A weekly roundup of economic news
Stocks:
After four months of going up and down, the Dow Jones average finished out the second half of the year higher than it started.
News reports said traders held renewed hope that the economic recovery would pick up speed. Earlier this year, the economy was weighed down by a combination of soaring oil prices and disruptions in supplies coming from Japan after its devastating earthquake.
Taxes:
The state sales tax dropped by a penny Friday, and vehicle license fees were sliced by nearly half.
For many Californians, the lower taxes are a positive byproduct of the budget battle in Sacramento. Republicans refused to go along with Gov. Jerry Brown's plan to keep higher taxes in place.
Democratic leaders say they'll pursue a ballot initiative next year to restore the higher taxes. But in the meantime, Californians will save an estimated $5.87 billion a year, according to the Department of Finance.
Car dealers, especially, hope the lower vehicle license fee will help boost sales.
Government:
Despite the tax cut, the new state budget will likely bring more hardship to Sacramento, which has already been slammed by state and local government cutbacks. The budget contemplates 5,600 additional layoffs, and potentially more if hoped-for tax revenues don't materialize.
It's not clear how many of those cutbacks would be in Sacramento.
Spending on a wide variety of government programs has also been cut. Monthly grants for those participating in the state's CalWORKs program were cut to $460 for a family of three, their lowest level in more than 20 years.
The state also plans to take $1.7 billion from local redevelopment agencies to help balance the budget. That's money that otherwise would have been spent on housing or urban projects such as revitalizing K Street or the downtown railyard.
Real estate:
Home prices just continue dropping, and they show little sign of stopping.
Corelogic of Santa Ana said Thurday that median home prices in the Sacramento, Arden and Roseville area tumbled 11.3 percent in May 2011 from the same month of 2010.
Short sales and foreclosures unloaded at bargain prices continue to keep a lid on the market. If they are taken out of the equation, the region's home prices were 4.5 percent lower in May.
Nationally, median prices slipped 7.4 percent in May from the same time in 2010.
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