U.S. Economy Expanded at a 3.2% in First Quarter

The U.S. economy continued to grow in the first quarter. National output expanded at a seasonally adjusted annual rate of 3.2 percent last quarter, after growing 5.6 percent in the fourth quarter of 2009. This marked the third quarter in a row the economy showed strong economic growth. Economists are optimistic that the news may breed more confidence about the future turnaround.

Increased consumer spending played a significant role in the last quarter expansion. Consumer spending grew at 3.6 percent annual rate in the first part of the year, after growing at 1.6 percent annual rate in the previous three months.

SEC charges Goldman Sachs defrauded investors

The Securities and Exchange Commission (SEC) filed a case to sue Goldman Sachs and one of its employees for civil fraud, alleging they defrauded investors in selling a financial product tied to subprime mortgages, in 2007.

The SEC's allegation focuses on a mortgage securities transaction structured by Goldman, for which it allegedly earned $15 million in fees. Goldman allegedly helped hedge fund Paulson & Co., led by John Paulson, bet against those securities, and Paulson's firm made a profit of about $1 billion. Investors in the mortgage securities lost more than $1 billion, the SEC said.

The instrument in the S.E.C. case, called Abacus 2007-AC1, was one of 25 deals that Goldman created so the bank and select clients could bet against the housing market.

Economy added new jobs in March

Payrolls surge in March marked the beginning of job recovery as employers added 162,000 nonfarm jobs. This good news came from the Labor Department reported on Friday, after eight million jobs lost since the beginning of recession in December 2007. To absorb only new entrants into the labor market the economy needs to add more than 100,000 jobs a month.

While the unemployment rate held steady at 9.7 percent, economists saw signs in the latest report that the economy was poised to make steady progress.