Weekly Wrap: Greek Default Trumps Obama's Job Plan

President Obama unveiled the $447 billion "American Jobs Act," comprised of tax credits and spending measures that intend to "jolt" the US economy and create jobs. The plan wasn't enough to convince stock investors, who continue to fear a Greek default and uncertainty in the Eurozone, especially after the unexpected departure of European Central Bank chief economist Jürgen Stark. Evidently, European central bankers have internal conflicts too.

Europe will remain in focus, as Greek Prime Minister George Papandreou delivers his annual economic policy speech this weekend. Greece resumes talks on Wednesday with European Commission, IMF and ECB officials about how the country can comply with the conditions necessary to grab the next $11 billion payment. While $11B may not sound like a lot, it just might unravel the larger bailout agreement announced on July 21^st.

In the mean time, jittery investors wrapped themselves in the safety of US Treasury bonds. The yield of the 10-year Treasury fell to 1.917 percent, the lowest level since at least the 1940s.

• DJIA: 10,992, down 2.2% on week, down 5% YTD (sixth weekly decline in last seven)
• S&P 500: 1154, down 1.7% on week, down 8.2% YTD
• NASDAQ: 2467, down 0.5% on week, down 7% YTD
• October Crude Oil: $87.24, up 0.9% on week
• December Gold: $1859.50, down 0.9% on the week

Total bank failures for 2011 = 71 (1 new bank failure over weekend)

FACTOIDS OF THE WEEK: American Jobs Act Edition
Tax relief for workers (Cost: $175B)

• Cutting payroll taxes in half for 160 million workers next year
• Allow more Americans to refinance mortgages at near 4 percent interest rates

• "Returning Heroes" hiring tax credit for veterans: provides tax credits from $5,600 to $9,600 to encourage the hiring of unemployed veterans.
• Preventing up to 280,000 teacher layoffs, while keeping cops and firefighters on the job
• Modernizing at least 35,000 public schools
• Immediate investments in infrastructure and a bipartisan National Infrastructure Bank
• Expanding access to high-speed wireless

• Cut payroll tax in half for 98% of businesses on their first $5 million in payroll
• A payroll tax holiday for added workers or increased wages (capped at the first $50M)
• Extending 100% expensing into 2012

• Extension of unemployment insurance
• A $4,000 tax credit to employers for hiring long-term unemployed workers
• Expanding job opportunities for low-income youth and adults through a fund for successful approaches for subsidized employment, innovative training programs and summer/year-round jobs for youth

Mon 9/12:

Tues 9/13:
8:30 Import-Export Prices

Weds 9/14:
8:30 Producer Price Index

8:30 Retail Sales

10:00 Business Inventories

Thurs 9/15:
8:30 Weekly Claims

8:30 Consumer Price Index

8:30 Empire State Manufacturing Survey

9:15 Industrial Production

10:00 Philadelphia Fed Survey

Fri 9/16:
9:55 Consumer Sentiment

Quadruple Witching (stock index futures, stock index options, stock options and single stock futures expire)

Jill Schlesinger

Jill Schlesinger, CFP® is the Emmy-nominated business analyst for CBS News. She covers the economy, markets, investing and anything else with a dollar sign on TV, radio (including her nationally syndicated radio show), the web and her blog, "Jill on Money." Prior to her second career at CBS, Jill spent 14 years as the co-owner and chief investment officer for an independent investment advisory firm. She began her career as a self-employed options trader on the Commodities Exchange of New York, following her graduation from Brown University.

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