My finance view

U.K. house prices (UKNBAAMM) may decline in 2012 as economic turmoil emanating from the euro area

Workers in the U.S. earning the minimum wage are worse off now than they were four decades ago.

The CHART OF THE DAY shows that after adjusting for inflation, the federal minimum wage dropped 20 percent from 1967 to 2010, even as the nominal figure climbed to $7.25 an hour from $1.40, a 418 percent gain.

The decline would have been worse if not for increases that took place from 2008 through 2010 in how much employers were legally obligated to pay. Combined with more stable consumer prices, those adjustments helped trim the reduction in earnings from 41 percent at the end of 2007, following a decade of no change in minimum pay.

Turkey and Azerbaijan will sign a memorandum of understanding tomorrow, establishing a consortium that will build a pipeline to ship natural gas from the BP Plc- operated Shah Deniz field to Europe via Anatolia.

State Oil Co. of Azerbaijan, or Socar, Turkey

+%3Cp%3E+It+looks+like+the+millionaire+surtax+is+going+down+again.%3C%2Fp%3E%3Cp%3EDemocrats+have+pushed+for+weeks+to+impose+a+millionaire+surtax+to+help+pay+for+the+cost+of+extending+the+payroll+tax+cut.+Republicans+have+said+it+would+be+a+job-killer.%3C%2Fp%3E%3Cp%3E%3Cp%3E%3C%2Fp%3E%3Cp%3E%3Cp%3E%3C%2Fp%3E%3C%2Fp%3E%3C%2Fp%3E%3Cp%3EOn+Wednesday+night%2C+with+time+running+out+before+Congress+adjourns+for+the+year%2C+it+appeared+that+Democrats+were+ready+to+give+up+in+the+name+of+getting+a+deal+done.+A+source+told+CNN+that+Senate+Democrats+would+propose+a+new+plan+that+did+not+include+the+tax.+%28Read%3A+The+latest+on+negotiations%29%3C%2Fp%3E%3Cp%3EThe+demise+of+this+version+of+the+millionaire+tax+would+not+be+a+surprise.+Lawmakers+have+already+voted+down+a+surtax+of+5.6%25%2C+then+3.25%25+and+most+recently+1.9%25.%3C%2Fp%3E%3Cp%3EBut+the+idea+of+taxing+the+rich+will+come+up+again+and+again+next+year%2C+since+themes+of+income+inequality+and+tax+fairness+will+be+sounded+repeatedly+on+the+campaign+trail.%3C%2Fp%3EPayroll+tax+cut%3A+What%27s+at+stake%3Cp%3EUrban+Institute+resident+fellow+Howard+Gleckman+points+out+that+an+extra+tax+on+millionaires+may+make+for+great+politics+but+it+would+make+for+awful+policy%2C+although+not+for+the+reasons+that+many+in+the+GOP+suggest.%3C%2Fp%3E%3Cp%3ERepublicans+still+cleave+to+the+notion+that+to+ever+ask+millionaires+to+pay+more+in+taxes+will+bring+the+economy+to+a+screeching+halt+because+it+would+hurt+small+business+job+creation.+%3C%2Fp%3E%3Cp%3EBut+there+are+problems+with+that+reasoning%3A%3C%2Fp%3E%3Cp%3E–A+very+small+percentage+of+tax+filers+with+business+income+make+more+than+%241+million.+%3C%2Fp%3E%3Cp%3E–There+is+no+way+to+tell+how+many+new+jobs+those+millionaires+create.+%3C%2Fp%3E%3Cp%3E–And+business+income+can+come+from+activities+that+don%27t+result+in+a+lot+of+hiring%2C+such+as+owning+rental+property+or+investing+in+a+partnership.+%3C%2Fp%3E%3Cp%3EFor+Gleckman%2C+a+big+problem+with+the+millionaire+surtax+is+that+it+feeds+the+myth+that+the+super+rich+can+pay+for+everything.+They+can%27t.+There+are+not+enough+of+them.%3C%2Fp%3EPayroll+tax+cut+divide%3A+How+to+pay+for+it%3Cp%3EAnd+by+applying+a+surtax+here+and+a+surtax+there%2C+soon+you%27re+talking+serious+rate+creep+–+to+levels+that+could+be+counterproductive+%3Ca+href%3D%22http%3A%2F%2Fus-fast-cash-now.com%22%3Efast+cash%3C%2Fa%3E%3C%21–+.+–%3E.+The+higher+rates+become+the+more+likely+it+is+that+the+rich+will+look+for+ways+to+avoid+paying+them.%3C%2Fp%3E%3Cp%3EIf+the+Bush+tax+cuts+expire%2C+the+top+rate+goes+to+39.6%25+and+the+value+of+certain+deductions+goes+down.+Add+in+a+new+Medicare+tax+for+high-income+households+starting+in+2013%2C+and+the+top+rate+could+approach+50%25+if+Congress+passed+a+5.6%25+surtax%2C+Gleckman+noted.+%3C%2Fp%3E%3Cp%3EDespite+the+flaws+in+the+parties%27+strategies+–+Democrats+always+reach+first+to+tax+the+rich+and+Republicans+always+rush+to+protect+them+even+at+the+expense+of+everyone+else+–+each+contains+a+bit+of+truth+the+other+side+will+have+to+accept+sooner+or+later.%3C%2Fp%3E%3Cp%3E%3C%2Fp%3E%3Cp%3E+%3C%2Fp%3E%3Cp%3EBoth+the+rich+and+the+middle+class+eventually+will+have+to+contribute+to+efforts+to+spur+the+economy+and+stabilize+the+federal+budget.%3C%2Fp%3E%3Cp%3E%26quot%3BDemocrats+today+can%27t+solve+our+nation%27s+many+budgetary+woes+primarily+by+taxing+the+rich%2C+and+Republicans+risk+alienating+the+middle+class+when+they+try+to+spare+the+rich+from+sharing+the+additional+burdens+most+Americans+soon+must+bear%2C%26quot%3B+former+Treasury+official+Eugene+Steuerle+wrote+in+his+public+policy+column+%26quot%3BThe+Government+We+Deserve.%26quot%3B%3C%2Fp%3E%3Cp%3EThe+rich+will+have+to+pay+more+in+taxes%2C+he+notes%2C+because+even+if+spending+is+cut+across+the+board%2C+they+won%27t+feel+the+pinch+since+they+don%27t+rely+on+government+spending+to+get+by.%3C%2Fp%3E%3Cp%3EAnd+the+middle+class+will+eventually+need+to+accept+some+spending+cuts+and+tax+increases%2C+Steuerle+said%2C+%26quot%3Bnot+because+the+rich+can%27t+pay+more%2C+but+because+most+income+in+the+economy+resides+with+that+80+percent+of+the+population+that+is+neither+poor+nor+rich.%26quot%3B%26nbsp%3B+%3C%2Fp%3E++%3Cp%3E%3Ca+href%3D%27http%3A%2F%2Fmoney.cnn.com%2F2011%2F12%2F14%2Fnews%2Feconomy%2Fmillionaire_surtax%2Findex.htm%27+rel%3D%27nofollow%27%3ESource%3C%2Fa%3E%3C%2Fp%3E+

U.S. online sales this holiday shopping season are up 15 percent compared to last year, after what may have been the busiest week of the season, said research firm comScore on Sunday.

Shoppers have spent $30.9 billion online from Nov. 1 through Dec. 16, up from $26.9 billion at the same point last year, said the Reston, Va., company, which tracks Web use.

Online sales surpassed $1 billion on four days last week. Total sales for the week climbed 15 percent to $6.31 billion compared to last year.

The five days that ended on Friday “will almost certainly be the heaviest week of the online holiday shopping season,” said comScore chairman Gian Fulgoni. Online spending will begin to slow as Christmas draws closer, he said.

But “Cyber Monday,” the Monday after Thanksgiving, is still the largest online shopping day ever, according to comScore. Sales for that day rose 22 percent from last year to $1.25 billion. Cyber Monday sales topped $1 billion for the first time last year.

The holiday shopping season can make up to 40 percent of retailers’ annual revenue. The online sales data point to Americans’ growing comfort with using their personal computers, tablets and smartphones to shop for the holidays.

Discounting and promotions have also boosted shopping this year. ComScore said on Sunday that shoppers have received free shipping on at least half of all their purchases in each week of this year’s holiday shopping season.

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Stephen Wancha was promoted to food and beverage director at Four Seasons St. Louis Hotel.

Wancha is responsible for overseeing Cielo restaurant and bar at the hotel as well as the food/beverage service for banquets and catering. He manages a staff of about 110 people.

Wancha previously worked at the Four Seasons Hotel here before briefly taking a job in food service at Four Seasons San Francisco Hotel cash till payday. He visited 91 regional wineries during his 18 months in San Francisco and says the contacts he made there will help Cielo bring new wines to St. Louis that aren’t usually available in the area.

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European Central Bank president Mario Draghi says there’s “no external savior” for heavily indebted governments in the eurozone debt crisis and gave no sign the bank is ready to step in and support their finances.

Draghi said governments must take the tough steps to balance budgets and reform economies to promote growth.

“I will never tire of saying that the first response should be from government,” Draghi said Thursday at a speech in Berlin. “There is no external savior for a country that doesn’t want to save itself.”

As a “firewall” to calm markets in the meantime, Draghi said, the EU has its newly strengthened bailout fund.

Some economists have urged the ECB to support governments with bigger purchases of government bonds. So far the bank has made some purchases but kept them limited and said the program is temporary, stressing that governments must not rely on such help from the ECB.

Draghi said that the purchases were “neither eternal nor infinite.”

In his speech, Draghi focussed instead on the European Financial Stability Facility, the current EU bailout fund, as the “firewall” against the crisis. He urged EU officials to quickly implement decisions to strengthen it to assure markets governments will pay their debts on time.

Governments have agreed on ways to increase the fund’s lending power and are seeking outside investors such as countries in emerging markets to contribute to its lending power, so far without much progress.

Economists say the EFSF is too small to bail out Italy, the most recent focus of the debt crisis that has seen Greece, Ireland and Portugal seek bailouts from other eurozone governments and the International Monetary Fund.

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Stock markets steadied Tuesday after the previous day’s big declines when investors fretted over the deal to fix the euro crisis by binding member economies closer together.

Optimism over last Friday’s agreement by the 17 euro countries and nine others to adopt a new fiscal pact to prevent a repeat of the debt crisis evaporated Monday after credit rating agencies Moody’s and Fitch both said it was insufficient and would not materially address the crushing debt loads of some nations or their rising borrowing costs.

Moody’s warned that it will review all EU governments’ ratings for possible downgrades in early 2012 _ a threat that analysts said was particularly worrisome to France, a major contributor to the European Financial Stability Facility, Europe’s emergency bailout fund. A downgrade of France’s triple A rating could hurt its ability to fulfill its commitments to the fund.

Investors are also awaiting the response of rival agency Standard & Poor’s. Last week it warned that it could downgrade most of the eurozone economies, including Germany, if the deal failed to deliver.

“It was not the reaction to the summit that politicians had hoped for, but it was in line with previous market response to summits which are sold as being the solution to all of Europe’s problems but end up raising more questions than they answer,” said Gary Jenkins, an analyst at Evolution Securities.

Following Monday’s big retreat, there’s been a calmer tone in the markets, though skepticism over the deal’s details remain.

In Europe, Germany’s DAX recouped some of Monday’s lost ground, trading 0.5 percent higher at 5,815 while the CAC-40 rose 0.1 percent to 3,092. The FTSE 100 index of leading British shares rose 0.4 percent to 5,450.

Wall Street was poised for modest gains at the open _ Dow futures were up 0.4 percent at 11,991 while the broader Standard & Poor’s 500 futures rose an equivalent rate to 1,235.

The calmer tone was evident in the performance of the euro, which was trading 0.2 percent higher at $1.3195. On Monday, the single currency fell to a 10-week low over worries that Europe’s new financial pact won’t be enough to stop the region’s growing debt crisis.

“The financial markets are now digesting the details of the EU deal struck last Friday, and it is quickly becoming apparent that the financial markets have once again given it the thumbs down, which could quickly result in increased concerns of major funding difficulties emerging in the first half of 2012 when there is sizable sovereign debt to be rolled over, in particular in Italy,” said Derek Halpenny, an analyst at The Bank of Tokyo-Mitsubishi UFJ.

Another currency in the headlines was the Indian rupee, which hit a fresh record low Tuesday, after a contraction in industrial output reported the day before. The currency touched 53.52 against the dollar, down over 21 percent since late July. It is the third time in three weeks that it has breached prior lows.

The plunging currency is further darkening the economic outlook for Asia’s third largest economy. While a weak rupee can help exporters, it wreaks havoc with India’s giant oil import bill, deepening the country’s growing deficit.

“It clearly reflects the slowing economy in India and also the flight to the dollar of global money,” said SMC Global Securities strategist Jagannadham Thunuguntla.

The benchmark Sensex index was up 0.6 percent in midday trade in Mumbai, as trading held steady after a punishing three-day slide.

Elsewhere in Asia, stocks took a battering following the previous day’s retreats in Europe and the U.S.

Japan’s Nikkei 225 fell 1.2 percent to close at 8,552.81 while South Korea’s Kospi gave up 1.9 percent to 1,864.06 and Hong Kong’s Hang Seng lost 0.7 percent to 18,447.17. On mainland China, the benchmark Shanghai Composite Index fell 1.9 percent to 2,248.59, its lowest in closing since March 2009. The Shenzhen Composite Index lost 3 percent to 921.32.

Oil prices tracked equities in Europe modestly higher ahead of a meeting of the OPEC oil cartel in Vienna, Austria, which is expected to see production levels left unchanged _ benchmark oil for January delivery was up 38 cents to $98.14 per barrel in electronic trading on the New York Mercantile Exchange.

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U.S. stock futures are falling Monday as the initial enthusiasm over last week’s agreement on fixing the European debt crisis is replaced by worries that it won’t be enough.

The deal would allow for a central European authority to oversee future budgets for the 17 countries that use the euro. But it doesn’t help cut existing debt, which has caused Greece, Ireland and Portugal to need bailouts and is threatening Italy and Spain.

Less than an hour before the opening of trading in New York, futures for the Dow Jones industrial average are down 99 points to 12,044 while futures on the broader S&P 500 index are down 11 points to 1,242.

Markets in Europe are dropping, with France’s CAC-40 down 1.5 percent to 3,123.71, Germany’s DAX off by 1.2 percent to 5,862.44, and London’s FTSE 100 down 0.5 percent to 5,499.62.

Credit rating agency Moody’s said last week’s summit “offers few new measures.”

“The announced measures therefore do not change Moody’s previously expressed view that the crisis is in a critical and volatile stage,” Moody’s said, warning that it still intends to review all EU governments’ ratings for possible downgrades during the first three months of 2012.

Asian stocks mostly closed higher, as they caught up with the gains made in Europe and the U.S. on Friday.

Japan’s Nikkei 225 index jumped 1.4 percent to close at 8,653.82. South Korea’s Kospi added 1.3 percent to 1,899.76 and benchmarks in Singapore, Taiwan, Australia and Indonesia also rose.

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Britain’s Treasury chief defended Prime Minister David Cameron’s decision to veto changes to the European Union treaty, saying Saturday the move protected U.K. economic interests.

Cameron rejected an invitation to join 26 European partners in a tighter financial alliance to save the euro which he said didn’t adequately protect Britain’s national interest and meant giving up too much control over regulation of Britain’s dominant financial sector.

The move isolated Cameron from the European Union and raised doubts about whether Britain realistically can remain a member of the 27-nation bloc _ prompting cheers from the prime minister’s typically anti-EU party and jeers from the opposition.

Britain’s typically brash media reflected the divide Saturday, with The Guardian headline “Cameron Cuts UK Adrift” batting against the Daily Mail’s “The Day He Put Britain First.”

Treasury chief George Osborne defended Cameron on BBC radio, saying he thinks Britons are pleased the prime minister “stood up for the British national interest.

“We have protected Britain’s financial services and manufacturing companies that need to be able to trade their products into Europe from the development of eurozone integration spilling over and affecting non-euro members of the EU,” he said.

Osborne added that if the prime minister had “caved in” to signing the treaty, the “full force” of the EU could have undermined British interests.

“We were not prepared to let that happen,” he said.

Osborne’s vote of confidence echoed support from other Conservative lawmakers over the prime minister’s move to set Britain apart.

But Cameron also is facing a chorus of criticism from the opposition Labour Party and growing tensions with his Conservative Party’s junior coalition partner, the Liberal Democrats.

Deputy Prime Minister Nick Clegg has rejected talk of a rift between his Liberal Democrats and the Conservatives and backed Cameron’s move, but dissent bubbled up from elsewhere in the party.

One Liberal Democrat lawmaker accused Cameron of “betraying Britain,” while another called the fallout “a black day for Britain and Europe.”

Emboldened by Cameron’s move, Conservatives stepped up calls for a full re-negotiation of Britain’s position in the EU, but Liberal Democrat deputy leader Simon Hughes shot down that idea in an interview with Sky News, insisting the issue was “not on the table” and telling the Tories to “calm down.”

In Italy, Premier Mario Monti has summoned union leaders to discuss his new austerity plan as lawmakers tinker with his tough proposals to try to rescue the country from its debt load and get the economy growing again.

Unions have bitterly contested Monti’s proposal to reform Italy’s generous pension system and have called a strike for Monday. Monti’s office said Saturday the premier, fresh from the EU summit in Brussels, would meet with union leaders on Sunday to discuss the proposals.

Monti has also proposed restoring a property tax suspended during Premier Silvio Berlusconi’s government. The proposal has renewed criticism of the tax-exempt status of the Catholic Church in Italy, even though the church merely enjoys the same tax-exempt status as any non-profit.

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