U.s. Economy | featured news

Barack Obama's approval ratings are down, Republican challengers are beating him in polls and the U.S. economy is in a slump, yet the Democratic president's re-election campaign headquarters is buzzing.

US Federal Reserve Chairman Ben Bernanke tells Congress that the US economy is "close to faltering" and more action may be needed.

Every six months, the Treasury issues a report declaring that China’s currency is undervalued, draining dollars and jobs out of the U.S. economy. And every six months, the Treasury defers action, saying the Beijing government is not manipulating its currency. But with the prolonged slump in jobs, pressure is mounting among American politicians — as well as those in Europe, Brazil and emerging markets — to challenge China, even if that means imposing import tariffs to protect domestic industries and jobs.

Americans earned less last month, the first decline in nearly two years. With less income, consumers could cut back on spending and weaken an already-fragile economy.

The economy grew slightly faster in the spring than previously estimated but remained dangerously weak in the face of high unemployment and higher gas prices. Many economists foresee slightly better growth in the current July-September quarter. The annual growth rate was 1.3 percent in the April-June quarter, up from an estimate of 1 percent made a month ago, the Commerce Department said Thursday. The improvement reflected modestly more consumer spending and a bigger boost from trade.

People like Christine Alonzo are keeping President Barack Obama afloat and giving his political team hope that he can win re-election despite high unemployment and sour attitudes about his policies and the country's future.

Stocks tumbled on Thursday, extending losses for a fourth straight session, as the Federal Reserve's weak outlook for the U.S. economy and disappointing data from China heightened fears about a global recession.

Bernanke launched a new package of measures to support a limping economy and once again took the kind of unconventional approach that has become a trademark of his tumultuous tenure.

Bottom Line: Stocks rose in mid-morning trade on Wall Street Tuesday as investors grew more optimistic that the Federal Reserve would announce new moves to stimulate the economy.

The International Monetary Fund is sharply downgrading its outlook for the U.S. economy through 2012 because of weak growth and concern that Europe won't be able to solve its debt crisis.