Tuesday morning headlines

Stocks edge lower: Some unexpectedly sour news about consumer spending might be playing a role - or maybe it's just more of the push-pull pattern we've been seeing for weeks. Dow is down about 50 points in early trading.

Growth revised down: GDP numbers for the third quarter show that the economy grew at a 2.8 percent pace, down from the initial estimate of 3.5 percent. From AP:

The main factors behind the downgrade: consumers didn't spend as much, commercial construction was weaker and the nation's trade deficit was more of a drag on growth. Businesses also trimmed more of their stockpiles, another restraining factor.

Krugman's take: NYT columnist says the GDP revision "is really quite grim," adding that "we may be in a technical recovery, but we're not recovering." From the NYT:

At this growth rate it's far from clear that we're doing anything to reduce the output gap -- the gap between what the economy could produce and what it's actually producing. Correspondingly, there's no reason now for even a bit of optimism on unemployment.

Home prices edge higher: It gets confusing because different surveys say different things, but the latest Case Shiller numbers show that L.A. prices rose 0.8 percent from August to September (better than a number of other cities), and were down just 9 percent from a year earlier. (release)

Underwater housing: More than one-in-three borrowers in California owed more on their mortgages in the third quarter than their properties were worth. In Nevada, it was about two-in-three. Numbers are from First American CoreLogic in Santa Ana. From the WSJ:

These so-called underwater mortgages pose a roadblock to a housing recovery because the properties are more likely to fall into bank foreclosure and get dumped into an already saturated market. Economists from J.P. Morgan Chase & Co. said Monday they didn't expect U.S. home prices to hit bottom until early 2011, citing the prospect of oversupply.

Small drop in pump prices: An average gallon of regular in the L.A. area is $2.996, down about a penny from last week, according to the government's survey. Not much change is expected through this week's holiday.

Playboy outsources: The men's magazine will have an outside company handle all its operations - except for editorial - in an effort to save money. The move comes as Playboy Enterprises is in talks to be sold for about $300 million. (Reuters)

Tesla in Downey?: The fledgling automaker is nearing a deal to have its electric car assembly line located on a former NASA site. A bunch of incentives are being readied by the city. Also in the running is the old Boeing 717 plant in Long Beach. (Press-Telegram)

Lacter on radio: This morning's business chat with KPCC's Steve Julian looks at the holiday shopping outlook and how retailers are planning to stay above water. Also on kpcc.org and on podcast.