 600,000 students dropped out of school in 2008. The research found that if just half of those students had graduated, they would have earned more than $4.1 billion in additional income. In addition, state and local tax revenues in an average year would jump by a total of nearly $536 million.

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The 24th Annual Holiday Survey from Deloitte finds people here in Southern California are hopeful about the economy in 2010 and are likely to spend more this holiday season. The survey says 47 percent of consumers here expect to spend more or the same on the holidays this year, an improvement from last year when only 41 percent felt the same way. And, 52 percent of Southern Californians surveyed said they expect the economy to improve next year compared with just 29 percent last year. I think we are going to look back at this time a year ago as about the gloomiest period for the country in many decades.

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And, 66 percent of people who plan to shop next Friday, the day after Thanksgiving when the big discounts are expected, say they will buy something for themselves. No kidding. When I go shopping for my wife and kids and grandkids, I use that as an excuse to pick up a treat for myself, too. After all, who knows better what you want than you?

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Freddie Mac reported this morning that the average rate on a 30-year fixed rate loan dropped to 4.83 percent. A year ago the rate was 6.04 percent. In the third quarter, an estimated $1.1 trillion in refinancing activity occurred, saving homeowners an estimated $10 billion in monthly payments in the first 12 months of the new loans.

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