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Fewer groceries, more debt: Families brace for first month without child tax payments

The child tax credit, part of the Biden administration’s American Rescue Plan Act passed last year, distributed as much as $300 per child every month to millions of American families starting in July. The extra pay lasted six months before it lapsed in late December. It would have come this weekend......»»

Category: topSource: washpostJan 14th, 2022

10 Things in Politics: Dems under pressure to keep child tax credit

And Jussie Smollett was found guilty of falsely reporting a hate crime. Welcome back to 10 Things in Politics. Today is the last edition before the newsletter goes on hiatus. I'll be a senior politics reporter at Insider starting next year. Please stay in touch! You can reach me at bgriffiths@insider.com or follow me on Twitter at @BrentGriffiths.Be sure to sign up for Insider Exclusives to get our politics scoops delivered right to your inbox. And to help us improve our newsletters, please fill out this quick, seven-question survey.I truly appreciate your waking up with us each morning.Here's what we're talking about:Democrats have 2 1/2 weeks to pass Biden's big bill before parents get cut off from child-tax-credit checksA federal court handed Trump another stinging defeat in his efforts to shield documents related to January 6Jussie Smollett was found guilty of falsely reporting a hate crimePresident Joe Biden.Chip Somodevilla/Getty Images1. INSIDE CONGRESS: Time is running out for Democrats. Senate Majority Leader Chuck Schumer wants his party to pass President Joe Biden's massive spending plan by Christmas. Failing to meet the deadline will do more than just exacerbate frustrations with the state of Biden's agenda. The IRS has advised lawmakers that December 28 is the last day Biden's $2 trillion package can pass to ensure the next round of child-tax-credit payments goes out smoothly.Here's where things stand:Experts say it would be a disaster if the child tax credit expires: Some 35 million families are receiving the monthly child tax credit, per the IRS and Treasury, my colleague Joseph Zeballos-Roig reports. Data indicates the government cash is going toward basic expenses like rent, groceries, and gas.Biden's plan would extend the tax credit through next year: It provides up to $300 a month per child age 5 and under, or $3,600 annually. For children ages 6 to 17, families can receive $250 each month, or $3,000 yearly. And it would lock in the ability for the vast majority of American families to receive the cash every month, regardless of whether they file taxes.A key swing vote remains a holdout: Sen. Joe Manchin of West Virginia has yet to commit to supporting Biden's plan. He told Insider that even if the revamped child tax credit were to abruptly end, the federal government had stepped in enough with a burst of new spending to help families during the coronavirus pandemic.Read more about where talks on the core of Biden's agenda stand.2. Biden touts economic headwinds before another expected inflation-related doozy: Biden argued that overall the US economy was performing well, saying it was "the fastest movement of people from relying on government support to earning a weekly paycheck in history." Thursday's weekly jobless claims were also at their lowest since 1969. But inflation continues to haunt him. Inflation in October hit a 30-year high. Today's inflation report for November could be a 40-year high.3. Congress now has a clear path to raising the debt ceiling: A bipartisan group of senators sent legislation to Biden's desk that would allow Democrats to lift the limit with a 51-vote majority. The deal cuts short further bluster less than a week before an expected default, but not all Republicans were happy with it. Others said there were simply no good options. "We're confronted with a crap sandwich, and I'd rather have a hamburger," Sen. Kevin Cramer of South Dakota told reporters. Some Democrats view the episode as reopening the possibility of weakening the Senate's filibuster.Jussie Smollett.AP Photo/Charles Rex Arbogast4. Jussie Smollett was found guilty of falsely reporting a hate crime: Smollett, an actor known from his time on Fox's "Empire," was found guilty on five out of six counts in connection with staging a hate crime against himself nearly three years ago on the streets of downtown Chicago. Smollett, 39, faces up to three years in prison. But experts have said he would most likely be put on probation and ordered to do community service, per the Associated Press. The actor, who is Black and gay, unexpectedly took the stand in his trial, telling jurors, "There was no hoax on my part." More ​​on the verdict from the closely watched case.5. Federal court rules Trump must turn over January 6 documents: Judge Patricia Millett, writing for a three-judge panel, rejected former President Donald Trump's bid to block the House's January 6 select committee from obtaining a tranche of executive-branch documents. Trump, per The New York Times, is now expected to appeal the ruling to the Supreme Court. Millett's decision gives his team just two weeks to make such a move before a temporary block on the National Archives turning over the records is lifted. More information from what has become a closely watched court battle.Key quote: "The constitutional protections of executive privilege should not be used to shield, from Congress or the public, information that reflects a clear and apparent effort to subvert the Constitution itself," Millett, an Obama appointee, wrote in a blistering 68-page opinion.More potentially bad legal news for Trump: New York's attorney general, Letitia James, wants to put Trump under oath as her office conducts a civil investigation into the Trump Organization, The Washington Post reports. James also dropped out of the New York governor's race to focus on keeping her current job.6. At least 53 people are dead after a truck carrying migrants crashed in Mexico: "Rescue workers rushing to a highway accident found a horrific scene of death and injury after a freight truck jammed with as many as 200 migrants tipped over and crashed into the base of a steel pedestrian bridge in southern Mexico," the Associated Press reports. Here's the latest on the horrific crash.7. New York gives noncitizens a right to vote in local elections: New York City is now the largest municipality in the US to allow noncitizens to vote in local races, The Post reports. The new policy does not apply to New Yorkers living in the country illegally but does cover an estimated roughly 1 million adult noncitizens. Read more about this historic change.8. Daunte Wright's girlfriend gave emotional testimony about what happened after he was shot: Alayna Albrecht-Payton, who was in the car when the Minnesota police officer Kim Potter fatally shot Wright, testified that she frantically searched for a sweater or towel to "put it on his chest like you see in the movies and TV shows." Potter has pleaded not guilty to first- and second-degree manslaughter charges. Potter has said she confused the placement of her gun with her Taser. More from an emotional day in the trial.9. Buffalo Starbucks workers vote for historic union: Starbucks workers at a store in Buffalo, New York, have voted to form a union, which is a first for the coffee giant's company-owned stores in the US. There could be even more Starbucks unionization efforts on the horizon.10. One last thing: There's no trivia question today, so instead I want to take a moment to thank all the wonderful people who have helped guide this from the start. (Yesterday's answer: Bob and Elizabeth Dole lived inside the Watergate complex for decades. Then the Republican National Committee chairman, Dole was out of town during the infamous break-in. They later lived next door to Monica Lewinsky.)The team: There wouldn't be a newsletter if it weren't for Darren Samuelsohn and his DC reporters' fabulous reporting. Jordan Erb and Phil Rosen often found the quirky 10th things that you love and pitched in more times than I can count. Oma Seddiq and Grace Panetta kindly filled in during my time off. Kevin Kaplan, Kieran Corcoran, and Alexandra Ma have made us all better with their edits. And last but not least, Olivia Oran and Lisa Ryan have deftly guided us from behind the scenes.Like a true Midwesterner, I am bad at goodbyes. So thank you once again for waking up with us. Until we meet again, I hope you have a wonderful weekend and holiday season.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 10th, 2021

95 House Democrats urge the Senate to pass Build Back Better before Biden"s monthly child tax credit runs out

Sen. Joe Manchin hasn't thrown his support behind the sprawling plan, including its direct payments. Senate Democrats face a jam-packed schedule. Democratic Rep. Suzan DelBene of Washington is a former Microsoft executive and one of the House's wealthiest members.Chip Somodevilla/Getty Images Ninety-five House Democrats are urging the Senate to pass Biden's spending bill by December's end. They're warning that families "can't afford to lose" the monthly child tax credit. Sen. Chuck Schumer wants to pass it by Christmas, but Democrats still disagree on many fronts. Ninety-five House Democrats are urging the Senate to approve President Joe Biden's social spending bill before the end of the month. They say action is necessary to prevent a lapse in monthly child-tax-credit payments."Our members stood united in passing the Build Back Better Act last month and now it is time for the Senate to act before the expanded Child Tax Credit payments expire at the end of December," Rep. Suzan DelBene, the chair of the moderate-leaning New Democrat Coalition, said in a statement.She went on, "American families cannot afford to lose this critical middle-class tax cut, which has cut child poverty in half and helped millions of families afford childcare, pay their bills, and put food on the table."The remarks came as Senate Majority Leader Chuck Schumer of New York issued a statement on Monday doubling down on approving the $2 trillion Build Back Better legislation by Christmas. The measure would establish universal pre-K for young children, renew the bulked-up child tax credit for another year, and combat the climate emergency.All 50 Senate Democrats must coalesce around the package so it can clear the 50-50 chamber over unanimous GOP opposition. Schumer said the Senate parliamentarian was still working to ensure that all parts of the bill had an effect on the federal budget so that it complied with the party-line reconciliation process. Otherwise, some provisions could still be stripped.But the swift timeline for passage is threatened by at least one key swing vote: Sen. Joe Manchin of West Virginia. He has declined to throw his backing behind the House-approved bill, including the one-year expansion of the child tax credit. Last week, he told Insider it was still "a work in progress."Other Senate Democrats are starting to raise concerns about a potential lapse. "I think it's extraordinarily important to keep this program on track," Sen. Ron Wyden of Oregon, the chair of the Finance Committee, recently told reporters.Millions of families rely on the benefit to cover expenses, such as the cost of rent, groceries, childcare, and school supplies. The Internal Revenue Service is scheduled to distribute the final monthly payments on December 15, and families are set to receive the other half at tax time.Other disagreements threaten to capsize the rapid timetable. Senate negotiations on tax cuts for high-earning Americans are faltering. In addition, Manchin remains opposed to a provision authorizing four weeks of paid medical and family leave within the House bill.Lawmakers are also struggling to clear a must-pass defense spending bill. Congress also has nine days to raise the debt limit, or the US might have trouble paying its financial obligations.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 6th, 2021

With just weeks before Biden"s monthly child tax credit runs out, 95 House Democrats urge Senate to pass Build Back Better

Joe Manchin hasn't thrown his support behind the sprawling plan, including its direct payments. Senate Democrats face a jam-packed schedule. Rep. Suzan DelBene, a Democrat of Washington, is a former Microsoft executive and one of the House's wealthiest members.Chip Somodevilla/Getty Images 95 House Democrats are pressuring the Senate to pass the Biden spending bill by December's end. They're warning that families "can't afford to lose" the monthly child tax credit. Schumer wants to pass it by Christmas, but Democrats still disagree on many fronts. Ninety-five House Democrats are urging the Senate to approve President Joe Biden's social spending bill before month's end, warning that action is necessary to prevent a lapse in monthly child tax credit payments."Our members stood united in passing the Build Back Better Act last month and now it is time for the Senate to act before the expanded Child Tax Credit payments expire at the end of December," Rep. Suzan DelBene, chair of the  moderate-leaning New Democrat Coalition, said in a statement.She went on: "American families cannot afford to lose this critical middle-class tax cut, which has cut child poverty in half and helped millions of families afford childcare, pay their bills, and put food on the table."The remarks come as Senate Majority Leader Chuck Schumer of New York issued another statement on Monday doubling down on approving the $2 trillion Build Back Better legislation by Christmas. The measure will set up universal pre-K for young children, renew the bulked-up child tax credit for another year, and combat the climate emergency.All 50 Senate Democrats must coalesce around the package so it clears the 50-50 chamber over unanimous GOP opposition. Schumer said the Senate parliamentarian is still working to ensure all parts of the bill have an effect on the federal budget, so it complies with the party-line reconciliation process. Otherwise, some provisions could still be stripped.But the swift timeline for passage is also threatened by at least one key swing vote: Sen. Joe Manchin of West Virginia. He has declined to throw his backing behind the House-approved bill, including the one-year child tax credit expansion. He told Insider that part was still "a work in progress" last week.Other Senate Democrats are starting to raise concern about a potential lapse. "I think it's extraordinarily important to keep this program on track," Sen. Ron Wyden of Oregon, chair of the Finance Committee, recently told reporters.Millions of families are relying on the benefit to cover expenses like rent, groceries, childcare, and school supplies. The Internal Revenue Service will distribute the final monthly payments on December 15 and families will receive the other half at tax time.Other disagreements threaten to capsize their rapid timetable. Senate negotiations on tax cuts for high-earning Americans are faltering. In addition, Manchin remains opposed to a provision authorizing four weeks of paid medical and family leave within the House bill.Lawmakers are also struggling to clear a must-pass defense spending bill. Congress also has nine days to raise the debt limit or the US might have trouble paying its financial obligations.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 6th, 2021

Biden"s monthly payments to families were a "godsend." Now that they"ve ended, parents are "a little bit terrified" about what comes next.

The payments helped millions of families stay afloat. One mother said, It was "huge to just know that we're not going to lose our house." Catherine Falls Commercial/Getty Images Over 36 million families were sent the final advance monthly child-tax-credit payment in December. Parents told Insider how the monthly payments have been helpful, such as for mortgage payments. One said the payments meant she could keep working amid the pandemic and its effect on schools. Meghan Hullinger is a single mother with four children living in West Virginia, and the monthly payments parents received from the government from July to December were a lifeline for her family.Thinking back to the first payment in July, Hullinger told Insider that "it was just the relief of knowing" that she wouldn't have to "play the bill lottery.""It was basically, I had just enough to pay all of my bills and have a decent sitter that I trusted to watch my kids so I could work," Hullinger said. "It was the absolute relief of having enough."But that relief Hullinger and others have felt from receiving the payments has evaporated. Parents who were getting used to receiving monthly checks from the federal government won't see any fresh deposits for the time being, and it could make it harder to pay bills and support their families. Since July, households had received up to $300 per child each month under the expanded child tax credit passed last year as part of the government's response to the ongoing pandemic. The last payment before the program was set to expire was sent on December 15 to over 36 million families, the IRS said. Democrats don't have a clear shot at reviving it anytime soon. They sought to extend it for another year as part of their $2 trillion Build Back Better plan. But it's languishing in the Senate because of opposition from Sen. Joe Manchin, a conservative Democrat from West Virginia — Hullinger's home state — who wants to add a work requirement to the benefit.The advance monthly payments have helped households in a variety of ways. It has helped some make their mortgage payments or pay for rent, food, school supplies, or other school expenses. Some have put it away in savings or used it to pay down debt. Insider spoke with two moms who are also MomsRising members. The two moms had relied on the child-tax-credit payments and were now worried about what comes next.Without another monthly payment, one mom said she was "a little bit terrified.""The monthly payment is significantly more helpful for everyday people who kind of are living paycheck to paycheck and really have to figure stuff out," said Stacy Niemann, a mother of two who received payments of $550 per month.Kristin Rowe-Finkbeiner, a cofounder and the executive director and CEO of MomsRising, called the expanded child tax credit transformational for families. She said it helped lift children out of poverty and helped working parents afford care, which kept them in their jobs.Rowe-Finkbeiner said the expanded child tax credit benefited not only the millions of families receiving the payments but also the US economy."We can't forget that parents, and moms in particular, are the primary people making consumer purchasing decisions in our consumer-fueled economy," she added.One parent said the payments helped her family 'just be a little bit more comfortable'Hullinger said the monthly payments helped her in multiple ways. For one, knowing that the payments would start in July, she was able to get a used car in May that she said was much safer than the one she already had.The expanded tax credit also helped her keep working. With the pandemic still raging, Hullinger and her family have faced multiple school closures and quarantines. She said that without the payments, such disruptions would have meant taking time off work. Instead, she was able to get a sitter.Hullinger said the last advance monthly payment was a godsend as she was able to buy kerosene to heat her apartment and also get Christmas gifts for her four children.Niemann's experience with the monthly payments differed from Hullinger's. She said her husband's income was the family's primary income."But with my husband being self-employed, our income is variable and kind of unpredictable," Niemann said. "So that's the biggest thing that the child tax credit has helped us with — to know that every month, for sure, we have at least one bill that's going to be paid by getting the child tax credit."Trying to maintain a small business amid the pandemic has been hard for Niemann and her husband. She said they lost a lot of business. She and her husband also both needed surgery and were now paying thousands of dollars in medical debt.She said the monthly payments helped them "in some months to be able to just be a little bit more comfortable."In particular, the monthly disbursements helped with their mortgage payments."That's honestly been huge to just know that we're not going to lose our house," Niemann said.She added that she was able to use the money on fun activities for her two children, such as buying pumpkins or a Christmas tree."None of us are going on extravagant vacations and living our best lives on this money," Hullinger said. "A lot of times it gives us just enough to where we can sleep at night."No more payments could mean negative consequences for some familiesOther parents spoke with Insider's Erin Snodgrass about what the end of the payments meant for their families. "Without these payments, I won't eat so my kids can," one parent told Snodgrass.Congressional Democrats want to extend the program for another year through their social- and climate-policy bill. But resistance from Manchin means they can't muscle it through the Senate and sidestep Republicans anytime soon. The Biden administration has floated retroactive payments for eligible families if the plan clears the 50-50 Senate."The temporary child-tax-credit expansion that we have had in place for the past several months is proof of concept that a permanent child-tax-credit expansion is needed into the future in our nation," Rowe-Finkbeiner told Insider in December.Put simply, Rowe-Finkbeiner said the expanded child tax credit "definitely must continue," and Niemann called it "really just a huge help."Read the original article on Business Insider.....»»

Category: worldSource: nytJan 15th, 2022

4 Charts That Explain the U.S.’s 2021 Economic Rollercoaster

The U.S. economy ended up in a weird place in 2021. Consumers were eager to spend money, but couldn’t get their purchases because supply chains were haywire. Wages rose as workers resigned. Prices, meanwhile, soared for everything from groceries to gas to rent and vehicles. And the global health crisis that triggered these trends is… The U.S. economy ended up in a weird place in 2021. Consumers were eager to spend money, but couldn’t get their purchases because supply chains were haywire. Wages rose as workers resigned. Prices, meanwhile, soared for everything from groceries to gas to rent and vehicles. And the global health crisis that triggered these trends is still in full force. If you are feeling a bit of whiplash from all this, you’re not alone. Americans have mixed feelings about what’s going on. A Gallup economic poll in November found that 70% of U.S. adults believe the economy is getting worse—a rate not seen since April 2020, when the country was in shut-down mode. But at the same time, 74% say now is a good time to get a job—the highest rate recorded in the survey’s 20-year history. [time-brightcove not-tgx=”true”] It’s hard to say if things will start to feel more normal in 2022. The unusual combination of economic circumstances from the last year could persist for some time, experts say, but the timeline is uncertain because so much depends on the pandemic’s severity, monetary policies and human behavior—all of which play off each other. Consider all the ingredients that were necessary to create the so-called “great resignation” of 2021. First was the fact that Americans weren’t cash-strapped thanks to federal programs such as relief checks and enhanced unemployment benefits from President Biden in 2021 and former President Trump in 2020. Even as those programs wound down, families with children received child tax credit payments on a monthly basis in the second half of the year. Those income sources, combined with the dampened consumer spending from early in the pandemic, triggered the personal savings rate to shoot up—giving Americans a financial cushion to sit on as they waited to rejoin the labor force. Americans experienced less material hardship during the pandemic than before the pandemic, according to one analysis from the Urban Institute, a left-leaning think tank. “The intentions [of the pandemic policies] might have been good, but they also provided a bit of a disincentive and lack of a need to get back on the job,” says Joel Griffith, an economics research fellow at the Heritage Foundation, a conservative think tank. “So I think we’re still experiencing some of the lagging effects of that.” Financial security aside, the decision to take a job—or stay in an existing one—became more complicated in 2021 as the pandemic continued to drag on. Some workers left customer-facing jobs due to the health risks. Others left industries like trucking that capitalize on poor working conditions. More recently, employees left jobs in defiance of vaccine mandates, as well. This confluence of factors, both tangible and psychological, created an unusual scenario where people didn’t rush into available jobs. Currently, there are 6.9 million unemployed Americans, but there are 11 million job openings, according to the Bureau of Labor Statistics. A rising number of workers quit in the second half of 2021, hitting a record 4.4 million people, or 3% of workers, in September. The upshot of the great resignation is that companies are bumping wages and benefits to lure and retain employees. Just ahead of the holiday shopping season, for instance, Macy’s announced that all workers would earn at least $15 an hour by May 2022, making the department store one of the latest national chains to boost pay, following the likes of Costco (which set a $17 base wage in October) and Starbucks ($15 by next summer). Amazon’s base wage has been $15 since 2018, but the company announced in September that its average starting pay would jump to $18. The Macy’s decision came amid “intense competition for talent,” as noted in the retailer’s latest earnings report. Although these increases are above the $7.25 federal minimum wage, researchers at the Massachusetts Institute of Technology who track the cost of living by U.S. county report that even $15 an hour is not enough for most Americans to get by. What’s most defining about 2021’s labor crunch is that so many Americans left the labor force at a time when living costs were rising. Indeed, inflation has been an increasingly worrisome issue, hitting 6.9% year-over-year in November, a 39-year high. Inflation has stemmed largely from tight supply chains (an ongoing problem since the first economic shutdowns) and high consumer demand. Labor shortages haven’t been the main cause for inflation, experts say, but they aren’t exactly helping the problem, either. Indeed, manufacturing, transport and wholesale industries are all paying more to hire and retain workers and certainly some of those costs are getting passed down the line to the consumer. Energy prices are a major reason why inflation has spiked. Consumers around the world are feeling the effects of rising energy costs in their utility bills and at the pump—and just about everywhere else considering the vast number of goods that get produced and transported with fuel. The World Bank announced in late October that energy prices are on track to be more than 80% higher in 2021 compared to 2020, and will stay high in the first half of next year, posing a significant risk to global inflation. “We were in a pandemic recession. We were in a quarantine. We were really slowing down economic activity for a long time,” says Michael Horrigan, president of the W. E. Upjohn Institute for Employment Research who previously served as an associate commissioner with the Bureau of Labor Statistics. “As we have come back—and it’s been uneven—but as we have come back, there has been a big increase in the demand for a variety of things that are related to the use of energy.” Prices for goods and services are running so high that they are wiping out wage gains. Wages and salaries for private industry workers as measured by the Employment Cost Index were rising about 3% a year prior to the pandemic. They were up 4.6% for the 12-month period ending Sept. 2021. But U.S. inflation, as measured by the Consumer Price Index, has topped 5% annual increases every month since June, which means that the price increases have eaten into the salary gains for much of the year. Researchers at Harvard’s Kennedy School calculate that inflation-adjusted wages are nearly 3% below the pre-pandemic growth trend. Inflation-adjusted wages may strengthen again if prices return to their pre-pandemic norms in 2022, says Jason Furman, an economics professor at Harvard. “If inflation is below 2.5% next year, then probably workers will start to catch up—maybe not get back all the way, but make up some of the ground they lost in the last year and a half,” he says. “If inflation is above 3%, then they’re likely to lose further ground next year.” (Furman’s personal prediction is that inflation will top 3% next year.) Economists aren’t certain how long it will take for prices to restabilize. The calculation depends on which policy interventions will kick in. The Federal Reserve, which is tasked with maintaining price stability, has signaled that it could raise interest rates in an effort to lower inflation. Higher interest rates could dampen spending and slow down the economy because consumers and businesses will find it more expensive to borrow money. The trade-off in curbing inflation with higher interest rates is that as the economy cools, businesses typically slow hiring. Should that happen, it could take longer for the U.S. unemployment rate—which was 4.2% in November— to drop back down to its pre-pandemic rate of 3.5%. “The Fed expected inflation to come back down much more rapidly,” says Narayana Kocherlakota, an economics professor at the University of Rochester who previously served as president of the Federal Reserve Bank of Minneapolis. “The forces that we’re seeing on inflation are more persistent than were expected a year ago.” Now, the clock is ticking as economists debate what normal employment should look like in an era when employees are quitting in droves. For Americans, fearing that inflation is here to stay could make inflation worse. Given enough time and exposure to higher prices, businesses and workers may start to worry that their dollars won’t cover expenses and they may try to hedge against it. For instance, labor unions could demand wage boosts that are commensurate with living costs. Businesses might opt into contracts that account for anticipated price spikes. And landlords may raise rents in their lease agreements. These reactions, in combination with the current inflation triggers like high energy prices and supply chain problems, could lock in high prices for the future, making inflation spiral higher. For much of 2021, Federal Reserve chair Jerome Powell publicly noted that inflation was transitory and driven by certain parts of the economy most impacted by the pandemic. Only recently has that outlook shifted. The Fed has acknowledged in more recent weeks that the problem is more widespread, to the point of requiring intervention. “Expectations matter tremendously,” says Kocherlakota. “You’re trying to see, as a policymaker, how permanent do people believe inflation is going to be, because the more they believe it’s going to be permanent, the more tendency there is for it to become permanent.” Managing expectations about how inflation will look in 2022 could curb the behaviors that threaten to perpetuate ever-rising prices. But at the same time, the forces that kicked off the economic problems in the first place—a hesitant workforce, supply chain holdups and a glut of consumer spending—are all rooted in a pandemic that can’t be solved with monetary policies. For the economy to feel healthy again, the world needs to pull together to overcome the human health crisis first......»»

Category: topSource: timeJan 1st, 2022

Sen. Joe Manchin says he won"t back $2 trillion social spending bill, dooming huge part of Biden"s agenda: "I can"t vote for it"

The moderate Democratic senator said during a Fox News interview that he will oppose President Joe Biden's signature bill. Sen. Joe Manchin of West Virginia.AP Photo/J. Scott Applewhite Manchin said on Sunday he cannot support the centerpiece of Biden's economic agenda. "This is a no on this piece of this legislation," he said. His opposition torpedoes its passage since all Senate Democrats must get behind it. Sen. Joe Manchin of West Virginia on Sunday said he was opposed to President Joe Biden's $2 trillion social spending bill, effectively dooming the centerpiece of the president's economic agenda in its current form."If I can't go home and explain it to the people of West Virginia I can't vote for it," he said in a "Fox News Sunday" interview. "I've tried everything humanly possible, I can't get there. This is a no."—The Recount (@therecount) December 19, 2021He continued: "This is a no on this legislation. I have tried everything I know to do."Manchin later put out a statement chastising Democrats for trying to usher in transformative changes to the country."My Democratic colleagues in Washington are determined to dramatically reshape our society in a way that leaves our country even more vulnerable to the threats we face," he said in a statement, adding he "cannot take that risk" with federal debt and inflation on the rise.To overcome unanimous GOP opposition to the package, all 50 Senate Democrats need to coalesce behind the plan so it passes the 50-50 chamber. The conservative Democrat's opposition effectively pulls the plug on it.The legislation would represent a major expansion of the American safety net. It would set up universal pre-K, renew monthly child tax credit payments to American families for another year, establish federal subsidies for childcare, combat the climate emergency and more. Democrats wanted to finance it with new taxes on rich Americans and large corporations currently paying little or no federal tax.The path ahead for Democrats was not immediately clear. To assuage Manchin's concerns, they may cut the size of the bill even further, already down to about $2 billion from the original $3.5 trillion price tag they envisioned, or attempt to strike bipartisan deals on parts of it with the GOP.Manchin has cited a range of reasons for Democrats to pull back from their ambitious package throughout the summer and fall, urging a "strategic pause" on it since August. But inflation has risen as a concern near the top of his list, alongside the increasing level of government spending."We've done everything that we can to help people," Manchin told Insider earlier this month, referring to $5.4 trillion in emergency federal spending that Congress authorized to combat the pandemic.Progressives expressed outrage on Sunday at Manchin. Sen. Bernie Sanders of Vermont said that the legislation should still put up for a vote on the Senate floor next year."Let Mr. Manchin explain to the people of West Virginia why he doesn't have the guts to stand up to the powerful special interests," he said on CNN's "State of the Union."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 19th, 2021

AOC says it"s "actually delusional" to think Democrats can get re-elected without acting on student debt or expanding child tax credits

"The President has tools at his disposal," AOC wrote on Twitter. Student-loan payments are set to resume 46 days after a nearly 2-year pause. Rep. Alexandria Ocasio-Cortez.Alex Wong/Getty Images AOC said Democrats will not get re-elected if they don't act on student debt and pass Biden's agenda. The Senate likely won't vote on Build Back Better until 2022, causing the child tax credit to lapse. Plus, 43 million federal student-loan borrowers will have to resume payments on Feb. 1.  AOC gave her Democratic colleagues a reality check: act on issues their voters care about or lose the next election."It is actually delusional to believe Dems can get re-elected without acting on filibuster or student debt, Biden breaking his BBB (Build Back Better) promise, letting CTC (child tax credit) lapse, 0 path to citizenship, etc," New York Rep. Ocasio Cortez wrote on Twitter on Friday.—Alexandria Ocasio-Cortez (@AOC) December 17, 2021 All those issues Ocasio-Cortez listed are ones progressive lawmakers, and Americans who voted for them, are strongly advocating for. Although it's been almost a month since the House passed President Joe Biden's $2 trillion social-spending package, which included a one-year expansion of the child tax credit for families with children, it looks like the Senate will not be voting on the package until after Christmas.Given the pushed-back timeline, not only will the $300 monthly checks per child lapse in January, but just one month later, 43 million federal student-loan borrowers will be resuming payments on their debt once the pandemic pause lifts on February 1. As Insider previously reported, many fully-employed borrowers do not feel financially secure enough to make payments next year, and per a new Data for Progress poll, 55% of voters think the payment pause should be extended since COVID-19 cases are still rising.White House Press Secretary Jen Psaki said in a recent press briefing that while the administration still plans so stay on schedule with the payment resumption, they are continuing to review the impact of the Omicron variant.Ocasio-Cortez has been one of the many progressive lawmakers urging Biden to not only extend the pause on student-loan payments, given the pandemic is ongoing, but to cancel student debt broadly for every borrower. She took to the House floor earlier this month to urge Biden to act on the $1.7 trillion crisis, and she slammed the "ridiculous assertion" that canceling student debt would benefit the rich."Do we really think that a billionaire's child is taking on student loans?" Ocasio-Cortez said.Biden campaigned on approving $10,000 in student debt per borrower, but that promise has yet to come to fruition and voters are beginning to take notice. For example, an independent voter recently appeared on CNN to weigh in on Biden's actions so far, and she gave the president a B-minus rating for not yet delivering on his student-debt promises."I would definitely say he has delivered on many promises, but some of them he has not," Amikka Burl, an independent voter, said on CNN. "He promised when he was actually running, on his campaign trail, that he would wipe out $10,000 worth of student-loan debt for every individual that has student loans. That has yet to come to fruition, so I am waiting for that to happen."Aside from student-debt cancellation, the most pressing issue right now for many borrowers is being thrown back into repayment early next year, and lawmakers and advocates are working to ensure that does not happen."This debt is just overwhelming for people," Senate Majority Leader Chuck Schumer said last week. "If we don't extend the pause, interest rates just pile up. Students owe a fortune. And with Omicron here, we're not getting out of this as quickly as we'd like."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 17th, 2021

Democrats have 19 days to pass Biden"s big bill before parents get cut off from child tax credit checks in January, IRS says

Lingering issues over the scope of Biden's $2 trillion spending plan could force Democrats to work through Christmas to preserve the child tax credit. President Joe Biden delivers remarks on the passage of the Bipartisan Infrastructure Bill in the State Dining Room of the White House on Saturday, Nov. 6, 2021.(Kent Nishimura / Los Angeles Times via Getty Images The IRS says December 28 is the latest Biden's plan can pass for January CTC payments to go out. Two Democratic aides privately confirmed the IRS communications to Insider. Schumer is putting his foot on the gas, but Manchin hasn't signaled that he's onboard with this timeline. The Internal Revenue Service has advised Congressional Democrats that December 28 is the latest date that President Joe Biden's $2 trillion social and climate spending bill must pass to ensure the January 15 round of child tax credit payments goes out smoothly.Two Democratic aides were granted anonymity to privately discuss the matter with Insider.The development could add further urgency to Democrats' struggle to meet their ambitious timeline to approve the sprawling bill by Christmas. Senate Majority Leader Chuck Schumer is using the looming deadline to pressure all 50 Senate Democrats to immediately unite around the package over unanimous Republican opposition."COVID isn't over, and so these checks shouldn't lapse either — on the contrary they should keep going!" Schumer said Thursday on the Senate floor.Though Schumer is pressing his foot on the gas, he's already collided with a major obstacle: Sen. Joe Manchin of West Virginia.Manchin has not thrown his support behind the bill and said on Wednesday a chunk of the package was still being negotiated. He told Insider that the federal government had stepped in enough with a burst of new spending to help families during the pandemic, in the event of the child tax credit abruptly ending."We're doing an awful lot," Manchin said. "We did an expansion of SNAP. We've done everything that we can to help people — we sent out $5.4 trillion in aid."The current bill would renew the revamped child tax credit through 2022. It provides up to $300 a month per child age 5 and under, or $3,600 annually. For children between ages 6 and 17, families can receive $250 each month, or $3,000 yearly. And it would lock in the ability for the vast majority of American families to receive the cash every month, regardless of whether they file taxes.Some 35 million families are receiving the monthly child tax credit, per the IRS and Treasury. Data shows the government cash is going towards basic expenses like rent, groceries and gas. Sen. Michael Bennet of Colorado told Insider on Wednesday that it would be a "disaster" if millions of families were abruptly cut off from the monthly checks. Experts agree."Letting the child tax credit expire would be a terrible mistake," Lindsay Owens, an economist at the left-leaning Groundwork Collaborative who has closely studied the issue, told Insider. "It's successful program that's helping families afford the rising costs and take on childcare costs."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 9th, 2021

Democrats raise alarm on the "disaster" of child tax credit checks ending as Manchin signals he"ll slam the brakes on passing Biden"s big bill anytime soon

Joe Manchin is pouring cold water on a vote before Christmas. "It would be a tragedy if the child tax credit lapses," Michael Bennet told Insider. Sen. Joe Manchin (D-WV) speaks to reporters about infrastructure legislation on Capitol Hill June 24, 2021 in Washington, DC. A bipartisan group of Senators and White House negotiators have agreed on a framework for infrastructure legislation and will meet with President Joe Biden today.Drew Angerer/Getty Images Democrats are raising alarm about passing Biden's big bill before the year ends or the child tax credit expires. "It would be a tragedy if the child tax credit lapses," Sen. Michael Bennet told Insider. But Joe Manchin is pouring cold water on approving the legislation by Christmas. Congressional Democrats are raising significant alarm over the pending expiration of the bulked-up child tax credit at the end of the month, warning of "disaster" if there's an abrupt cutoff in payments in January 2022.Their hope to swiftly pass President Joe Biden's $2 trillion social and climate spending package is crashing into resistance from Sen. Joe Manchin of West Virginia. All 50 Senate Democrats must join together and approve the legislation to clear the upper chamber over unanimous GOP opposition. Senate Majority Leader Chuck Schumer has doubled down on passing the sprawling legislation by Christmas. But Manchin hasn't thrown his support behind it, all but dashing Democratic hopes for speedy action.Democrats are scrambling to keep the monthly checks to flowing to families uninterrupted. "I'm deeply concerned. It would be a tragedy if the child tax credit lapses," Sen. Michael Bennet of Colorado, an architect of the expansion, told Insider on Wednesday.He cited recent data showing families are spending the federal cash on rent, groceries, and daycare. "We should make sure that we don't cancel this at the beginning of the new year, that will be a disaster," Bennet said.The urgency is being felt among senior House Democrats as well. "House Democrats will not allow this tax credit to expire and I don't believe the Senate will either," Rep. Hakeem Jefferies, the third-ranking Democrat, told reporters.The current bill provides up to $300 a month per child age 5 and under, or $3,600 annually. For children between ages 6 and 17, families can receive $250 each month, or $3,000 yearly. And it would lock in the ability for the vast majority of American families to receive the federal cash every month, regardless of whether they file taxes.Still, Manchin doesn't appear to be in any rush to give the legislation a thumbs-up. He said he's concerned about how the package could worsen inflation and contribute to rising prices for groceries and gas. On Tuesday, he said at a Wall Street Journal event that the threat of the "unknown we're facing today" is much bigger than "this aspirational bill we're looking at."He doubled down on Wednesday, telling reporters that the government had already approved $5.4 trillion in new federal spending since the pandemic started and pouring cold water on the concept of more spending.The Internal Revenue Service is scheduled to send the last round of payments to 35 million families on December 15. But for the agency to distribute payments next month without a hitch, some experts say Congress must approve the legislation by year's end."I just think if they pass it by the end of the year, then the payments will go out," Chuck Marr, director of federal tax policy at the Center on Budget and Policy Priorities, told Insider. "That's most likely."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 8th, 2021

Joe Manchin signals he may not back Biden"s social spending plan until 2022, risking an abrupt cutoff for monthly child tax credit checks

Nearly 35 million families could lose monthly checks if the spending fight drags into next year. Final child tax credit payments go out December 15. Sen. Joe Manchin (D-WV) speaks with Xavier Becerra, Secretary of Health and Human Services (HHS) (L), before a Senate Appropriations Subcommittee hearing on June 9, 2021 at the Capitol.Photo by Al Drago-Pool/Getty Images Manchin may be about to hand his party a lump of coal when it comes to passing Biden's spending bill. He's not onboard with passing it by Christmas, risking a lapse in monthly checks to families. "No question that it would be a blow to lower-income and middle-class households," one expert said. Senate Democrats are wishing for a holiday gift in the form of approving President Joe Biden's $2 trillion domestic spending package by Christmas. But Sen. Joe Manchin of West Virginia seems readier to hand his own party a thick lump of coal instead.The West Virginia Democrat is reportedly expressing skepticism to his Senate colleagues about whether they'll be able to approve pass the Build Back Better legislation this year, CNN reported. It's significant given that all 50 Senate Democrats must band together to clear the bill in the evenly divided Senate over what's likely to be unanimous GOP opposition.He's not committing to the legislation, suggesting more work needs to be done to iron out the finer details. "I wouldn't have any idea how I'm going to vote until I walk in," Manchin told CNN's Manu Raju departing the Capitol.Manchin's reluctance to back the bill could capsize the swift timetable that Senate Majority Leader Chuck Schumer of New York originally envisioned to wrap everything up and deliver Biden a major win going into 2022, a crucial midterm election year. Depending on how long Manchin drags his feet, passage of the bill may slip into next year — a possibility raised on Tuesday by Rep. Richard Neal of Massachusetts, chair of the House Ways and Means panel.It risks an abrupt halt of monthly child tax credit payments that tens of millions of families are relying on to cover expenses like rent, groceries, childcare, and school supplies. The Internal Revenue Service will distribute the final monthly payments on December 15 and families will receive the other half at tax time."No question that it would be a blow to lower-income and middle-class households," Andy Boardman, a research assistant at the Urban Institute, said in an interview. "Folks are depending on this money, and it's helping them. It has become a pretty significant piece of family household budgets."The House bill renews the bulked-up child tax credit payments for another year. It provides up to $300 a month per child age 5 and under, or $3,600 annually. For children between ages 6 and 17, families can receive $250 each month, or $3,000 yearly. And it would lock in the ability for the vast majority of American families to get the government cash every month, regardless of whether they file taxes.Asked by Insider on Tuesday, Manchin didn't commit to approving the child tax credit as it was laid out in the House bill, only calling it a "work in progress." That raised the prospect of changes to that measure."I think it's extraordinarily important to keep this program on track," Sen. Ron Wyden of Oregon told reporters on Thursday about the possibility of a sudden lapse in checks to families.Wyden added it was the "overwhelming view" of Senate Democrats that it is "priority business" to pass the Build Back Better Act this year.Manchin may not be the only obstacle standing between Democrats and their Christmas deadline. Sen. Kyrsten Sinema of Arizona isn't onboard with the package yet, either. She told CNN in an interview which aired on Thursday that she was negotiating in "good faith" with other Democrats — and not in public. It's possible the IRS can move swiftly to prevent a lapse in payments by mid-January. The third wave of $1,400 direct payments started landing in bank accounts within days of Biden approving the stimulus law earlier this year.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderDec 4th, 2021

35 million families will lose Biden"s monthly child tax credit payments in 3 weeks if Congress doesn"t step in

If Congress acts before the last payments on Dec. 15, the IRS may be able to quickly get the money to families like it did with stimulus checks. President Joe Biden.John Tully/Getty Images Millions of families rely on the child tax credit to make ends meet, but it expires in just weeks. It's unclear if Congress will act before the last payments go out on December 15. If it gets renewed, the IRS may be able to act swiftly, as it did earlier this year with stimulus checks. Over 35 million families are receiving monthly payments from President Joe Biden's child tax credit. The federal aid is being used to put food on the table, buy clothes, cover rent, and cover school-related expenses, per data from the Census Bureau.However, the measure is expiring in three weeks if Congress doesn't step in to renew it with the last payments poised to go out on December 15. Democrats want to extend it for another year as part of their $2 trillion social spending, health, and climate legislation called the Build Back Better Act. But as the act now faces a vote in the Senate, infighting among centrists and progressives could stall its passage.The child tax credit currently provides up to $300 a month per child age 5 and under, or $3,600 annually. For children between ages 6 and 17, families can receive $250 each month, or $3,000 yearly. The Democratic stimulus law in March turned it into a one-year cash benefit for families in a bid to cut child poverty by up to half.Republicans are staunchly opposed to the child benefit, with Senate Minority Leader Mitch McConnell calling it "a monthly welfare deposit."Sen. Sherrod Brown of Ohio, a leading advocate, told Insider last week he believed December 15 was functioning as a deadline for Democrats to pass the sprawling legislation. He pushed back on the suggestion the onus was on his party to renew the child allowance in time."Don't put it on the Democrats as they let it expire," Brown told Insider. "Republicans have done nothing."Congress will juggle competing priorities on its to-do list once it returns after the Thanksgiving break, including an extension of government funding and lifting the debt ceiling so the US can continue repaying its bills. It's unclear whether Democrats will be able to pass the party-line bill by then, though they're aiming to approve it by Christmas.Even if lawmakers blow past the Dec. 15 deadline, it's possible the Internal Revenue Service can move swiftly to prevent a lapse in payments by mid-January. The third wave of $1,400 direct payments started landing in bank accounts within days of Biden approving the stimulus law earlier this year.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderNov 24th, 2021

3 Financial Skills for Investors Who Are Just Starting Out

When starting out, knowing how to manage your money can feel daunting. In this post, we will offer simple steps to help you begin taking control of your financial life. Q3 2021 hedge fund letters, conferences and more Set Priorities And Goals When you get your first paycheck, it is easy to want to spend […] When starting out, knowing how to manage your money can feel daunting. In this post, we will offer simple steps to help you begin taking control of your financial life. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Icahn eBook! Get our entire 10-part series on Carl Icahn and other famous investors in PDF for free! Save it to your desktop, read it on your tablet or print it! Sign up below. NO SPAM EVER (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2021 hedge fund letters, conferences and more Set Priorities And Goals When you get your first paycheck, it is easy to want to spend it all right away, but what are all the things you should be putting your money toward with these limited resources? Strategies To Help You Save Regularly And Effectively Automatically direct a portion of your paycheck to your separate savings account. Studies show that if you don’t see the money, it makes it a lot easier to save. You can direct this money to building your emergency fund, paying down debt, and adding to your investment account. Allocate a certain percentage of every paycheck rather than a flat amount. That way, the contribution will go up when you get a salary increase. Many apps and platforms exist to help you save even more frequently and in a smarter way. These apps can help you work towards your goals. Establish an emergency fund. A good rule of thumb is to have 6 months of living expenses set aside. Keep your emergency funds in money market accounts or no-penalty CDs so that you can earn interest while your funds are stored safely away. This is where the concept of liquidity (readily accessible cash) is important – depending on what you’re saving for, you may want to keep certain funds in a vehicle where you can access them quickly and without penalty. Build & Monitor A Budget Creating and maintaining a budget is an essential part of financial health because it helps you set both limits and goals, stay on track with your savings, and monitor your expenses. To create a budget, we recommend focusing on the following: Calculate your monthly take home pay (after health insurance, taxes, retirement money). If you have more than one source of income, or receive irregular pay (i.e., bonuses, commission, etc.), you should also take that into account. Once you have your top line monthly income, you should gather a list of your fixed expenses, or the costs that stay the same each month (i.e., car insurance, rent, utilities, student loan payment, phone plan, and car payment). Next, estimate your monthly discretionary expenses, or the expenses that vary month-to-month (i.e., groceries, eating out, gas, travel, entertainment, buying clothes, and buying coffee). Subtract your fixed and discretionary expenses from your take home pay. This will tell you how much you have left at the end of the month (or overspend). To help you come up with the best estimate for the numbers above, we recommend going through your past credit card/debit card statements and totaling up each type of expense. Creating a budget is great, but it doesn’t mean much if you don’t continue to monitor your expenses each month. This can help you pinpoint areas in need of improvement, as well as locating ways to save more. For example, taking public transportation instead of calling an Uber, or making sure you are diligent about buying groceries instead of eating out frequently. To guide you through this process, there are lots of budgeting platforms and tools out there, many of which are free and easy to use. You can also create your own spreadsheet in excel. Budgeting helps you become more cost-conscious and leads to finding more creative ways to save. Master Debt & Credit Management Since debt is a common aspect of many young people’s financial life, sound cash flow management becomes even more important. When deciding whether to use your money to pay off debt or invest, consider the cost of debt and the current market environment. Make sure you understand the concept of opportunity cost - money put towards one goal has a cost of not being applied elsewhere. For example, if your student loan rate is 7%, the markets are returning 5%, and your mortgage is a fixed 3%, you should prioritize payments on the student loans and then consider investing in the markets, as it is expected to return more than the interest cost of your mortgage. Next Steps & Advanced Planning Considerations Employer retirement programs. We always encourage participation in 401(k)s and other retirement plans to the greatest extent possible, as they are powerful tax-deferred savings vehicles that may include attractive company match programs. However, there is such a thing as over-allocating if it puts you in a bind and forces you to take actions we discourage, such as borrowing from the plan. Insurance. Analyzing insurance options on your own can be very confusing, and there is a sense of general distrust when it comes to dealing with insurance companies. But insurance is absolutely critical for some situations, particularly for young families. Many employers offer group benefits which can be a great place to start. Estate Planning. Estate planning is not just for the wealthy. Understanding what happens to you and your assets in situations of death or debilitation is very important. How We Work with Someone Who is Just Starting Out Developing strong financial skills as a young adult can set off a chain reaction. If you take a disciplined approach to your financial life, you can pay down debt faster and have more money set aside for investments. Once you have built up enough money to start investing, it is important to consider what method might be right for you. Due to the major technological innovations within the financial industry in recent years, low-cost digital planning solutions are more accessible than ever. We launched Wealthspire Pathways, an offering of this nature, to enable us to provide our fundamental services for a competitive fee to clients who are tech-friendly and planning-focused. Regardless of the investing path you choose, the earlier you begin to put money away in savings and investments, the more growth potential lies ahead. All in all, these principles of money management should make for a bright future built upon knowledge, healthy financial habits, and confidence in your ability to be the steward of your own wealth. For further reading we recommend “The Millionaire Next Door,” which points out that the truly wealthy are not the ones who live lavish lifestyles, but the ones who live right next door, drive used cars, and save and invest their wealth. About the Author Emily Platt, CFP®, Senior Associate, Investments, joined Wealthspire Advisors as a client associate in 2017 after completing her undergraduate degree in Finance at James Madison University. In November 2018, Emily transitioned to an internal investment role, supporting the firm’s Chief Investment Officer. As a member of this team, Emily is focusing on asset allocation, manager research and due diligence. Wealthspire Advisors LLC is a registered investment adviser and subsidiary company of NFP Corp. Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the certification marks CFP®, Certified Financial Planner, and CFP® (with plaque design) in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements. This information should not be construed as a recommendation, offer to sell, or solicitation of an offer to buy a particular security or investment strategy. The commentary provided is for informational purposes only and should not be relied upon for accounting, legal, or tax advice. While the information is deemed reliable, Wealthspire Advisors cannot guarantee its accuracy, completeness, or suitability for any purpose, and makes no warranties with regard to the results to be obtained from its use. ©2021 Wealthspire Advisors Updated on Oct 22, 2021, 12:28 pm (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 22nd, 2021

Futures Drift Before Taper-Triggering Jobs Report

Futures Drift Before Taper-Triggering Jobs Report US equity-index drifted in a tight range overnight, in a tight range before key jobs data that could provide clues on the Federal Reserve’s policy. As noted in our preview, unless the jobs report is a disaster, it will virtually assure the Fed launches tapering in one month. Markets drifted higher on Thursday after the Senate averted the risk of an immediate default, pushing global stocks on course for their best week since early September, but a late day selloff wiped away most gains and closed spoos below the critical 4400 level. At 07:30 a.m. ET, Dow e-minis were up 35 points, or 0.10%, S&P 500 e-minis were up 5.00 points, or 0.1%, and Nasdaq 100 e-minis were up 10.75 points, or 0.07%. Treasury Yields were 1 point higher after earlier tagging 1.60%, the highest since June. The dollar was flat while Brent topped $83 before paring gains. Bitcoin traded above $55,000. Uncertainty over the debt ceiling negotiations and a run-up in U.S. Treasury yields over elevated inflation were major concerns among investors earlier this week, injecting volatility in equity markets this week. High-growth FAAMG stocks slipped in premarket trading following sharp gains in previous session. Energy firms including Chevron Corp and Exxon Mobil gained about 0.8% tracking crude prices, while major U.S. lenders also edged up as the benchmark 10-year yield hit its highest level since June 4. Here are some of the biggest movers and stocks to watch today: Tesla (TSLA US) shares in focus after Elon Musk says a global shortage of chips and ships is the only thing standing in the way of the company maintaining sales growth in excess of 50% Sundial Growers (SNDL US) shares rise as much as 19% in U.S. premarket after the Canadian cannabis producer said it will buy liquor and pot retailer Alcanna for $276m in stock Allogene Therapeutics (ALLO US) plunges 36% in U.S. premarket trading after an early-stage study of its cell therapy was put on hold by U.S. regulators Prelude Therapeutics (PRLD US) fell in U.S. premarket trading, adding to Thursday’s 40% plunge on early- stage data for the company’s experimental cancer treatments that Barclays says came in below expectations Vaxart (VXRT US) rises 8% in U.S. premarket trading after its oral tablet vaccine candidate cut transmission of Covid-19 in animals, according to data from a study led by Duke University Faraday Future (FFIE US) slides 4% in U.S. premarket trading after J Capital says it is short on the stock. The short-seller says they don’t think the company “will ever sell a car” Codiak Biosciences (CDAK US) shares fell 6% in Thursday postmarket trading after disclosing that Sarepta Therapeutics is terminating a research license and option agreement Agile Therapeutics (AGRX US) tumbled Thursday postmarket after the women’s health-care company said that it intends to offer and sell shares of its common stock, as well as warrants to purchase shares of its common stock, in an underwritten public offering Looking to today's main event, economists expect September hiring to have surged by 500,000 jobs as the summer wave of COVID-19 infections began to subside, and as millions of Americans no longer receive jobless benefits, positioning the Fed to start scaling back its monthly bond buying.  “All roads lead to non-farm payrolls data which will decide, in the market’s minds, whether the start of the Fed taper is a done deal for December,” said Jeffrey Halley, senior market analyst at OANDA. “I do not believe that markets have priced in the Fed taper and its implications to any large degree yet. Even a weak number probably only delays the inevitable for another month.” Even “reasonably soft” payrolls and unemployment figures wouldn’t be enough to change the minds of its officials, according to Ipek Ozkardeskaya, senior analyst at Swissquote. “Only a shockingly low figure could do that,” she said. “The persistent rise in oil prices can only continue boosting inflation fears and the central bank hawks, limiting the upside potential in case of a further recovery in stocks.” “As soon as you start thinking about tapering it’s really hard to not then think about what that means for the Fed funds rate and when that might start to increase,” Kim Mundy, currency strategist and international economist at Commonwealth Bank of Australia in Sydney, said on Bloomberg Television. “We do see scope that markets can start to price in a more aggressive Fed funds rate hike cycle.” In Europe, tech companies led the Stoxx Europe 600 Index down 0.2%, with energy stocks and carmakers being the only industry groups with meaningful gains. Chip stocks fell, especially Apple suppliers, following a profit warning from Asian peer and fellow supplier AAC Technologies. On the other end, European travel stocks rose after U.K. confirmed the travel “red list” will be cut to just seven countries; British Airways parent IAG and TUI led the advances. Here are some of the biggest European movers today: Daimler shares gains as much as 3.2%, outperforming peers, after UBS upgrades stock to buy from neutral, calling it an earnings momentum story that stands to gain from strong demand, electrification trends and its future focus on passenger cars. Adler shares rise as much as 13% after shareholder Aggregate sells a call option to Vonovia for a 13.3% stake in the German real estate investment firm at a strike price of EU14 per share. Cewe Stiftung shares jump as much as 4.2%, their best day in over three months, after the photography services firm gets a new buy rating at Hauck & Aufhaeuser. Weir shares fall as much as 6.3%, to the lowest since Nov. 13, after the U.K. machinery maker announced that a ransomware attack will affect full-year profitability; Jefferies says it’s unlikely that guidance beyond that will be revised. Zur Rose slumps as much as 9.2% after Berenberg downgrades the Swiss online pharmacy to hold from buy, citing the expected negative impact from a delay in the implementation of mandatory e-prescriptions in Germany. Czech digital-payments provider Eurowag shares slide as much as 10% as it starts trading in London, after pricing its IPO below an initial range and making its debut a day later than planned. Asian stocks rose for a second day as China’s market reopened higher and the U.S. Senate approved a short-term increase in the debt ceiling. The MSCI Asia Pacific Index advanced as much as 1% in a rally led by consumer discretionary shares. Alibaba and Tencent were among the biggest contributors to the gauge’s climb. Shares in mainland China surged more than 1% as investors returned from the Golden Week holiday. Chinese property shares fell after a report that more than 90% of China’s top 100 property developers’ sales declined in September by an average of 36% from the same period last year, while investor concerns about developers’ liquidity rose after Fantasia bonds were suspended from trading. In mainland: CSI 300 Real Estate Index drops as much as 2%, Seazen Holdings falls as much as 5%, Poly Developments -4%. Asia’s stock benchmark is slightly down for the week, as rising bond yields weighed on tech-heavy indexes in South Korea, Taiwan and Japan. The gauge is down more than 1% this month amid an energy shortage in China and India.  “Markets may not want to commit directionally” given that we have non-farm payrolls data on the docket, making a follow-through of today’s rally suspect, said Ilya Spivak, the head of Greater Asia at DailyFX. Traders are expecting today’s U.S. employment data to provide clues on the direction of the world’s largest economy. On Thursday, the U.S. averted what would have been its first default on a debt payment. Most major benchmarks in Asia climbed, led by Japan, Indonesia and Australia. India’s central bank kept its lending rates at a record low at a policy meeting today. In Australia, the S&P/ASX 200 index rose 0.9% to close at 7,320.10. All industry groups edged higher. The benchmark rose 1.9% for the week, the biggest weekly gain since early August. Miners led the charge, having the best week since July, banks the best since the start of March. EML Payments tumbled after an update on its Ireland subsidiary from the country’s central bank. Chalice Mining continued its rebound, finishing the session the strongest performer in the mining subgauge.  There is a risk of excessive borrowing due to low interest rates and rising house prices, Reserve Bank of Australia said in its semiannual Financial Stability Review released Friday. In New Zealand, the S&P/NZX 50 index fell 0.1% to 13,086.60 In rates, Treasury futures remained under pressure after paring declines that pushed 10-year yield as high as 1.5995% during European morning, highest since June 4; the 1.60% zone is thought to have potential to spur next wave of convexity hedging. U.K. 10-year is higher by 4bp, German by 2.3bp - gilts underperformed, weighing on Treasuries as money markets continue to bring forward BOE rate-hike expectations. During U.S. session, September jobs report may seal case for Fed taper announcement in November.  In FX, the greenback traded in a narrow range versus G10 peers while 10-year Treasury yields approached 1.6%, outperforming Bunds.  Gilt yields rose 5-6bps across the curve; demand for downside protection in the pound eases this week as the U.K. currency moves off cycle lows amid money markets repricing. U.K. wage growth rose at its strongest pace on record in a survey of job recruiters, indicating strains from a shortage of workers are persisting. Turkish lira initially weakens above 8.96/USD before recouping half of its losses In commodities, oil extended a rebound, on track for a seventh weekly gain. Crude futures pushed to the best levels for the week. WTI rises 1.5% near $79.50, Brent pops back on to a $83-handle. Spot gold trades a $5 range near $1,757/oz. Base metals are mostly positive, with LME nickel gaining over 3.5%. Looking at the day ahead, the highlight will be the aforementioned September jobs report. Central bank speakers include ECB President Lagarde and the ECB’s Panetta. Market Snapshot S&P 500 futures little changed at 4,389.50 STOXX Europe 600 down 0.3% to 457.18 MXAP up 0.4% to 194.72 MXAPJ up 0.2% to 636.80 Nikkei up 1.3% to 28,048.94 Topix up 1.1% to 1,961.85 Hang Seng Index up 0.6% to 24,837.85 Shanghai Composite up 0.7% to 3,592.17 Sensex up 0.7% to 60,070.61 Australia S&P/ASX 200 up 0.9% to 7,320.09 Kospi down 0.1% to 2,956.30 Brent Futures up 1.4% to $83.09/bbl Gold spot up 0.0% to $1,756.25 U.S. Dollar Index little changed at 94.29 German 10Y yield up +3.4 bps to -0.151% Euro little changed at $1.1549 Top Overnight News from Bloomberg Global talks to reshape the corporate tax landscape are set to resume on Friday after Ireland’s decision to adhere to the world consensus on a minimum rate removed one hurdle to an agreement that still hangs in the balance Germany’s Social Democrats hailed a positive start in their effort to form a government after their first meeting with the Greens and the pro-business Free Democrats A U.S. nuclear-powered attack submarine struck an object while submerged in international waters in the Indo- Pacific region last week, the Navy said, adding that no life- threatening injuries were reported China drained the most short- term liquidity from the banking system in a year on a net basis as it reduced support after a week-long holiday. Government bond futures slid by the most since August China’s central bank will continue to push for the reform of its benchmark loan rate and make deposit rates more market-based, according to a senior official India’s central bank surprised markets by suspending its version of quantitative easing, signaling the start of tapering pandemic-era stimulus measures as an economic recovery takes hold U.K. government bond yields have climbed to levels last seen before the Brexit referendum in 2016 relative to German peers, as traders brace for inflation in Britain over the next decade to far outpace the rate in Europe’s largest economy A detailed look at global markets courtesy of Newsquawk Asia-Pac stocks traded mostly higher as the region conformed to the global upbeat mood after the agreement in Washington to raise the debt ceiling which the Senate approved, with the overnight bourses also invigorated by the return of China and strong Caixin PMI data. The ASX 200 (+0.9%) was led higher by strength in mining names with underlying commodity prices boosted as Chinese buyers flocked back to market which helped the ASX disregard a record increase in daily COVID-19 cases in Victoria state. Nikkei 225 (+1.3%) was the biggest gainer and reclaimed the 28k level as exporters benefitted from a softer currency, while attention turns to PM Kishida who will outline his policy program today and is reportedly planning to present an additional budget after the election. Furthermore, there were recent comments from an ally of the new PM who suggested that capital gains tax could be raised to 25% from the current 20% without affecting stock prices, although this failed to dent the mood in Tokyo and weaker than expected Household Spending was also brushed aside. The gains for the KOSPI (-0.1%) were later reversed alongside the tentative price action in index heavyweight Samsung Electronics after its Q3 prelim. results showed oper. profit likely rose to its highest in three years but missed analysts’ forecasts. Hang Seng (+0.6%) and Shanghai Comp. (+0.7%) were mixed with the latter jubilant on reopen from the Golden Week holiday after improved Caixin Services and Composite PMI data which both returned to expansionary territory. This helped mainland stocks overlook the recent developer default fears and largest daily liquidity drain by the PBoC since October last year, although Hong Kong initially lagged amid heavy Northbound Stock Connect trade. Finally, 10yr JGBs declined on spillover selling from T-notes and with havens shunned amid the gains across riskier assets, although downside in JGBs was limited given the BoJ’s presence in the market for nearly JPY 1.5tln of JGBs with up to 10yr maturities. Top Asian News Gold Steadies Ahead of Key U.S. Jobs Report as Yields Climb Investors Fear Tax Talk in Kishida’s ‘New Japanese Capitalism’ China Coal Prices Plunge as Producers Vow to Ease Shortages China Developer Stocks Fall After Report of Monthly Sales Drop An initially contained to marginally-firmer European cash open followed an upbeat APAC handover (ex-Hang Seng) was short-lived with bourses coming under moderate pressure; Euro Stoxx 600 -0.3%. As such, major indices are all in the red, except for of the UK FTSE 100 which is essentially unchanged and bolstered by strength in heavy-weight energy and mining names given broader price action the return of China. Sectors were initially mixed at the open, but in-fitting with the action in indices, has turned to a predominantly negative performance ex-energy. Crossing to the US, futures have directionally been following European peers, but the magnitude has been more contained, with the ES unchanged as we await the September labour market report for any read across to the Fed’s policy path; however, officials have already made it clear that it would have to be a very poor report to spark a deviation from its announced intentions, where it is expected to announce an asset purchase tapering in November. Returning to Europe, Daimler (+2.5%) stands out in the individual stocks space, firmer after a broker upgrade and notable price target lift at UBS; Marks & Spencer (+1.5%) is also supported on broker action. To the downside lies Weir Group (-3.0%) after reports of a ransomware attack. Top European News Adler’s Largest Shareholder Sells Option on Stake to Vonovia; A Controversial Tycoon Sits on Adler’s $9 Billion Pile of Debt Chip Stocks Drag Tech Gauge Lower as Asian Apple Supplier Warns European Gas Rises as Bumpy Ride Continues With Cold Air Coming Lira Weakens to Fresh Low as Rising U.S. Yields Add Pressure In FX, the Dollar is trying to regroup and firm up again after its latest downturn amidst a further rebound in US Treasury yields, more pronounced curve re-steepening, and perhaps some relief that the Senate finally passed the debt ceiling extension bill, albeit by a slender margin and only delaying the issue until early December. Looking at the DXY as a benchmark, a marginally higher low above 94.000 and lower high below 94.500 is keeping the index contained as the clock ticks down to September’s jobs report that is expected to show a recovery in hiring after the prior month’s shortfall, but anecdotal data has been rather mixed to offer little clear pointers for the bias around consensus - full preview of the latest BLS release is available via the Research Suite under the Ad-hoc Economic Analysis section. From a technical perspective, near term support for the DXY resides at 94.077 (vs the current 94.139 base) and resistance sits at 94.448 (compared to a 94.338 intraday high). TRY - A double whammy for the already beleaguered Lira as oil prices come back to the boil and ‘sources’ suggest that Turkish President Erdogan’s patience is wearing thin with the latest CBRT Governor as the Bank waited until September to cut rates. Recall, Erdogan has already ousted a CBRT chief for not loosening monetary policy in his belief that lowering the cost of borrowing will bring inflation down, and although the reports have been by a senior member of his administration there is a distinct feeling of no smoke without fire in the markets as Usd/Try remains bid having only held below 9.0000 by short distance between 8.9707-8.8670 parameters. CHF/JPY - No real surprise that the low yielders and funders are underperforming, even though broadly upbeat risk sentiment during APAC hours has not rolled over to the European session. The Franc has retreated to 0.9300 vs the Buck and Yen is trying to fend off pressure on the 112.00 handle after failing to sustain momentum through 111.50 before weaker than expected Japanese household spending data overnight. However, decent option expiry interest from 111.85-75 (1.4 bn) may weigh on Usd/Jpy pending the aforementioned US payrolls outcome. AUD - Some payback for the Aussie after Thursday’s outperformance, as Aud/Usd loses a bit more momentum following its rebound beyond 0.7300 and with hefty option expiries at 0.7335 (2.7 bn) capping the upside more than smaller size at the round number (1.1 bn) cushions the downside. In commodities, WTI and Brent remain on an upward trajectory after the mid-week pullback; as it stands, crude benchmarks are near fresh highs for the week, with WTI for November eyeing USD 80/bbl once again. Fresh news flow for the complex has been sparse, aside from substantial UK press focus on the domestic energy price cap potentially set to increase next year. More broadly, US officials have largely reiterated commentary from the Energy Department provided on Thursday around not currently intending act on energy costs with a reserve release. The session ahead has just the Baker Hughes rig count specifically for crude scheduled, though the complex may well get dragged into a broader risk move depending on the initial reaction to and analysis on NFP. For metals, spot gold and silver are contained around the unchanged mark and haven’t been affected by any significant amount by the firmer USD or elevated yield space thus far. Elsewhere, base metals are buoyed by China’s return and strong Caixin data from the region, although it is worth highlighting that the likes of LME copper are well off earlier highs. US Event Calendar 8:30am: Sept. Change in Nonfarm Payrolls, est. 500,000, prior 235,000 Change in Private Payrolls, est. 450,000, prior 243,000 Change in Manufact. Payrolls, est. 25,000, prior 37,000 Unemployment Rate, est. 5.1%, prior 5.2% Sept. Underemployment Rate, prior 8.8% Labor Force Participation Rate, est. 61.8%, prior 61.7% Average Weekly Hours All Emplo, est. 34.7, prior 34.7 Average Hourly Earnings MoM, est. 0.4%, prior 0.6% Average Hourly Earnings YoY, est. 4.6%, prior 4.3% 10am: Aug. Wholesale Trade Sales MoM, est. 0.9%, prior 2.0%; Wholesale Inventories MoM, est. 1.2%, prior 1.2% DB's Jim Reid concludes the overnight wrap I’ve never quite understood why you’d go to the cinema if you’ve got a nice telly at home but such has been the nature of life over the last 19 months that I was giddy with excitement last night at booking tickets for James Bond at the local cinema next week. We’ve booked it on the same night as our first ever physical parents evening where I’ll maybe have the first disappointing clues that my three children aren’t going to be child prodigies and that maybe they’ll even have to settle for a career in finance! Markets have been stirred but not completely shaken this week and yesterday they continued to rebound thanks to the near-term resolution on the US debt ceiling alongside subsiding gas prices, which took the sting out of two of the most prominent risks for investors over the last couple of weeks. That provided a significant boost to risk appetite, and by the close of trade, the S&P 500 had recovered +0.83% in its 3rd consecutive move higher, which put it back to just -3.0% beneath its all-time high in early September, whilst Europe’s STOXX 600 was also up +1.60% and closed before a later US sell-off. Attention will today focus squarely on the US jobs report at 13:30 London time, which is the last one before the Fed’s next decision in early November, where a potential tapering announcement is likely bar an extraordinarily poor number today, or an exogenous event in the next few weeks. Starting with the debt ceiling, yesterday saw Democratic and Republican Senators agree to pass legislation to raise the ceiling by enough to get to early December, meaning we won’t have to worry about it for another 8 whole weeks. The Senate voted 50-48 with no Republicans blocking the legislation to increase the debt limit by $480bn, with House Majority leader Hoyer saying that the House would convene on Tuesday to pass the measure as well. To raise it for a longer period, the chatter out of Washington made it clear that Democrats would need to need to raise the debt ceiling in a partisan manner as part of the reconciliation process. As we mentioned in yesterday’s edition, this extension means that a number of deadlines have now been punted into the year end, including the government funding and the debt ceiling (both now expiring the first Friday of December), just as the Democrats are also seeking to pass Biden’s economic agenda through a reconciliation bill containing much of their social proposals, alongside the $550bn bipartisan infrastructure package. And on top of that, we’ve also got the decision on whether Chair Powell will be re-nominated as Fed Chair, with the decision 4 years ago coming at the start of November. So a busy end to the year in DC. The other main story yesterday was the sizeable decline in European natural gas prices, with the benchmark future down -10.73% to post its biggest daily loss since August. Admittedly, they’re still up almost five-fold since the start of the year, but relative to their intraday peak on Wednesday they’ve now shed -37.5%. So nearly a double bear market all of a sudden! The moves follow Wednesday’s signal that Russia could supply more gas to Europe. However, even as energy prices were starting to fall back from their peak, the effects of inflation were being felt elsewhere, with the UN’s world food price index climbing to its highest level in a decade in September. Looking ahead, today’s main focus will be on the US jobs report for September later on. Last month the report significantly underwhelmed expectations, coming in at just +235k, which was well beneath the +733k consensus expectation and the slowest pace since January. That raised questions as to the state of the labour market recovery, and helped to complicate a potential decision on tapering, with nonfarm payrolls still standing over 5m beneath their pre-Covid peak. This month, our US economists are expecting a somewhat stronger +400k increase in nonfarm payrolls, which should see the unemployment rate tick down to a post-pandemic low of 5.1%. On the bright side at least, the ADP’s report of private payrolls for September on Wednesday came in at an above-forecast 568k (vs. 430k expected), while the weekly initial jobless claims out yesterday for the week through October 2 were beneath expectations at 326k (vs. 348k expected). Ahead of that, global equities posted a decent rebound across the board, with cyclicals leading the march higher on both sides of the Atlantic. As mentioned at the top, the S&P 500 advanced +0.83%, which was part of a broad-based advance that saw over 390 companies move higher on the day. That said the index was up as much as +1.5% in early US trading before slipping lower in the US afternoon. The pullback was partly due to new headlines that China’s central bank plans to continue addressing monopolistic actions in internet companies that operate in the payments sector. Nonetheless, Megacap tech stocks were among the big winners yesterday, with the FANG+ index up +2.08%, whilst the small-cap Russell 2000 index was also up +1.58%. In Europe, the STOXX 600 (+1.60%) posted its strongest daily gain since July, and the broader gains helped the STOXX Banks index (+1.61%) surpass its pre-pandemic high, taking it to levels not seen since April 2019, even as sovereign bond yields moved lower. Speaking of sovereign bonds, yesterday saw a divergent set of moves once again, with yields on 10yr Treasuries up +5.2bps to 1.573%, their highest level since June, whereas those across the European continent moved lower. The US increase came against the backdrop of that debt ceiling resolution, and there was a noticeable rise in yields for Treasury bills that mature in December, which is where the debt ceiling deadline has now been kicked to. Elsewhere in North America, the Bank of Canada’s Macklem joined the global central bank chorus and noted inflation pressures were likely to be temporary, even if they’ve been more persistent than previously expected. Meanwhile over in Europe, lower inflation expectations helped yields move lower, with those on 10yr bunds (-0.3bps), OATs (-1.1bps) and BTPs (-3.6bps) all moving back. Overnight in Asia, all markets are trading in the green with the Nikkei (+2.16%) leading the way, along with CSI (+1.34%), Shanghai Composite (+0.60%), KOSPI (+0.22%) and Hang Seng (+0.04%). Chinese markets reopened after a week-long holiday so the focus will again be back on property market debt, and today the PBOC injected just 10bn Yuan with its 7-day reverse repos, resulting in a net liquidity withdrawal of 330bn Yuan. That comes as the services and composite PMIs did see a pickup from August level, with the services PMI up to 53.4 (vs. 49.2 expected), moving back above the 50 mark that separates expansion from contraction. In Japan however, household spending was down -3.0% year-on-year in August (vs. -1.2% expected) which came amidst a surge in the virus there. There’s also some news on the ESG front, with finance minister Shunichi Suzuki saying that the country would introduce ESG factors when considering the finance ministry’s foreign reserves. Looking forward, S&P 500 futures (+0.06%) are pointing to a small move higher. In Germany, as talks got underway today on a potential traffic-light coalition, it was reported by DPA that CDU leader Armin Laschet had signalled his willingness to stand down, with the report citing unidentified participants from internal discussions. In televised remarks last night, Laschet said that his party needs fresh voices across the board and that new leadership will be in place soon. This moves comes as Germany’s Social Democratic Party held talks with the Greens and the Free Democratic Party to enact a new three-way ruling coalition, which would leave the CDU out of power entirely. There wasn’t a massive amount of data yesterday, though German industrial production fell by -4.0% in August (vs. -0.5% expected), which follows the much weaker than expected data on factory orders the previous day. Elsewhere, the Manheim used car index increased +5.3% in September, its first positive reading in 4 months. Our US economics team points out that there tends to be around a two month lag between wholesale prices and CPI prints, so we aren’t likely to see this impact next week’s CPI print but it will likely prevent a bigger fall towards the end of the year. To the day ahead now, and the highlight will be the aforementioned September jobs report from the US. Central bank speakers include ECB President Lagarde and the ECB’s Panetta. Tyler Durden Fri, 10/08/2021 - 07:50.....»»

Category: smallbizSource: nytOct 8th, 2021

El Salvador Is Betting on Bitcoin to Rebrand the Country — and Strengthen the President’s Grip

Will the country's adoption of the digital currency help its people, or just its president? When Roman Martinez was growing up in El Zonte, a small coastal village in El Salvador, the American Dream loomed large. Beyond the local fishing industry, which Martinez’s parents worked in, there weren’t a lot of opportunities. “Young people just wanted to leave, to go to the U.S.,” he says. “But now we have a Salvadoran dream.” It’s a dream about Bitcoin. Two years ago an anonymous American donor sent more than $100,000 in the decentralized digital currency, or cryptocurrency, to an NGO that Martinez works for in El Zonte to pay for social programs. As the team began encouraging families and businesses to use Bitcoin, many of the town’s residents, most of whom had never had a bank account, began saving their money in the currency, making gains as its value surged. Curious tourists flooded into the town and foreign businesses set up shop. The project gave El Zonte the nickname “Bitcoin beach,” simultaneously a philanthropic endeavour and one of the world’s largest experiments in cryptocurrency. [time-brightcove not-tgx=”true”] “People with little income, who didn’t have access to a financial system, with $5 worth of Bitcoin they can start building something that can be the legacy they leave to their children,” Martinez says, over video call, wearing a black T-shirt emblazoned with Bitcoin’s orange logo. It was partly El Zonte’s experiment that inspired El Salvador last month to become the first country in the world to adopt Bitcoin as legal tender—alongside the U.S. dollar, which El Salvador has used as its currency since 2001. The Bitcoin law, which came into force on Sept. 7, makes taxes payable in Bitcoin, obliges all businesses to accept it, and paves the way for the government to disburse subsidies in it. The government has built a network of 200 Bitcoin ATMs and a digital Bitcoin wallet app, called Chivo, through which it has distributed $30 worth of Bitcoin to every Salvadoran citizen in a bid to kickstart the Bitcoin economy. Salvadoran President Nayib Bukele claims 2.1 million Salvadorans have used Chivo so far, in a country of 6 million people. Bukele is touting Bitcoin as a way for Salvadorans to reduce the fees they pay to send and receive remittances—which make up 22% of El Salvador’s GDP, mostly from the U.S.—and as a way for the 70% of Salvadorans who are unbanked to access financial services. He’s not alone in advocating for cryptocurrencies as a way for developing economies to bypass a global financial system in which access to services and investment are geared towards the world’s richer countries and individuals. Crypto has achieved its highest penetration mostly in countries where banking systems are costly and complicated to use, or where local economies and currencies are unstable. But critics say making Bitcoin—notoriously volatile and not subject to controls by any central bank—into legal tender is an unjustifiable gamble for El Salvador’s already ailing economy. The $200 million of taxpayer money congress has devoted to the project equates to 2.7% of the government’s total budget for 2021, or almost three times the agriculture ministry’s budget for the year. The uncertainty introduced by the Bitcoin policy has sent the price of government bonds tumbling, and halted negotiations for a deal with the International Monetary Fund (IMF) that the country is seeking to plug a $1.5 billion hole in its public finances. ‘The coolest dictator in the world’ For the President, a 40 year-old with the casual wardrobe and cheeky communication style of a tech entrepreneur, Bitcoin is about more than its immediate economic impact, though. It’s a chance to rebrand El Salvador, from a country known primarily for gang violence and a sluggish economy that drives emigration to the U.S., to an independent, modern crypto pioneer. For young Salvadorans like Martinez, that means creating a Salvadoran dream. For the international community, it’s a rebuke to a world order that casts El Salvador as the backyard to the U.S.—which Bukele has increasingly railed against since taking power in 2019. Instead, he casts El Salvador as an independent hub of innovation, aligned with the anti-establishment crypto community, members of which have flooded and celebrated the country in recent months and will return for a large crypto conference in November. Envisioning the transformation he witnessed in El Zonte taking place across the country, Martinez is excited—despite doubts among the wider population. “We’re used to new things happening in the U.S. or Canada or Europe,” Martinez says. “Now we’ve changed the narrative about El Salvador and started moving forward. Michael Nagle—Bloomberg/Getty ImagesNayib Bukele, El Salvador’s president, speaks in a prerecorded video during the United Nations General Assembly via live stream in New York on Sept. 23, 2021. But there’s another narrative unfolding in El Salvador. Since Bukele’s party, New Ideas, won a landslide victory at parliamentary elections in February, he has moved rapidly to undermine the structures of El Salvador’s democracy. In May, parliament voted to replace opposition-linked judges on the supreme court with Bukele allies, bringing all levers of power under his control. In September—a few days before the Bitcoin launch—the same court ruled that Bukele can run for a second term in 2024, in defiance of El Salvador’s constitution, triggering sanctions from the U.S. He has also stepped up attacks on the media, including launching criminal investigations into news organizations and kicking critical journalists out of the country. Analysts say the Bitcoin experiment is part of Bukele’s proto-strongman trajectory. “He’s fallen in love with his own power and wants to nurture this cool millennial President image through this adventure into the Bitcoin world,” says Tiziano Breda, a Central America analyst at the International Crisis Group, a think tank. It’s working for him, largely. The Bitcoin law has sparked the first major protests of his presidency, with 8,000 people marching in San Salvador on Sept. 15— a significant number of people in a country where street protest is unusual. But the President’s approval ratings still stand above 85%. With that backing, Bukele is deeply dismissive of global concern about his leadership. On Sept 18, he changed his bio on Twitter to “Dictator of El Salvador,” clearly trolling the international press. Then, a couple of days later he changed it again, to “The coolest dictator in the world.” El Salvador’s rapid transformation On the night that Bitcoin launched in El Salvador, Nelson Rauda, a reporter for independent newspaper El Faro, went to a party. At a sleek hotel bar next to an infinity pool overlooking the pacific ocean in the department of La Libertad, crypto enthusiasts and internet celebrities from the U.S., including YouTuber Logan Paul, danced and let off fireworks to celebrate a major moment for the cryptocurrency. Some wore headdresses and carried orange signs featuring Bitcoin’s white B logo. Almost everyone was speaking English. ”The scenery, and the location was a beach in El Salvador, but it could have been anywhere else in the world,” Rauda says. “[The crypto community] want to portray themselves as bringing a future and development to El Salvador through Bitcoin— a kind of white saviorism in that sense. But most of them are not interested in the country, just business.” Bukele’s government welcomes their business. The President claims that if 1% of the world’s Bitcoin were invested in El Salvador, it would raise GDP by 25%. He has offered permanent residency to anyone who spends three Bitcoin (currently around $125,000). He has also highlighted the fact that, since Bitcoin is legal tender, rather than an investment asset, foreigners who move to El Salvador will not have to pay capital gains tax in the country on any profits made if the cryptocurrency’s value increases. To that he adds, in English, “Great weather, world class surfing beaches, beach front properties for sale” as reasons that crypto entrepreneurs should move to El Salvador. This pragmatic, salesman-like tone is something that Salvadorans appear to appreciate from their President. Though he served as mayor of the capital, San Salvador until 2018, Bukele ran for the presidency in 2019 as a political outsider. He used his direct link with millions of followers on social media to pit himself against the right and leftwing parties that had ruled the country since its civil war in the 1980s. That conflict, in which the U.S. played a decisive role by funding opponents of leftist rebels, sowed the seeds of many of El Salvador’s current problems: chronically low economic growth, weak institutions vulnerable to corruption, the world’s worst rates of gang violence and one of the lowest rates of direct foreign investment in Central America. Bukele argued, convincingly, that the postwar governments had failed to meaningfully address those woes over three decades. Since taking office, Bukele has projected an image of ruthless efficiency. In February 2020, he and a group of armed soldiers stormed into parliament in order to pressure lawmakers to pass his budget plan. He has slashed rates of gang violence, with the country’s homicide rate falling from 51 per 100,000 in 2018 to 19 per 100,000 in 2020 (Experts debate whether this is a result of Bukele’s security policy, gang trends independent of him, or a secretive quid pro quo deal he may have struck with gang leaders). He adopted a hardline response to COVID-19, ordering one of the world’s most stringent lockdowns and giving security forces the right to put any rule-breakers in detention centers, a move human rights watchdogs say led to violent repression. The unprecedented popularity Bukele has enjoyed has allowed him to move faster than Latin America observers expected to take anti-democratic steps, such as intervening in the judiciary, Breda says. “For many other sort of authoritarian governments in the region, it took [many] years to do the things that Bukele has done in such a sweeping way. The pace is definitely surprising.” Marvin Recinos—AFP/Getty ImagesIlluminated drones form figures inspired by the Bitcoin logo in El Sunzal Beach, El Salvador, on Sept. 7, 2021. ‘Bitcoin is costing the country dearly’ Those who are most sceptical of Bukele—conservative economists—see his Bitcoin law as new packaging for an old move for populist authoritarian leaders in Latin America. The policy was labelled a “Bitcoin scam” in a Wall Street Journal op-ed. “They’re always trying to pull a rabbit out of a hat,” says Steve Hanke, professor of applied economics at the John Hopkins University and director of the Troubled Currencies Project at the libertarian think tank, the Cato Institute. “They say: ‘We’ve had all these financial problems because of all these irresponsible leaders we’ve had in the past. And now here I am riding a white horse and I’ve got some new gimmick that’s going to solve it all. It’s called Bitcoin.’” Hanke helped advise the Salvadoran government on the country’s dollarization, when it adopted the U.S. dollar as its sole currency in 2001. From 1993 the Salvadoran colón had been pegged to the U.S. dollar on a fixed exchange rate, in a successful effort to keep previously rampant inflation under control. After eight years, the government opted to fully replace the colón with the dollar. That made the economy more stable and lowered the cost of borrowing, but limited Salvadoran governments’ freedom to spend money, particularly in times of financial crisis. Hanke and others have speculated that the Bitcoin move is a first step towards scrapping dollarization altogether and issuing a national digital currency. That would both enable looser public spending, and reduce the impact of U.S. sanctions. But for local economists, the immediate concern is how Bitcoin could complicate El Salvador’s path out of a deep pandemic recession. “Public finances in El Salvador are on a knife edge. Public debt stands at close to 90% of GDP and the government needs to find almost $1.5 billion to close the year and pay its obligations,” says Alvaro Trigueros Arguello, director of economic studies at FUSADES, a San Salvador-based development thinktank. Though El Salvador’s economy is growing—with the Central Bank saying Sept. 29 that GDP is on course to surge by 9% this year—Trigueros Arguello says this is mostly due to a temporary factors, including the reopening of businesses after COVID-19 restrictions and a surge in remittances after the disbursement of pandemic aid packages in the U.S. The Bitcoin rollout has complicated El Salvador’s relationship with the IMF, from which it is seeking a $1 billion assistance package. In June the fund denied a request by El Salvador to assist in its Bitcoin rollout. It cited the lack of transparency in cryptocurrencies, arguing that the difficulty of tracing who makes Bitcoin transactions has facilitated criminal activity elsewhere, as well as environmental concerns about widening the use of Btcoin, which requires vasts amount of energy to produce. Fears over the cryptocurrency’s impact on El Salvador’s macroeconomic stability have stalled negotiations between El Salvador and the IMF, Trigueros Arguello says. “The government needs international credit and because of Bitcoin, it’s not getting it,” Trigueros Arguello says. “Bitcoin is costing the country dearly.” Camilo Freedman—Bloomberg/Getty ImagesDemonstrators hold signs during a protest against President Bukele and Bitcoin in San Salvador on Sept. 15, 2021. The backdrop to El Salvador’s experiment hasn’t undermined the excitement for those who want crypto currencies to be more widely used. Bitcoin Twitter has filled with tweets celebrating how easy it is for Salvadorans to use the currency in places like Starbucks, and praising Bukele’s foresight. “I’m totally excited about what’s happening in El Salvador. [Particularly] the fact that it’s happening in Latin America,” says Cristóbal Pereira, CEO of Blockchain Summit LatAm, a regional conference covering the blockchain technology that underlies Bitcoin, which will host events at El Salvador’s own Bitcoin conference in November. “If people end up using it widely, there’s a good chance other countries and people will end up using it more too.” It’s too early to tell if the buzz will be matched by the significant investments Bukele is hoping for. Analysts say businesses will likely wait and see how the bitcoin rollout affects El Salvador’s economic stability before striking any major deals. Mike Petersen, an American who moved to El Zonte in 2005 and helped found the Bitcoin beach, says he’s received a “a huge flood of [enquiries from] businesses that want to set up shop here, because, for the first time they are realizing, hey, Salvador is a forward looking country.” Those include companies in the Bitcoin space, such as exchanges and ATM networks, but also real estate developers, manufacturing companies and “some lighting and architectural companies that are now outsourcing, hiring architectural students here to do design and and put together bids for them. Because they can pay them in Bitcoin.” Peterson says he doubts that concern about the political situation in El Salvador will have any impact on investors. “Elite media circles are the ones that are more focused on that. I think, in the business climate, people are more pragmatic and practical about things. And they see that Bukele is extremely popular.” What’s not necessarily popular, so far, is Bitcoin. Bukele claims that a third of Salvadorans are actively using Chivo, but it is unclear how many are only using the app to access the initial $30 gift from the government. Media outlets in El Salvador reported long queues for the ATMs, where most people were converting their Bitcoin to take dollars home with them. In the first week of the rollout, one of the country’s largest banks told The Financial Times that the cryptocurrency accounted for fewer than 0.0001 % of its daily transactions. Rauda, the El Faro reporter, says he knows “no one” who’s using Bitcoin on a regular basis. Teething troubles The government gave itself just three months after parliament approved its Bitcoin law in June to introduce the currency, leading to a series of technical issues with the Chivo wallet app. Crypto bloggers reported cash taking days to show up in their Chivo accounts after being transferred by other users, bugs making the app unusable, and an initial inability to transfer any sum below $5. Bukele, who took to Twitter throughout the launch to offer emoji-laden tech support messages, claimed most of the technical problems were resolved within a few days. The bumpy rollout helped trigger a 10% fall in the value of Bitcoin against the day it became legal tender, and further falls since. On Sept. 20 Bukele said his government had “bought the dip” and acquired 150 more coins, bringing the country’s total holding to 700 (around $22 million). Chaotic rollouts of new government programs are not unique to El Salvador. But some in the Bitcoin community have concerns about the structure of the country’s experiment, beyond the initial hiccups. Marc Falzon, a New Jersey-based Bitcoin YouTuber who visited San Salvador to document the rollout, says he became concerned about Salvadoran taxpayers footing the bill despite opposition to the policy, and about Article 6 of the Bitcoin law, which says that all economic actors in the country must accept Bitcoin if they have the technical capacity to do so. “Forcing people to accept a decentralized currency from a centralized authority ebbs away at the legitimacy of not just Bitcoin, but cryptocurrency in general,” he says. Supporters of the project point out that Salvadorans don’t have to keep their money in Bitcoin if they don’t want to, with the government guaranteeing their ability to transfer them into U.S. dollars via its national development bank and a range of services allowing businesses to make that transfer automatically. But Falzon says that the positive image of EL Salvador’s rollout generated by Bitcoin influencers on Instagram and Twitter didn’t reflect what he saw. In a health store near his hotel, for example, the shopkeeper said she couldn’t afford to restock because so many Bitcoin payments made by customers had simply never shown up in her Chivo app account. “For people in the Bitcoin and crypto community, El Salvador is a ‘told you so moment,’ proof that this isn’t just a fad. And I think that in that enthusiasm, we can lose sight of both the bigger picture—in how future countries may start to follow suit—and also of the individual experiences of the people that are in these countries.” Some individuals are happy though. Martinez, the community activist who grew up in El Zonte, says the town’s experience suggests hesitancy to use Bitcoin—and opposition to the Bitcoin law—will fade as Salvadorans become more used to the technology, and become widespread within a few years. He’s not concerned, he says, by how Bitcoin may play into Bukele’s larger political project. “As an NGO, we’re apolitical. We support anything that can make a better El Salvador. And I think we’re walking towards a better future.”.....»»

Category: topSource: timeOct 1st, 2021

Futures Slide After Disappointing JPMorgan Earnings, Tech Rout Worsens

Futures Slide After Disappointing JPMorgan Earnings, Tech Rout Worsens After trading flat for much of the overnight session, S&P futures slumped to session lows shortly after JPM reported earnings that disappointed the market (see our full write up here) and were last trading down 30 points or 0.64%, with Dow futures down 0.3% and Nasdaq futures taking on even more water as the "sell tech" trade was back with a bang. Treasury yields rose 3bps to 1.74% and the dollar reversed an overnight loss. The VIX jumped above 20 and was last seen around 21. The Nasdaq 100 fell to the lowest in almost three months yesterday as tech came under pressure after Fed Governor Lael Brainard said officials could boost rates as early as March. It looks like the selling will continue today. “Market sentiment has been shaken by concerns over the prospect of imminent Fed tightening along with record global Covid-19 infection rates, but we don’t expect either of these factors to end the equity rally,” said UBS Wealth Management CIO Mark Haefele in a note. “The fourth-quarter U.S. earnings season, which started this week, could turn investor attention back to strong fundamentals.” JPMorgan shares dropped in premarket trading after revenues and EPS beat thanks to a $1.8 billion reserve release while FICC trading revenue missed expectations even as its dealmakers posted their best quarter ever and Chief Executive Officer Jamie Dimon gave an upbeat assessment of prospects for growth. Wells Fargo advanced after reporting higher-than-estimated revenue. BlackRock Inc. became the first public asset manager to hit $10 trillion in assets, propelled by a surge in fourth-quarter flows into its exchange-traded funds. Here are some of the other notable pre-movers today: U.S.-listed casino stocks with operations in Macau rise after the announcement of much-anticipated changes to the local casino law aimed at tightening government oversight on the world’s largest gaming market. Las Vegas Sands (LVS US) +6.6%; Melco Resorts (MLCO US) +5.5%; Wynn Resorts (WYNN US) +5.6%. Apple (AAPL US) shares are up in U.S. premarket trading after Piper Sandler raises its target for the stock, saying that Apple’s set-up for 2022 is favorable. Broker adds that the tech giant’s venture into health-care and automotive markets are the next catalysts to drive the stock to a $4 trillion market cap and beyond. NextPlay Technologies (NXTP US) shares jump 19% in U.S. premarket trading after giving an update for fiscal 3Q 2022 late yesterday. Domino’s Pizza (DPZ US) is cut to equal-weight from overweight at Morgan Stanley, while Chipotle is upgraded to overweight from equal-weight amid a “mixed” view on restaurant stocks into 2022. Amicus Therapeutics (FOLD US) advanced in postmarket trading after being upgraded to outperform from market perform at SVB Leerink, which cited the potential of a treatment for Pompe disease, should it be approved. Spirit Realty dropped 4% postmarket after launching a share sale via Morgan Stanley and BofA Securities. European equities traded poorly and followed the drop in Asia, with most sectors trading lower, weighed down once again by a soft tech sector. Euro Stoxx 50 is down 0.8%, most major indexes dropped over 1% before rising off the lows. Oil & gas is the best Stoxx 600 performer with crude trading well. European technology stocks as well as pandemic winners are leading declines after a U.S. selloff in tech shares resumed Thursday as Federal Reserve officials signaled their intention to combat inflation aggressively.  European chipmakers are down in early trading Friday: ASM International -3.5% at 9.17 a.m. CET, Infineon -0.9%, ASML -2.9%, STMicroelectronics -2.3%. Meanwhile, energy and automakers outperformed. Utilities were also in focus as French nuclear energy producer Electricite de France SA (EDF) plunged by a record as the French government confirmed plans to force it to sell more power at a steep discount to protect households from surging wholesale electricity prices, a move that could cost the state-controlled utility 7.7 billion euros ($8.8 billion) at Thursday’s market prices. There was some good news: a majority of strategists still see the rally in European equities continuing this year. The Stoxx Europe 600 Index will rise about 5.2% to 511 index points by the end of 2022 from Wednesday’s close, according to the average of 19 forecasts in a Bloomberg survey. Equity funds once more led inflows among asset classes in the week through Jan. 12, as investors reduced cash holdings, according to BofA and EPFR Global data. Earlier in the session, Asian stocks slid as investors offloaded technology shares on growing speculation the Federal Reserve will raise interest rates in March.  The MSCI Asia Pacific Index fell as much as 1.3% before paring losses to 0.7% in afternoon trading. Alibaba, Keyence and Sony Group were among the largest contributors to the benchmark’s slide. The Hang Seng Tech Index, which tracks China’s biggest tech firms, closed down 0.5%. Electronics makers also dragged down indexes in Japan and South Korea, with benchmarks in both nations leading the region’s drop. China’s CSI 300 Index closed at its lowest since November 2020. Asian stocks have been whipsawed this year by remarks from Fed officials as investors try to gauge the timing and scope of the anticipated interest rate hikes. The renewed weakness on Friday was triggered by comments from Fed Governor Lael Brainard, who said officials could boost rates as early as March to ensure that price pressures are brought under control. “This kind of hawkishness and a rush for rate hikes is, of course, a minus for share prices,” said Ayako Sera, a market strategist at Sumitomo Mitsui Trust Bank in Tokyo. If the Fed were to increase rates in March, “investors will want to make sure the economy remains strong despite the monetary tightening before making their move,” Sera added.  With Friday’s moves, Asia’s benchmark is set to pare its weekly gain to about 1.6%, which would still be its best weekly performance since October.    In Japan, sentiment worsened as Tokyo raised its Covid alert to the second-highest of four levels as virus cases surged. South Korea’s Kospi was also weighed down as the central bank increased its policy rate for the third time in just five months In rates, Treasuries pared declines with stock index futures under pressure as U.S. day begins. Yields beyond the 2-year reached session highs inside Thursday’s ranges amid a global government bond selloff. Treasury yields are cheaper by 3bp to 4bp across the curve with 10- year yields around 1.7274%, fading a bigger loss earlier and slightly underperforming bunds and gilts. Asia session featured speculation about tighter global monetary policy. IG dollar issuance slate empty so far and expected to remain light ahead of U.S. holiday weekend with markets closed Monday; four names priced $3.8b Thursday. In FX, the Bloomberg dollar spot is little changed around worst levels for the week, while NOK, JPY and CAD top the G-10 scoreboard. The yen advanced, and is set for its largest weekly advance in more than a year as speculation about a shift in the Bank of Japan’s policy spurred a further unwinding of dollar longs. The five-year Japanese government bond yield climbed to a six-year high. The volatility term structure in dollar-yen shifted higher Friday and inverted. The euro was little changed around $1.1460 and European sovereign bond yields rose, with the core underperforming the periphery. Norway’s krone and the Canadian dollar advanced as oil prices rose, with Brent trading above $85 per barrel, while the Australian and New Zealand dollars were the worst performers. The pound extended its longest winning streak in nearly two months as the U.K. economy surpassed its pre-pandemic size in November for the first time. Sweden’s krona inched down, shrugging off data showing that the nation’s inflation rate rose to the highest level in 28 years In commodities, crude futures rally with WTI recovering to Wednesday’s best levels near $83 and Brent putting in fresh highs near $85.40. Spot gold is little changed a brief retest of the week’s highs, trading near $1,823/oz. Base metals are mixed: LME nickel adds about 2% extending its recent surge; copper holds a narrow range in the red Looking at the day ahead now, data releases include US retail sales, industrial production and capacity utilisation for December, along with the University of Michigan’s preliminary consumer sentiment index for January and the UK’s GDP for November. Central bank speakers include ECB President Lagarde and New York Fed President Williams. Lastly, earnings releases include Citigroup, JPMorgan Chase, Wells Fargo and BlackRock. Market Snapshot S&P 500 futures up 0.3% to 4,667.00 STOXX Europe 600 down 0.5% to 483.71 MXAP down 0.8% to 195.28 MXAPJ down 0.5% to 639.13 Nikkei down 1.3% to 28,124.28 Topix down 1.4% to 1,977.66 Hang Seng Index down 0.2% to 24,383.32 Shanghai Composite down 1.0% to 3,521.26 Sensex up 0.1% to 61,320.31 Australia S&P/ASX 200 down 1.1% to 7,393.86 Kospi down 1.4% to 2,921.92 German 10Y yield little changed at -0.08% Euro up 0.1% to $1.1467 Brent Futures up 0.8% to $85.16/bbl Gold spot up 0.1% to $1,823.97 U.S. Dollar Index little changed at 94.73 Top Overnight News from Bloomberg Federal Reserve Governor Christopher Waller said that three interest-rate increases this year was a “good baseline” but there may be fewer or even as many as five moves, depending on inflation The U.K. and the European Union agreed to intensify post-Brexit negotiations over Northern Ireland, as Foreign Secretary Liz Truss led the British side for the first time in a meeting at her official country residence Germany’s economy contracted by as much as 1% in the final quarter of 2021 as the emergence of the coronavirus’s omicron strain added to drags on output from supply snarls and the fastest inflation in three decades Japan’s Government Pension Investment Fund, the world’s largest, may mull investing in Chinese government bonds if the market situation improves, GPIF President Masataka Miyazono says at a press conference in Tokyo Ukraine said a cyberattack brought down the websites of several government agencies for hours. Authorities didn’t immediately comment on the source of the outage, which comes as tensions with Russia surge over its troop buildup near the border Russia won’t wait “endlessly” for a security deal with NATO and progress depends on the U.S., Foreign Minister Sergei Lavrov said Friday, keeping up pressure after a week of high-level talks with the West failed to yield noticeable progress Turkey’s newly appointed finance chief said the country’s inflation will peak months earlier and at a level far lower than predicted by top Wall Street banks The global pressures driving inflation higher represent a “major change in trends” and will keep price growth high for the foreseeable future, Bank of Russia Governor Elvira Nabiullina said North Korea appears to have fired two ballistic missiles into waters off its east coast-- in what could be its third rocket-volley test in less than 10 days -- hours after issuing a fresh warning to the Biden administration A more detailed look at global markets courtesy of Newsquawk Asian equity markets weakened amid headwinds from the US where all major indices declined led by losses in tech and consumer discretionary amid a slew of hawkish Fed speak, while mixed Chinese trade data added to the cautiousness in the region. ASX 200 (-1.1%) traded lower as tech and consumer stocks mirrored the underperformance of stateside peers and with nearly all industries on the back foot aside from utilities and gold miners. Nikkei 225 (-1.3%) briefly gave up the 28k level amid a firmer currency and source reports that BoJ policy makers are said to debate how soon they can begin signalling a rate hike. In terms of the notable movers, Fast Retailing was the biggest gainer after it reported a record Q1 net, followed by Seven & I Holdings which also benefitted post-earnings, while Hitachi Construction was at the other end of the spectrum after news that parent Hitachi will offload half its majority stake. KOSPI (-1.4%) eventually underperformed after the Bank of Korea hiked rates by 25bps for a third time in the current tightening cycle to 1.25%, as expected. BoK also noted that CPI is to stay in the 3% range for a while and BoK Governor Lee made it clear that rates will continue to be adjusted which has fuelled speculation of similar action at next month’s meeting. Hang Seng (-0.2%) and Shanghai Comp. (-1.0%) were also pressured with participants digesting the latest trade figures which showed weaker than expected Imports although Exports topped estimates. Nonetheless, the downside was somewhat limited amid ongoing expectations for PBoC easing to support the economy as the Fed moves closer towards a rate lift off and with some encouragement after Evergrande averted its first onshore debt default whereby bondholders approved a six-month postponement of bond redemption and coupon payments. Finally, 10yr JGBs retreated beneath the 151.00 level following the source report that suggested debate within the BoJ on how soon a rate increase can be signalled which could occur ahead of the 2% price target, while this coincided with an increase in the 5yr yield to a 6-year high and a weaker than previous 20yr JGB auction. Top Asian News Chinese Developer R&F Downgraded to Restricted Default by Fitch Macau Cuts Casino License Tenure, Caps Float as Controls Tighten Inflation Irks Asia as Japan Yields Hit Six-Year High, BOK Hikes China Builders’ Dollar Bonds Slump Further; Logan, KWG Lead The major cash equity indices in Europe remain subdued but off worst levels (Euro Stoxx 50 -0.7%; Stoxx 600 -0.6%) as the downbeat APAC mood reverberated into the region amid a slew of hawkish Fed speak, while the mixed Chinese trade data added to the concerns of a slowdown ahead of next week’s GDP metrics. Newsflow had overall been quiet during the European session ahead of the start of US earnings season, but geopolitical tensions remain hot on the radar after North Korea fired its third missile of the year (albeit landing outside Japan’s EEZ), whilst Russia closed all communication channels with the EU and exerted some time-pressure on Washington with regards to Moscow’s security demands. Back to trade, a divergence is seen between Europe and the US as the former catches up to the late accelerated sell-off on Wall Street yesterday; US equity futures have been consolidating with mild broad-based gains seen across the ES (+0.2%), YM (+0.2%), NQ (+0.2%) whilst the RTY (Unch) narrowly lags. Delving into Europe, the UK’s FTSE 100 (-0.1%) is cushioned by gains across its Oil & Gas and Financial sectors as crude oil prices and yields clamber off intraday lows, whilst the SMI (-0.3%) sees some losses countered by its heavyweight healthcare sector. Sectors in Europe are mostly in the red with a slight defensive tilt, although Oil & Gas stands as the top gainer and the only sector in the green. The downside meanwhile sees Tech following a similar sectorial underperformance seen on Wall Street and APAC overnight. In terms of individual movers, DAX-heavyweight SAP (-0.3%) conforms to the losses across tech after initially rising as a result of upgraded guidance and the announcement of a share buyback programme of up to EUR 1bln. The most notable mover of the day has been EDF (-17.5%) as the Co. withdrew guidance after noting the impact of new French price cap measures is forecast to be around EUR 8.4bln on FY22 EBITDA. Top European News EDF Slumps by Most on Record on Hit From Price Cap U.K. Economy Surpasses Pre-Pandemic Size With November Surge German Recovery Lags Rest of Europe on Supply Snarls, Inflation HSBC Markets Chief Georges Elhedery To Take Six-Month Sabbatical In FX, another lower low off a lower high does not bode well for the index and Buck more broadly, but some technicians will be encouraged by the fact that chart supports in the form of a Fib retracement and 100 DMA have only been breached briefly. Meanwhile, Friday may provide the Greenback with a prop via pre-weekend position squaring and US data could lend a hand if upbeat or better than expected at the very least. For now, the DXY is restrained between 94.887-626 confines, with the upside capped by a major trendline that falls just below 95.000 around 94.980, and the Dollar also hampered by pressure emanating outside the basket from the likes of the Yuan, crude oil and other commodities. CAD/JPY/GBP - The Loonie has reclaimed 1.2500+ status in line with a rebound in WTI towards Usd 83/brl, but still faces stiff trendline resistance vs its US counterpart at 1.2451 and probably conscious that several multi-billion option expiries roll off either side of the 1.2500 level today. Conversely, the Yen has cleared the psychological 114.00 hurdle with some fundamental impetus coming from hawkish BoJ source reports contending that policy-setters are contemplating how soon the Bank can telegraph a rate hike that is likely to be delivered prior to inflation reaching its 2% target. Elsewhere, Sterling remains elevated above 1.3700, though unable to scale 1.3750 even with tailwinds from stronger than forecast UK GDP and IP or a narrower than feared trade gap amidst ongoing political uncertainty. CHF/EUR/NZD/AUD - All narrowly divergent and contained against their US rival, with the Franc straddling 0.9100 and Euro holding within a 1.1483-51 range and immersed in hefty option expiry interest spanning 1.1395 to 1.1485 (see 7.01GMT post on the Headline Feed for details). On the flip-side, the Aussie and Kiwi have both lost a bit more momentum after probing 0.7300 and approaching 0.6900 respectively yesterday, and Aud/Usd appears to have shrugged off robust housing finance data in the run up to China’s trade balance revealing sub-consensus imports. SCANDI/EM - Firmer than anticipated Swedish CPI and CPIF metrics have not offered the Sek much support, as the stripped down core ex-energy print was in line and bang on the Riksbank’s own projection. However, the Huf has been underpinned by hot Hungarian inflation and the Cnh/Cny in wake of the aforementioned Chinese trade data showing a record surplus for December and 2021 overall. In Turkey, the Try is flattish following the latest CBRT survey that predicts a weaker year-end Lira from current levels, but above record lows and still well above target CPI, while in Russia the Rub is benefiting from Brent’s rise above Usd 85.50/brl (in keeping with the Nok) against the backdrop of geopolitical and diplomatic strains as the country’s Foreign Minister declares that all lines of communication with the EU have ended. In commodities, WTI and Brent front-month futures have been on an upward trajectory since the Wall Street close, with the former now above USD 83/bbl (vs 81.58/bbl low) and the latter north of USD 85.50/bbl (vs 83.99/bbl low) in European hours. Overall market sentiment has been a non-committal one amid a lack of fresh macro catalysts, however, geopolitical updates have been abundant: namely with Russia’s punchy rhetoric surrounding its security demand from NATO and Washington, whilst North Korea fired what is said to be ballistic missiles which landed just outside Japan’s Exclusive Economic Zone (EEZ). On the demand side of the equation, eyes remain on China’s economic and COVID situations, with the import figures indicating China's annual crude oil imports drop for the first time in 20 years, whilst the nation grounded further flights between the US due to its zero-COVID policy. On the supply side, reports suggested that China will release oil stockpiles in the run-up to the Lunar New Year (dubbed as the largest human migration). The release is part of a coordinated plan with the US and other major consumers, according to the reports, which cited sources suggesting China will likely ramp up its releases if prices top USD 85/bbl. Turning to metals, spot gold is trading sideways and prices waned after again hitting the resistance zone around USD 1,830/oz flagged earlier this week. LME copper meanwhile remains under USD 10,000/t – subdued by the sharp slowdown in Chinese imports suggesting weaker demand, albeit annual imports of copper concentrate hit a historic high in 2021. The trade data also indicated a fall in iron ore imports as a factor of the steel production curbs imposed last year to tackle pollution and high iron ore prices. US Event Calendar 8:30am: Dec. Import Price Index YoY, est. 10.8%, prior 11.7%; MoM, est. 0.2%, prior 0.7% Export Price Index YoY, est. 16.0%, prior 18.2%; MoM, est. 0.3%, prior 1.0% 8:30am: Dec. Retail Sales Advance MoM, est. -0.1%, prior 0.3% Dec. Retail Sales Ex Auto MoM, est. 0.1%, prior 0.3% Dec. Retail Sales Ex Auto and Gas, est. -0.2%, prior 0.2% Dec. Retail Sales Control Group, est. 0%, prior -0.1% 9:15am: Dec. Industrial Production MoM, est. 0.2%, prior 0.5% Capacity Utilization, est. 77.0%, prior 76.8% Manufacturing (SIC) Production, est. 0.3%, prior 0.7% 10am: Nov. Business Inventories, est. 1.3%, prior 1.2% 10am: Jan. U. of Mich. Sentiment, est. 70.0, prior 70.6; Expectations, est. 67.0, prior 68.3; Current Conditions, est. 73.8, prior 74.2 U. of Mich. 1 Yr Inflation, est. 4.8%, prior 4.8%; 5-10 Yr Inflation, prior 2.9% DB's Jim Reid concludes the overnight wrap There was no rest for markets either yesterday as the tech sell-off resumed in earnest, which came as fed funds futures moved to price in a 93% chance of a March rate hike, the highest closing probability to date. At the same time, however, the US dollar continued to weaken and has now put in its worst 3-day performance in over a year, having shed -1.25% in that time. And all this is coming just as earnings season is about to ramp up, with a number of US financials scheduled to report today ahead of an array of companies over the next few weeks. Starting with sovereign bonds, yields on 10yr Treasuries fell a further -3.9bps yesterday, their biggest decline since mid-December, to their lowest closing level in a week, at 1.704%, with most of the price action again happening during the New York afternoon. Lower inflation breakevens helped drive the decline, with the 10yr breakeven down -3.4bps after the producer price inflation data for December came in softer than expected. Indeed, the monthly gain of +0.2% (vs. +0.4% expected) was the slowest since November 2020, and in turn that left the year-on-year measure at +9.7% (vs. +9.8% expected), which is actually a modest decline from the upwardly revised +9.8% in November. As with the previous day’s CPI reading though, there was a more inflationary interpretation for those after one, as the core PPI measure came in at a monthly +0.5% as expected, leaving the year-on-year change at an above-expected +8.3% (vs. +8.0% expected). So something for everyone but no massive surprises either way. The latest inflation data came as numerous Fed speakers continued to match the recent hawkish tone, which helped strengthen investor conviction in the odds of a March hike as mentioned at the top. Philadelphia Fed President Harker said at an event that “My forecast is that we would have a 25 basis-point increase in March, barring any changes in the data”, and that he had 3 hikes pencilled in but “could be convinced of a fourth if inflation is not getting under control.” Separately, we heard from Governor Brainard, who appeared before the Senate Banking Committee as part of her nomination hearing to become Fed Vice Chair. She signalled that she would be open to a March hike as well, saying that they would be in a position to hike “as soon as asset purchases are terminated”, which they’re currently on course to do in March. Even President Evans, one of the most dovish members of Fed leadership, said a March rate hike and multiple hikes this year were a possibility. As it happens, today is the last we’ll hear from various Fed speakers for a while, as tomorrow they’ll be entering their blackout period ahead of the next FOMC announcement later in the month. Staying on the Fed, Bloomberg reported overnight that President Biden has picked three nominees for the vacant slots. They include Sarah Bloom Raskin, previously Deputy Secretary of the Treasury, who’s reportedly going to be nominated to become the Vice Chair of supervision, as well as Lisa Cook and Philip Jefferson, who’d become governors. Cook is an economics professor at Michigan State University, and Jefferson is an economics professor at Davidson College in North Carolina. All 3 would require Senate confirmation, and bear in mind those choices haven’t been officially confirmed as of yet. Over on the equity side, the main story was a further tech sell-off that sent both the NASDAQ (-2.51%) and the FANG+ index (-3.72%) lower for the first time this week, and taking the former to a 3-month low. That weakness dragged the S&P 500 (-1.5%) lower, though despite the stark headline numbers, it was only just over half of the shares in the index that were in the red on the day. Meanwhile in Europe, the STOXX 600 (-0.03%) also saw a modest decline, though the STOXX Banks (+1.10%) hit a fresh 3-year high after advancing for the 8th time in the last 9 sessions. Sovereign bond yields echoed the declines in the US too, with those on 10yr bunds (-3.1bps), OATs (-3.3bps) and BTPs (-4.6bps) all moving lower. Following that tech-driven fall overnight on Wall Street on the back of those hawkish comments, Asian stock markets are trading lower this morning. Japan's Nikkei (-1.42%) extended the previous session’s losses while briefly falling over -2%, as the Japanese Yen found a renewed bid amid the risk-off mood. Additionally, the Kospi (-1.37%) widened its losses, after the BOK lifted borrowing costs by 25bps to 1.25% amidst rising concerns about inflationary pressure. That takes the benchmark rate back to pre-pandemic levels after the central bank's 25bps rate increase in August and November last year. Meanwhile, the Korean government unveiled a supplementary budget worth 14 trillion won in size to continue providing support to the economy. Elsewhere, the Hang Seng index (-0.86%), CSI (-0.60%) and Shanghai Composite (-0.53%) have all moved lower as well. Data released in China showed that exports went up +20.9% y/y in December (vs +20.0% market expectations) albeit imports in December rose +19.5% y/y less than +28.5% as anticipated. That meant that they posted a trade surplus of $94.46bn last month, above the consensus forecast for a $74.50bn surplus. Looking ahead, futures on both the S&P 500 (-0.19%) and DAX (-0.79%) are pointing to further losses later on. Elsewhere in markets, yesterday saw another surge in European natural gas futures (+13.71%), albeit still at levels which are less than half of the peaks seen in mid-December. The latest moves came as Russia’s deputy foreign minister Sergei Ryabkov said that talks with the US had reached a “dead end”, amidst strong tensions between the two sides with Russia rejecting any further expansion of NATO as well as calls to pull back its forces from near Ukraine’s border. In response, the Russian ruble weakened -2.31% against the US dollar yesterday, whilst the MOEX stock index (-4.05%) suffered its worst daily performance since April 2020. Turning to the Covid-19 pandemic, the decline in UK cases continued to accelerate yesterday, with the number of cases over the past week now down -24% relative to the previous 7-day period. Looking at England specifically, the total number of Covid-19 patients in hospital is now down for a 3rd day running, and in London the total number in hospital is down to its lowest level since New Year’s Eve. To the day ahead now, and data releases include US retail sales, industrial production and capacity utilisation for December, along with the University of Michigan’s preliminary consumer sentiment index for January and the UK’s GDP for November. Central bank speakers include ECB President Lagarde and New York Fed President Williams. Lastly, earnings releases include Citigroup, JPMorgan Chase, Wells Fargo and BlackRock. Tyler Durden Fri, 01/14/2022 - 08:13.....»»

Category: dealsSource: nytJan 14th, 2022

The 24 best subscription boxes for food, drink, style, beauty, hobbies, and pets in 2022

From coffee and snacks to games and books, these are the best subscription boxes you can buy as gifts for yourself and everyone else in 2022. Prices are accurate at the time of publication.When you buy through our links, Insider may earn an affiliate commission. Learn more.Birchbox Subscription box services are great for anything you love to receive on a regular basis. They can help you discover new products, develop your hobbies, or add convenience to your life. If you're looking for more great products, check out our list of the All-Time Best products we've ever tested. By now, the subscription concept has been widely applied to pretty much anything you can buy, but it's most useful for the things you actually use and enjoy regularly. Whether that's razor blades for your daily shaving routine or books to read during your commute, a subscription box helps automate the process for buying and receiving products so you have more time to use said products. Subscription boxes can help you discover new products in an arena you're already interested in or figure out if you want to pursue a hobby further. They're like trial runs for your various interests or needs and usually a lot more affordable than a full commitment. Plus, subscription boxes are great for gifting. With one fell swoop, you can gift three whole months of discovering new wine or trying out different perfumes.If you do change your mind about your subscription, all the following services make it easy to skip next month's shipment or cancel your subscription.Here are the best subscription boxes in 2022Food and drinkBest wine subscriptionConnie Chen/InsiderWinc Monthly Wine Subscription (4 bottles)$29.95 FROM WINCOriginally $52.00 | Save 42%Subscription frequency: Every monthShipping fee: $9 for orders of three bottles or fewer; free for orders of four bottles or moreA la carte shop: Yes Gifting available: YesWinc's straightforward ordering process, on-trend wine curation, and reliable shipping make it the best online wine club we've tried in the last few years. If your interest in a wine subscription stems not only from the need for convenience but also the desire to expand your wine knowledge, Winc offers informative resources, easy-to-digest bottle descriptions, and a community ratings system to help you develop your palate. Winc delivers wine every month, but it's easy to adjust your membership to skip automatic shipments. Although it matches you to wines that it thinks you'll like based on your profile of tastes and preferences, you can also customize your shipment and browse Winc's complete catalog of varietals from all over the world.Runners-up: Firstleaf, for affordable wine and big discounts ($80/month)Plonk, for natural and biodynamic wines ($110/month) Read more about the best wine subscriptions we tested in 2022. Read our reviews of Winc and Firstleaf.Best coffee subscriptionTrade/InstagramTrade Coffee Monthly Membership$14.75 FROM TRADESubscription frequency: Every 1, 2, or 4 weeksShipping fee: FreeA la carte shop: YesGifting available: YesTrade is where you can order top-quality coffee from cool roasters all over the country, like Verve (Santa Cruz, CA), Cuvee (Austin, TX), and Huckleberry (Denver, CO). If you're the type to immediately seek out the local specialty coffee shop when you travel to a new city, then Trade's the best coffee subscription for you — and you don't even have to leave your house to receive your beans. All you have to do is tell Trade about how you take your coffee and it'll show you the best coffee you should be drinking every morning. It'll also provide the roaster's schedule for roasting and when your bag was roasted.Runners-up: Driftaway, for sustainability-focused, single-origin coffee ($14.40/shipment)Atlas, for exploring the global coffee scene ($14/shipment)Read more about the best coffee subscriptions we tested in 2022. Read our reviews of Trade, Driftaway, and Atlas.Best tea subscriptionSips bySips by Monthly Tea Subscription$16.00 FROM SIPS BYSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesSips by is a personalized tea subscription that sends you four different teas (enough to make at least 16 cups) every month, so your tea rotation always stays new and exciting. You'll get to explore teas from big and familiar brands as well as local tea shops and farms and choose from loose leaf, bagged, herbal, and caffeinated teas. If you weren't already familiar with all the benefits of tea, how to steep your tea, and the differences among all the tea types, Sips by shares plenty of educational resources to strengthen your tea knowledge. Plus, the subscription considers your taste and steep preferences — we loved the personal touch. Runners-up: Atlas Tea Club Starter Pack, for single-origin and global teas ($14/shipment)David's Tea Tasting Club, for exclusive and seasonal tea blends ($35/shipment)Read our review of Sips by.Best beer subscriptionBeer of the Month ClubBeer of the Month Club Subscription$31.95 FROM BEER OF THE MONTH CLUBSubscription frequency: Every monthShipping fee: $15 A la carte shop: No Gifting available: YesChoose from five different beer memberships in this club: Microbrewed, Hop Heads, Rare Beers, International, and US and International. Each of these clubs gives you 12 12-oz beers in different styles from a few different breweries, plus brewery profiles and tasting notes. It's the most convenient way to tour breweries in the US and around the world. The original club started in 1994, and its panel of brewmasters and beer judges only pick out a mix of the most interesting and innovative craft beers every month. The diversity of options means you can stop pigeonholing yourself into drinking (and pretending to enjoy) IPAs.Runners-up: Tavour, for mobile-first beer orders (Price varies)Craft Beer Kings, for fun and creative flavors ($70/shipment)Best cocktail subscriptionCocktail Courier/InstagramCocktail Courier Classic Cocktail Kit Subscription$49.99 FROM COCKTAIL COURIERSubscription frequency: Every 1, 2, or 4 weeksShipping fee: FreeA la carte shop: YesGifting available: YesUnless you keep your bar cart fully stocked and meticulously updated, it can be a hassle to source all the ingredients for a specialty cocktail you want to make. Let's also not forget that going out for happy hour requires putting on clothes. Cocktail Courier makes kits based on recipes from top bartenders and sends you all the ingredients you need, including the spirits. Keep in mind, though, you do need your own basic equipment, like glassware and a shaker. For the subscription, just choose your favorite spirits and you'll only be sent kits with those spirits. There's also an option for just the mixers and garnishes, if you prefer to use your own alcohol. Runners-up: Shaker & Spoon, for a variety of cocktails that focus on one spirit (from $40/shipment)SaloonBox, for group cocktail parties (from $57/shipment)Best snack subscriptionSnackCrate/InstagramSnackCrate Original Snack Box Subscription$21.99 FROM SNACKCRATEOriginally $26.99 | Save 19%Subscription frequency: Every monthShipping fee: FreeA la carte shop: NoGifting available: YesOne of our favorite things to do when visiting a new country is to scour the snack aisles of the local grocery store. SnackCrate brings that same excitement and discovery process to your door. Every month's snack box focuses on a different country and includes full-sized snacks directly imported from that country. You'll also get a music playlist and booklet of games and facts related to the country. There are three box sizes available to suit everyone from occasional grazers to snack aficionados. Runners-up: Mouth, for gourmet snacks from indie makers ($60/month)Bokksu, for authentic Japanese snacks ($49.95/month)Read our review of Bokksu.Best cheese subscriptionMurray’s Cheese/InstagramMurray’s Classic Cheese of the Month Club$63.00 FROM MURRAY'SSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesNew York City institution Murray's Cheese offers a few different monthly clubs that let you get your fix for creamy, stinky, soft, smoky, and hard cheeses. It's part indulgence, part educational experience. The Classic Club is great for people who want a reliable way to enjoy cheeses you might not have heard of but still have an approachable flavor profile — think Montealva, a flaky and citrus-y goat's milk cheese from Spain or The Farm at Doe Run's butterscotch-infused cheese. If you want something more adventurous, try the Cheesemonger's Picks club instead. Runners-up: Curdbox, for cheese plates including sweet and savory pairings ($49.95/month)Jasper Hill, for special release and limited-edition cheese from Vermont ($100/month)Read our review of Murray's Cheese of the Month Club.Best meat subscriptionButcherBox/InstagramButcherBox Mixed Box$137.00 FROM BUTCHERBOXSubscription frequency: Every monthShipping fee: FreeA la carte shop: NoGifting available: YesIn addition to pre-curated boxes of grass-fed beef, free-range organic chicken, and crate-free pork, ButcherBox lets you choose from more than 25 different cuts to make your own custom box. It's an easy way to get high-quality meat (up to 14 pounds every month) without having to visit your local butcher or farmer's market. The subscription is also flexible in case you don't need that much meat every month. But if you're feeding a lot of mouths, hosting a barbeque, or just enjoy eating meat, you'll want to take advantage of ButcherBox's value every month.Runners-up: Porter Road, for underrated cuts of meat and the best variety (Price varies) Snake River Farms, for high-end meat like American Wagyu ($225/shipment)Read more about the best meat subscriptions we tested in 2022. Read our reviews of ButcherBox, Porter Road, and Snake River Farms. Best meal kit subscriptionBlue Apron/InstagramBlue Apron Meal Kits (3-meal, 2-serving)$53.94 FROM BLUE APRON Subscription frequency: Every weekShipping fee: FreeA la carte shop: NoGifting available: YesBlue Apron's flavorful, creative takes on familiar recipes and reliable, accurate delivery make it the best meal kit you can subscribe to. It's versatile and flexible, with meal options for all kinds of dietary preferences, a variety of plans for two- and four-person families, and add-ons like meat and seafood bundles, spice blends, and cookware and tools. There's even a wine add-on to complete your dining experience. The meals (like chimichurri tilapia, one-pan prosciutto gnocchi, and sambal-peanut chicken noodles) are always delicious and the portions are generous — you'll even have leftovers,  sometimes. The menu updates frequently and we rarely see the same recipe twice.Runners-up: Sunbasket, for organic ingredients and health-conscious recipes ($71.94/3-meal, 2-serving plan)Everyplate, for the most affordable yet filling meals ($39.93/3-meal, 2-serving plan)Read more about the best meal kit subscriptions we tested in 2022.Beauty, grooming, and styleBest beauty subscriptionBirchbox/InstagramBirchbox Beauty Subscription Box$13.00 FROM BIRCHBOXSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesBirchbox's mission is to make the vast world of beauty and skincare fun and less intimidating by giving you the freedom to sample tons of different products. Every month's affordable beauty box contains five samples you might like based on your Beauty Profile, featuring a variety of new and upcoming brands and products (makeup, skincare, haircare, fragrance).The brands included reflect Birchbox's core values of sustainability, inclusivity, and supporting women. For example, there's a limited edition Brown Girl Jane box which is made by and for Black women's wellness. Once you've tried a sample you really love, you can directly shop the full-sized product at Birchbox's shop. There's also a Grooming section with hair, face and body, and shaving essentials.Runners-up: Kura, for clean skincare bundles customized to your needs (from $99/shipment)Prose, for personalized haircare like shampoo and hair masks (Price varies)Read more about the best beauty subscription boxes we tested in 2022. Read our reviews of Birchbox and Prose.Best shaving subscriptionDollar Shave Club/InstagramDollar Shave Club Starter Set$10.00 FROM DOLLAR SHAVE CLUBSubscription frequency: Every 2, 3, or 4 monthsShipping fee: FreeA la carte shop: Yes Gifting available: YesThere are a variety of ways you can get sharp and budget-friendly razor shipments from Dollar Shave Club: the first is the Starter Set, which costs just $5 ($20 every two months afterward) and acts as your trial run for the shave subscription. Or, you can take the site's quiz to receive a personalized recommendation of products based on your hair type and shaving needs. Either way, this famous online shave club offers plenty of flexibility so that you'll always have a supply of razor blades and soothing post-shave essentials whenever you need it. Runners-up: Billie, for fun yet practical razors ($9/shipment)Harry's, for sleek designs and other body care products ($15/shipment)Read our reviews of Billie and Harry's.Best men's clothing subscriptionAmir Ismael/InsiderMenlo Club Subscription$20.00 FROM MENLO CLUBOriginally $60.00 | Save 67%Subscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesMenlo Club, the styling service loved by NBA stars and our own senior style reporter, curates two to three pieces for you per month based on your style preferences and clothing sizes. Brands include Five Four, Grand AC, and New Republic, and the pieces are easy to incorporate into your existing wardrobe. It's your best bet if you don't like or have time for clothing shopping because it offers high-quality clothing with plenty of variety. You can exchange sizes for free and you'll also get perks like exclusive discounts and early access to drops.Runners-up: Stitch Fix, for clothing picks made by your own personal stylist ($20/shipment)Gentleman's Box, for stylish accessories like ties and socks ($35/shipment)Read more about the best men's clothing subscriptions we tested in 2022.Read our review of Menlo Club.Best women's clothing subscriptionRent the RunwayRent the Runway 2 Swaps$85.00 FROM RENT THE RUNWAYOriginally $135.00 | Save 37%Subscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesWith over 750 designers to choose from, Rent the Runway is the closet of your dreams for special occasions like weddings, workwear essentials, or simply to add excitement to your regular wardrobe. Its most popular plan lets you rent four pieces at a time, twice a month, for just $99 a month (for the first two months). We've always found it easy to pick out, wear, and return dresses, tops, loungewear, and accessories from the service. It's all the fun and excitement of wearing designer clothing, without the exorbitant price tags or complicated dry cleaning.Runners-up: Stitch Fix, for clothing picks made by your own personal stylist ($20/shipment)Nuuly, for affordable rentals from Urban Outfitters, Anthropologie, and Free People ($88/shipment)Read our review of Rent the Runway.Best jewelry subscriptionRocksbox/InstagramRocksbox Monthly Jewelry Subscription$21.00 FROM ROCKSBOXSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesThe right jewelry can bring an outfit to the next level, and with Rocksbox, the search for the perfect ring, earring, necklace, or bracelet is easy and very affordable. The $21 monthly membership gets you three pieces of jewelry from brands like Kendra Scott, Slate, 8 Other Reasons, and more, and the best part is you can swap the pieces as many times as you want during the month. If you fall in love with a piece and decide to buy it, your membership fee turns into a credit towards your purchase, saving you even more money.Runners-up: Switch, for luxury and fine jewelry like Hermes and Chanel (from $40/shipment)Rowan, for hypoallergenic earrings and fun freebies ($35/shipment)Best underwear subscriptionMeUndies/InstagramMeUndies Monthly Subscription$14.00 FROM MEUNDIESSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesMeUndies makes incredibly soft and comfy underwear in a variety of cuts and a huge selection of fun, ever-rotating prints and patterns. Though new underwear every month may seem unnecessary, you might just change your tune once you try a pair from MeUndies. All its fabrics are breathable and stretchy and last through years of washes. The part to look forward to the most? Collecting all the unique prints, which have included sharks, a "Space Jam" collaboration, and sun-tanning alligators in the past.Runners-up: Underclub, for designer underwear in a range of styles (from $15/shipment)Savage by Fenty Xtra VIP, for access to monthly drops and exclusive deals from Rihanna's lingerie brand ($49.95/shipment)Read our review of MeUndies.Best subscription for perfume and cologneScentbird/InstagramScentbird Subscription Box$15.95 FROM SCENTBIRDSubscription frequency: Every 1, 2, or 3 monthsShipping fee: FreeA la carte shop: YesGifting available: YesFragrance is so personal to each individual person that it only makes sense to turn buying perfume or cologne into a sampling experience. Scentbird is home to over 500 fragrances from designer and indie brands, letting you discover your signature scent, add some variety to your current fragrance lineup, or simply try fragrances you wouldn't have access to otherwise. You'll be able to try perfume and cologne from Versace, D&G, Acqua di Parma and more. Each 8 mL sampler bottle holds about 140 sprays — enough to use a couple times a day, every day of the month.Runners-up: Scentbox, for an even larger variety of fragrances to choose from ($9.72/shipment)Skylar Scent Club, for limited-edition rollerballs made with clean ingredients ($20/shipment)Hobbies and interestsBest flower subscriptionLauren Savoie/InsiderBloomsyBox Flower Subscription Service$44.99 FROM BLOOMSYBOX$38.99 FROM AMAZONOriginally $44.99 | Save 13%Subscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesSome people like food or shoes or jewelry, but for us, flowers are the ultimate monthly pick-me-up. BloomsyBox's monthly flower delivery service features one unique bouquet of 22-24 stems, and though you can't pick the exact flowers you want, the ones we've received from the service have always been gorgeous. It's a lovely way to liven up your home with new and interesting arrangements and the flowers arrive fresh and undisturbed. Be on the lookout for cool, limited-time collaborations, like the current partnership with the New York Botanical Garden.Runners-up: UrbanStems, for timeless arrangements and deliveries as frequent as every week ($55/shipment)Read more about the best flower delivery services we tested in 2022. Read our reviews of Bloomsybox and UrbanStems.Best plant subscriptionHorti/InstagramHorti Month-to-Month Plant Subscription$28.00 FROM HORTISubscription frequency: Every monthShipping fee: $8-$12A la carte shop: YesGifting available: YesHorti is best for beginner plant enthusiasts who are interested in starting a plant collection but may not know where to start or how to learn the basics of plant care. Horti's subscription is strategically designed so you begin with hardy, low-maintenance plants but eventually graduate to more complex species as you develop your confidence and experience. Each one always comes in a hand-painted pot (or you can opt for just the naked plants) and sometimes you'll also receive planting tools and accessories. Runners-up: The Sill, for a robust variety of medium-sized, easy care plants ($50/shipment)The Plant Club, for unique, seasonal plants ($39/month)Read our review of The Sill. Best book subscriptionBook of the Month Club/InstagramBook of the Month Membership$9.99 FROM BOOK OF THE MONTHOriginally $15.99 | Save 38%Subscription frequency: Every monthShipping fee: YesA la carte shop: YesGifting available: YesAs the OG national book club (since 1926!), Book of the Month has book curation down to a science, with its finger on the pulse of all the books that everyone seems to be reading and talking about lately. Every month you have the opportunity to choose from five hardcover books representing a variety of genres. Whether you're trying to start up a reading habit or already a voracious reader, the consistent shipments will keep you on track and make you a more well-read citizen. It also offers a separate, formal Book Club service where you can organize your own book club with anyone in your circle.Runners-up: Owl Crate, for signed young adult books and extra freebies ($32.99/shipment)Next Big Idea Club, for nonfiction books curated by big names in business and psychology ($21/month)Read our review of Book of the Month. Best game subscriptionUnbox Boardom/FacebookUnbox Boardom Monthly Subscription$29.99 FROM UNBOX BOARDOMSubscription frequency: Every 1, 2, or 3 months Shipping fee: $5 A la carte shop: YesGifting available: YesIf you like to unplug and unwind with a board game, try the cleverly named Unbox Boardom subscription. Each month, you can either choose a new game yourself or let the gaming experts choose one for you. The membership has all kinds of unique games (strategy, family, trivia, and more) that you haven't heard of before and will keep you well occupied throughout the year. Soon enough, you'll have a healthy stack of games to choose from any time you want to exercise your brain a bit. Past games have included Photosynthesis, a strategy game where you chase the sun to grow trees and Sabordage, a mayhem-filled pirate adventure.Runners-up: Video Games Monthly, for classic and retro video games (from $34.99/shipment)Finders Seekers, for mystery and escape room games ($30/shipment)Best crafting subscriptionThe Crafter’s Box/InstagramThe Crafter's Box Monthly Membership$65.00 FROM THE CRAFTER'S BOXSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesFor people who love working with their hands, The Crafter's Box offers the convenient and affordable opportunity to try out different kinds of crafts and learn from real working crafters. In addition to the kit of materials, you'll receive access to a digital workshop and live chat with a community of fellow craft lovers. The exciting lineup of craft options include fabric weaving, leather sandal making, paper making, soap making, and contemporary quilting. Since The Crafter's Box sends you all the materials you need, you can test drive various crafting types and figure out the one you love the most before you drop an entire month's paycheck at Michael's.Runners-up: Kiwi Doodle Crate, for creative projects designed for teens ($22.95/shipment)Adults and Crafts, for small, approachable projects ($33/shipment)Read our review of KiwiCo Crates. Best subscription for kidsAlicia Betz/InsiderKiwico Crates$19.95 FROM KIWICOSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesCreated by an engineer and mother of three, KiwiCo makes kits with toys and activities for kids of every age, from newborns to 14-year-olds. The science and art projects, designed by educators and scientists including but not limited to mechanical and industrial engineers, are age-appropriate and teach kids important skills like creative problem-solving, curiosity and tinkering, and hands-on craft. The beauty of KiwiCo is it frees up time for parents: time spent researching activities to do, and time spent participating in those activities with their kids. Though parents can certainly join in on the fun, the kits work best when the child can play independently.Runners-up: Lovevery, for developmental play kits for babies and toddlers (Price varies)Baketivity, for kid-friendly baking kits ($32.95/shipment)Read our reviews of KiwiCo and Lovevery. Best subscription for dogsKate Barrington/InsiderBarkBox Single Box$35.00 FROM BARKBOXSubscription frequency: Every monthShipping fee: FreeA la carte shop: YesGifting available: YesDogs and their owners love this popular subscription box, which sends toys, treats, and chews revolving around a creative theme each month. When you sign up, you'll share info about your dog, including its breed, birthday, and dietary restrictions, so that Barkbox can send a personalized collection of items. The plush toys in particular are a pup favorite. Soft, squeaky, and durable, they're made for play. Barkbox also has the best themes and collaborations we've seen around, from movie character chews and toys to a winter cabin getaway bundle.Runners-up: Pupbox from Petco, for treats, toys, and training resources specifically for puppies ($39/shipment)Kongbox, for highly rugged Kong products and especially playful dogs ($44.95/shipment)Read our review of Barkbox.Best subscription for catsMeowboxMeowbox Monthly Subscription$22.95 FROM MEOWBOXSubscription frequency: Every 1 or 2 monthsShipping fee: FreeA la carte shop: YesGifting available: YesSometimes hair ties, lights, and cardboard boxes just won't cut it for your cat. That's where Meowbox comes in. Every box has five to six items, including high-quality toys and organic or grain-free treats that are always produced in the US or Canada. Plus, for every box sold, Meowbox donates a can of food to a cat shelter. It even provides a unique code you can use to track exactly where your donation has gone. Like Barkbox, Meowbox offers adorable themed products, like a summer fishing bucket hat or a "skippy kitty rope" and kettlebell for cat-owner workouts. The a la carte shop also features paraphernalia for the owner so you don't feel left out of the fun.Runners-up: KitNipBox, for extra treats and toys if you have more than one cat ($22.99/shipment)RescueBox, for a subscription box with high impact ($29.95/shipment)Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 13th, 2022

Senate Democrats offered Manchin a huge compromise on checks to parents. Then Manchin blew it up and they don"t know why

Dems swapped a three-year expanded child tax credit extension for one year to get Manchin to drop his push for a work requirement. He hasn't budged. Senate Majority Leader Chuck Schumer and Sen. Joe ManchinDrew Angerer/Getty Images Senate Democrats thought Manchin had ultimately dropped his demands for a work requirement on the Biden child tax credit. But he's said he hasn't budged at all on the issue. It's thrown the fate of Biden's big social and climate bill into chaos with no clear path to success. Senate Democrats largely believed the heated clash around one of President Joe Biden's biggest economic priorities was behind them as fall turned to winter.Sen. Joe Manchin of West Virginia imperiled the renewal of the expanded child tax credit in September when he started demanding work requirements as a condition for families to receive up to $300 in monthly checks per child, amounting to either $3,000 or $3,600 a year for younger kids. The program was put in place for a year under the stimulus law, transforming it into a near-universal cash benefit for parents until it expired in December.Though the vast majority of congressional Democrats back renewing the program as it is, Manchin's desired change carried enormous consequences. Imposing a work requirement would shut out many families with little or no taxable income, significantly denting its anti-poverty effects. But Democrats need his vote in order to pass the centerpiece of Biden's domestic agenda to expand childcare, healthcare, and combat the climate emergency over universal GOP opposition in the 50-50 Senate. Manchin came out against the $2 trillion package and it's now stuck in the mud.To get Manchin to drop his push for a work requirement, Democrats and the White House made a huge compromise to try and get his support: They cut the planned extension for three years to only one, according to two Senate Democratic aides familiar with the matter. Both were granted anonymity to share details of private negotiations.The concession was included in the framework that the White House ultimately released in late October after weeks of negotiations with Manchin and Sen. Kyrsten Sinema of Arizona, another Democratic holdout. "I still do not understand what happened with this framework," one of the aides said. "And it being communicated to pretty much everyone that the reason we were only doing [one-year] CTC was because that was the only way he would agree to do the CTC without work requirements."The Biden administration's attempt to dislodge the stalled package landed with a thud. Manchin never publicly endorsed the White House plan and continued to hold back his support until he ultimately blew up the House-approved bill in December. "I've tried everything humanly possible, I can't get there," he told Fox News."Senator Manchin has always supported the child tax credit and would like to see it targeted to those families who need it most," a Manchin spokesperson told Insider via email. The White House didn't respond to requests for comment.Manchin's claim that he wants the neediest families to get the aid runs counter to the demands he's laid out, since a work requirement would block payments to the poorest families.Sen. Michael Bennet of Colorado, one of the architects of the expanded benefit, has told Insider recently that he's unsure that he'll get Manchin's support despite personally lobbying him on the issue."I don't think I'll ever convince Senator Manchin on this until he actually sees it in effect, working in his state benefiting the people of West Virginia, as it's benefiting the people of Colorado," Bennet said in an interview last month. "That's a good reason for us to extend it for some years, so that we can see how it's working."It's unclear what a potential compromise with Manchin could look like. Democrats could slash the size of the benefit so its cheaper or further restrict who can tap into the federal aid to satisfy his demands — but it still may not be enough to get him onboard.If it fell out of the Build Back Better plan, it's also unclear whether a bipartisan deal could be struck with the GOP since they're wary of any tax hikes to pay for it. "No Republican, including myself, is going to say, 'Hey, I'm in favor of tax increases of any kind," Sen. Mitt Romney of Utah, the author of a competing child benefit plan, told Insider on Wednesday. Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 13th, 2022

Tailwinds Shift To Headwinds In 2022

Tailwinds Shift To Headwinds In 2022 Authored by Michael Lebowitz via RealInvestmentAdvice.com, The first part of our 2022 outlook looks through the front windshield and contrasts 2021s tailwinds with 2022s growing headwinds. While no one knows what 2022 holds in store for investors, our concern is that it should not foster the same optimism as 2021. The economic and financial environments are shifting rapidly making the 2022 outlook much more difficult than this past year. Part 2 of the 2022 outlook, coming out next week, will cover our thoughts on the stock and bond markets. “The more extended the advance, and the higher valuations become, the more stable and promising the investment can appear to be, when judged through the rearview mirror.”  - John Hussman It’s All About Growth Before looking forward, it’s worth explaining how economists assess economic activity. Most economic activity is measured in percentage growth terms and not nominal terms. To stress the importance of this nuance, consider the following: If the government gives consumers $1 trillion to spend, it will boost GDP by at least $1 trillion. In our example, the stimulus will boost GDP to $21 trillion from $20 trillion, equating to 5% growth. Without government stimulus and excluding any new economic activity, GDP will retreat to $20 trillion in the following year. As a result, GDP will decline by 5%. While nothing changed with the economy, the 5% decline will be considered a recession. To avoid zero or declining economic growth, again assuming no other activity, the government will need to provide at least $1.01 trillion of stimulus. As we show above, stimulus boosts economic activity. However, it detracts from economic growth rates unless it grows each year. This fact will become important in our 2022 outlook as the government will not likely replicate the massive amount of stimulus doled out over the prior two years. Can the economy make up for it? Covid TailWinds In hindsight, the rearview mirror showing the period from March 2020 to the present paints an unusual picture. What started so poorly ended up being one of the greatest periods for investors. The S&P 500 total return since the March 2020 lows is +115%. In March 2020, the sky was falling, and investors aggressively sold stocks. It turns out buying stocks in the face of such a unique calamity was the right thing to do. The justification was not a coming cure or vaccine for Covid or an imminent return to normal, but the government with their fiscal guns blazing. Since March 2020, the government has run a $5.6 trillion deficit, dwarfing any prior instance. Such massive spending was only possible with the Treasury’s trusty sidekick, the Federal Reserve.  As we show, the Fed has bought nearly $5 trillion of bonds since the pandemic began. In doing so, it came close to absorbing 100% of the net new debt issuance from the government. While the government was doling out money to boost economic activity, the Fed spewed liquidity, supported asset prices, and kept interest rates low. Despite Covid shutting down large segments of the economy, economic data quickly recovered to pre-Covid levels. Record low interest rates, massive consumer and corporate stimulus, and enormous liquidity gusted at investors’ backs producing double- and triple-digit gains. Not only did most asset prices regain March 2020 levels, but many have well surpassed those levels. In the latter half of 2021, vaccines, increased consumer demand, and a record amount of savings added further oomph to the tailwinds. However, the ominous winds of inflation began picking up at that point. 2022 Headwinds The perfect fiscal and monetary storms are petering out. As a result, headwinds for 2022 are mounting. Let consider how that weighs on our 2022 outlook. Fiscal Spending Over the last 3 months, the federal deficit grew at a $1.6 trillion annualized rate. That is historically high but well below 2020 and 2021 levels. Further, Joe Biden and the Democrats are struggling to pass the Build Back Better (BBB) social infrastructure program. We think it will pass in time, but the fiscal stimulus and spending related to it will not be as immediate or significant as initially planned. The coming election in November poses more hurdles for spending bills. West Virginia Senator Joe Manchin and other Senators and Representatives from red and purple states face a growing risk of losing their seats. Some may take a page from Manchin’s playbook and voice deep concern for growing budget deficits to appease their voting bases. Throughout later 2021 and even into 2022, Covid related stimulus programs ended or will end shortly. The closure of these programs will further reduce the flow of stimulus to consumers. For example, the recently extended student loan deferment program ends in a few months. In this case, many student debtors consume goods and services with money that should be servicing student debt. Once the deferment period ends, spending, in many cases, will decline. The child tax credit will also end shortly, resulting in a shortfall of funds for those receiving the benefit. Likewise, those that did not pay rent are now left with back payments or higher rents to make their landlords whole. The graph below from Goldman Sachs helps quantify the sharp decline in fiscal spending related to the pandemic. As we discuss later, the savings rate has fallen back to normal levels, meaning many of those affected will have to reduce consumption. Monetary Stimulus The Fed is tapering QE, expecting to end new purchases by March 2021. QE provides vast amounts of liquidity to the financial markets. As the Fed backs away, not only will it reduce liquidity to markets, but reduce the power of the world’s largest holder of U.S. Treasury debt. Someone will take the Fed’s place but must shed other assets to do so. To help better understand this concept, we suggest reading The Fed Is Juicing Stocks. In particular, the section titled “Draining the Asset Pool.” The Fed is also hinting at raising interest rates. Higher interest rates will increase interest expenses for debt-laden companies, consumers, and the government. Additionally, those using loans to leverage assets will have to pay more for the leverage. This will undoubtedly cause some investors to reduce or remove leverage as the potential returns diminish.  The graphs below highlight that margin debt has proliferated and sits at or near record levels. The last two times margin debt grew this rapidly was in 1999 and 2007. Elections and the Fed Further pressuring the Fed is politicians. Consider the following from the Financial Times: “The Fed needs to start tapering immediately and then they need to raise interest rates. Both those things can be done by March,” Jake Auchincloss, a Democrat from Massachusetts and member of the House of Representatives financial services committee, which oversees monetary policy, told the Financial Times. “I think chair [Jay] Powell would do well to end the decade of easy money,” he added. Political pressure from the President and legislators may force the Fed to remove liquidity too quickly or raise rates too fast. Both are likely to be problematic for asset prices and economic recovery. Savings Rate The combination of direct government stimulus and the inability to spend money during the lockdowns resulted in unprecedented savings rates. As we show below, the savings rate jumped to levels that were twice as high as any previous level since at least 1959. Note that the two recent peaks result from the two rounds of personal stimulus checks. The following graph, courtesy of Brett Freeze, shows how government stimulus to consumers (transfer receipts) and credit provided a bonanza of spending power for consumers. Like the bloated savings rate above, that too has normalized. The savings rate is back to pre-Covid levels. Most consumers, especially those in the middle to lower-income classes, have fully exhausted extra savings and must either reduce spending or increase their use of debt. Credit card debt and home equity withdraws are both increasing. While such funds can propel additional spending, it will not be nearly the same as the enlarged savings rates. Further, higher interest rates will make debt less appealing. Inevitably credit card and home equity are limited based on wage growth and the ability to service their debt. Inflation Prices are on the rise. Higher prices mean consumers spend more to get the same amount of goods. If wages keep up with inflation, the consumer is indifferent.   Inflation is running at 6.9%, over three times higher than the Fed’s stated 2% objective. At the same time, wages are growing but at a lesser rate than inflation. Average hourly earnings are up 4.8%. While historically robust, real wages, factoring in inflation, are down 2%. As we note earlier inflation is pressuring the Fed to prioritize their fight against inflation. Might the Fed have to choose between inflation and asset prices? Ohio Democrat Sherrod Brown recently shared thoughts on that- “The Fed should make sure our economy works for workers and their families, not Wall Street.” Also, consider inflation is highly responsible for the recent string of poor consumer sentiment. People usually spend more when they have a positive outlook. As the graph below shows, the University of Michigan’s current and expected consumer sentiment indexes are at or near ten-year lows. The current index sits at 70.6. In April 2020, during the peak of Covid lockdowns, it was 71.8. In September 2008, when Lehman and others were failing, it was 70.3. Pent up Demand and Mid-Life Crisis Having been deprived of vacations, eating out, and a host of other activities, people were hungry to return to normal. Vaccines further raised comfort levels and allowed many stores and venues to return to normal. Consumers splurged as they bought those things they couldn’t buy during lockdowns. Not only did they travel and go out to dinner, but some bought cars and houses and other big-ticket items. It was as if many consumers had a mid-life crisis simultaneously. Most of that pent-up demand is quickly diminishing. The bills from those spending sprees are mounting, and life is slowly becoming more normal by the day. This additional source of spending is fading quickly. Summary “Prepare for the unknown by studying how others in the past have coped with the unforeseeable and the unpredictable.”  -George S. Patton As you just read in part one of our 2022 outlook, this year’s monetary and economic environment will not be as friendly for asset prices as last year. While that may seem problematic for investors, if we learned anything in 2020 and 2021, it is that stock prices can climb a wall of worry efficiently. In part two of our 2022 outlook, coming next week, we share our thoughts on how stocks and bonds might perform in the new year. Tyler Durden Thu, 01/06/2022 - 06:30.....»»

Category: blogSource: zerohedgeJan 6th, 2022

Joe Manchin digs in on cutting the poorest parents out of the Biden child tax credit as Build Back Better looks dead in the water

Manchin wants only working families to be eligible for monthly checks. The credit expired last year and Democrats don't have a clear path to renew it. Sen. Joe Manchin (D-WV) speaks to reporters outside of his office on Capitol Hill on January 04, 2022.Anna Moneymaker/Getty Images Manchin is sticking by his position to ensure only working families get the child tax credit. "I've been basically very clear on that," Manchin told Insider. But Manchin's demands may add bureaucratic hurdles that could end up shutting families out of the proposed program. Sen. Joe Manchin of West Virginia is sticking by a position he's expressed for at least four months. The conservative Democrat wants only working parents to get the expanded child tax credit."I've been basically very clear on that," Manchin told Insider. "I think there should be a work requirement. That means you file a 1099."He went on: "So I've been very, very direct on that."1099 forms are typically filed by independent contractors and freelancers. A Manchin spokesperson later clarified that the senator meant he wanted families to file a W-2 form to demonstrate they're earning enough to pay taxes.The move to require proof of taxable income would lock out the poorest families — those with no income at all or not enough to file federal income taxes — from being able to receive checks under the expanded child tax credit. Previously, most families, including those where parents had no income in the previous year, were eligible for monthly checks.But some experts say adding that requirement onto the federal aid could pose a fresh bureaucratic hurdle for even middle-income households. Other parents could be working as an Uber driver or a freelancer and file a different tax form that wouldn't be eligible."You'll see more people affected than you might imagine," Elaine Maag, a tax expert at the Urban Institute, told Insider. "It won't just be very low income families that won't be able to meet this test."Manchin's view on the benefit places him as an outlier among Congressional Democrats, most of whom favor locking in the ability of the poorest families to access the beefed-up child tax credit. The one-year child tax credit expansion was enacted under President Joe Biden's stimulus law. It allows most families to get up to $300 each month per kid, depending on their age. It was also changed so families with little or no tax obligations could get the aid.That expanded credit expired in December 2021, and congressional Democrats continue to haggle over whether and how to renew it amid negotations over Biden's broader domestic spending plans.The West Virginia Democrat effectively torpedoed the $2 trillion Build Back Better plan in late December, saying he couldn't bring himself to support it. All 50 Senate Democrats must line up behind the sprawling measure to overcome unanimous GOP opposition.The bill would set up universal pre-K, renew monthly child tax credit payments to American families for another year, establish federal subsidies for childcare, combat the climate emergency and more. Democrats wanted to finance it with new taxes on rich Americans and large corporations paying little in federal taxes.However, talks on reviving the legislation has stalled. "There is no negotiation going on at this time," Manchin told reporters on Tuesday. Instead, Senate Democrats are pivoting to voting rights for the rest of the month.The child tax credit has drawn Manchin's ire since the fall. He's been skeptical of the federal government issuing monthly checks to families with no strings attached.Yet many experts argue that allowing families to receive the aid regardless of whether they owe taxes or not would have big socioeconomic benefits. Research has shown that the child poverty rate has fallen by a third since July."This made a real dent in child poverty as we were coming out of the worst economic crisis since the Great Depression," Claudia Sahm, a senior fellow at the Jain Family Institute, said in a recent interview. "That's exactly what you go after."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 4th, 2022

New year, same demands: Joe Manchin will consider supporting Biden"s agenda if monthly child tax credits get an income limit — or are removed altogether

After dashing Democrats' hopes of passing Biden's economic agenda in 2021, Sen. Manchin still wants to cut the child tax credit. Sen. Joe Manchin, D-W.Va.Tom Williams/CQ-Roll Call, Inc via Getty Images Sen. Manchin tanked passage of Biden's agenda last year, largely due to the enhanced child tax credit. Axios reported Manchin is open to resuming negotiations if the CTC is cut or gets a lower income caps. Manchin has remained adamant the CTC should be limited and has also proposed work requirements. While Democratic lawmakers were disappointed to end 2021 without passing President Joe Biden's sweeping climate and social-spending package, many of them remained confident they would get it done in the new year.However, West Virginia Sen. Joe Manchin — the centrist Democrat holding out on the package — doesn't appear to be easing up on his demands.Axios reported on Sunday that Manchin is open to revisiting negotiations on the Build Back Better agenda if the White House removes the monthly child tax credit payments from the package completely, or significantly lowers the income cap for eligible families, citing people familiar with the matter.This is a demand Manchin has long held. The expanded child tax credit would have allowed parents who earn below a certain income to receive monthly payments of $300 per child under 6 and $250 for children between 6 and 18 for another year, but the last payment went out in December and has yet to be renewed due to Manchin's resistance."Do you believe people making $200,000 and $400,000 should still get the child tax credit the same as someone making $50,000, $60,000, or $70,000 that really needs it?" Manchin previously said. As Insider previously reported, the $200,000 and $400,000 levels are where the child tax credit phases out faster for individual or joint tax filers, and households making more than those levels each year already aren't able to receive the full credit.As Insider's Joseph Zeballos-Roig reported, Manchin's objections to the monthly payments extend beyond an income cap — he also wanted to institute work requirements to receive the federal benefit and has raised concerns parents would spend the payments on drugs. It's unclear when, or if, Biden's agenda will make it to his desk for signature, but given Democrats need 50 votes to pass the economic package, Manchin's support is crucial. The Washington Post reported that prior to sinking negotiations before Christmas, Manchin made a $1.8 trillion pitch to the White House that excluded the enhanced child tax credit, reflecting his firm stance the monthly payments need to be altered or removed altogether.Still, Senate Majority Leader Chuck Schumer told his Democratic colleagues last month that despite Manchin's resistance, he will bring Build Back Better to a vote early this year to deliver on Democrats' promises. Schumer wrote in a letter that "nearly all of us were disappointed by the decision to delay floor consideration of the Build Back Better Act because Senator Manchin could not come to an agreement with the president. However, neither that delay, nor other recent pronouncements, will deter us from continuing to find a way forward.""We simply cannot give up," he added.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJan 3rd, 2022