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Americans’ incomes rose last month by the most in nine months, a hopeful sign after a year of weak wage gains.

The Commerce Department says incomes rose 0.5 percent, the strongest increase since a similar gain in March. Consumer spending was unchanged, following weak gains of 0.1 percent in both October and November.

The income increase after paying taxes and adjusting for inflation was 0.3 percent in December. For the year, inflation-adjusted incomes rose 0.9 percent, just half the modest 1.8 percent rise in 2010.

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U.S. stocks rallied Tuesday, kicking off the new year on a high note, as investors welcomed upbeat reports on economic activity around the world.

The Dow Jones industrial average () jumped 180 points, or 1.5%, to end at 12,397. The S&P 500 () gained 19 points, or 1.5%, to 1,277. The Nasdaq () added 43 points, or 1.7%, to 2,649.

The gains came after reports on manufacturing growth in China and India came in better than expected over the weekend. On Tuesday, a report showed U.S. manufacturing activity grew at a faster rate in December.

U.S. markets were closed Monday for the New Year holiday.

"There were no major negative headlines out of Europe, and we had some data suggesting the global economy is expanding," said Dan Greenhaus, chief global strategist at BTIG.

Investors scooped up shares of companies that would benefit from a strengthening global economy.

Bank stocks, which were among the worst performing sectors last year, led the Dow higher. Bank of America (, Fortune 500), Citigroup (, Fortune 500) and JPMorgan (, Fortune 500) all posted strong gains.

Industrial names Caterpillar (, Fortune 500) and Alcoa (, Fortune 500) were also higher, as were multinationals such as GE (, Fortune 500), Microsoft (, Fortune 500) and 3M (, Fortune 500).

But traders say the market is vulnerable to concerns about the debt crisis in Europe, which has been the main driver of stock prices for several months.

Stocks in 2012: Choppy but higher

"At least for today, there’s no disaster in Europe," said Art Hogan, a managing director at Lazard Capital Markets. "The market remains focused on what’s going on in the eurozone."

Meanwhile, oil prices surged more than 4% on continued anxiety over Iran’s growing threat to shut down the Strait of Hormuz.

U.S. stocks finished little changed Friday, bringing to an end a year in which the S&P dropped just 0.04 point — the smallest annual change in history. The Dow rose 5.5% for the year, while the Nasdaq lost 1.8%.

Economy: The Institute of Supply Management’s survey of manufacturing purchasing managers rose to 53.9 from 52.7. That’s a bit better than the 53.4 forecast of economists surveyed by Briefing.com.

Any reading above 50 signals expansion in the sector.

The Commerce Department said construction spending jumped 1 quick guaranteed personal loans.2% in November, after a revised 0.2% decline in October. Analysts surveyed by Briefing.com expect construction spending to have risen by 0.5%.

Over the weekend, the Chinese government released its official reading on manufacturing activity, showing the sector expanded slightly in December, after contracting the month before. And on Monday, a report compiled by HSBC and Markit showed India’s manufacturing activity picked up significantly during the month.

The manufacturing data "provides further evidence that global industrial production is likely to be stabilizing in the months to come," analysts at Barclays Capital wrote in a note to clients.

The Federal Reserve plans to give even more detailed forecasts about where it expects its key interest rate to be years from now, according to minutes of the Fed’s December meeting released Tuesday.

Companies: Chesapeake Energy (, Fortune 500) shares rose after the Oklahoma City-based energy company announced it completed a venture with an affiliate of French oil company Total () that gives the French firm a 25% stake in more than 600,000 acres in eastern Ohio, an area rich in shale oil.

20 Stocks For January 2012

Mead Johnson Nutrition () shares gained after two U.S. government agencies said they have completed their investigation of Enfamil and found the baby formula safe to use. The Food and Drug Administration and the Centers for Disease Control and Prevention had stepped in after a newborn baby died of a rare bacterial infection that they suspected could be linked to the powder-based infant formula.

World markets: European stocks also rose. Britain’s FTSE 100 () added 2%, the DAX () in Germany added 1.5% and France’s CAC 40 () gained 0.4%.

The Hang Seng () in Hong Kong added 2.4%. Markets in Shanghai () and Tokyo () were both closed for an extended New Year holiday.

Currencies and commodities: The dollar fell against the euro, the British pound and the Japanese yen.

Oil for February delivery added $4.20, or 4.2%, to $103.03 a barrel.

Gold futures for February delivery rose $33.70 to end at $1,600.50 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.96% from 1.87% late Friday.  

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Gas prices unexpectedly rose more than 30 percent for the new year in Myanmar and sparked fears of other goods costing more as well.

Motorists learned of the increase at the pump Sunday when prices increased from 2,500 kyat (3.15 dollars) to 3,350 kyat (4.2 dollars) per Imperial gallon (4.5 liters).

The government made no announcement. But with the fuel price hike, and a new 40 percent electricity cost increase announced late last year, people are concerned about inflation of consumer goods, too.

Myanmar’s energy production is not enough to meet domestic demand, and it imports petrol and other fuels. The government subsidizes gas prices and rations it to two Imperial gallons (9 liters) a day.

An unannounced price hike in 2007 sparked anti-government protests that led to the “saffron rebellion.” The military government then in power crushed it, leaving at least 15 dead and thousands arrested.

The nominally civilian government that took power early last year has made political changes that have improved its relationship with citizens.

(This version CORRECTS Corrects conversion of Imperial gallon to liter, from 4.2 to 4.5. This story is part of AP’s general news and financial services.)

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If all goes as planned, the long-vacant Jefferson Arms will pulse with activity after a $106 million transformation that will convert it to a home for hundreds of young educators and a regional headquarters of Teach for America.

Work could begin next summer if McGowan Brothers Development meets its timetable for getting federal new markets tax credits and other public incentives as part of the financing to renovate what is among downtown’s largest empty buildings. Construction would take about 18 months, said Tim McGowan, who runs the company with brothers Bill, Seamus and Sean.

“The plan for the building is pretty much to bring it back to its original form,” McGowan said.

Removal of exterior panels installed in the 1950s on the two lower floors and replication of the terra cotta beneath is part of the plan, he said. McGowan Development also plans to restore the two-level lobby atrium, damaged from a leaky roof, and install a rooftop pool.

Key to the project is the agreement by Teach for America to move its St. Louis operation to the building, which is on the National Register of Historic Places. Scott Baier, the organization’s executive director in St. Louis, said Teach for America had agreed to occupy 5,000 square feet of space at the rehabbed Jefferson Arms. The agreement includes plans to later increase the space by an additional 6,000 square feet. Baier said Teach for America was outgrowing its current office at 1204 Washington Avenue.

Even more important to McGowan Development than filling some office space is the potential of renting hundreds of Jefferson Arms apartments to young teachers. McGowan said those doing their two-year Teach for America commitment to teach in inner-city schools would be able stretch their $36,000 salaries by paying cut-rate rent of about $675 a month for a two-bedroom, two-bathroom loft apartment.

Baier said as many as 150 new teachers would arrive in St. Louis in 2014, when the redone Jefferson Arms should be ready. McGowan said he hopes 250 teachers will eventually live in the building. The rehabbed building would have 450 to 500 apartments. Those not rented to teachers will be offered at market rates, McGowan said.

Pyramid Construction, the once high-flying downtown developer, paid $19 million for Jefferson Arms in 2006 and had planned to convert it to condos for senior housing. Pyramid collapsed in 2008 without starting work on the project although it cleared the building of tenants. Since then, the building has sat empty.

McGowan Development is trying to revive the building with David Jump, the investor who bought the 13-story, 500,000-square-foot building last year. An arm of Citicorp, which foreclosed on the block-wide building in 2009 for $5.5 million, sold it to AB Acres, a corporation held by Jump.

The building occupies a prime spot on Tucker Boulevard and is among downtown’s most historic structures. Built as the Hotel Jefferson, it went up in time for the 1904 World’s Fair. The then-posh, 400-room establishment was the headquarters hotel for the 1904 and 1916 Democratic Party national conventions. It was later expanded to more than 900 rooms and hosted a who’s who of notable visitors for decades before sliding into disrepair.

McGowan said the building’s 360-car garage, part of the hotel’s 1920s expansion and remarkable then for its innovative design, was an important part of the new project. The garage’s parking fees cover the current debt service and taxes on the Jefferson Arms, he said.

But the project is more about people than cars. McGowan said he hoped Teach for America would draw additional education-related nonprofits that would fill one-time hotel space and provide business for a conference center planned in what had been the hotel’s “grand hall.” A charter school would be another welcome component, he said.

Availability of a large conference center would increase the number of meetings Teach for America holds in St. Louis, Baier said. Cost is a big factor, said Baier, adding that a conference site this year in Kansas City was a $55 cab ride from the airport. In comparison, downtown St. Louis has competitive hotel rates and is a $3.75 MetroLink ride from Lambert-St. Louis International Airport, he noted.

Baier said the decision to move to the Jefferson Arms grew out of conversations with U.S. Bancorp’s Community Development Corp., which has invested in several downtown projects. Zack Boyers, the corporation’s chief executive, put Baier in touch with the McGowans.

“For us, it’s a win-win,” Baier said. “We love working with these guys.”

Matt Philpott, director of the development corporation’s New Markets program, said the redone Jefferson Arms “would bring a lot of people and activity to downtown” and increase demand for more services nearby.

The St. Louis project is modeled in part after Teach for America’s home in Baltimore.

Seawall Development of Baltimore spent about $20 million to renovate an abandoned can factory near Johns Hopkins University as Miller’s Court, which houses Teach for America’s Baltimore office, other nonprofits and about 100 apartments. Thibault Manekin, a Seawall principal, said the McGowans visited Miller’s Court this year.

“They spent the day with us, just touring around and brainstorming,” Manekin said.

New markets, plus state and historic preservation tax credits, are essential to such projects, said Manekin, adding that in exchange for incentives, the developments spur neighborhood revitalization.

Miller’s Court, opened in 2009, brought together from across the country new teachers who had been unfamiliar with Baltimore before joining Teach for America. The project also returned an abandoned building to active use and helped revive what had been a “forgotten” neighborhood, Manekin said.

Courtney Cass, Teach for America’s leader in Baltimore, said teachers with her group occupy about 70 apartments at Miller’s Court. The building has a waiting list, she added.

She and Baier said that many teachers stayed in their new cities after they completed their Teach for America work. Some continue to teach; others start businesses. In any event, the young, college-educated people energize their new home cities, Cass and Baier said.

“Getting top talent to stay here is what is really important,” Baier said.

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Virgin America CEO David Cush believes flying doesn’t have to be painful. He remembers when boarding a plane was exciting and wants to bring back that joy.

That is why every job applicant, including pilots, flight attendants and baggage handlers, takes a personality test. He wants employees who are hard-wired with positive outlooks on life.

Virgin America, which is partly owned by Richard Branson, the founder of the edgy British airline Virgin Atlantic, doesn’t aim to be the biggest carrier. It only flies between big cities, such as Los Angeles, Chicago and Boston, serving about 5 million passengers annually _ a tiny fraction of the size of major airlines like Delta and United.

But Cush wants Virgin America to be recognized for superior quality _ and he appears to be succeeding. The airline, based near San Francisco, has routinely ranked at the top of customer surveys.

The past month has been a little rocky, though. Since the airline switched to a new reservation system on Oct. 28, customers have not been able to change or cancel flights online or select seats on Virgin America’s website. Instead, they’ve had to call the airline or wait until they got to the airport. Cush emailed a letter to the 56,000 passengers affected apologizing for the problem and the airline says it hopes to have it fully resolved by the first week in December.

Virgin America’s fleet is made up of brand-new Airbus A319s and A320s, fuel-efficient aircraft that seat 119 and 146. Each is equipped with TVs for every passenger, colorful mood lighting and Wi-Fi. Instead of flight attendants dictating meal times, passengers buy food when they want it by pressing a few buttons on their TV.

“If you talk to people about what is most frustrating about air travel, what comes out is the loss of control,” Cush says. “We’ve been pushing to give people control again.”

Virgin isn’t the first U.S. airline to use TVs and friendly service to attract customers. Cush acknowledges some copying as he works to create the California version of New York-based JetBlue.

“JetBlue came around and had a different type of service. That opened my eyes,” he says.

But his quest to create a fun airline has been stymied by more serious concerns like high fuel prices and a recession whose impact is still being felt.

Since it started flying in August 2007, Virgin America has lost $661.4 million. Cush expects to become profitable in 2012, a year later than originally planned.

The privately held company is owned by a New York hedge fund, Richard Branson’s Virgin Group and private investors, including Donald J. Carty, the former head of American Airlines’ parent company, AMR Corp.

Cush, 51, spent most of his career at American and left to head up Virgin America just four months after the airline started flying.

The Shreveport, La.-native is a graduate of Southern Methodist University _ yet a giant Louisiana State University football fan.

In his spare time, Cush likes to swim and fish. In college, he was a DJ, spinning Bruce Springsteen and Pink Floyd tunes.

Cush visited The Associated Press in New York. Below are excerpts, edited for clarity, of the interview where he spoke about the health of American, his favorite seat and why risk-taking is necessary to survive.

Q: How is Virgin America different?

A: The biggest difference is our in-flight entertainment system. It’s a nine-inch screen _ larger than JetBlue. We’ve got live TV, on-demand movies, about 3,000 MP3s. We have food and drink on-demand. We’re the only airline in the world that has it. You order from the seatback, swipe your credit card. They see seat 12C wants a turkey sandwich and a Heineken and bring it to you on a tray. Carts aren’t blocking the aisles.

Q: Who came up with that?

A: This was designed before my time but as I tell people, as time goes on and memories fade it will become my idea.

Q: How much more are people willing to pay for these services?

A: The model is getting them to pay the same amount with a much lower production cost.

Q: How can you attract business travelers when your miles can’t be redeemed for Hawaii, Europe or other places you don’t serve?

A: The mile problem will be solved early next year. We have basic agreements with Virgin Atlantic and Virgin Australia that will be fully reciprocal. We also have agreements with Cathay Pacific, Singapore and Emirates that will develop into frequent flier relationships.

Q: In Dallas, you’re telling fliers to “dump your older airline for a younger, hotter one.” American responded by slashing fares to San Francisco and Los Angeles. Can you survive this fare war?

A: We’ll survive. At current fares, it will not be a profitable route but it wouldn’t be such a loss-making one where we would consider any type of reduction. You have to be in Dallas-Fort Worth if you’re going to be a business airline.

Q: In one ad you refer to American as running a cattle car. If you feel that way, how could you have worked there for 22 years?

A: It wasn’t always that way. The industry, out of survival, did a lot of things. One of the reasons I left was because I didn’t think the industry had to operate that way.

Q: Why did you get into the business?

A: I don’t think anyone knows why they get in unless they are a pilot or an aviation enthusiast. I wanted to live in Dallas. American was a big employer. Young, single, the ability to fly around anywhere you wanted to, it all sounded pretty good. Once you get in, you find it so intellectually demanding that you can’t see yourself doing anything else.

Q: Do you think that American is on the right path?

A: It’s hard to tell. There’s a culture there that is perhaps a bit risk-averse. In the past, it was always an airline that was willing to accept risk. The industry’s consolidated around it and all of a sudden American finds itself in third place. I don’t know if they have the answer. I do know their top guys. They’re smart, capable but at some point you need to stick your neck out a little bit if you’re going to get out of a rut.

Q: Are you a risk-taker?

A: Absolutely. But I don’t take unnecessary risk and I always have an exit strategy.

Q: Mile for mile, airplanes burn more fuel than cars, trucks or trains. Do you think this poses a problem for the industry?

A: If we don’t find a way to clean up air travel, we’ll become a pariah. We’ll be what the coal companies used to be.

Q: You’re in 14 markets. Where would you like to fly to next?

A: We’ve been trying to get into Newark, (N.J.) since the day we started. This is a huge policy issue _ slots and gates are tied up by legacy carriers. The economics of keeping us out of Newark are huge for United so they’ll fly unprofitable (regional jets) just to occupy slots. When we go into markets, fares drop by 30 or 40 percent.

Q: When you fly your own airline you always pick the second row of coach. Why?

A: I get to watch the interaction between our in-flight teammates and the customers in first. It’s a nice seat, 4A.

Q: A window.

A: I’m a window guy. Our in-flight entertainment system has Google Maps. You zoom in when you see something on the ground you’re interested in.

Q: How would you describe yourself as a boss?

A: I’m probably a tough guy to work for. I’m pretty demanding and part of the reason is the airline business is a demanding business. We have very little margin for error in building this into a successful company. We have 2,500 people that rely on us for a paycheck.

Q: Do you ever get overshadowed by Richard Branson?

A: All the time. People want to talk to him, they want to see him. When he’s around, I’m just the hired help.

Q: How much patience do you have for unprofitable routes?

A: We stopped service to two different places. One because we needed the aircraft, that was Orange County, (Calif.). We didn’t see that as a big strategic need. The other is Toronto. We misjudged the market.

Q: Did you fire the guy who pushed that route?

A: That was me, so no.

Q: In ten years, do you see Virgin America being a full-blown national airline?

A: That’s not our goal. The biggest discipline we need to have is not outgrowing the model. That means maybe 100, 150 aircraft, probably no more. The goal would be to be consistently profitable, the highest quality airline where we can hopefully make a few hours of people’s day a little bit nicer.

Q: Will you go public?

A: As much as it’s nice being private _ because you don’t have to manage to the short term and there are a lot of burdensome regulations that come from being public _ ultimately we need to (do an initial public offering.) It’s a capital-intensive business. We need to tap public markets and our investors want to take some money off the table. It could be 2013 if the market is ready.

Q: How do you unwind after leaving the office?

A: I do a lot of yoga. It’s a nice way to separate the mind from what you’ve gone through all day.

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Charter Communications added Sean O’Donnell as its vice president and general manager in Missouri and Illinois, overseeing Charter’s day-to-day operations in those states.

O’Donnell most recently was senior vice president of regional operations for Bresnan Communications/Cablevision Systems in Billings, Mont. Before that, O’Donnell was a member of Charter’s corporate team in St. Louis, serving in key roles for four years, including vice president of information technology and vice president of operations No teletrak payday loan.

O’Donnell has more than 13 years of experience in the communications industry. He has a master’s of business administration degree and a bachelor’s degree in accounting, both from the University of Missouri-St. Louis.

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Greece will try to avoid international “blackmail and humiliation” by speeding up reforms and civil-service staff cuts, the finance minister said Monday, hours before holding an emergency teleconference with creditors.

Greece’s international bailout creditors stepped up the pressure at the start a crucial week in the nearly two-year debt crisis, urging the government to do more to heal its finances. Global markets were skeptical, however, and fell sharply on fears Athens will default on its mountain of debt.

Out of patience with the Socialist government’s delays on promised reforms, Greece’s partners and creditors are threatening to cut the cash lifeline without which the country would go bankrupt in less than a month.

Athens is struggling with a deepening recession that is eating away at the impact of its austerity measures while also causing unemployment and public anger to grow.

International debt inspectors will talk to finance chief Evangelos Venizelos around 1600 GMT ahead of a government meeting called by Prime Minister George Papandreou, who canceled a scheduled trip to the U.S. on Saturday.

“We expect the Greek authorities to explain, in particular, how they intend to close the fiscal gaps in 2011 and 2012 and how they plan to proceed with the structural reforms and privatizations,” said Amadeu Altafaj Tardio, a spokesman for the European Commission.

Ahead of the discussions, Venizelos said the government still seeks to generate euro3 billion ($4.1 billion) more revenues next year than it spends, before counting the cost of interest on existing debts.

Greece’s economy is expected to contract by about 5.5 percent this year _ more than the 3.5 percent earlier assumed _ and a further 2.5 percent in 2012, according to new government and IMF estimates.

“The country cannot go forward without the true implementation of major structural reforms _ we have delayed them,” Venizelos said at a conference south of Athens, adding that achieving the 2012 target was vital.

The government still must live up to its commitment to lower the 2011 budget deficit goal to 7.6 percent of gross domestic product.

When it became obvious earlier this month that there was a more than euro2 billion ($2.75 billion) shortfall in the budget, Greece’s creditors threatened to withhold the sixth installment of a euro110 billion rescue package agreed upon in May 2010.

Without the installment, worth euro8 billion, Greece faces defaulting on its debts by mid-October no checking account payday advance.

A review by officials from the International Monetary Fund, the European Central Bank and the European Commission, collectively known as the ‘troika,’ was suspended earlier this month amid talk of missed targets.

The government hurriedly announced an extra two-year property tax _ payable through electricity bills to ensure its collection _ to compensate for the shortfall.

But the news was greeted with an outcry from a public already reeling from salary cuts and the recession. State electricity company unionists also threatened to refuse to collect the taxes, and to prevent those who don’t pay having their power supply cut off.

A Communist labor union has called a protest against the tax outside parliament Wednesday.

Venizelos said Sunday night that the backlash led to skepticism among Greece’s creditors about whether the government would manage to raise the projected revenue.

While technical staff from the troika have been back in Athens for about a week, trying to figure out whether the recently announced measures will be enough to meet the targets, senior debt inspectors have stayed away until progress is made.

Altafaj Tardio said that, depending on what Venizelos says at the teleconference, the troika “will decide on the resumption of the review mission.”

IMF representative Bob Traa urged the government to speed up structural reforms and avoid further emergency taxes, arguing that Athens should give up the “taboo” of firing public servants.

“I have compared Greece to a Mercedes that can go 120 kilometers per hour but is only going 40 because it has so much sludge in the engine,” Traa told the conference.

He said Greece needed to speed up its reforms in tax collection and reducing the size of the overmanned public sector.

In an interview, Traa said Greece needed to implement key commitments including plans to slash 150,000 public sector positions by 2015.

“If you can do it (staff cuts) up front, you get over it much more quickly. Whether society can support that is a different issue,” Traa told the AP. “Our experience is that … if you do things gradually that may induce the public getting very tired. Adjustment fatigue is something that happens in every country.”

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Disposing of vacant St. Louis public schools is proving a tough sell cash advance to savings account.

With 20 school buildings on the market

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