Richard Drew, File, Associated Press
It was an easy year to emulate Warren Buffett even as Congress almost wrecked the economy.
U.S. stocks rocketed to new heights, and markets in Japan and Europe jumped, too. The gains enriched investors and defied a still-subpar economic rebound from the Great Recession.
Budget fights closed much of the U.S. government for 16 days. Leaked classified documents showed that the National Security Agency collected private online communications via Internet companies. The disastrous rollout of President Barack Obama's health care law confirmed fears of a bureaucratic train wreck.
Central banks embarked on a shopping spree. JPMorgan Chase paid a record $13 billion for its role in the housing bust. General Motors flashed signs of its old horsepower. A colossal merger for American Airlines and US Airways took flight. Twitter's IPO recalled the dizzy dot.com era. And the heartbreaking deaths of 1,100 garment workers in Bangladesh showed that some overseas factories serving U.S. companies remain unsafe.
The stock market boom was chosen as the top business story of 2013 by business editors at The Associated Press. Washington's gridlock and dysfunction came in second, followed by revelations involving the NSA.
Here are the top 10 business stories of 2013:
1. STOCK MARKETS SURGE: The Dow Jones industrial average set a record in March and hardly stopped to celebrate. The blue chip average has soared roughly 25 percent so far, its best performance in a decade. Stocks stand out as among the few areas of the economy to fully recover from the 2008 financial crisis.
The Federal Reserve's bond purchases helped cut long-term interest rates, making stocks more alluring than bonds. Also, companies boosted share prices through an unusually large $751 billion in stock buybacks. And corporate profits achieved a record share of the U.S. economy. The explosiveness of the stock rally prompted fears of a bubble because economic growth has been tepid by historical standards.
2. FEDERAL CHAOS: Congress nearly derailed the economy — not once but several times. Lawmakers allowed a Social Security tax cut to lapse after Jan. 1, which shrank Americans' paychecks. Then they let deep federal spending cuts take effect in March because they couldn't agree on a budget. The dysfunction peaked in October: Unable to pass a 2014 budget, Congress shut down part of the government for 16 days. National parks were closed. Federal employees stayed home. The government even risked a default on its debt until, with just hours to spare, Congress reopened the government and by December forged a two-year budget deal.
3. TECH COMPANIES AND NSA: Big Brother has logged on. The U.S. government gathered data on online messages through a program that's intended to stop terrorism but that touches the communications of ordinary Americans. Internet companies already track users and then sell customized digital advertising. But they reacted indignantly after documents leaked by a former NSA contractor said the agency had backdoors at Google, Yahoo, Facebook, Apple and Microsoft. The companies said they provided data only as required by federal courts. They tried to mend any public fallout by pressing the Obama administration to curb electronic snooping and to let the companies disclose more information about government requests for their users' online activities.
4. JPMORGAN CHASE: The biggest U.S. bank agreed to pay $13 billion for its part in the housing frenzy that sparked the financial crisis. The agreement dwarfed the previous record settlement with the government: $4 billion against BP for its 2010 oil spill. JPMorgan Chase and banks it had acquired had misled Fannie Mae and Freddie Mac about mortgage bonds it sold them that later went belly up. The settlement represented 60 percent of JPMorgan's 2012 net income. On the bright side for the bank: Most of the penalty is tax-deductible.
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