Financial Watch

A new survey from the American Chamber of Commerce in China indicated that concern is growing among U.S. businesses in the country that protectionist policies are threatening their long-term future in a key market, even while they remain optimistic about an economy that has rebounded strongly from the global recession.

The annual AmCham-China survey of its members—a barometer of sentiment among U.S. investors in China—reflects worries that China’s three-decades-long push for open markets could be stalling, as the government increasingly seeks to favor state-owned domestic enterprises that have spearheaded the economic recovery.

Stocks fell Tuesday on Wall Street as Greece’s debt problems and China’s economy again have investors concerned about economic growth.

Upbeat earnings and outlooks from the industrial giants DuPont, 3M and Ford have helped to moderate the losses. Strong first-quarter earnings have sent stocks higher in recent weeks.

In early trading, the Dow Jones industrial average was down 11.18, or 0.1 percent, at 11,193.85. The Standard & Poor’s 500-stock index was down 0.4 percent and the Nasdaq composite index was off 0.3 percent.

Failing to curb federal budget deficits would do “great damage” to the U.S. economy in the long run, Federal Reserve Chairman Ben Bernanke warned Tuesday.

Bernanke again urged the White House and Congress to come up with a credible plan to reduce the nation’s red ink, which hit a record $1.4 trillion last year.

Failing to do so would push interest rates higher — not only for Americans buying cars, homes and other things — but also for Uncle Sam to service its debt payments, he said.

All that would sap national economic activity and could cause employers to cut back on hiring, Bernanke said.

President Obama’s speech on Wall Street last week signals that a year after one of the worst financial panics in U.S. history, financial reform is on its way. Though reform will not prevent all future crises, it will make them less frequent and less likely to pose the same lethal threat to the economy.

That reform is necessary almost goes without saying. The financial system issued trillions of dollars in bad loans over the last decade – loans unlikely to be repaid under even the best of circumstances – creating the fodder for the subsequent financial panic and Great Recession. Its legal merits aside, the recent Securities and Exchange Commission suit against Goldman Sachs Group Inc. brings into sharp relief all that we feared about the financial system: that it has become opaque, conflicted, and dysfunctional.

The Senate is considering legislation to let the federal government set a “cap” limiting the amount of carbon dioxide each business may emit. A company discharging less than its allowance could sell or “trade” its unused portion to another firm that had reached its limit. Hence cap and trade.

This is supposed to reduce the amount of carbon dioxide produced by burning oil, coal and natural gas. Utilities, manufacturing and transportation rely on these fossil fuels and will face heavy taxes. President Barack Obama predicted electricity rates would necessarily skyrocket. Remember, 86 percent of Ohio’s electricity comes from coal-fired power plants.

Sales of new homes surged 27 percent in March and orders for most durable goods climbed, indicating the U.S. economy sped up heading into the second quarter.

The gain in new-home sales was the biggest in 47 years as buyers rushed to qualify for a government tax credit and the weather improved, a Commerce Department report showed. Bookings for goods meant to last at least three years, excluding cars and aircraft, climbed 2.8 percent.